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What is Sustainable Business?

How important is sustainability when it comes to your business practices? While 90% of business owners agree that sustainability is important, only 60% have actually begun implementing sustainability strategies. While we know that organisations want to reduce their environmental impact, most lack the resources, accountability and the commitment to do so. Others just don’t know where to start.


What is Sustainable Business?

Being a sustainable business is no longer something companies should strive for. It’s a necessity. In order to maintain a competitive edge, businesses need to prioritise the implementation of sustainability practices. But what does being a sustainable business actually mean?


At Green Interval, we specialise in sustainability business consulting. We assist organisations in the implementation of sustainable practices through our Green Interval Capability Framework (GCF.) This step-by-step process allows your burgeoning eco business to increase the uptake of sustainable business practices and drive sustainable growth.


We explore what a sustainable business is and the ways that sustainable practices are beneficial to both businesses and the environment. This article will help you gain a better understanding of what makes sustainability important for business, the challenges businesses face in their quest to become sustainable, and why companies should be thinking about sustainability from the get-go.


Business and sustainability in our modern world

What is Sustainable Business?

Once upon a time, reducing waste and recycling materials may have been sufficient enough to call your business “sustainable”. But today, sustainability encompasses so much more.


To be sustainable, businesses and consumers alike must go above and beyond by implementing initiatives that protect our environment. Now, more than ever, consumers are doing their research and seeking to support sustainable businesses. With demand increasing, more companies are making sustainability a core component of their business model. From investing in renewable energy to using recycled materials, many eco-friendly businesses are leading the way in creating a more sustainable world for us to live in.


A sustainable business is one committed to protecting our planet for future generations by seeking greener, more environmentally-friendly ways of doing business. From reducing energy consumption, to sourcing more sustainable materials and packaging options, each step supports a better future for us all.


For businesses, sustainability is about more than just being eco-friendly. It's about running a business in a way that meets the needs of the present without compromising the ability of future generations to meet their own needs. In other words, it's about creating a balance between environmental, social, and economic concerns.


How consumers are shopping sustainably

What is Sustainable Business?

Understanding consumer behaviour is essential so that businesses can effectively meet their needs and demands. Consumers make more informed choices about the products they buy, where they shop and the services they invest in. This may manifest as:

  • Customers predominantly buying from brands that use sustainable materials. This could include organic cotton, recycled materials, or even bamboo.

  • Consumers look for brands that are transparent about their manufacturing process. This means consumers are looking for eco-friendly businesses that are open about where their products are made, and how they're made.

  • Eco-conscious consumers buy from brands that give back to the environment or support sustainable initiatives.

  • Consumers may look for companies who are proactively working on reducing their energy usage, and want to be informed how.

Understanding consumer behaviour can help businesses to prioritise where they need to implement new practices, which will both benefit continued profitability and our planet. In order to remain relevant and become truly environmentally sustainable companies must understand that their corporate culture must align with social calls for action, and they should strive to align themselves with consumer expectations of sustainability in order to strengthen brand-customer relationships. But even beyond consumer expectation, Research from Smurfit Kappa and the Financial Times shows the importance of balancing sustainability and profitability to drive growth and secure long-term stakeholder buy-in.


In an effort to prove sustainability, businesses will likely need to have a comprehensive framework in place.


What is sustainability in business?

What is Sustainable Business?

Sustainability has become a buzzword in the business world. But what does it actually mean?


Put simply, sustainable business is about creating value for all stakeholders – not just shareholders. This means taking into account the environmental and social impact of our actions, as well as the financial bottom line. A sustainable business is one that considers the environmental and social impact of its activities and works to minimise any negative impact. This might include things like using energy-efficient methods of production or sourcing materials from recycled or sustainable sources.


A sustainable business will have an approach to business that seeks to create positive social and environmental impact. Their way of doing business will usually include reducing energy consumption, waste reduction, and creating products and services that have a positive social or environmental impact. Sustainability in business most often addresses two main categories:

  • The effect that business operations have on the environment

  • The effect a business has on society

Examples of Sustainability in Business

Here are some examples of some of the changes businesses can implement to make their operations sustainable:

  • Improve energy management efficiency by using alternative power sources and carbon accounting

  • Deploy infrastructure that reduces greenhouse gas (GHG) emissions, preserves water resources, and eliminates waste

  • Enable sustainable development by assessing risks and improving resilience while making sure to adhere to external regulations and internal development goals

  • Operating dynamic and efficient supply chains that encourage reuse, reduce waste, promote sustainable consumption, and protect natural resources

  • Adhere to a sustainability framework which facilitates sustainability action and gives quantifiable results.

Why is sustainability in business Important?

What is Sustainable Business?

The world is altering rapidly due to the growing impact of climate change. Concern over depleted natural resources, and exploding energy demands are putting companies in the spotlight.


Operating in this environment is becoming increasingly challenging for businesses and organisations alike. Research and development of more eco-friendly processes is vital in becoming a successful sustainable business. In the modern world, sustainability is a business priority and has to be central to the strategy and conduct of every business. The reasons for sustainability are not only ethical, they are financial too.


Employees are becoming more mission-driven, and aware of the climate crisis. They are actively seeking out employers who care about their environmental impact when deciding where to work. A recent study from Gartner repositions “The Great Resignation” as “The Great Reflection” as employees are changing their expectations towards their employees as they seek to find more purpose from their jobs and want to contribute more towards society and the planet. If businesses want to increase employee retention, or attract top-tier talent, sustainability will play a substantial role in that.


Additionally, businesses who adopt sustainable practices may be able to charge above the market rate for their goods or services. A recent Business of Sustainability Index report from PDI Technologies found that 66% of consumers will pay significantly higher prices for sustainable products. And that overall percentage will only grow in the future, as 80% of young adults surveyed said they are willing to pay more to sustainable businesses.


Customers and consumers are increasingly becoming activists. To reference the Smurfit Kappa survey again, more than a quarter of those surveyed said they had made a formal complaint in the previous six months to a company regarding its sustainable business practices or packaging. And 50% said they had rejected a product entirely because its packaging was not sustainable. This is something important for businesses to keep in mind, as it impacts the financial bottom line.


Eco-friendly businesses reap rewards

What is Sustainable Business?

Environmental sustainability in business is the catalyst for positive relationships with customers and increased sales. Measuring business sustainability success can be difficult to quantify, but awareness is a big step in the right direction. One thing that is immensely clear is that businesses have no choice but to embrace sustainability.


A sustainable business that is prepared to invest time and money into meeting these challenges head on will reap significant rewards. Investors and customers alike are taking note of businesses eco credentials, and an eco-business will benefit from crucial competitive differentiation from those competitors that fall by the wayside. Beyond the financial rewards of running a sustainable business are the rewards of principle and morality that come along with having a positive impact on the planet. By implementing sustainable practices, businesses increase profitability while reducing negative impact. Everybody wins!


Challenges facing sustainable businesses

What is Sustainable Business?

The majority of business owners today want to be more sustainable and eco-friendly. It’s unlikely that anyone would state the contrary. They want to use natural resources more efficiently. And for the sake of employees, customers, shareholders, and the environment, they know that it's the right thing to do.


However, there are many challenges and obstacles involved with this shift. Building a sustainable development strategy demands time and effort, but it’s necessary Any while it can be an undertaking to create an appropriate sustainability program, obstacles can be overcome with the appropriate approach, strategy, and tactics. And often the perceived challenges aren’t as substantial as you might think.


Some perceived obstacles when developing a sustainability program are:


Funding

There is a misconception that anything sustainable costs most. But going green doesn't cost as much as you might think. Being a green business comes down to being more energy-efficient and wasting fewer resources, all of which can save you money in the long run.


Time constraints

Becoming more sustainable doesn’t have to be time-consuming. While becoming a fully eco-friendly business doesn’t happen overnight, just a few hours per week dedicated to your green mission can make a huge difference.


Going green can be as simple as changing your electricity provider, setting up an energy strategy or participating in a green energy program. Every small change is a step in the right direction. And while you will need to invest some time in new initiatives, it’s essential for the continued growth and success of your business.


Pushback from employees

There can often be concerns that changing the way your business operates will cause pushback from employees. But this isn’t always the case. When it comes to implementing green initiatives employees will likely be in support of changes as a means for doing something that has positive impact. Employees are often the ones persuading business owners to make changes related to environmental and social responsibility.


Going green and becoming a sustainable business is a chance to increase employee development, boost morale, and champion a new company culture.


Greenwashing

Greenwashing is an area of concern for many business owners when it comes to their transition to greener ways of working. They want to be operating as a certified green business, but are concerned about the implications of greenwashing. As you make eco-friendly changes to your business there are those who will question the validity of them. And the best way to showcase that new practices are legitimate is having them verified by a third party, like Green Business Bureau, or a framework like Green Interval. That way, if there are concerns over greenwashing you can back up your business's efforts in a reliable and trustworthy way.


Building a green business

What is Sustainable Business?

With €8.8 billion invested in European sustainability startups in 2021 versus €4.7billion that was invested in 2022, it's clear that investors are becoming more and more aware of the importance of sustainability.


Businesses of every size should be thinking about how they can make their business sustainable. Sustainability is no longer a trend that businesses can ignore – it’s becoming a necessity. Building a sustainable businesses is important to all stakeholders for the following reasons:


  • Investors: Investors that aim to deliver long term return for their shareholders can't ignore sustainability factors from environmental, social governance to economics that can all affect company profitability.

  • Customers: Customers are more interested in the sustainability impact of their goods and services. Research from IBM shows that 7 out of 10 consumers deem sustainability to be extremely important, and have expressed a willingness to pay up extra for sustainable brands.

  • Staff: An integrated sustainability strategy boosts productivity amongst staff and increases retention. It can also be used as a pull towards your business when recruiting.

  • Broader stakeholders: Incorporating sustainability into your day-to-day operations will help you to stand out amongst your broader stakeholders, whether it be competitors or suppliers.

Become a sustainable business: Green Interval

A sustainable business is one that takes into account the environmental and social impact of its activities when building operational strategies. As business owners, accountability towards becoming more sustainable is of utmost importance since decisions have a greater impact than those of individuals. Sustainable business practices and decisions can inspire a movement and make a true difference in the protection of the planet and its resources. But they are also a key component to the profitability of your business in the future.


While there are some inevitable challenges to going green, the benefits of running a sustainable business far outweigh the challenges. And Green Interval is here to support your organisation in the journey to becoming sustainable.


We assist in helping companies of all sizes to adopt sustainable business practices with a simple step-by-step process to accelerate sustainable business practices. Through our Green Interval Capability Framework (GCF) we can help your business to develop and drive sustainable growth. Our framework is composed of 5 Modules where you can find all the information, useful tools, and resources to build the necessary capacity and documentation to effectively implement a sustainability management system within your organisation.


Find out more and grow sustainably with Green Interval.



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