As climate change continues to affect all our lives, consumers are beginning to hold corporations accountable for their actions. Consumers are looking to shop brands that are more sustainable and environmentally responsible. Therefore, there has never been a more important time for discussing sustainability in business practices.
In this article, we will be discussing 4 ways sustainability can benefit your business. However, it is important to first understand what ‘sustainability in business’ even means.
What is Sustainability in Business?
Sustainability in business refers to operating a business without negatively impacting the environment. It means earning profits while being socially responsible and considering the impact your business has on the environment and society. This can include anything from what you sell (either your product or service) to how you operate.
Sustainable businesses tend to address key global issues such as energy consumption, waste management, transportation, pollution, and wellbeing.
Now that we’ve covered what sustainability in business means, we can talk about the importance of sustainability for your business. Keep reading to find out more!
4 Benefits of Sustainability for Your Business
1. Improve Brand Value & Reputation
In a 2019 study conducted by Nielson, 73% of global consumers said they would change their consumption habits to reduce their impact on the environment. Another study, conducted by Cone Communications on corporate social responsibility found that 87% of American consumers are willing to purchase a product or service because a company advocated for an issue they care about.
87% of American consumers are willing to purchase a product or service because a company advocated for an issue they care about
Sustainability is becoming an increasing concern for consumers and it is affecting the brands they choose to purchase from. Therefore, having a business that aligns with sustainable practices can tremendously improve brand value and your reputation to these consumers.
Many leading brands have started to realize this and have begun to focus on and commit to sustainability. For example, Puma has a 10FOR25 initiative, or 10 sustainability targets they want to achieve by 2025. One of these targets is reducing the discharge of all chemicals from their supply chain to 0. Another example would be Apple, who has committed to becoming 100% carbon neutral by 2030.
2. Align With Consumer Demands
Consumers are increasingly wanting to feel good about what they are buying and where it comes from. In fact, 66% of consumers are willing to pay more for a product if it came from a sustainable brand. This trend of supporting more sustainable brands is only getting stronger with the increasing buying power of millennials and generation Z.
66% of consumers are willing to pay more for a product if it came from a sustainable brand
Millennials, the largest generation in the world, account for an estimated $1 trillion in spending. This number is only expected to grow. According to a 2015 study conducted by Cone Communications, more than 9 out of 10 millennials would switch brands to one associated with a cause instead. Generation Z, the soon to become dominant generation, is equally, if not more concerned about sustainability than its millennial counterparts.
Therefore, if companies want to meet the growing consumer demand for more socially and environmentally responsible goods and services, it is imperative that they focus on how to become more sustainable and operate with a triple bottom line strategy.
3. Attract More Inspired Employees
As millennials and generation Z begin entering the workforce in increasing numbers, not having a sustainable strategy for your business could mean losing out on great talent.
Millennials and Generation Z are more than willing to make personal sacrifices for issues they care about. In fact, in the same Cone Communications study, 62% of millennials are willing to take a pay cut to work for a more responsible company.
62% of millennials are willing to take a pay cut to work for a more responsible company
In addition to attracting more talent, sustainable businesses also benefit from having more motivated and inspired employees. They begin to see a value and purpose in what the company and their own work does.
4. Improve Efficiency and Reduce Costs
Becoming a sustainable business is not just a win for the environment, but also for your own bottom line. It can improve your overall efficiency. This in turn can also reduce your cost to operate and improve your overall profits.
For example, Companies can significantly improve their efficiency and reduce their costs through:
- Better conservation of resources
- Increased water & energy efficiency initiatives
- Reduce-reuse-recycle programs
In fact, according to McKinsey, sustainable strategies can reduce costs and affect operating profits by as much as 60%.
How Your Business Can Incorporate Sustainability
Want to become a more sustainable business?