Understanding what makes a business sustainable

The three pillars of business sustainability are the environment, social responsibility, and economic impact. They are more informally known as “people, planet, purpose, and profits.”

The people concerned are your employees, customers, and community members.

The planet is the physical environment and its natural resources, and purpose refers to the reasons your company functions as it does. For instance, is it compatible with the other pillars?

Profit refers to more than making money. It also means the effects your business has on the environment and society, now and in the future.  

Sustainability intentions are fine, but results matter. You need to know if your efforts are effective. Measuring sustainability can be difficult, but you can create meaningful benchmarks to evaluate your progress.

Environmental impact

Determining environmental impact includes measuring the resources your company uses each year. That includes energy use, of course, as well as water consumption, carbon emissions, etc. In addition, you need to determine how much waste your company produces and break it down into daily, weekly, monthly, and yearly amounts.

Progress in achieving sustainability can be measured by the reduction in negative environmental effects.

Companies should develop clear environmental policies that guide their efforts to reduce current negative environmental impacts and prevent further damage.

Better yet, the policies should improve the environment in addition to mitigating harm.

Social impact 

Your company’s social impact involves the work environment, the products and services you offer, and your employees’ health and safety. Other factors may include your company’s inclusivity and equitable pay.

Does your company offer a healthy culture that values all employees?

Your business should also be measured against community employment standards.

Measuring social impact requires multiple approaches.

You may compile product recall numbers, consumer complaints, average employee sick days, health and safety records, and employee retention numbers as part of your analysis.

Economic impact

Traditional methods of measuring economic success can be used to determine profitability, but they should be supplemented by an analysis of community financial impact.

Did the company help raise the local standards of living?

Have ESG efforts improved the environment and the immediate and global community?

A corporate code of ethics can guide the board’s efforts in this area and streamline sustainability implementation.

Sustainability is a smart business strategy as well as an ethical one. Responsible investors are increasingly drawn to sustainable businesses due to their personal embrace of ESG governance.

Many talented employees are now searching for meaningful work that improves the world instead of just providing a paycheck.

Sustainable companies are also compliant companies that do not violate government regulatory policies. In fact, they often implement advanced technology before they are required, which prevents last-minute cost outlays.

Compliant companies also avoid serious legal consequences and exorbitant government fines.

By making your company sustainable today, you will reap the long-term financial benefits of energy efficiency. You will also build a company culture that attracts and retains top talent, a proven way to increase your bottom line.

Fortunately, advances in technology have simplified sustainability efforts.

Artificial intelligence, the Internet of Things (IoT), and the cloud have made it easier to improve energy efficiency, create a safer workplace, and measure the effects of sustainability policies.

Something as simple as smart thermostats can significantly reduce your company’s energy usage. The answers to sustainability are available to the businesses that want them.

Sustainability may sound mysterious and difficult, but it is surprisingly easy to pursue. The first step is to make it a priority with your board and company leaders.

You need to establish practical goals to improve your ESG governance and implement best practices as soon as possible.

Many of these steps are simple and cost-effective. Others take time to incorporate into your business practices and be considered a long-term investment.

You must also establish metrics to measure your current environmental and social impact so you can accurately evaluate your progress.

It will take effort and determination. But sustainability is not a momentary trend. It’s the path to responsible corporate operations and a better future for the world.

Build your knowledge of ESG with a world-renowned, university-approved Diploma in ESG.