How to develop a business model based on sustainability goals
A decade ago, sustainable business practices and being eco-friendly were a novelty that formed part of a company’s cursory Corporate Sustainability Responsibility programme. Still, as more and more awareness brings with it a grim picture of the future, the pressure is on everyone and every business to become more sustainable.
More recently, this message, initially only championed by environmental specialists, is now being propelled by governments and international organisations. The United Nations 17 Sustainable Development Goals were approved by 193 member states for a reason; governments can no longer ignore the global impact of environmental, social and economic problems. Governments are now the driving forces for societal awareness and have had to take on the responsibility for change.
But it’s not just governments and NGOs driving change to adopt sustainable practices. This pressure has shifted to the more aware consumer that now demands accountability and transparency. 6 out of 10 consumers are willing to change their shopping habits to help reduce their environmental impact. Of those that rank sustainability highly, 72% are willing to pay a premium for products and services developed or produced through sustainable and environmentally responsible means.
So, why are sustainable business models seen as a challenge? They are commonly associated with uncertainty, disruption, risk of stomping growth, and decreased revenues. This couldn’t be further from the truth.
Corporations that actively incorporate sustainability practices in their strategy secure an 18% higher return on investment (ROI) than companies that don’t and 67% higher than companies that refuse to disclose their emissions.
So, what should a business consider when developing a business model based on sustainability goals?
Create a sustainable strategy
The first step is to see where your company stands. Study hypothetical risks such as disrupted supply chains or rising insurance costs to labour challenges. Assess opportunities while playing on your organisation’s strengths.
The second step is to assess opportunities and threats, including materiality assessments. The goal is to create a refined business model that integrates and reinforces both business advantage and environmental benefits through innovation.
The third step is to elevate the innovative sustainable business model by engaging and connecting people in the company, partners from the supply chain, and the entire ecosystem to maximise impact and advantage.
Start small: Implement small sustainable changes with a great impact
Companies should strive to make sustainability a core part of their DNA. Yet, becoming sustainable doesn’t have to be complex or significantly transformational – start with the basics:
1. Reduce, repurpose and recycle
Several of the 17 United Nations SDGs address the issue of waste, and that’s something offices can be guilty of, so make sure you:
- Reduce by going paperless
In the era of digital, why use paper? It’s not only easy to misplace, unreliable and impossible to trace, but it’s also very damaging to the environment.
- Move to reusables for drinks
There are about 220 working days in a year. Considering most people have 2 cups of coffee per day, almost 500 cups and 500 stirrers are discarded each year unnecessarily.
- Recycle your office waste
Although many might be very strict when recycling at home, many rules are forgotten or ignored in busy office environments. Make it easy for everyone to recycle in the office by providing sufficient visible bins and baskets.
2. Sustainable practices related to energy efficiency and clean resources
There are many ways to make your office more energy-efficient, from improving insulation to optimising the use of your equipment through technologies:
With energy bills hitting new heights worldwide, now is the time to make sure your office is well insulated. Small businesses use between 15,000 kWh and 25,000 kWh and large corporations over 50,000 kWh. Whatever the size of your business, insulating your facilities is, therefore, crucial to reducing your energy bill.
- Use automation tools to configure equipment
There are now automatic switch systems for lighting and heaters with thermostats which adapt automatically and reduce unnecessary consumption. You can also set up your equipment without heavy investment in smart gadgets. For instance, you can install software to put screens in standby mode after a period of inactivity. As you know, digitalisation is key to optimise office resources, so it’s important to include energy efficiency goals in your digital transformation plan.
Sustainable goals and business models are not trends that will fade in time; they’re part of a much-needed societal shift towards a more environmentally friendly way of producing, distributing and consuming. They are worth integrating into the DNA of a company.
Start by analysing where you stand on sustainability, assess opportunities and threats and integrate both business goals and environmental benefits through innovation and technology. Then, elevate through collaborations and partnerships within your ecosystem when you’re ready. Start making changes in your daily working environment while getting the more significant strategic shift in motion. It’s a small effort that will go a long way.
Get started now to avoid the penalties that are likely to be imposed by governments and consumers soon and reap the rewards with savvy consumers.