The need for sustainability in businesses practices has never been more important. This isn’t only to the consumer, but also to potential investors and for a company’s reputation. According to a recent study, 28% of consumers have stopped buying certain products due to ethical or environmental concerns. A study of 500 S&P companies that built sustainability in their core strategy, outperform those who fail to show leadership. In fact, corporations actively managing and planning for climate change secured an 18% higher ROI than those that aren’t.
So, what exactly is sustainability in business?
A sustainable business is one that generates profit while improving societal and environmental conditions, and generates these strategies for company longevity. This includes both what the company offers (products, services etc) and how it operates.
Why is it so important?
Alongside the reasons we touched on above, by not taking steps to be more sustainable in business, many companies face additional costs. In some countries, there are taxes on carbon. Also, when it comes to investing, private investors have found organisations with strong ESG and sustainability strategy have an improved ROI and reduced lending risks.
It also helps improve a businesses’ reputation. It shows people the business cares about more than just making money. By showing it cares about its impact, this helps create competitive advantage. Being sustainable in business can also be used as part of a marketing strategy and the development of a brand identity. A recent study on millennials, found ESG issues were incredibly important when deciding whether or not to do business with a company.
How do you improve your sustainability strategy?
There is no direct route to a sustainable business strategy. It depends on the goals, resources and stakeholders of your company. Here are a few key tips to helping improve your businesses’ sustainability practices.
Set your current benchmark for progress
Before starting your plan to be more sustainable, using a set of criteria by which to compare progress helps provide direction and a framework moving forward. When setting these to make sustainability improvements, some key areas to focus on could be operations, business practices, transport, and office space. By using a points-based system, this could help measure the progress of improvements and provide stakeholders with actionable and comparable progress.
Increase transparency
You can’t properly plan for the implementation of a strategy without transparency. By creating an open environment in your business, it becomes easier to identify areas which require improvement and attention. Open communication with all stakeholders is required to establish the purpose and benefits of a sustainable strategy, and to ensure all information is disclosed accurately.
Through increasing transparency, this can help with engaging employees and encourage them to contribute to any initiatives. Alongside provide their own feedback and advocation for the plan.
Create a committee for sustainability
Reaching out to your employees asking if anyone wants to be a part of a committee for sustainability can drastically improve organisation’s efforts. Not only will it help employees feel engaged and valued within your business, it will also help create accountability. The committee can help come up with a constant stream of ideas for improving sustainability, alongside provide details of current and predicted challenges.
Through the creation of a committee, it will help create an organisation wide culture and identity surrounding sustainability. So that eventually, it becomes part of the businesses’ internal and external brand.
Become a B Corp
“B corp” businesses are those who have gained a B Corporation certification (assessed by the not-for-profit B Lab). This is given to for-profit organisations who have achieved a certain score or above, for a criterion of social and environmental standards.
There are many benefits to becoming a B Corp, especially in a consumer-focused market, where adhering to ESG standards are becoming increasingly important. Overall, becoming a B corp helps improve sustainability in business as it lays out a set of criteria businesses need to adhere to, to continue to be awarded this status.
Incentivise employees
There’s no better way to increase sustainability organisation wide than with an incentive. Can you get your employees discounts on group travel? Is there a cycle to work scheme you could implement which would save employees money on their bikes? By providing financial incentives for employees to cut their carbon emissions and be more sustainable, they will be far more likely to get involved.
Building great teams who achieve excellence doesn’t happen overnight. By aligning company branding with the right talent aquisition strategy, organisations can find candidates that not only excel in their work but help the business to grow and develop. If you need help growing your team, speak to a member of the Gibson Watts team today.
Written by Josh Smith