6 Reasons Your Business Should Start Its Sustainability Journey
In the current globalized world countries are focusing on achieving net zero carbon emissions for travel, We can see some of it being implemented in terms of SAF( Sustainable Aviation Fuels). Tourists in 2024 are more willing to travel with the lowest carbon option available.
Here are the Top 6 Reasons Why Your Business Should also Begin its Sustainability Journey
1. Customer behavior changes
Change management and sustainability go hand in hand. A higher number of consumers now care about sustainability. Deloitte’s Sustainable Consumer Research highlights how 85% of UK customers adapted to a more sustainable way of life during 2021 while 1/3rd look for sustainable businesses while purchasing. Ethical consumerism is on the rise with bigger markets shifting towards these approaches and lifestyles. They look for carbon reporting and NetZero commitments from businesses along with progress on other SDGs and overall energy efficiency among other factors.
The purchasing power of Gen-Z and millennials, while having increased, is more tilted towards sustainable products, policies, and businesses. Many customers are now willing to pay higher prices for sustainable products and the trend is expected to increase. Companies that adhere to environmental regulations, use renewable resources, and have sustainable supply chains will automatically build competitive advantages due to this changing consumer mindset. For instance, when it comes to choosing a property to stay during a vacation, new-age consumers are looking up more sustainable options like EcoGrade serviced apartments that help them get a picture of their energy consumption during their stay along with ensuring a minimal carbon footprint overall.
2. Rise in sustainable initiatives and global regulations
There has been a steady rise in sustainability initiatives for tackling social issues and protecting the environment. The SDGs (sustainable development goals) were adopted by more than 178 nations in 1992 in the form of Agenda 21. They highlight the need for business success in building a more sustainable future for the world. Governments across the globe are already taking initiatives towards ensuring sustainability across the spectrum while several regulations have been introduced that directly impact businesses. For instance, April 2019 saw the UK Government unveiling new emission and energy rules where large companies have to report on their annual greenhouse gas emissions and energy use in their annual reports. By 2021, the Government in the UK had already set a target of lowering emissions by a whopping 78% by 2035.
Information disclosure through carbon reporting and other sustainability reporting is also on the rise along with sustainable certification like Global GAP, Rainforest Alliance, and Fairtrade. These trends make it imperative for businesses to latch onto the sustainability bandwagon at the earliest. Carbon reporting, for instance, now allows businesses to stay resistant to future risks and legally compliant while avoiding fines and penalties.
3. Growth in sustainable finance
Given that most businesses require or will require external investments for future innovation and growth, sustainable finance cannot be ignored any longer. The growth in sustainable financing models means that a larger section of investors are considering ESG factors while deciding on investments. According to Edie, global green finance has grown to $540 billion in 2021 from $5.2 billion in 2012.
4. Sustainability comes with higher profits and cost savings
Adopting sustainability goals may help your business reap the benefits of higher cost savings and profits in the long run. McKinsey has reported how adopting such practices may lead to cost reductions and profit boosts up to 60 pc. Companies with higher ESG ratings have the highest profitability. While there is an initial cost of boosting sustainability across the business, it will ultimately lead to reduction in unnecessary wastage, recycling and reuse of materials, and lower operating costs throughout the manufacturing process. Water and fossil fuels will also keep becoming costlier and more limited. Energy prices are also forecasted to keep rising. Hence, energy efficiency and sustainable ways of production and working with renewable sources and behavior changes will safeguard resources while helping businesses earn higher profits.
5. Sustainable businesses attract the best global talent today
Companies with a focus on sustainability may be the ones attracting top talent in the future. The Fast Company held a survey where 40 pc of millennials selected to work for companies based on their commitments towards sustainability. Millennials make up the largest portion of the workforce and are unwilling to work for companies that do not adhere to regulations and use unsustainable and toxic production methods. Millennials, according to this survey, are also okay with getting lower compensation while working for companies that care about sustainable growth.
6. A sustainable approach enhances brand image and competitive advantages
With more consumers favoring sustainable businesses over their regular counterparts, adopting a sustainable approach will not only bring you a competitive advantage in your space, but also boost your brand image. A firm commitment towards sustainability and caring about environmental issues will get you newer customers whose values sync with yours.
However, keep in mind that your business should walk the walk when it comes to implementing sustainable strategies and measures. Once you start properly marketing your initiatives, more customers will recognize your work and you will be able to pave the way for long-term growth and prosperity.
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