5 reasons why sustainable businesses perform betterMarch 18th, 2020 By Jonp
Following more sustainable business practices hasn’t always been associated with increased profits. In fact cutting costs is often linked to cutting corners when it comes to the environment.
As a business, it can be tempting to outsource the development of products to countries where the cost of production is cheaper due to the country having more relaxed policies on the environment. If you’re a manufacturer you’ll know that using plastic is often cheaper than using glass or cardboard alternatives. It’s also true that certain suppliers are more affordable than others due to their less sustainable methods of sourcing raw materials.
However, as tempting as it might be to cut costs through following unsustainable processes, as times change and people become more aware of environmental issues, we believe that in 2020 sustainable businesses will actually perform better, and here are 5 reasons why.
1. Appeal to a wider customer base
More and more customers are going green. A study carried out in 2018 found that half of digital consumers said environmental concerns impact their purchasing decisions. So by following more sustainable business practices, you make sure you aren’t alienating yourself to any group of customers.
2. Attract high quality candidates
Almost 40% of millenials have chosen a job because of company sustainability. As millenials make up a huge proportion of the global workforce (some estimate that by 2025 millennials will make up 75% of the global workforce) showing a commitment to the environment will open you up to a much wider pool of candidates.
3. Win more tenders
Whatever the industry you’re in, environmental impact is likely going to be one of the criteria that your organisation is evaluated on when you are considered for tender. The environmental section of the evaluation criteria usually equates to around 10-20% of your total mark.
4. Attract more investment
In the same vein as the above, you’re more likely to win over investors if you have sustainability policies in place. For example, Norges Bank requires organisations to integrate relevant climate change risks and opportunities in their business management for them to be considered for investment.
5. Avoid bad press
Nowadays business processes are far more transparent than they once were. For example in 2010 KitKat got in trouble for using a supplier that used unsustainable practices to source palm oil. When the Greenpeace advert got released, outing the company’s use of unsustainable palm oil, KitKat saw a massive drop in sales. This bad press can take years to shake off, even if the organisation addresses the issue, and makes a change straight away.
So yes, sustainable businesses do perform better in more ways than one. If you’re not sure how you can show your organisation’s commitment to the environment, consider becoming ISO 14001 certified,
The certification provides a framework for organisations to enhance their environmental performance.
Want to know more? Download our free guide:
For a free Quotation or On-Site presentation by an ISO Specialist, contact us today!
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