Sustainability: The New Competitive Advantage
A growing number of companies are abandoning the old view that protecting the environment is incompatible with a better bottom line. Instead, they are finding that sustainability is profitable for a variety of reasons. For one thing, it is good publicity.
Bob Willard, a retired senior manager from IBM with over 35 years experience, is the author of The Sustainability Advantage: Seven Business Case Benefits of a Triple Bottom Line.
Willard says environmentally-friendly companies are showing they can improve their profits through energy conservation and efficiency and other environmental measures. When sustainable companies reduce their manufacturing waste in energy, raw materials, packaging and transportation, average savings are at least five percent. More savings come through energy efficiencies, water conservation, and other environmental initiatives at non-manufacturing sites.
But there are indirect benefits to a green approach to business that outweigh direct benefits. For example,
- Because they have a more compelling corporate mission, one that employees can find a meaningful role in, they find it easier to hire the best talent, especially young people. This results in a five percent decrease in recruiting costs. Bigger savings come from improved retention of staff, but the biggest advantage of all is improved employee productivity.
- All things being equal, consumers prefer to do business with environmentally conscious companies. By differentiating itself in the marketplace, a green company can generate 5 per cent more in revenue.
- Green companies also reduce risk by meeting and exceeding environmental regulations, and they typically attract easier financing.