In recent times protecting the environment and sustainability have become more prevalent in the business world. There is an increasing realisation that businesses need to do more to become sustainable. But does being sustainable need to be seen as an expense or can it become profitable?
What do the stats say?
- S&P 500 corporations that actively manage and plan for climate change secure an 18% higher ROI than companies that don’t.
- Companies that integrate social impact into their business boost sales by as much as 20%, enhance productivity by 13%, and increase its share price by up to 6%.
- At least nine companies globally generate a billion dollars or more in revenue annually from sustainable products or services. The nine companies are Unilever, General Electric, IKEA, Tesla, Chipotle, Nike, Toyota, Natura, and Whole Foods.
What is sustainability?
To understand whether sustainability can be profitable it is first important to understand what sustainability is and isn’t. In our blog ‘What is Sustainable IT?’, we examined the United Nations definition which defines sustainability as:
“Meeting the needs of the present without compromising the ability of future generations to meet their own needs.”
The definition highlights the need to meet the demands of the present. It therefore means that our sustainability goals need to be profitable otherwise by definition they are not sustainable.
How your business can benefit from sustainability
It seems logical to think that if you can create a culture of waste reduction that you will waste less and therefore reduce your costs. Look for ways to recycle, reuse or resell. Your IT is a great example of where you can reuse or resell. When a member of staff leaves it is reasonable to review their IT and where possible wipe it, reconfigure it and then give it to a new member of staff. Alternatively, you can sell it. There are a lot of companies, like Ikonic, who have schemes to buy your IT off you. Utilitising these schemes are going to reduce your waste, re-coup some of your costs and contribute to the circular economy.
A reputation for sustainability can attract new customers.
Your reputation is important to your business. By improving your sustainability policies, you can stand out from your competition. An example of this is a small business near to Ikonic HQ called Crystal Doors. They have rebuilt their entire business based on their green credentials.
Be careful of green washing
If you are going to increase business and build a reputation based around being environmentally friendly or sustainable then you need to back it up with action. As mentioned above your reputation is important and it takes a long time to build up and a short time to destroy. Only promote your sustainable credentials if your company is buying into this and are actually being sustainable, otherwise you may face investigation from watchdogs. A recent example of this involves the food and toiletries industry.
Many tenders ask for your green credentials.
If you are bidding for any major government contract then you have to prove your green credentials as part of your bidding process. However, this policy is not restricted to public sector organisations. It also extends to several companies in the private sector. It will become increasingly important for your business to prove that you have a clear plan for your sustainability goals if you wish to win new business.
There is a shift in perspective towards being environmentally friendly and that culture shift needs to be integrated into business. Being environmentally can not be seen as a cost any more, it needs to be seen as an investment and if done properly it can become a profitable investment.