By: Rick Crawford
Consumers are seeking out brands that embrace sustainability, and there are currently three main drivers for company’s to operate more sustainably, which means they measure not only their economic bottom line, but also their social and environmental bottom lines, which is known as the triple bottom line. The first driver is a sense of business responsibility, who are the company’s that do it for altruistic reasons because they want to ensure they aren’t harming communities, people or the planet and want to make a positive impact. The second driver that is forcing a lot of companies to disclose climate-related information is that big box retailers like Walmart, Target and REI are requiring companies to disclose sustainability-related data, such as your company’s carbon footprint. The third driver is government regulation, such as the upcoming SEC and the European Union Climate Reporting Regulations.
However, it just so happens that your customers also care deeply, especially the younger generations, because they know the planet will not be able to support their future needs, and therefore, support brands that align with their values. In fact, according to Harris Poll research commissioned by Google Cloud, “82% of shoppers prefer a consumer brand’s values to align with their own, and they’ll vote with their wallet if they don’t feel a match. Three-quarters of shoppers reported parting ways with a brand over a conflict in values.” The research goes on to say that “66% of shoppers are seeking out eco-friendly brands and products and 55% will pay more for sustainability.
It is clear that consumers want brands to be more sustainable and there are several drivers for the increase in company’s making sustainability and climate-related commitments, but for brands who actually embed sustainability into their culture, there is even more to gain. Here are 6 reasons why doing good is good for business:
- Reducing Costs: Businesses that measure environmental (energy, waste, water) and social data (volunteer hours, monetary donations, etc.) will have a reduction in operational costs, which is good for business. Z-Man Fishing Products is a perfect example of one of our clients whose environmental efforts are paying off! Conserving resources through energy efficiency and renewable energy will also reduce costs, which is good for business, but will also reduce a company’s carbon footprint, which is GOOD for business.
- Increasing Competitive Advantage: As more companies are being forced to embrace sustainability from a compliance standpoint, the companies that authentically embed sustainability into their culture will gain a significant competitive advantage as it will become clear who is checking the compliance box, and who is motivated to make a positive impact. For example, companies that have third-party certifications, such as B-Corps, 1% for the Planet members, and Climate Neutral Certified, will easily differentiate themselves as their competitors come to market with saying they are now “eco-friendly.” Differentiating your brand from competitors is good for business, but doing so while making a positive community impact, giving back and reducing your carbon footprint is GOOD for business!
- Growing Customer Loyalty: As previously mentioned, consumers will support brands that align with their values, and my clients, such as RepYourWater, can speak firsthand about how credibly marketing their sustainability achievements and sharing their sustainability journey has significantly increased customer loyalty. Increasing customer loyalty is good for business, but having customers buy more of your products so that your brand can give back more, that is GOOD for business!
- Mitigating Risks: One of the biggest risks to all businesses is climate change. Consider the supply chain disruptions from hurricanes, wildfires and flooding, so it would make sense that companies who assess this risk with Strategic Sustainability Plan, and also work to measure and reduce their carbon footprint are better at managing risks, and are therefore, a less risky investment if publicly traded, or if they hope to be acquired. Mitigating risks is necessary and good for business, but when companies are able to adapt to our changing climate to better serve humanity, that is GOOD for business.
- Attracting & Retaining Talent: How much is employee turnover costing your business? When employees are working towards a vision and helping to fulfill a company’s mission that makes the world a better place, they are more motivated and happier. Not only do consumers want to support brands that align with their values, but they want to work for companies that align with their values too. Reducing costs is good for business, but using your business to solve social and environmental problems is GOOD for business!
- Restoring Our Planet: We are completely dependent on our planet and its natural resources to meet our basic human needs, such as food, clothing and shelter, so it makes sense to monitor the environmental and social impact of a company on an annual basis, right? Right. When companies measure and improve their sustainability performance, they are doing good for their businesses, good for the planet and good for future generations!
There are several reasons company’s are adopting sustainability, and consumers are supporting brands that align with their values, but can a company really become more profitable through sustainability? The short answer is yes. If a brand takes a triple bottom line approach, and embeds sustainability into its culture, it can see exactly how doing good is GOOD for business because they are simply more profitable businesses!
Learn more about how our Sustainability Consulting Services can help your business Profit, Sustainably!