Are you interested in reducing costs, gaining access to contracts, attracting industry talent, or increasing organizational innovation? If you answered yes then it’s time to start taking sustainability seriously.
Many organizations are working on sustainable business development purely for the reason that they believe in these ideals, which is noble and we absolutely support.
Although, have you heard about the financial benefits of corporate sustainability? If you want to learn exactly how your organization can benefit from embracing corporate sustainability, then you’ll want to read this article.
Nine Benefits of Corporate Sustainability:
- Cost Savings
- Gaining Access to Contracts
- Attracting Talent
- Fostering Innovation
- Increased Productivity
- Improved Investment Opportunities
- Building Customer Loyalty
- Build a Relationship with Local Government
- Improved Brand Recognition
1. Cost Savings
Simply put, through the development of more sustainable business practices, efficiencies in operations will increase. With better use and conservation of resources, operations will be streamlined and costs naturally decrease.
One common example of cost savings is through reduced waste disposal fees.
Furthermore, your business can apply for an energy assessment from Fortis BC to see whether you may upgrade to high efficiency appliances.
2. Gaining Access to Contracts
A common theme in corporate sustainability is businesses having sustainable purchasing requirements.
By being truly sustainable, and advertising your business as such, you’ll gain access to contracts only available to corresponding companies.
3. Attracting Talent
Leaders want to work for leading companies. By taking corporate sustainability head on you’ll show your industry’s talent pool that your business welcomes a challenge.
People want to work with companies who are ‘doing the right thing’ and being proactive with environmental and social programs. In the report Advancing Sustainability: HR’s Role by the Society for Human Resource Management, companies with sustainability programs report 55% better employee morale, 43% more efficient business processes and 38% improved employee loyalty.
4. Fostering Innovation
By taking on sustainability you’re empowering your team to be problem solvers. Sustainability can be the perfect catalyst to shift your organizational culture into a Learning Culture – explorative, creative, inventive and open minded.
Utilize the creative environment generated from your commitment to sustainability in all other arms of your business.
5. Increased Productivity
Often corporate sustainability is conceived as a strictly environmental pursuit, but it’s not.
The principles of sustainability are the foundations of what this concept represents. Therefore, sustainability is made up of three pillars: society, economy, and the environment. These principles are also informally called people, profit, and planet.
By making legitimate efforts to put your people first you’re participating in one of the three key pillars of sustainability. The benefits are immense to companies who choose to put their team’s first. The most notable benefit to businesses who put their people first is increased productivity.
6. Improve Investment Opportunity
This benefit of corporate sustainability primarily affects publicly traded companies, but can also ring true for smaller businesses looking for an investment.
On January 14, 2020 BlackRock chairman and CEO Larry Fink signed two letters that may change the face of Wall Street. The first, to CEOs hoping for a slice of the nearly $7 trillion in assets that BlackRock manages, makes a compelling argument that climate change “has become a defining factor in companies’ long-term prospects.”
The second letter, to BlackRock clients, explains what the firm is doing about it.
The pairing of the two letters could easily represent a tipping point for sustainable investing, a growing but still-niche strategy that puts environmental, social, and governance (ESG) concerns on par with the quest for financial returns.
Take a read of Mr. Fink’s closing remarks in his letter to Blackrock CEO’s:
“We believe that when a company is not effectively addressing a material issue, its directors should be held accountable. Last year BlackRock voted against or withheld votes from 4,800 directors at 2,700 different companies. Where we feel companies and boards are not producing effective sustainability disclosures or implementing frameworks for managing these issues, we will hold board members accountable. Given the groundwork we have already laid engaging on disclosure, and the growing investment risks surrounding sustainability, we will be increasingly disposed to vote against management and board directors when companies are not making sufficient progress on sustainability-related disclosures and the business practices and plans underlying them.”
By taking the initiative to join the circular economy your business will succeed in a key factor of investing today: environmental and social governance (ESG) .
7. Building Customer Loyalty
Sustainability as a viable strategy is validated by a number of research studies. According to a global corporate social responsibility study by Cone Communications, people are less likely to do business with companies considered irresponsible. On the contrary, businesses able to visibly demonstrate their ethics and show a commitment to the environment are more likely to have a stronger reputation, and therefore attract customers who care deeply about what their business stands for.
8. Build a Relationship With Government Agencies
Government agencies are necessary, but they can either work with you or against you. Be an example of a truly sustainable business in your industry, and watch government agencies refer to your business when dealing with companies in less compliance.
9. Improved Brand Recognition
Research shows that consumers take a company’s environmental impact into consideration and are more likely to do business with companies that integrate sustainability into their business practices.
Reports have also revealed that customers prefer companies that actively support their local community, leading to businesses doing better when they are seen as ‘doing good’.
Businesses that have a carbon reduction strategy in place, and regularly report their progress towards carbon reduction goals, can clearly demonstrate their contribution towards downsizing the risk of dangerous climate change. It also shows that they take their global environmental responsibilities seriously and positions them as a sustainable brand.
On the flip side, businesses that are responsible for, or implicated in, environmental damage such as oil spills, chemical leaks, pollution or habitat destruction can find themselves subject to boycotts and public demonstrations. Negative media coverage can have a severe impact on their brand perception, sales figures and profitability for many years.
Corporate sustainability is no longer a nice addition to your business. Take note of the benefits of corporate sustainability, and the demand for it from stakeholders.
Internally, if you’re looking for somewhere to start, hold a meeting with your team to get their input on your sustainable transformation.
Remember, sustainability goes beyond green – people, planet, profit.