Taking necessary decisions and actions in the interests of protection of the natural world is known as environmental sustainability. Proper maintenance of environmental sustainability is a very important step in the business to remain ahead of the competitors and gain advantage or profit from the market. According to researchers, it is seen that a sustainable business can reap more benefits than those who are still not aware of this concept.
For many years, businesses or organizations have done nothing to save the environment from the harsh impacts. But nowadays, many big or small enterprises have taken an active part for their businesses to be sustainable and eco-friendly. This is mainly due to the realization that a good environmentally sustainable business has more chances of long term success. The organizations have understood that both economy and environment are simultaneously dependant on each other. If the businesses damage the environment, then the environment will cause return damage to the economy of the country which will also affect the business of a person.
Thus we can say, an environmentally sustainable development business means the adaptation of strategies and policies that will justify the needs of the enterprise as well as protects and sustain the natural resources that will be needed shortly.
Importance of Environmental sustainability in the Business
Below are some of the most important factors that indicate the necessity of environmentally sustainable business in today’s world. They are:
Overlooking Climate Change results in Material business Risks
Degradation in the environment and climate change can create unexpected business and environmental risks in the corporate chains. Asda has found that 95% of their fresh products are damaged due to drastic climate change. Archer Daniels Midland, a USA crops processor, suffers a drop of 21% of their earnings due to drought in 2013. Environmental threats and cascading risks in businesses are also interconnected. In 2001, a USA beer brewing company named Anheuser-Busch suffered a lot of losses due to drought. Due to the unavailability of water, the price of Barley skyrocketed.
The energy sector is another hotspot for the risks. Most of the shale of the energy companies are either located at the water-stressed regions or at the locations that are at the top levels of water stress. No water means no energy hat will create a rippling effect across the economy of the country.
Read our Featured Guide on – What is environmental sustainability?
Businesses that are Hampering the Environment Cannot Hide Anymore
Most of the strategies of the organizations for environmental sustainability are on full display now. Different NGOs are exposing harmful practices of the companies and hold them open for environmental damage. Lumber Liquidators is one such company where the US federal has operated a search in the companies’ headquarter regarding their wood imports. Their share price has dropped to 13% and has not increased since then.
Similarly, the reputation of a world-renowned company named Gibson Guitar was tarnished as they had to pay huge fines due to the import of exotic woods from India and Madagascar.
Benefits of Environmentally Sustainable Business
Let us have a detailed look at some of the advantages of environmentally sustainable businesses. They are:
Improvement in the branding and competitive benefits
According to a survey by the Natural Marketing Institute, It is observed that almost 58% of consumers tend to purchase services and goods from the companies that employ sustainable practices and have a positive impact on the environment. During an event of Super Bowl, Colgate has created public awareness about conservation of water. The ad displays that we can live without paper or electricity, but it is impossible to survive without water. The creation of brand awareness through the conservation of resources not only benefits the companies but also the environment.
Sustainable business has more ability to comply with the regulations
Most of the Federal Governments are imposing regulations on big organizations for the protection of the environment due to dwindling energy resources and negative climate change. Integrating strategies for sustainable development will help the business to meet these rules and regulations on time.
Reduction of wastes
Reduction in waste is the most valuable step towards taking your business to become sustainable. Mitigation in the paper, development of processes that will utilize fewer raw materials, wastage of materials during goods productions, switching to LED from incandescent lights are some of the ways that will not only reduce the waste but also increase benefits in the long run
Increase in productivity and reduction in the costs
Development of sustainable policies by the organizations results in efficient operations, conservation of resources, enhancement in the productivity of an employee and a decrease in the production costs. Installation of cooling systems and geothermal heating through energy conservation strategies also reduces unnecessary costs of the energy resources spent.
Will Attract More Investors
Investors like to be associated with companies that have a strong environmental protection message. They do not like to link to the organizations that are involved in social welfare scandals and ecological disasters. Investors tend to put their money more in those companies who are embracing plans for a sustainable business.
Examples of Big Organizations Taking Steps for Environmental Sustainability
- Coca-Cola: In 2018, The Coca-Cola Company was ranked as the 5th by the Influence Map due to its sustainable business policies for climate change. Saving water and cleaning up the beaches of Ireland are some other initiatives taken by the company for environmental protection.
- McDonald’s: McDonald’s has committed to source coffee, palm oil, fish and beef only from environmentally sustainable companies. They have also announced to decrease their emission of greenhouse gasses by 36% within 2030.
- Unilever: Unilever has converted the packaging of its PG tips tea bags to fully biodegradable and plastic-free materials. They have also set a target to reduce their 50% carbon footprint by 2030.
- Tesla Motors: Tesla Motors have committed to restore the electricity of Children’s Hospital of San Juan with solar panel after the hurricane Maria in 2017. They also support their policy for an electric vehicle. These examples are a clear instance to the businesses that governments should not only be responsible for protecting the environment. Organizations should also include sustainable development in their business policies to save the world. It is a misconception that involving eco-friendly strategies will incur a loss to the business. But the sustainable policies will only offer profits in the long term and will yield more customer satisfaction along with a sustainable environment.
For more further detailed information, read our guides on the related topics –