Embracing a sustainable mindset: shifting the emphasis from risks to opportunities

09/12/21

Despite its positive goal, sustainability policies are sometimes seen as threats by firms towards their business. This simply isn’t true. Soon, businesses within the new economy will understand that only by integrating sustainability into their business strategy will they be able to take advantage of new opportunities, learn to better manage risk, and increase their appeal for inward investment. Additionally, they’ll be making strides towards improving the environment and more just society.

To help businesses better comprehend these changes, we’ve examined some of the most common concerns businesses have when embedding sustainability into their strategies. Afterward, we shared our practical experiences to showcase the reality of the situation.

Common concerns businesses have on applying sustainability 

1. Cost

The initial cost that comes with integrating sustainability into business strategies is a point of contention for some companies. When it comes to product development, the goal is to evolve existing processes and be able to measure the new outcomes. But these factors can be offset against cost savings, reduced risks (like in supply chains), and higher operational efficiencies.

2. Business governance

 It’s true that redefining internal policies and updating your governance strategies may lead to certain changes in office governance. One of them can even be the restructuring of your leadership team’s responsibilities - and sometimes those of your board, but improved governance highlights your business’s long-term sustainable intent and will make it more attractive to investors. It's invaluable as a competitive advantage for you, not only will you gain inward investment, but it’ll also motivate new and existing employees. 

To make it more understandable, we’ve constructed ‘A practical guide for boards and leadership teams on ‘ sustainability, which further streamlines engaging with sustainability.

3. Evolution, not revolution

To evolve, your business shouldn’t solely focus on just reinventing its business purpose, you also need to know how to best integrate sustainability into your existing company goals. It’s not, however, about being wholly sustainable on the first day. The process is more of a journey rather than a destination.

As such, the first challenge faced by many firms is knowing where to start, the next challenges are defining short, medium, and long-term priorities.

To gain sustainability, your company needs to be part of a phased strategy owned by the company’s internal stakeholders and business partners. It needs to be able to consider its carbon footprint, attempt to reduce (or eliminate) unsustainable materials and practices within itself.

4. Better alignment with the new economy

The demand for sustainability management is growing in the economic market, customers, investors, and suppliers all want it applied to a business. This means integrating it at the core of your business strategy also meets their demand for sustainable products and services. Positive brand association is one of the most beneficial effects of sustainability. We can see, for instance, how it could be beneficial for medium-sized enterprises seeking to secure contracts with governments or larger companies.

While this tactic creates the risk of businesses sitting on their hands, our personal experience shows that a great many businesses are already well advanced in their business planning.

Quote from William Hughes :

“In this fast-paced, ever-changing world that we live in sustainability has shifted from a perceived ‘nice to have’ addition, to an essential component for every business no matter the size. Driven by a move towards stakeholder capitalism and the recognition of the importance of creating long-term value, business as usual is no longer an option. The time is now to grasp ESG as an opportunity or risk becoming irrelevant.”

Want to read more on this topic? 

Our article ‘Three simple steps to kickstart your sustainability strategy’ [link] article could be of interest.

Need practical support on your sustainability journey?

Read our joint publication with ecoDa ‘A practical guide for boards and leadership teams on sustainability [link]

Check out other insights for privately owned businesses like yours [link].

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