Understanding How Sustainability Affects Your Business
All over the world, small and medium-sized companies like yours are becoming more than casual observers. They are committed to learning about sustainability trends that have a positive economic, social and environmental impact.
But there is a difference between understanding sustainability and understanding how it affects your business.Understanding sustainability vs Understanding how it affects your business? #sustainability #SME Click To Tweet
Will Sustainability Change Things for SME’s?
In September 2015 the United Nations unanimously adopted the 17 Sustainable Development Goals (SDG’s). A few months later, 195 countries met at the Paris climate conference — COP21, where they agreed to limit “the increase in the global average temperature to well below 2° C…” among other things.
What does that mean for a smaller company? What do you do with that information?
You need to have a solid understanding of how to begin talking about sustainability.
It gets confusing, especially if your research time is limited. It’s a complex issue that has a history of disagreements politically and financially, as well as with the proposed solutions.
What makes this unique, however, is that over the next fifteen years, the 17 Goals, unanimously agreed on, will universally apply to all countries — rich or poor.
Here’s a quick, 2-minute explanation:
4 Reasons Sustainability Will Affect Your Business
To achieve the Goals, businesses large and small need to be more knowledgeable and more involved. It isn’t an option to passively observe any longer.
Sustainability is already having a significant financial impact in four areas that will jolt your business.
1. Companies are divesting.
Contemporary divestment is the practice of ending investments in companies and products that aren’t socially responsible. Which also means they are choosing to invest in companies that have a record of sustainability, or socially responsible investment.
In 2014, The New Yorker reported that roughly one of every six dollars, or 18% of the $36.8 trillion in professionally managed assets here in the United States, are consciously being invested in socially responsible ventures.
And that trend, up 50% from 2012, continues today.
Socially responsible investment isn’t limited to large investors and large companies. Everyone from the large companies right down to end users are scrutinizing the processes and supply chains used to bring products to market.
How does that trickle down to an SME?
Many of you are part of that supply chain or you are using those products in your own company.
Does socially responsible investment trickle down to your SME? #SME #Sustainability Click To Tweet
2. Direct consumers are asking questions.
You may not think that a sustainability policy is important for a small business.
You would be wrong. Here is a perfect example
Last month I attended the Strawberry Festival outside the tiny community of Travelers Rest, South Carolina. I met an amazing saleswoman who had a booth selling an assortment of very professionally packaged herbs and spices. She was making a killing. She was a natural salesperson…easy to talk with and a smile for everyone.
A buyer walked up and asked, “Where are your herbs sourced?”
This entrepreneur, who was clearly a senior citizen, didn’t miss a beat. Even at her age she understood the importance of knowing her product and her buyers. She explained exactly which local farms she purchased from and which products were gluten-free, vegetarian and even vegan!
Sustainability, in one form or another, is mainstream — even for the smallest business owners.
3. Job seekers are asking about company sustainability policies.
In January 2016, Monster.com ran the article, 6 Traits Millennials Should Look for in a New Employer.
Number 2 on the list: “…a company with strong environmental sustainability practices.”
When one of the top two job-seeking services online advises readers to ask about a company’s sustainability practices , it’s far more than a passing trend.
4. Corporate responsibility is already mainstream in most large companies.
(And in their supply chains, including smaller companies like yours.)
According to the Governance & Accountability Institute Research Results and the Bulldog Reporter, in 2011, 80% of the S&P 500 didn’t participate in corporate sustainability and responsibility reporting. By 2013 the number dropped to 28%. In 2015, only 19% were not reporting.
It’s important to ask if your company is making their sustainability policy known.
SME’s Talk About Sustainability
The landscape is changing. Whether you’re global giant or a small, local business, the company policy question used to be, “How much do we give?” Today, the question is, “What difference can we make in our community? In the world?”
If you’re still skeptical, read Forbes’ list of 25 Best Small Companies for 2016. I took an afternoon and researched each one. With a single exception, each company talked quite openly about the importance of at least one — and for most— several of the 17 Sustainable Development Goals. They didn’t refer to the Goals. Some didn’t even say the word “sustainability.” But it was proudly discussed in some form as a foundational principle of 24 out of 25 companies on the list.
24 out of 25 of Forbes’ Best Small Companies find sustainability important enough to include on their company website!
Some companies are very comfortable putting their story and their policy front and center. New Belgium Brewery was a great example. Check out their navigation bar and you’ll find that they love their product, they have fun marketing, and they are deeply committed to sustainability. When you arrive on their site you see a clear link, but notice that it drops down to six pages describing their company sustainability policy.
Prefer a more industrial background? Read Fluor’s website. Like New Belgium, they have a Sustainability tab in the navigation bar that opens to several pages about their sustainability journey.
Other companies are a bit more low-key. Meet Parker & Sons, Inc. You don’t see a tab in the navigation bar talking about their sustainability policy or their story but look at their “Employment Opportunities” page. It’s simple, straight-forward and brilliantly effective.
Sustainability IS a big deal in SME marketing.
How Will Your Company Make a Difference?
It’s a question that begins internally, with your employees and stakeholders. To be authentic, a sustainability policy has to be a genuine part of your company DNA. Again, Fluor has done an outstanding job of communicating the importance of their employees. Employee buy-in is essential to the sustainability policy of a company.
Creating a meaningful company policy and communicating it to other companies you work with takes time. Don’t wait to talk about sustainability. Let your partners know you’re making the move.
- Ask for tips
- If you blog on your website, tell your story
- Get a conversation started
- Watch your competitors’ progress and learn from it
- Take a class
It’s a holistic change that evolves…it’s a story of its own.
It’s true. As one guy told me this week, “Sustainability still doesn’t trump the bottom line.”
But I think you’ll find that the bottom line is increasingly influenced by sustainability.
Not only is it good for economic, environmental, and social reasons, it’s becoming a factor in your company profits.
What about you? Are you ready to bring your company into the world of sustainability? If you’d like more tips and resources, I hope you’ll subscribe to Gig! Marketing Newsletter. And if you like the tips you received here, please share! You hear me say it all the time…I love this stuff!