(4 minute read) Anyone looking to implement a sustainability strategy needs to be able to communicate the business case for putting in the resources (time, effort and money).
Unilever’s ‘Sustainable Living’ brands accounted for a record 70% of its turnover growth in 2017, and grew 46% faster than the rest of the business. In 2018 those figures increased to 75% and 69% respectively. [Source: Unilever Sustainable Living Report Hub].
In addition, ethical investments are consistently outperforming their non-ethical counterparts, and demand for ethical and green investments are at an all time high [Source: Good With Money]. Globally, more than $23 trillion of assets are being managed under responsible investment strategies and this number is set to continue rising [Source: Global Sustainable Investment Review].
To be honest I could probably end this blog post there. But let’s dig in to this further and see how this can be applied to businesses that are not huge corporations with Corporate Social Responsibility (CSR) budgets, or financial institutions with access to teams of advisors.
Listed companies are driving forward progress on sustainability in leaps and bounds. They have investors, stakeholders, shareholders and customers who all want different variations on the same theme: for the business to be successful. They may want it to be successful in different ways but they do all want success. These days, there are significant pressures from all of those stakeholders for companies to be more ethical and sustainable.
Where the company in question has a comprehensive sustainability strategy, their network of suppliers is being influenced and driven forward by that sustainable strategy, whether they realise it or not. Their supply chains range broadly from product designers to manufacturers to accountants, consultants, lawyers, recruitment specialists, office support, transport, packaging, marketing and communications. The supply chain for a listed company is, in itself, made up of even more, smaller supply chains.
If you as a business are connected in any way with such a corporate then you are already, or are soon-to-be, subject to their supply chain sustainability requirements. This requires on-going reporting and answering of various questions and if you are not performing in a way that aligns with this strategy then you risk losing your place as a supplier to that business.
The risk is that you do not adapt fast enough to keep up with the changing demands of your customer base. Failing to adapt to changing demand will damage your business and has the potential to damage it in a way that you find very difficult to come back from.
However, while the risk element is important I want to be clear on the opportunities because that is where things get far more interesting.
New business opportunities
If you have a sustainable strategy for your business, or create sustainable products, or advise on sustainability issues, you may be able to develop new business relationships with listed companies who are looking for suppliers just like you. A business-led understanding of sustainability issues means that you can adapt quickly to changing demands from companies and that adaptability is vital for developing business opportunities.
Additionally, you may be able to solve a challenge that a particular business has – which can help you develop a new business relationship and source of revenue that you did not previously have access to. If you manage to create a reputation for yourself as a supplier that innovates and adapts their product to help tackle sustainability challenges for your customers, the possibilities are endless.
Strengthening existing business
If you are already a supplier to such a business then you may be able to strengthen your existing relationship. This can lead to larger contracts, more opportunities and the ability to provide a broader range of products or services to the business in question. From experience I know how disappointing it can be to contact a supplier for sustainability information and be met with a lack of understanding and, at points, complete indifference to the importance of the question. If your customer is asking the question it is because it is important to them. Therefore, understanding the drivers behind some of these questions can help you to develop a stronger relationship with your customer.
What about if you are a business operating near to the offices or other facilities of one of these large corporates? You may be in competition with other vendors in the area. These businesses are educating their staff about sustainability – and so is the news and the TV and social media. Do you provide a service that is more sustainable than the alternative? If you’re a cafe and you offer sustainable packaging or offer customers the option of bringing their own containers – will that strengthen your business? Do you think it would be well-received by customers? If you are a shop nearby – do you offer products that come from sustainable sources? Would that help to attract new customers through your door?
The important thing is to learn enough about the topic to be able to integrate sustainability in to your own business case to help drive adaptation, growth and business development. The good news is that the business case for integrating sustainability exists. The great news is that integrating it in to your strategy will help you to adapt, grow and develop your business.
If you’re looking for information on what you can do to implement a sustainability strategy in-house, take a look at my blog post here for some tips on how to start.
I am a sustainability coach with 10 years experience in the sustainability sector. I can help you and your business understand how to start mapping out a path to a more sustainable, profitable, business model. Contact me at email@example.com for more information. Find out more information on my website.