The decision to consider how sustainability can positively impact your business can be prompted by many factors. You may be personally committed to running a business that is more eco-friendly, your competition may be taking steps to becoming a more sustainable business, your suppliers may demand compliance with international sustainability frameworks (UNGC, GRI), or your customers may be starting to ask about your business practices and the extent to which you are committed to Corporate Social Responsibility (CSR). Whatever the motivation, every business ultimately looks at the bottom line for any new initiative. What is this going to cost me in terms of the initial capital investment, what resources are required and any ongoing expenses to modify my business practices?
Becoming more Sustainable
Sustainable business practices don’t, unfortunately, arrive in a kit or with the flick of a switch. Your options will be dictated by the industry in which you operate and the characteristics and maturity of your business. Coal mining will have different options than organic farming or tourism, for example. The size of your business will dictate how much you can do and how quickly it can be done. Most sustainability initiatives won’t occur in isolation – your suppliers will be involved as you start to discuss changes in packaging, ingredients and even frequency of deliveries in order to minimize the carbon footprint of your business. Customers can get involved, as you survey them to better understand their needs and expectations, and as you change your practices to meet those expectations. For example, hotels now give guests the option of not having their towels and linens changed every day in order to reduce water and detergent consumption. Your employees may also have ideas for more sustainable business practices, and actively encouraging them to participate can create a real sense of ownership and involvement.
Should I Expect a Return on Investment?
CSR and sustainability typically don’t fit into an accounting justification. If your market is moving in that direction and your customers are clearly asking for information on your business practices, that should be justification enough. Keeping customers who might go to your competitors should definitely be justification, and as you begin to examine your business in detail to identify opportunities to be more sustainable, you may identify savings to balance out any addition expenses you might incur. In addition, keeping your business at the leading edge of a market trend and actively promoting that position should generate new business. Surveys conducted by Nielsen verify those trends, while sustainability indexes demonstrate the returns.
Where do I Start?
Identifying what sustainability and CSR will cost you is a difficult question to answer, because it depends on where you are starting. There are opportunities to make significant improvements in your internal practices with little additional expense. The “Three R’s” – Reduce, Reuse, and Recycle – can have an immediate positive impact and create some excitement for further improvements. There are plenty of ways to spend money to become more green; solar and power generation will provide a fast and calculated recovery.
Sustainability as an Investment
Sustainability goes beyond green, or a stand-alone nice to have initiative. Sustainability is about transforming the DNA of the company and creating value for everyone involved. It represents a fundamental and long-term commitment to the way your business operates, and it needs to become a central part of your decision making and planning process. Investing in employee development and welfare, creating a welcoming environment that rewards innovation and supports differentiation will soon yield returns, from winning awards and recognitions, becoming a preferred supplier, to reducing absenteeism. Sustainability means transforming the business mindset and thus switching from short term “cost” to long term “investment”.