What Does it Mean to be a Sustainable Business?

What does it mean to be a sustainable business? It’s much more than just looking after the environment, it’s about making sure that your business model and operations are resilient enough to thrive in the long-term. It’s about taking responsibility for all of your business’ impacts and doing your best to mitigate the negative ones. Being a sustainable business can also improve your reputation and marketing, as well as increase sales, profit, productivity and staff retention.

The market

Consumers are becoming increasingly influenced by the impact of their purchasing power on society, their health and the planet. They are more likely to buy from a company that aligns with their personal values and is able to help build the kind of world they want to live in. 66% of global consumers are willing to pay more for sustainable products and this rises to 73% when focusing on Millennials (born 1977 to 1995), whom currently have the highest purchasing power. The younger generations (who are even more concerned with ethical consumption) will continue to drive this demand as their purchasing power increases with age.

If you ignore this trend and continue ‘business as normal’, it is likely your business will fail in the long-term as you’ll be overlooked in favour of the more sustainable brands. It will affect B2B business too as consumer trends and customer demands filter down to the supply chain.

Adapting your business now and becoming recognised as a sustainable brand will prepare you for these changes, as well as allow you to increase prices and your profit! A win-win scenario.

Sustainability is creating a resilient environment or platform for long-term positive impact to thrive.

Becoming a sustainable business

Sustainability is an extremely broad term but in its simplest sense is creating a resilient environment or platform for long-term positive impact to thrive. Below are some suggestions to help you create a sustainable business.

• Reduce your environmental impact – everything from the more obvious reuse and recycling, switching to LEDs, reducing plastic, reducing travel and having energy efficient appliances, through to adopting a circular business model.
• Ensure a sustainable supply chain – once you understand what it takes to be a sustainable business you can make sure that your suppliers are also doing their bit and look for alternatives when they are not (or support them to adapt).
• Engage your people – embed your goals within your company culture. Explain why they’re important, set targets, collaborate on ideas and even assign sustainability champions.
• Look after your people – develop a positive culture, invest in employee development, pay employees and your supply chain fairly, be transparent in your communication, hire local if possible to boost your community, offer incentive and reward for great work.
• Embrace technology – technology can massively benefit your business by providing data to learn from, helping to minimise inefficiencies, understand finances, improve customer and supplier relationships and respond to trends much faster than their traditional competitors. It can also help businesses access new markets.
• Plan for the bad times – diversify your offering, expand your customer base, understand your competitors and be one step ahead, have a solid cash flow plan, keep up to date with your industry and wider news and enable innovation.
• Enable innovation – enabling a collaborative and creative culture within your business will empower your people to think outside the box, share ideas, test them, put them into practice and help your business grow. A sustainable business needs to be able to adapt quickly which is not be possible if innovation is stifled.
• Give back – engage your staff in deciding how and where to give back to society. Donate a % of profits to a local charity, allow your staff time off to volunteer, partner with a school to offer mentoring opportunities, join a carbon offsetting scheme. There are so many options available at all budgets, scales and timeframes. A great side effect is that giving back can increase staff loyalty, wellbeing, motivation and productivity.

Impact reporting

Traditional businesses typically only account for their ‘bottom line’ profit or loss. Triple bottom line (TBL) accounting expands the traditional reporting framework to take into account social and environmental performance in addition to financial. In brief: people, planet, profit. As a business striving to be sustainable in all senses of the word, it is important to understand your wider impact and collecting data can help identify where improvement is required. Consumers are extremely good at spotting a “greenwash” now too, so your sustainability credentials must be genuine and transparent.

Sustainability is a journey and there is always room for improvement. Once you see the benefits of running a sustainable business, you will become hooked on finding new and improved ways of doing things. Set yourself ambitious goals and make sure to shout about your achievements to your staff, customers and suppliers!

The benefits

• Protect the environment, your people and the wider community.
• Increase profit by minimising inefficiencies and operational costs.
• Increase sales by appealing to the growing demand for sustainable products and services.
• Improve staff retention by valuing them and creating a supportive culture, which in turn will reduce recruitment costs.
• Attract talent by communicating your core values effectively, offering a great working environment and enabling staff to progress and share their ideas.
• Decrease sick days by making sure your staff have a happy and healthy working environment, which in turn increases productivity.
• Be resilient to change by understanding the data and trends, enabling innovation and creating a collaborative and supportive team environment. Your business can weather any storm!
• Become a trusted brand by communicating your commitment to sustainability. This will improve your marketing messages and customer loyalty and in turn reduce your customer acquisition costs.
• Access new opportunities that may otherwise not have been available. Business funding and investment is often now aimed at sustainable business. You’ll also find that other businesses want to collaborate and jump on your success whilst helping to spread the word about you and your good work.