By Industry Expert Murtaza Manji
An Exclusive Viewpoint for Economist Dubai Readers
Over the past decade, “Sustainability” has become more than a trendy tagline that sophisticated brands include in their mission statements. Today, research has proven that it is a crucial part of every successful business around the world; it has become a strategic concern driven by market forces. Keeping the ‘Greater Good’ in mind when designing business practices is more than just the right thing to do; it is also good for your business. Whether it’s making your supply chain more environmentally-friendly, launching a cruelty-free product, decreasing your company’s carbon footprint, giving back to the community, or adapting an equal pay policy, sustainability can add significant value to your business. Although every industry and business have their own motives to embrace sustainability, here are some universal benefits of becoming more sustainable.
Sustainability Improves a Brand’s Perceived Value
Perception is reality – in life and in business. Businesses that are perceived by their target market to be good for the larger ecosystem will have a much better position compared to their competitors. And this positioning is not only for consumers – according to the Stanford Innovation Review, more than 90% of CEOs believe that sustainability is significant to their company’s success. When customers, management, the society, the media, the government, and all other stakeholders respect a brand for its commitment to sustainability, the brand equity is unmatchable.
Sustainability Helps Build Customer Loyalty
Sustainability makes a business look attractive and responsible in the eyes of customers. According to a CSR study: “People are less likely to do business with companies that are perceived as irresponsible. On the other hand, companies that are able to visibly demonstrate their ethics and show a commitment to the environment are more likely to have a stronger reputation and attract customers who care deeply about what a business stands for.” It’s become a fact that consumers favour sustainable brands. With the right messaging and responsible initiatives, businesses can leverage their reputation to develop a high level of customer loyalty and differentiate themselves from competitors.
Comparatively Cost-Effective Investment
Millennials, the large majority of today’s consumer base, are very sophisticated in the way they pick their brands. They want more than a product; they want an emotional connection, a story, and a cause. Most importantly, they are more appreciative of sustainable brands. In 2015, Neilsen conducted a study to understand consumer behaviour and its relationship with brand connection. A surprising insight from the report was that 66% of global consumers are willing to pay more for sustainable goods, with Millennials representing the majority of this percentage. Consumers today are willing to spend extra to ensure that what they are spending money on is actually good for the planet and the people on it. In our interconnected world, it’s becoming a norm to think critically about where products are sourced from. And if that means customers will have to pay an extra amount to ensure the supply chain is ethical, they happily do it.
Business sustainability contributes to the protection of the environment
According to the World Bank Group, current global waste generation levels are approximately 1.3 billion tonnes per year, and are expected to increase to approximately 2.2 billion tonnes per year by 2025. In the Middle East alone, the annual waste produced is estimated at more than 150 million tons. Bahrain, Saudi Arabia, UAE, Qatar and Kuwait rank in the top-ten worldwide in terms of per capita solid waste generation. Compare this number with the annual waste produced in Sweden, where – since 2011 – the country has run out of waste to process, and now are able to process and recycle waste from other countries, for the benefit of the environment.
Businesses around the world and in the Middle East, regardless of size or industry, can – and should – improve environmental sustainability, at least incrementally if not in transformative ways. Every positive achievement is important to saving our planet, our lives, and our businesses. Whether via appointing sustainability ambassadors within the organisation, pledging to adopt greener supply chains, or implementing best practices for decreasing damaging or unnecessary waste, businesses that endorse environmental sustainability can become pioneers in the drive to create a sustainable planet, society, and economy for future generations.
Here are a few steps that businesses can take to become more sustainable:
The problems facing the planet today are greater than any one person or business can tackle. Together, however, we can bring about massive change. Here are a few suggestions to start implementing immediately in your businesses:
In the long term
- Conduct an audit of the environmental impact of the company: utilities usage, waste created, types of waste, and so on.
- Create a cross-company team of environment champions that push lowering waste in every department.
- Be innovative and encourage the sharing of ideas for initiatives. Run a quarterly workshop, and have prizes for people with the best ideas.
In the short term
- Make recycling a non-negotiable practice, embed it into culture. Make it easy for people to recycle, more convenient than a garbage bin.
- Set short-to-medium term goals for every department. For example, lower electricity costs for an office, or reducing packaging waste for a department. Set targets, and have team members that will be accountable for it.
- Celebrate wins. If the company saves $100,000 through lower utilities costs, pay that out as bonuses to the whole team. That way, you build momentum and good environmental practices are positively reinforced.
- Encourage initiatives like #trashtag, and run a team event to do a beach or desert clean-up activities.
There is an age-old saying: Nothing Worth Having Comes Easy. The same applies for building a sustainable business environment. It takes commitment, dedication and consistency from the top down to embrace the sustainability cause and make it happen. The return, however, is manifold: building customer loyalty, increasing brand equity, building pride for the employees, and – ultimately – a healthier planet.
It’s time to start focusing on the People, the Planet, and the Profit.