Why is Becoming a Sustainable Business Important? Because it’s the Right Thing to Do
Sustainability is no Longer an Option
Climate change and environmental sustainability are becoming increasingly important in the minds of the modern consumer. Not only this but the UK government is set to bring forward its target for reducing emissions by almost 15 years, with a mission to reduce 78% of carbon emissions by 2035. With a radical shift in purchasing behaviour and new UK laws about to come in place, debating whether to incorporate sustainability into your business strategy is no longer an option. It’s a must.
“Purchasing behaviour is increasingly being driven by ethical and renewably sourced products and purchasing decisions can no longer be achieved solely by price or product.”
Consumers now look for more, and sustainability and ethical sourcing are both high on their list.
Among consumers, millennials are considered to be those who are driving the sustainable movement through their lifestyle choices and behavioural changes (Sheahan 2005; Smith 2011; Hanson-Rasmussen and Lauver 2018). This “Green Generation” also claim that they would be happy to pay more for eco-friendly and sustainable products (Young 2018).
Even at the peak of the Coronavirus pandemic, the climate crisis was high on the agenda of the millennials, which perhaps suggests how important sustainable purchasing behaviours have become.
This article takes a look at the value of becoming a sustainable business, the challenges and the steps you can take to improve your environmental impact while improving your bottom line.
At Crown Oil, we’re on a journey to become the UK’s leading alternative fuels supplier and put the environment at the forefront of our business decisions. We recognise that our operations have a direct influence on our planet; however, we are actively implementing ways to reduce our own carbon footprint and our customers too.
Find out what green steps we’ve been taking towards becoming a sustainable business.
Sustainable business defined
Sustainable (or green) businesses are committed to jointly adding value to stakeholders, the environment and our society. To be considered sustainable, the focus must be on reducing harmful emissions whilst dynamically supporting global efforts to improve the environment.
Sustainability creates long-term value by considering how an organisation operates in ecological, social and economic environments. Not only does it help tackle global challenges, but it’s the driving force behind today’s successful businesses. Being sustainable reduces the risk of debt and increases equity from initiatives that help enhance financial performance while nurturing public support.
Heavyweight brands such as Coca Cola, Nike, Nestle and Adidas are all leading by while being transparent in addressing their environmental debt. So, isn’t it about time that you do too?
“Doing good and doing well go hand in hand”
Businesses must improve their green brand image to not only help ensure that customers choose your product over someone else’s but, most importantly, because it’s the right thing to do for the planet and for future generations.
There are many factors that come into play when taking the first steps to become a more environmentally conscious organisation.
Whatever your reasons, it’s clear that being sustainable is invaluable to your business’s success. As the UK’s net zero carbon target approaches, each and every one of us has a responsibility to do our bit to help reduce the level of harmful emissions.
Benefits of being a sustainable business
Protects your brand and reduces risks
Not only do poor practices damage a business’s reputation but dealing with a PR disaster can divert human and financial resources from the fundamental business activity. Being remembered as a company that allowed an oil spill or provided unsafe work conditions can wreak havoc on a company’s reputation and that can be very difficult to come back from.
In 2016, BP PLC took a $1.7 billion charge for expenses from the 2010 Deepwater Horizon spill. By July 2016, it had spent $61.6 billion in court fees, penalties and clean-up costs after a federal judge ruled that it was “grossly negligent”. A decade later, and the disaster continues to harm wildlife and the environment.
Implementing a sustainable strategy that protects both the environment and your staff will help safeguard you from any irreversible damage to your brand.
Although it often requires an initial investment, you will undoubtedly save money by prioritising sustainability. A 2011 McKinsey survey on the business of sustainability revealed that 33% of businesses incorporating green practices improved operational efficiency and reduced costs.
Examples include using more efficient lighting and reusing existing materials; both practices reduce spending over time whilst providing tangible sustainability benefits.
Improved business image & reputation
A good business reputation helps establish a positive brand image by aligning key messaging with your operations. People view sustainability as a benefit – and going green shows you care about more than just profits.
Research by The Natural Marketing Institute, a strategic consulting partner that operates in 30 countries, found that consumers are 58% more likely to buy your company’s products or services when they know your organisation is mindful of its impact on society and the environment.
The research also demonstrated that consumers are prepared to spend up to 20% more on environmentally sound products and services.
Higher financial and investment opportunities
Investors are increasingly in search of sustainable businesses and look to support those that they believe will result in a high return, as well as a cause that they believe in. This change is even reflected in the popular BBC television show, Dragon’s Den, where those businesses offering sustainable and eco-friendly practices or products are now heavily favoured by investors when compared to older episodes broadcasted.
“Reducing your carbon footprint is undoubtedly the right thing to do, but even if that wasn’t the case, there is the need to be compliant with increasing environmental laws.”
In April 2019, the government introduced environmental taxes to urge businesses to operate in a more environmentally friendly manner. There are different taxes and schemes for various types and sizes of businesses.
You may also get reliefs or be exempt from taxes if:
- you’re a high-energy user due to the nature of your business
- you’re a small business that uses minimal energy
- you use energy-efficient technology in your business
You can also pay less tax by applying for schemes to help you show that you’re running more efficiently and producing less waste.
Increased preparedness for future legislation and costs
Significant new climate change commitments are set to become UK law with the mission to slash 78% of carbon emissions by 2035 – nearly 15 years earlier than originally planned. The new deadline is to ensure we’re on track to reduce emissions enough to be in line with recommendations by the Committee on Climate Change.
However, global emissions continue to rise and a 45% reduction is needed worldwide to keep this increase in global temperatures close to 1.5oC above pre-industrial levels and well below 2oC.
This will impact both the availability and cost of energy, which are anticipated to double within the next ten years.
On 1st April 2019, new energy and emission rules were introduced that require all large quoted companies to report on their UK annual energy use and greenhouse gas emissions in their annual Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018.
The measures are to help improve corporate transparency for investors and boost energy efficiency to provide energy cost and carbon savings. The government also encourages all other companies to report likewise, although this is currently voluntary. In other words, starting to take steps to a greener future today, will help make the transition much smoother in the long term.
According to a recent global survey, 62% of executives consider a sustainable strategy necessary to be competitive in today’s world of business and 22% think it will be in the near future.
To stay competitive into the future, businesses must act now to retain a loyal customer base. As younger generations grow up with a rising awareness of sustainability, they look for companies that mirror their values and aspirations. Understanding this cultural change will really give you a competitive edge when marketing to a more ethically aware consumer.
Improved bottom line
Jeffrey Hollender, professor of sustainability at NYU Stern claims “You will perform better financially by doing things like having a great sustainability program.” Researchers from Harvard Business Review agree: “We’ve been studying the sustainability initiatives of 30 large corporations for some time. Our research shows that sustainability is a mother lode of organisational and technological innovations that yield both bottom-line and top-line returns.”
Making your business more sustainable allows you to make more money and boost your bottom line. Reduced business costs, more innovative strategies, a great reputation and more customers who value sustainability all contribute to the profits a business makes.
Millennials are often willing to pay more for products that have sustainable ingredients or those with social responsibility claims. If your company is committed to sustainable products and procedures, it can gain market share by acquiring sustainability-inclined customers and increasing sales.
Improved recruitment and staff retention
Ensuring your company does good in the world can provide a huge competitive advantage when retaining the best talent. Prospective employees are increasingly seeking to join workplaces that are ‘doing the right thing’ in terms of environmentally sound ethical morals and values, with professional services company PwC finding that 65% of people want to work for a company with a strong social conscience.
Developing a corporate social responsibility programme is one of the top 5 internal practices for ensuring an ethical corporate culture.
In summary, the benefits of becoming a sustainable business and improving your green brand image are:
- Become more efficient
- Improve brand value, image and reputation
- Get ahead of the game for future legislation
- Provides a platform for innovation
- Strengthens stakeholder relations
- Improved recruitment opportunities and staff retention
- Achieve better growth
- Positive PR by leading by example
- Demonstrates your commitment to the environment
- Include in Annual Corporate and Social Responsibility Reports
- Healthier work environment
Challenges of implementing sustainability in business
Undeniably, the Coronavirus pandemic makes sustainable goals more difficult to achieve – but it also means they are more pressing, considering what we now know about the association between the environment and the pandemic and retrospectively, climate change and human health. The national shutdown and empty high streets saw the biggest fall in energy demand since World War Two.
Many wished that these changes in behaviours would remain in the recovery of the pandemic but the IEA indicates that this will likely not be the case.
While there are many positive effects of being sustainable within your business including the new opportunities for organisational development, it can be challenging to implement these measures as it entails finding ways to continue to effectively meet customer needs while reducing your environmental impact.
Lack of resources
Many businesses are opposed to becoming sustainable due to the lack of resources – namely time and money. However, being green doesn’t always mean implementing radical changes all at once. You can start small and make affordable changes along the way. Doing something is better than doing nothing!
Staff not on board
A recent survey carried out by YouGov revealed that almost 25% of Brits are reluctant to change key behaviours to help tackle climate change. 69% of those polled claimed they do not feel personally impacted by climate change.
If people in your organisation don’t support your sustainable initiatives, it’s going to be a challenge to implement them. Increasing team engagement with your initiatives is vital to their success, and it can be achieved through promotion on internal communication channels. Creating incentives such as awards or parties can also add gratification to the whole experience.
How to make your business more sustainable
Although it may be a challenge at first, becoming greener is well worth the reward. There is no better time than the present to embrace sustainability and implement strategies that work for your business and your staff.
Creating a green brand image should start at home: your company buildings. Implementing both eco-friendly practices and green marketing will help reduce your organisation’s carbon footprint while improving your brand image.
Have an energy audit
Many sustainable businesses undertake energy audits that analyse different areas of a building to help reduce both gas and electricity use. This includes lighting, heating and insulation and allows you to recalibrate control systems and save energy through simple changes to daily routines.
For example, simply ensuring all monitors are turned off at the end of the working day can create real energy savings – a single monitor being left on overnight uses the same amount of energy as printing 500 A4 pages.
If your business isn’t doing already, it’s time to start recycling. Provide ample bins and ensure they’re labelled to encourage the correct items to go in the correct bin.
Conserve energy within the office
A few simple habits such as introducing a “switch off” policy to include turning off the lights and electronic equipment during shutdown hours will help preserve energy as well as save your company a large amount on your bills. Motion-sensitive lights in rooms that don’t see much use or a “last one out” policy are also great ways to help conserve energy and will help encourage staff to get on board.
Encourage green commuting
Cycling, carsharing and taking the bus to work are all great forms of green commuting that can help your staff contribute to your sustainability. However, following the Coronavirus pandemic, this isn’t always feasible. So instead, businesses can encourage staff to continue working from home where possible, hold digital meetings via Zoom and Microsoft Teams and allow staggered shift patterns to help keep their emissions down.
Reinvest into communities
Investing in communities is another great way to help improve your sustainable efforts. You could give staff allocated charity days and donate gifts or surplus products. This will help benefit communities and also help sustain a charitable role in the community without necessarily investing hard capital. That way, you can balance how much you invest and allocate your resources strategically.
Carbon offsetting is another great example, where you can purchase carbon credits to fund global projects such as tree planting and helping developing communities.
Despite the increase in digital technology, many businesses are still continuing to waste unnecessary paper. Using desktop applications such as Microsoft Office, Zoom and Google Drive to their full extent will help you coordinate projects and avoid using paper where avoidable. Encourage customers to come on board with paperless e-billing and take advantage of cloud-based systems to help cut down on unnecessary waste.
Create a sustainability committee
Making green thinking a part of your company culture will help get all staff on board. A team of volunteers who are responsible for sustainable initiatives can bolster a culture of sustainability and keep new ideas flowing. Getting staff involved will give them the chance to influence, embody and embrace your company’s new mission and goals.
Partner with fellow sustainable organisations
Opt to do business with other environmentally-friendly brands that align with your company’s own vision and values regarding sustainability to help promote your eco-friendly efforts. For example, a non-profit organisation and a corporate brand from the same industry will join forces or perhaps entities from multiple sectors will come together and share their resources.
These sustainable partnerships will enable you to learn best practices from each other, highlighting any inadequacies and realising shared skill sets to benefit both parties.
Use a green fuel
Many solutions to the harmful emissions released from businesses come with baggage; anything from charging points to new pipework and unusual storage conditions. All of this new infrastructure costs money requires lots of space and involves new staff training.
The benefit of running your business on clean-burning fuels such as Crown HVO fuel is that none of the above is needed. A member of the paraffinic family of fuels, Crown HVO can be used as a direct, drop-in alternative to diesel. It can be stored in the very same fuel tank and used in exactly the same way.
By switching to Crown HVO fuel, you will join us in tackling climate change head-on, by sustainably fuelling your operations and reducing net CO2 greenhouse gas emissions by up to 90%.
We are already helping businesses across the UK commit to a sustainable journey into the next century across a range of sectors and industries through our innovation – a commitment we have also made with all of our own tanker fleets already being fuelled by HVO.
We are committed to tackling climate change and are on the journey to become the UK’s leading alternative fuel supplier.
The sustainable roundup
Sustainability doesn’t have to mean forfeiting profits and putting success on the back burner. In reality, it’s become a crucial element to a successful business strategy. If you don’t factor in sustainability, you risk reduced profitability, growth and employee retention.
The benefits of leaving a long-lasting impression of your company’s environmental efforts will remain for generations to come. So, do the right thing. Find out more about our alternative fuels such as Crown HVO fuel or the steps we’re taking to reduce our environmental impact and call us today on 0330 123 1444.