Companies are becoming more aware of the need to act on sustainability as expectations regarding corporate responsibility and transparency rise. Promises and good intentions just aren’t enough anymore.
The following industry leaders provide examples of what sustainability initiatives can look like in practice:
- Adidas and Nike have both taken significant steps forward. Adidas has established a greener supply chain and addressed specific concerns like eliminating plastic bags, while Nike has prioritized waste reduction and lowering its carbon footprint.
- Both Nestlé and Unilever have made major sustainability commitments. Nestlé is looking to minimize waste, improve water efficiency and product lifecycle. Unilever is focusing on sustainable palm oil and reducing its carbon footprint.
- Walmart, IKEA, and H&M have all taken steps toward being more environmentally friendly retailers, mostly through fostering collaboration across their supply chains to decrease waste and boost resource productivity. As part of this effort, they’ve also been teaming up with their suppliers from emerging markets to improve working conditions.
- Pepsi and Coca-Cola have both set ambitious goals, including a greater emphasis on water conservation and the establishment of water replenishment targets.
- Biogen and Novo Nordisk have pushed to improve energy efficiency, waste minimization, and other environmental initiatives in the biopharmaceutical industry.
- Banks like ANZ and Westpac in Australia, for example, are advancing local communities through good sustainability practices and by incorporating sustainability in their business culture and processes.
- Several automakers, including BMW, Toyota, and Tesla, have made significant achievements in terms of energy efficiency and emission reduction.
These companies have all committed to business sustainability, largely through transparency and addressing the material consequences of their operations. They’re taking a more eco-friendly approach, and over the next decade, other companies should follow suit.
Business sustainability is a strategy that aims to achieve long-term value by considering how a company’s operations impact its ecological, economic, and social environment. Sustainability is predicated on the premise that implementing such initiatives promotes business longevity.
The Problem with Modern Business
We all pollute, but because businesses consume more and generate more waste, their carbon footprint is higher as well. Large organizations pose a serious threat when they fail to grasp the magnitude of their contribution to the increase in pollution and waste.
A 2015 study found that since 1988, 70% of global greenhouse gas emissions have been generated by only one hundred companies. According to the study, these companies were generating enough emissions on their own to have a significant impact on climate change.
There is evidence that this trend can have serious consequences on our planet and on us, the people who live on it. We can see that shifts in the planet’s temperature resulting in undernutrition, environmental calamities, and vector-borne diseases and allergies are already having an influence on public health.
Of course, the vast majority of businesses do not pollute on the same scale as corporations such as Shell and Chevron. The study does, however, make it abundantly clear that a single organization can have a significant impact on the environment, which is why businesses that haven’t already done so should implement sustainable growth practices as soon as possible.
A New Demographic of Customers
While running a sustainable business can add to your expenses, it will also increase your revenue by attracting new customers who are more environmentally conscious. This new demographic of customers wants to see the companies they buy from show more initiative in terms of resource use, waste management, and environmental responsibility, even if it means sacrificing profits. Developing an environmentally sustainable business is no easy task but we can learn a lot from Scandinavian countries. Some of the most successful eco-friendly businesses in the world are located in Sweden, Denmark and Norway.
Furthermore, no company can operate without its employees, and doing the right thing may pay off in terms of employee satisfaction and retention. Long-term, sustainability can strengthen brand image, attracting both more customers and employees.
From a strictly economic standpoint, we’ve reached a stage where businesses should embrace sustainability not just because it’s morally good but because it’s good for their bottom line.
Proactive Sustainability vs Reactive Sustainability
With so many major brands facing criticism for failing to take responsibility for using materials that have a harmful impact on the environment or for not addressing problems with working conditions, there is a race to be proactive rather than reactive. It’s extremely difficult to recover from public outrage and boycotts based on a lack of sustainability, especially in the age of social media, when news can travel in a matter of minutes.
Failing to show your commitment to protecting the environment can result in your brand being ‘canceled,’ which is something that no company can afford. Transparency is therefore essential when it comes to sustainability.
Productivity and Cost Reduction
This is the conflict for businesses: historically, sustainable business practices have been associated with higher costs and lower profits, but this no longer holds true thanks to technological advancements.
While sustainability and profitability were once considered mutually exclusive, we can now see plenty of examples where sustainable practices have actually increased profits. Companies today are demonstrating time and time again that business executives no longer have to choose between the two. They can have both.
Committing to sustainable practices leads to more efficient use of resources, higher productivity, and lower costs. Additionally, the process provides additional revenue from improving products and exploring new business opportunities.
Environmental problems are getting more recognition across a wide range of industries, leading to innovations that can help companies combat them.
A circular economy focused on regeneration and restoration can help us overcome practically all issues stemming from a linear economy that’s based on a take-make-dispose approach. In contrast, a circular economy strives to preserve the value of raw materials and manufactured goods.
Finally, companies are also incentivized through tax benefits and rebates. If you’re a business owner or manager, there are probably multiple incentive programs in your area that will allow you to offset the initial cost of implement sustainable practices. And always bear in mind that while sustainable technologies like geothermal heating and cooling systems can be expensive, they have a high cumulative effect, so they pay off in the long run.
Plus, making these changes allows you to build better relationships with local communities and governing bodies. You can expect new laws and regulations to focus more and more on sustainability, and like we already mentioned, it’s better to be proactive than reactive.
OTS News on Social Media