When it comes to sustainability, a lot of folks and organizations are often left scratching their head. What does it actually mean? Will it definitively help my organization? What are the benefits? In other words, as a business, how does becoming sustainable affect our bottom line?[email protected]
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Ten years ago sustainability was a hot concept. We had folks calling and emailing us asking what we knew about it, how they could start looking into it, etc. Then something happened. It was like the perfect storm. The economy took a nosedive. Everyone started watching their spending. People were laid off, facilities were mothballed, and only the most needed things were given any financial backing. Long story short, the pipe dream of becoming sustainable for many, many organizations was shelved. But why?
Let's be honest here, most businesses are still firmly holding onto that mindset. The majority of businesses in the United States are running leaner and more cautious than ever. Sure, they'll spend money and lay out capital, but only when it makes sense. Just because something's vogue or in trend doesn't mean it's worth throwing money at
But, sustainability isn't just in vogue. It's not a temporary trend. It's not going to go away. We're not ever going to go back to doing business like we did in the 50's. Click here to learn what is sustainability
Of course, I'm biased and my answer is yes, but ask a layman, and you'll most likely get the same answer. Should we stop burning as much fossil fuel? Should we look into more efficient means of production? Should we reduce our carbon footprint? Do we need to re-evaluate how we use natural resources?
If you're thinking 'No' to any of those, stop reading and go back to daydreaming. It's not about you, it's about the future. Your kids. Your kid's kids. Your children and grandchildren are going to depend on the choices we make today
Not always, but most operations that start implementing sustainable practices almost immediately notice a reduction in their energy demand. For example, a client of ours modified their facility to incorporate new, more efficient machinery and experienced a drastic reduction in their energy demand. So they technically didn't do anything "sustainable", but just upgraded and got with the times. Their reduction in energy needs is certainly a step towards sustainability
Maybe you can't upgrade. Have you considered alternative energies? Another client of ours with a massive piece of property installed a very large solar panel array. Sure the up-front costs were high, but at this point, they've recouped a large amount of their outlay, gotten some great tax breaks, and are able to advertise that they run an operation powered mostly by solar energy made onsite
If you take a hard look at your operation, chances are you'll find ways to reduce the waste you generate. How can you trim the fat? Maybe it's material reuse. Maybe it's recycling. Maybe it's something one of your employees suggested which sounds far-fetched but might be a brilliant idea. A reduction in the waste generated at your operation can not only be financially lucrative but can become a great selling point when discussing or advertising your facility and processes
I know I've said I was going to stay away from touchy-feely stuff, but bear with me. Reducing your environmental impact can be more than financially lucrative, not just because of a reduction in waste generated. Think of my client above. How can upgrading or modifying your facility, or alerting your business processes save you a headache? Can you eliminate your expensive wastewater discharge permit? Maybe it can reduce the use of expensive air pollution control equipment? How about a reduction in environmental regulatory compliance fees (and possibly fines) associated with these activities? Sure, the biggest benefit here is keeping the environment cleaner and greener (which obviously isn't a bad thing), but there's a very significant chance at saving money here too
So, we've just covered a few areas above that will reduce your operating costs, but are you really thinking outside the box? How can you cut costs while benefitting the environment? Are there raw material substitutions that can be used? Can your by-product be reused, sold, or even donated for a tax break?
A classic example of this is what I like to call the brewery to farm example. Go into any brewery in America (probably across the world too) and take a tour. They'll give you the full run-down on how they make beer, what goes into it, etc. For those that don't know, a ton of grain goes into making beer. Once the brewery uses it for its intended purposes, the grain is no longer useful to them. So what do they do with it?
They donate it to farmers for use as feed for livestock. In fact, most farmers will come and pick the grain up! Think about it: no waste disposal fees and great publicity for the company's local image
Remember, sustainability is about more than just improving your bottom line. People, planet, profit (not necessarily in that order) means helping out the company, the local environment, and those who exist in it. Sure you can save a few bucks, but you're also helping the planet
Happy employees are productive employees. Check out this article by Inc. saying happiness boosts productivity by 10%. Or this Harvard Business Review article that shows happy employees are on average 31% more productive, produce 37% higher sales, and are 3 times more creative
Like I said above, profit is a staple of sustainability. Become more profitable without expanding your operation and create a workforce that looks forward to getting the job done quickly and efficiently
Say what you will but sustainability is here to stay. Savvy businesses are getting with the program, and one aspect of that means the people and companies you do business with now are going to start taking that into consideration when doing business with you
How would your business measure up? More importantly, how would your partners, suppliers, and others you do business with measure up? Look into sustainable supply chain management and figure out where you, your partners, and suppliers all stand
For you to be sustainable you need to be doing business with other sustainable companies, otherwise it doesn't work. What will your customers and suppliers think of your company and your sustainability program? Will they want to continue doing business with you as they become more sustainable? Do you want to continue doing business with them? More importantly, will you be missing out on opportunities by clinging to the past?
Following the last item, the business and financial world are actively seeking sustainable businesses. Have you heard of the Dow-Jones Sustainability Index? How about mutual funds devoted entirely to sustainable businesses? Socially responsible investing anyone? These investors are reviewing your sustainability reports and scrutinizing what you're publishing
If you want to work with the best customers, the best companies, the best suppliers, or if you want financing from the public realm, then you've got to have a program or some practices in place. Don't we all have a dream customer? A dream job? Something simple but highly profitable? Sustainability can get you to a point where this dream becomes a reality
The financial world today isn't interested in dinosaurs. Forward-thinking companies, as demonstrated by a sustainability program, almost always have a much lower financial risk, insurance risk, liability risk, you name it
You're attractive to customers, the financial world, insurers, etc. Since you're a star, expect to get treated like one, with increased access to capital, reduced underwriting costs, etc. This is an area that can see a wide variety in cost savings and financial opportunities
If you want to be welcomed, appreciated, and a vital part of your community, you're going to need to… think about your community! Again, think about big organizations like Amazon. We recently had an Amazon shipment center (or something along those lines) open up around the corner from our office. They were welcomed with open arms because of how they treat their people, their business practices, and their pro-environmental stance
Let's say you're opening up a new facility. How are you going to be received? How many angry citizens will show up at local meetings? Or, how many happy voices will support you entering their community?
If you want better treatment from your community, you need a good reputation. Sustainability can help. Even being pro-environment and spreading your message (hint, use your website) can help! It can mean an easier time getting local approvals and permits, tax incentives, etc., which all mean less money shelled out up front. Now you've just obtained a big plus for your bottom line
This is such a no-brainer it isn't funny. Run a clean, lean, green operation and your inspectors, regulatory agents, and any environmental worries will be a breeze. You'll have fewer inspections, less fines, less hassles, less complaints from neighbors
We've seen this before to the point where regulatory agencies use clean, environmentally friendly facilities as comparisons when visiting other facilities. That indirect marketing really helps elevate your position as an industry and market leader, all contributing to your standing with officials and the community
Sustainability can (and in many, many places already has) become a key component in buying decisions. Organizations, businesses, and agencies are already demanding that sustainability be part of your business if you want to be a part of their project
A good client of ours was one of only two suppliers in a region who had a product with an EPD. Sure enough, they bid on a job for an extremely forward thinking, multi-national company who would only do business with those who could provide environmental data on their products and services. They ended up getting a very, very lucrative job based solely on the environmental qualities of their product. Simply put, they made a more environmentally friendly product than their competitor, and they got the job