Sustainability is no longer simply a buzzword executives trot out. Implementing sustainable business practices now that create a better future is increasingly critical amid worsening environmental conditions, as well as heightened employee expectations. But to do good, you must still do well—the bottom line and remaining profitable still drive business decisions. Here are a few steps you can take as a business owner to reap big rewards and positively contribute to the future of our planet.
Why sustainable business practices should be imperative
Shawn Finnegan, a St. Louis-based sustainability expert with a M.S. in environmental sustainability, says businesses have impacted society and the surrounding environment in positive and negative ways for hundreds of years.
“However, in the past couple of decades, changes in the environment are now having a serious impact on how businesses operate,” Finnegan says. “Similarly, society’s expectations of business are also changing. Production has globalized and resources are increasingly narrowing. A blip in one area of our interconnected system can have huge ripple effects.”
According to a Harvard Business School article, research shows that companies with high ESG (environmental, social and governance) ratings “have a lower cost of debt and equity, and that sustainability initiatives can help improve financial performance while fostering public support.”
Finnegan believes consumers and shareholders have a desire for more transparency in how goods are made and businesses deliver their services. “The sooner companies accept this, the sooner they’ll start making business decisions that make them more resilient and set them up for long-term success,” she says.
“Consumer commitment to environmental sustainability and social responsibility has intensified with consumers voting with their wallets,” Jonathan Wright, global lead for cognitive process reengineering at IBM, told Yahoo Finance. “As a majority of consumers choose to buy from and work for ESG leaders, businesses must prioritize transparency and break down barriers to ESG data.”
The “Esker 2023 Survey: Sustainability in the Workplace” supports Finnegan and Wright’s beliefs on the importance of sustainable business practices, and details that it’s a high priority for many employees as well. One key finding of the study was that “employees increasingly consider a company’s commitment to sustainability in choosing where they want to work—with younger workers leading the charge.” In addition, the survey found that “workers expect their employers to consider a company’s environmental record when choosing vendors—and when workers have personal buying authority, they favor sustainable providers.”
How to combat the naysayers
“Sustainability goals continue to be perceived as the top corporate priority, cited by 71% of organizations as of one of their top five priorities,” according to the Honeywell Environmental Sustainability Index. However, it’s not uncommon to still see hesitation or exaggeration from other companies about taking steps to enhance their sustainable business practices.
According to Finnegan, the reluctance to embrace sustainability is usually linked to thinking of the additional expenses incurred for a “trend” that “will pass.”
“Extreme weather events and natural disasters aren’t going to stop anytime in the foreseeable future, nor is the need to safeguard resources,” she says.
She encourages businesses to better understand the environmental costs and performance of processes and products. “For example, many environmental costs can be significantly reduced with minimizing waste,” Finnegan says. “Incorporating sustainability into capital investment decision making can reveal financially attractive investments such as pollution prevention and clean technology. And new revenue streams can be created through the sale of waste-byproducts or transferable pollution allowances.”
Businesses that “go green” can also take advantage of green vehicle tax credits, green building deductions and solar investment tax credits, if applicable.
Another advantage to having a better understanding of environmental costs/performance, according to Finnegan? More accurate costing and pricing of products today helps companies to design more environmentally preferable processes, products and services for the future.
Simple sustainable business practices you can implement
Don’t put sustainability off until tomorrow. Start building a brighter, greener future today by considering the following ideas:
- Conduct an analysis of your current usage/waste figures to determine where there are excesses and direct attention to what issues are most pressing. According to Wright, “Data is the lifeblood of ESG. Now is the time for enterprises to act. By operationalizing ESG plans, enterprises are putting information in the hands of operators who can make informed business decisions that can improve their ESG impact on a daily basis.”
- Make energy-efficient upgrades to the office and manufacturing line
- Choose sustainable options for workplace supplies (such as Forest Stewardship Council-certified printer paper and toilet paper)
- Implement sustainable packaging for your products
- Use green web hosting services
- Do business with carbon-neutral suppliers
- Buy carbon offsets
Finnegan also believes remote work options can help a company increase their sustainability contributions. “Fewer cars on the road idling in traffic means less carbon dioxide going into the atmosphere,” she says. “Less people in the office can save companies money with cooling, heating, lighting and stocking the workplace. All of this helps companies reduce their carbon footprint.”
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