August 08 National Newsletter   The Business Case for Sustainability David Solsky, Zerofootprint   Meet David

 

 

With increasing urgency around climate change and environmental sustainability, the business world is facing a number of complex issues in ensuring the business readiness of themselves and their clients to participate in a carbon constrained economy. Global economic forces, increased government regulation and compliance, an impending price on carbon, and a market that is swiftly turning green are all contributing to organisations seriously considering their environmental and sustainability positioning. In what has become a swiftly moving carbon economy, it is not unusual to see businesses implementing green office programs, advertising carbon neutrality, buying offsets and developing sustainability policies and strategies. Other organisations know they should act, but struggle to help their executive team understand why their sustainability position needs to be a priority. However, the business case for an organisation to become more sustainable is quite compelling.

 

1. The world and money is moving

The world is moving towards a carbon constrained economy and investors are taking notice. The effects of climate change are global, so investors are analysing the risks and demanding organisations have carbon mitigation strategies. The Carbon Disclosure Project (CDP), as an example, is a secretariat representing investment bodies around the globe, with combined investment assets of over $57 trillion. The CDP is asking corporations to disclose how they are addressing the issue of climate change, and investors are noting the responses and allocating funds accordingly. The Stern report highlighted the global economic implications for failing to act on Climate Change. In Australia, Garnaut echoed Stern’s concerns and the Government’s Green Paper fuelled the discussion over the price of carbon after 2010. Organisations that fail to act now will find themselves struggling to maintain profitability in this new economy.

 

2. Cost reduction

An organisation’s large operational expenditures are often the ones responsible for generating the most carbon emissions. By reducing the demand for carbon-intensive goods and services in your organisation, you can cut costs whilst achieving environmental and sustainability objectives. Sustainable behaviour naturally drives bottom line profit through reduced costs, process improvements and efficiencies around energy, travel, water, waste and office consumables. By improving organisational processes such as procurement, travel and energy use, and engaging employees in sustainability initiatives, you can lower your organisation’s carbon footprint, increase your commitment to sustainability, and reduce costs.

 

3. Managing Stakeholder Expectations

A sustainable approach to business can enhance corporate reputation, grow shareholder value and help maintain competitive advantage, particularly through new product and service development to meet the growing market demand for ethical and environmentally positive products. Organisations that establish a strong position on this issue will enhance their reputation with communities demanding corporate action on climate change, employees that want to work in a healthy environment, shareholders who want to invest ethically and with customers and clients who want to spend their money on goods and services aligned with their own values. Clients have a growing need to work with organisations that have the capability to help them address the emerging issues around climate change and the risks and opportunities that they should consider. Organisations with the ability to address these issues will find themselves leading their competitors in innovation, reputation and market share.

 

4. Attraction and Retention of Talent

An organisation that aligns its business processes with its commitment to sustainability has a greater chance of attracting the best new recruits as well as engaging and retaining existing staff. Employees (and potential employees) are urging employers to do more and do better when it comes to the environment and sustainability. Engaged employees are involved in their company’s sustainability plans, have a clear understanding of the actions they can take at work, actively supply feedback on how the company is progressing, and feel empowered to make change. These employees also drive innovation and goodwill throughout the organisation as well as their communities.

These are just some of the reasons supporting the business case for sustainability. However, perhaps the most important is that it is simply the right thing to do. Inaction on this issue places our planet and all who share its resources at risk. The combined efforts of businesses, governments, communities and individuals has the potential to create powerful, effective change in our world, creating a sustainable economy, workplaces that inspire, and communities that thrive.

 

 

David Solsky is Managing Director of Zerofootprint Australia, a joint venture with Zerofootprint International – a global market leader that has developed software platforms and programs that enable businesses, individuals and communities to measure and reduce their environmental footprint.