Becoming sustainable to create a sustainable business
David Saul, Managing Director at the leading serviced office operator Business Environment, examines how sustainability is playing an important role in business success.
A recent Accenture survey of 250 senior excecutives in the UK, US, Germany, France, Brazil, China and India has surely put paid to any doubt that sustainability is a key issue for businesses across the globe.
Some 83 per cent of respondents believed spending on sustainability was an investment rather than a cost, with 62 per cent claiming their efforts to become more sustainable were the result of consumer demand, while just 40 per cent were motivated by the need to comply with regulation.
Furthermore, the report revealed that demand for sustainable products or services is so great that many companies are struggling to meet it. This is a particular problem in emerging economies, where 44 per cent of companies struggle to provide sustainable goods or services at the level requested.
Admittedly, this could be taken as a sign that demand is higher than it used be, rather than demand is high when compared to similar goods or services that aren’t marketed as sustainable.
Even so, it’s a powerful indicator that sustainability is becoming big business and there’s room for it to become bigger still.
Similarly, a study by Deloitte has found that 90 per cent of companies have set targets for reducing energy consumption, with many of these motivated by the need to cut costs during the economic downturn.
Taken together, these studies show that the corporate world has recognised the business case for sustainability.
Indeed, the report shows businesses are responding to the double benefit of sustainability – boosting profits by catering to consumer demand as well as by reducing outgoings by cutting running costs, such as energy bills.
On top of these factors, there’s a reputational benefit to becoming sustainable – which is likely to correlate with increased consumer demand for sustainable goods – along with a regulatory incentive.
Taking all of this into account, we can expect businesses to invest in becoming more sustainable, which is why it is perhaps surprising that studies show many consumers are sceptical about CSR initiatives.
I believe the most likely explanation for this is that too many companies have treated sustainability as an add-on rather than an integral part of their operations and CSR efforts.
Consumers can detect inconsistency – a company that does nothing to help its employees volunteer but reduces its energy use will struggle to convince consumers it is genuinely committed to its role as a responsible corporate citizen, as will a company that voluteers but does nothing to reduce its energy use.
It’s for all these reasons that we’ve made social responsibility a central part of our company culture at Business Environment, which means placing CSR at the heart of the business.
Examples of this include offering employees time off work, on top of their usual holiday allowance, so that they can carry out charitable work and support good causes, installing recycling points throughout our buildings and encouraging staff to cycle to work.
We’ve also donated services in kind to good causes, including Rays of Sunshine, a charity helping seriously ill children, and have raised money for charities our employees have a personal connection with.
Becoming more sustainable makes sense from every perspective – protecting the planet and boosting business – which is why there’s every reason to expect more companies placing CSR at the centre of their operations.
David Saul is MD of Business Environment