Business sustainability: investing in the future

Business sustainability:
investing in the future

Sustainability is about meeting the needs of today without compromising the ability to meet the needs of tomorrow.

Risks and benefits

The world has finite resources. Economic growth cannot be maintained indefinitely unless sustainable business practices and employed. Climate change could spell disaster for many businesses. The Stern Report believes that it could decrease global GDP by 20%. It is also an opportunity forced upon us to become more sustainable. It is likely that, as competitive forces come into play, economic growth will only come from employing sustainable business practices.

By introducing sustainable practices competitive advantage can come from many areas including:

Reduced operating costs
Better systems for measurement and management
Improved identification and management of risk
Enhanced reputation and positive customer response
Increased ability to attract and retain employees
Reduced downtime and sick leave
Better learning and innovation
Better frameworks for existing social and environmental initiatives
Reduced Government intervention

The Triple Bottom Line
Business sustainability is ‘captured’ in the concept known as the Triple Bottom Line where – in addition to economic profitability – a business is also accountable for its social and environmental bottom lines. The basic premise is that a businesses’ ‘costs’ are not just economic in which case profits (and losses) should not be counted in just dollars. The true cost of business involves natural capital (environments, sunlight, water, air) and social capital (society/culture, individual rights) as well as financial capital.

1. Economic sustainability
Some would argue that sustainability is not economically based or economically feasible. They would argue that business cannot profit through sustainability, yet nothing could be further from the truth. In a business sense the key messages of sustainability actually tie in with what are considered to be ‘sound’ business practices – being efficient, minimising waste and maximising resources.

2. Social sustainability
Social sustainability is focused on the development of programs and processes that promote social interaction and cultural enrichment. It emphasizes protecting the vulnerable, respecting social diversity and ensuring that we all put priority on social capital.
Social sustainability is related to how we make choices that affect other humans in our global community. It covers the broadest aspects of business operations and the effect that they have on employees, suppliers, investors, local and global communities and customers. Social sustainability is also related to more basic needs of happiness, safety, freedom, dignity and self-esteem.

3. Environmental sustainability
Environmental issues are the elements of sustainability that are most commonly addressed by society and industry today.
Natural resources are no longer abundant. We are depleting them at a more rapid rate than they can be replaced in nature. Man-made materials and their waste streams are polluting the Earth and compromising the survival and diversity of many plant and animal species. We are compromising humankind as a species through harmful emissions (water impurities, air pollution), and we are compromising the Earth's ability to regenerate natural resources. We are compromising the ability to meet our own needs and those of future generations.

Investing in the future

By developing a business sustainability strategy you are investing in the future. The following is the fundamental process for success:

Conduct a sustainability assessment of your business
Gauge risks and opportunities
Evaluate options for solutions – technology, best practice/systems, policy
Set goals and targets
Develop financial mechanisms to support programmes/initiatives
Engage the organisation
Measure and evaluate against goals and refine the strategy for improvement