For years, “sustainability” was something of a buzzword and an undefined goal in business. Very few companies actually integrated this concept into their core business model, or only did so as a response to market conditions and public perception. More often, it was treated as a marketing tool, or something to implement incrementally as needed. Today, however, sustainability is no longer an abstract concept for business; it is a necessary tool for self-preservation and long-term success.
The ongoing pandemic, with all the economic and logistical disruptions it caused, highlighted the need for businesses to take resource limitations and supply chain challenges far more seriously. Adopting a corporate sustainability culture and practices is not only good for the planet, but also for adding durability in the face of future disruption, securing a stable supply of resources, attracting more investors, retaining talent, building a strong internal culture, and improving overall competitiveness.
Still, making a company sustainable is harder than it sounds. Here are some ways businesses can properly integrate sustainable actions and practices, setting themselves up for success.
Make sustainability a core value
According to a recent global analysis by the World Wildlife Fund (WWF), internet searches for sustainable goods increased by 71% in the past 5 years alone. With this trend likely to continue moving forward, companies that internalise this sentiment will be more successful than those that resist it.
Sustainability should become part of each company’s DNA, to be ingrained in the mindset of employees and managers at all levels. In short, every action taken by the company must be done with sustainability in mind.
Examples can be as straightforward as going paperless or promoting remote work, or as complex as revamping entire production/manufacturing methods. Other ideas include embracing the push towards electric vehicles and greener transportation options.
Global governing bodies all the way down to local governments are implementing caps, regulations, and other incentives to reduce fossil-fuel powered transportation. Most manufacturers have taken notice and are actively restructuring their core business models to get ahead of further legislation. The recent COP26 declaration to achieve zero emissions on all cars and vans by 2040 should be an alarm call for companies in all sectors, as a failure to integrate sustainability as a core value will eventually have serious consequences that go beyond brand reputation.
Embed ESG principles in the overall business strategy
Another important step is to incorporate structural Environmental, Social and Governance (ESG) principles into the overall business strategy. Examples include a circular economy approach, regenerative agriculture, and other initiatives that can help develop long-term business resilience when implemented correctly.
Often “sustainability” is seen solely in terms of the environment and waste reduction. Yet importance should also be placed on social and governance issues as well. Human rights, flexible working conditions, community relations, and wider social impact are receiving increased public attention, with regulations already catching up to address these concerns.
From overfishing to deforestation, the human cost of unsustainable practices is now more widely understood than ever, and companies that create such negative externalities will face public scrutiny and diminished market share as people increasingly vote with their wallets. Indeed, recent surveys already show that 35% of consumers would pay slightly more for environmentally sustainable options.
With post-COVID economic recovery remaining uneven for the foreseeable future, and consumers adapting their spending preferences towards companies that act responsibly, today’s businesses would be wise to embrace ESG principles as quickly as possible.
Invest in sustainable projects
Going forward, all new projects and investments should be accompanied by long-term sustainability impact evaluations prior to implementation. In the past, companies have been forced to adapt and retrofit projects to increase their sustainability, but it is far better and cheaper to integrate sustainability directly into new projects from the beginning. Although doing so might mean slightly higher upfront costs, the long tail savings and added efficiency can often make up for these costs and then some.
Businesses, for instance, can invest in CO2 reduction projects that include participation from their own personnel. Our own mangrove planting initiative is an example of such corporate sustainability in action, as it demonstrates positive brand values to employees as well as the wider public.
Post-COVID, the move towards remote and online business practices means that companies can hold more digital meetings, reducing travel while also giving employees added personal flexibility. Developing a mindful sustainability culture within any given company starts at the top, but must nevertheless be integrated at every level of the corporate structure.
Measure and reduce your carbon footprint
Before implementing any sustainability plan of action, it is critical to have an impartial assessment of its impact, especially in terms of the amount of greenhouse gases it will produce.
1 in 3 consumers are willing to pay more for eco-friendly products, a number that is likely to rise as the world comes to terms with global warming. Transparent and honest reporting about each company’s carbon footprint is becoming the norm, with many consumers expecting such commitments as the bare minimum for business activity in today’s world.
This social trend towards accountability means that companies can no longer avoid responsibility for their impact on the broader environment. With various countries in the COP26 agreeing to reach net zero carbon emissions in the future, companies should take the lead in making net zero an actionable plan – through investing in sustainable local suppliers, reducing travel costs, recycling their materials, and any number of other initiatives.
The shift to a sustainable business model is by no means easy, though success in this area is a win-win outcome for companies as well as the communities they serve.
Many organisations in today’s economy find it challenging enough to maintain the status quo, let alone improve it. But by outsourcing non-core business functions to professional services companies like Grant Thornton in Thailand, companies can devote more time and resources toward making the necessary transformation. Contact us today for outsourcing support and high-level business guidance, as we move together to a more sustainable future.