Nowadays, businesses are facing two big problems. On the one hand, they want to grow and prosper, increase their sales, be profitable and have great revenues.
On the other hand, there is an increased need to be responsible for their own actions and impact they create on the world around them. Even though being profitable and creating a sustainable business may seem like different paths to take, they both lead to the same outcome: Environment-friendly business model that spells success both for customers and for companies which products or services they use and for this planet, we all walk and live upon.
This was confirmed by a survey done by the Danish green energy company Ørsted in which 83% of respondents said they want a world totally powered by renewable energy, so much in fact that they would rather choose a competing brand if it offered an environmentally friendly solution.
What is ESG and why is it so important?
ESG (Environmental, Social and Governance) is a blanket term for a set of criteria used by socially conscious investors to screen potential investments by evaluating company’s behavior and its influence on the environment and people. ESG standards are performance indicators which are non-financial in nature and are as follows:
a) Environmental
How a company performs as a guardian of nature and how good are its waste and water conservation efforts and energy efficiency? How big are its greenhouse gas (GHG) emissions?
And how does it use energy and treats animals? Does it conserve natural resources? How do different environmental risks exert their influence on the company’s income and how does a company deal with those risks? For example, a company could face environmental risks that are related to its disposal of hazardous wastes, management of toxic emissions or its ownership of contaminated land.
b) Social
In what way does the company manage its business relationships with its suppliers, customers, employees and communities it operates in. How big is its staff turnover? What’s the quality of its community involvement and human rights policies?
Does it cooperate with suppliers that share the same values as the company claims to hold? Is there a philanthropic side of the company? Are there any charities to the community or does it perform volunteer work? Are the working conditions in the company based upon its employees’ safety and health?
c) Governance
How a company governs its external and internal affairs. How it deals with its shareholders’ rights, the company’s leadership, anti-corruption policies, internal controls, executive pays, and audits. Does a company have a transparent and accurate accounting method?
What does a company do to decrease its conflict of interest between different board members? Many investors choose not to invest in businesses that use political contributions or illegal behavior to gain favorable treatment.
Bad ESG practices can decrease the company’s stock prices and public trust. Which then results in billions of dollars losses for investors. Volkswagen’s emission scandal is a typical example of such bad business practices. This is why some companies deal with such issues by themselves or by outsourcing the work to different ESG consulting services in hopes of complying with such criteriums and attracting the right kind of investors. This business model creates growing businesses that won’t ruin the planet for the generations to come.
5 Different solutions to this problem
1. Recycle everything
From paper waste, glass, machines, cardboard, furniture, metal and wood, plastic containers and bags recycle everything. Make separate bins for glass, plastic and over time people will get used to them and use them more and more.
Overall you will reduce waste production by a third. When appropriate, try to buy second-hand furniture or items made from recycled materials. Save those ink cartridges, use more emails and computer-based internal communication.
Especially try to recycle electronics, either by following a manufacturer recycling programme or one used by electronic retailers. Just be sure to remove all data beforehand.
2. Transportation
If possible, ride a bicycle to work. Besides clear health benefits, this will cause a reduction in pollutions, as well as fewer travel expenses. Try to convince your workers to do the same.
When sending packages, find courier businesses that have green credentials. Some of them already employ bicycle fleets. When ordering try to buy from businesses with close proximity.
3. Cleaning
Instead of using standard cleaning products that obviously harm the environment, purchase or make environmentally-friendly products for the office, those that incorporate nontoxic and biodegradable elements.
Use liquid instead of solid soap, this will also save you the money in the long run. Use toilet paper created from recycled materials instead of generic ones or ditch them all together for an energy efficient hand dryer.
4. Water
Conserve it. Fix leaky faucets, besides apparent environment-friendly effect, this will also decrease monthly tolls. If you’re not an expert yourself, use plumbing services. Additionally search for eco-friendly water system options, to decrease unnecessary waste. Turn down the hot water setting for the boiler. Or decrease it if possible.
To summarize all of this: remember, having a growing and sustainable business is not about making a big bang and sparkly explosion that goes down as soon as it went up. It’s about creating a small star in the night sky that even though it doesn’t shine as brightly, it will continue to shine in the years to come. The only shortcuts, in the long run, are the ones leading to your company’s downfall.
Read Also:
- 5 Tips for Going Green in Your Office
- 5 Profitable Green Product Ideas to Private Label & Sell on Amazon
- 10 Green Business Ideas For Entrepreneurs
- Going Green! 5 Eco-Friendly Small Businesses in America Changing the Game
Author: Keith Coppersmith
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