As a business owner, you have a responsibility to your shareholders to maximize profits and to the environment at the same time. There are a number of reasons why sustainability is important to all businesses, but it is important to note that it is not simply a “nice to do”, but rather a key to long-term success.
Corporations today have embraced sustainability as a business strategy, but there is still a lot of confusion about what it is and how it impacts your business. It’s not simply a matter of using eco-friendly materials, but a commitment to comprehensive strategies that reduce waste and energy consumption, increase recycling and use environmentally friendly practices throughout the entire business.
In this article, we’ll explain why it is important for all businesses to embrace sustainability, and the impact it can have on your business.
The impact of climate change on global industries
The world’s population is expected to grow to 9 billion people by 2030. This growth is going to increase the demand for food, water, and energy, but also for other resources. We will see increased pollution, global warming, and the depletion of natural resources.
Although most of the impact of climate change will not be felt until the end of this century, the world is already starting to feel its effects. The impacts of climate change have already increased the number of droughts, floods, and storms.
While these may seem like obvious statements, what isn’t so obvious is the effects felt on industries we take for granted. The top producers of the world’s supply of coffee are Brazil, Vietnam, Colombia, Indonesia, and Ethiopia. It is predicted that by 2050, suitable growing areas for Arabica coffee will reduce by 50%, as Arabica coffee is grown in cool and moist climates.
We can make many other examples of simple, everyday products we consume being impacted by global warming, but it all boils down to having clear visions for sustainability in business, and doing our best to mitigate the effects of climate change.
How sustainability impacts your business
Reducing waste and carbon footprint isn’t just something that enables your company to tout itself as “green”, it is the key to long-term success and competitiveness. As businesses compete for resources – perhaps best exemplified by the supply chain crises experienced during the global pandemic throughout 2020 and 2021 – companies that find alternative ways to produce their products or distribute them will be the ones that survive.
The UN Environment Programme (UNEP) estimates that global industries need to cut 30 gigatonnes of greenhouse gases (GHGs) per year by 2030 to meet the internationally agreed-upon climate change target of a maximum of 2C.
Achieving this target would require a large number of companies to embrace sustainable practices. To put it in perspective, the current emissions of the US alone are around 32.5 gigatonnes of CO2 per year, so we have a lot of work to do.
Sustainability in business can be broken down into four categories:
- Energy reduction: Companies that take a long-term approach to energy reduction will find ways to use less energy to manufacture their products, transport them, and to operate their businesses.
- Waste reduction: Companies that take a long-term approach to waste reduction will find ways to reduce waste in their operations and products. This could include developing packaging that is recyclable, compostable, or reusable.
- Resource efficiency: Companies that take a long-term approach to resource efficiency will find ways to use fewer resources to manufacture their products, transport them, and operate their businesses. This could include developing processes that use less water, energy, or raw materials.
- Employee wellness: Unlike the other categories, this deals specifically with reducing employees’ need to travel, such as remote work setups. According to industry studies, remote work as the “new normal” reduced electricity consumption by 7%, waste production by 67%, and carbon dioxide emissions by 15%.
Global warming is no longer a problem that can be passed onto the next generation, its effects are already being felt in the lives of individuals and businesses around the world. It is now up to businesses to lead the charge and find ways to mitigate the effects of climate change, and this begins with embracing sustainable practices.