Sustainability and Business
A sustainable business, or a green business, is an enterprise that has minimal negative impact, or potentially a positive effect, on the global or local environment, community, society, or economy - a business that strives to meet the triple bottom line. They cluster under different groupings and the whole is sometimes referred to as "green capitalism". Often, sustainable businesses have progressive environmental and human rights policies. In general, business is described as green if it matches the following four criteria:
- It incorporates principles of sustainability into each of its business decisions.
- It supplies environmentally friendly products or services that replaces demand for non-green products and/or services.
- It is greener than traditional competition.
- It has made an enduring commitment to environmental principles in its business operations.
A sustainable business is any organisation that participates in environmentally friendly or green activities to ensure that all processes, products, and manufacturing activities adequately address current environmental concerns while maintaining a profit. In other words, it is a business that “meets the needs of the present [world] without compromising the ability of future generations to meet their own needs.” It is the process of assessing how to design products that will take advantage of the current environmental situation and how well a company’s products perform with renewable resources.
A recent report emphasised that sustainability is a three-legged stool of people, planet, and profit. Sustainable businesses with the supply chain try to balance all three through the triple-bottom-line concept—using sustainable development and sustainable distribution to affect the environment, business growth, and the society.
Everyone affects the sustainability of the marketplace and the planet in some way. Sustainable development within a business can create value for customers, investors, and the environment. A sustainable business must meet customer needs while, at the same time, treating the environment well. To succeed in such an approach, where stakeholder balancing and joint solutions are key, requires a structural approach. One philosophy, that include many different tools and methods, is the concept of Sustainable Enterprise Excellence. Another is the adoption of the concept of responsible growth.
Green business has been seen as a possible mediator of economic-environmental relations, and if proliferated, would serve to diversify our economy, even if it has a negligible effect at lowering atmospheric CO2 levels. The definition of "green jobs" is ambiguous, but it is generally agreed that these jobs, the result of green business, should be linked to clean energy, and contribute to the reduction of greenhouse gases. These corporations can be seen as generators of not only "green energy", but as producers of new "materiality’s" that are the product of the technologies these firms developed and deployed.
A major initiative of sustainable businesses is to eliminate or decrease the environmental harm caused by the production and consumption of their goods. The impact of such human activities in terms of the amount of greenhouse gases produced can be measured in units of carbon dioxide and is referred to as the carbon footprint. The carbon footprint concept is derived from ecological footprint analysis, which examines the ecological capacity required to support the consumption of products.
Businesses take a wide range of green initiatives. One of the most common examples is the act of "going paperless" or sending electronic correspondence in lieu of paper when possible. On a higher level, examples of sustainable business practices include: refurbishing used products (e.g., tuning up lightly used commercial fitness equipment for resale); revising production processes to eliminate waste (such as using a more accurate template to cut out designs); and choosing nontoxic raw materials and processes. For example, many farmers have found that hemp is a sustainable alternative to rapeseed in their traditional crop rotation; hemp grown for fibre or seed requires no pesticides or herbicides.
Sustainable business leaders also consider the life cycle costs for the items they produce. Input costs must be considered regarding regulations, energy use, storage, and disposal. Designing for the environment (DFE) is also an element of sustainable business. This process enables users to consider the potential environmental impacts of a product and the process used to make that product.
The many possibilities for adopting green practices have led to considerable pressure being put upon companies from consumers, employees, government regulators and other stakeholders. Some companies have resorted to greenwashing instead of making meaningful changes, merely marketing their products in ways that suggest green practices.
For example, various producers in the bamboo fibre industry have been taken to court for advertising their products as “greener” than they are. Still, countless other companies have taken the sustainability trend seriously and are enjoying profits.
Green investment firms are consequently attracting unprecedented interest. In the UK, for instance, the Green Investment Bank is devoted exclusively to supporting renewable domestic energy. However, the UK and Europe as a whole are falling behind the impressive pace set by developing nations in terms of green development. Thus, green investment firms are creating more and more opportunities to support sustainable development practices in emerging economies. By providing micro-loans and larger investments, these firms assist small business owners in developing nations who seek business education, affordable loans, and new distribution networks for their "green" products.
The Harvard Business School business historian Geoffrey Jones has traced the historical origins of green business back to pioneering start-ups in organic food and wind and solar energy before World War 1. Among large corporations, Ford Motor Company occupies an odd role in the story of sustainability. Ironically, founder Henry Ford was a pioneer in the sustainable business realm, experimenting with plant-based fuels during the days of the Model T. Ford Motor Company also shipped the Model A truck in crates that then became the vehicle floorboards at the factory destination. This was a form of upcycling, retaining high quality in a closed-loop industrial cycle. Furthermore, the original auto body was made of a stronger-than-steel hemp composite.
Today, of course, Fords are not made of hemp nor do they run on the most sensible fuel. Currently, Ford's claim to eco-friendly fame is the use of seat fabric made from 100% post-industrial materials and renewable soy foam seat bases. Ford executives recently appointed the company’s first senior vice president of sustainability, environment, and safety engineering. This position is responsible for establishing a long-range sustainability strategy and environmental policy. The person in this position will also help develop the products and processes necessary to satisfy both customers and society as a whole while working toward energy independence. It remains to be seen whether Ford will return to its founder's vision of a petroleum-free automobile, a vehicle powered by the remains of plant matter.
Organisations that give back to the community, whether through employees volunteering their time or through charitable donations are often considered socially sustainable. Organisations also can encourage education in their communities by training their employees and offering internships to younger members of the community. Practices such as these increase the education level and quality of life in the community.
For a business to be truly sustainable, it must sustain not only the necessary environmental resources, but also social resources—including employees, customers (the community), and its reputation.