Corporate sustainability is enormously important for customers and employees. Many companies have already anchored their economic, ecological and social responsibility in corporate social responsibility (CSR). It is far more than a marketing tool or even lip service. Current studies and the experiences of sustainable companies show why corporate sustainability is worthwhile.
What does sustainability mean exactly?
You encounter the term sustainability everywhere and all the time. Everyone knows it has something to do with ecological responsibility, conscious consumption and climate-neutral transport. The term sustainability was invented by a Saxon. In the 18th century, Hans Carl von Carlowitz called for sustainable forestry for the first time in his work "Sylvicultura oeconomica". The decisive factor was material reasons for taking action against the clear-cutting of forests and not climate protection.
Sustainability: from forestry to politics
It was not until the 1980s that the United Nations (UN) recognized the implications of sustainable management for future generations. As a result, the Enquete Commission of the German Bundestag felt called upon to formulate a three-pillar model. It was based on the Brundtland Report of 1987, in which the then UN Chairwoman of the World Commission on Environment and Development called for a strategy for sustainability. It must "meet the needs of the present without risking that future generations will not be able to meet their own needs."
Sustainability in the company: where does it start?
Sustainable companies develop their strategy on the basis of the three-pillar principle. Their economic growth is based on ecological responsibility and social security. The best prerequisite for making sustainable companies more successful. But what do the three pillars mean in practice?
Economic activity always revolves around efficiency. It is about achieving the maximum profit with the lowest possible means or resources. You will find many approaches to sustainably reducing costs or increasing efficiency. These include, for example, environmentally friendly lighting, energy-efficient equipment, a paperless office and reusable products.
The ecological dimension builds on your responsibility for the environment. It has a clear link to the economic pillar. If you use resources sparingly, this leads to reduced CO2 emissions and less waste. Recyclable products play a major role in this. They don't just end up in the trash, but also yield secondary raw materials such as electronic devices, textiles, glass and paper.
Sustainable companies fulfill their social responsibility. Some companies have already developed a CSR concept for this purpose. Social commitment, benefits in kind and monetary incentives for employees are part of this pillar. For example, company bicycles encourage employees to leave their cars behind from time to time. Sustainable companies also pay attention to fair business partners who pay their employees fairly.
Good reasons for sustainability in the company
More than 50% of consumers prefer companies that act sustainably, socially and ecologically. They trust brands with a clear message of values. A study by the think tank of the Landesbank Baden-Württemberg, LBBW Research, proves this. Sustainable companies are more successful because they attract customers more easily.
It's not just customers who like sustainable companies. Potential employees also value sustainability, fair pay and work-life balance. Companies that value resources, the environment and human capital are attractive employers. Sustainable companies are more successful in attracting and retaining employees.
Sustainable companies are always evolving. They design sustainable product and service strategies. In doing so, they meet the needs of all stakeholders. In these companies, sustainability is neither lip service nor a marketing strategy; it is anchored in the corporate philosophy.
Farms have a direct influence on ensuring that there is a livable, healthy environment today and tomorrow. In the long term, sustainable action leads to responsible production along the entire supply chain and changed consumer behavior.
What makes companies more sustainable?
The first step toward sustainability is to establish it as a guiding principle. This is the only way to ensure that all employees identify with it and live sustainability. In practice, you have various approaches to acting more sustainably.
Conscious use of resources
Ideally, you avoid waste completely. The path to zero waste should be the goal. That is not always possible at the moment. Alternatively, you can also conserve resources by recycling. In addition, you reduce CO2 pollution. Therefore, use reusable products instead of disposable ones.
Avoid packaging waste
The biggest polluters are disposable products. We use them only once and then throw them away. By using reusable products such as thermal cups instead of coffee-to-go cups, you avoid packaging waste. Also, avoid multiple packaging such as foil and paper.
A decisive factor in protecting the environment is your chosen means of transport. If possible, use e-vehicles or e-bikes for transport. Ideally, you supply them with self-produced electricity via a photovoltaic system. Alternatively, you can use green electricity from energy providers.
Produce or sell products that have a neutral eco-balance. Your entire process, from the selection of raw materials to production, transport and disposal, is climate-neutral. Containers, for example, are made from renewable raw materials. Cosmetics do not contain parabens, PEG derivatives or microplastics. They consist only of natural ingredients.
Use sustainable stores and service providers
E-commerce is more climate-friendly than bricks-and-mortar retail. This is confirmed by the meta-study "Climate impacts put to the test: How environmentally (un)friendly is e-commerce really?" from 2021, commissioned by the e-commerce company Gambio. The result: those who store online release fewer CO2 emissions. Surprisingly, the high returns rate is not a driver of the e-commerce climate footprint.
Nevertheless, the 280 million parcels returned each year cause enormous costs, as economists at the University of Bamberg have determined. Returns cost around 5.46 billion euros, half of which is spent on transport. All returns together emit 238,000 tons of CO2 every day. Ultimately, customers foot the bill through higher margins.
The solution is to bring a sustainable service provider on board for environmentally friendly transportation. For example, Liefergrün has developed a sustainable delivery concept that relies on e-vans, cargo bikes and central micro-hubs. For companies, this has a decisive advantage: the last mile is emission-free. The holistic approach relies on short, efficient routes with self-sufficient supply to the micro-hubs. This is how sustainable logistics works today.
According to the competitive strategies of marketing guru Michael E. Porter, companies can pursue various sustainability strategies. For example, you can improve your processes as an ecological pioneer. You position yourself as a trendsetter through a strategic cooperation with a sustainable logistics provider like Liefergrün.
As an ecological cost leader, you focus on producing low-cost sustainable products. If the focus is on eco-efficiency, you use the available resources sensibly and design the entire value chain economically. Uncompromising is eco-branding with a consistent focus on sustainable products and processes. With the different sustainability strategies you align your company ecologically in the long term.
How sustainability pays off for companies
Sustainability is no longer a trend, but an ethical obligation. As early as 2012, Ernst & Young pointed out the importance of sustainable corporate management in a study. Almost 80% of the SMEs and consumers surveyed confirmed the importance of sustainable action. Sustainability pays off for companies, for example through:
- Higher prices: Customers are willing to pay more for transparent sustainability. In doing so, they reward environmental protection, careful use of resources, and fair working conditions.
- Above-average investments: Sustainable companies with sustainable business concepts are attractive to investors, funds and financial institutions. They value the long-term return associated with their investment.
- Excellent marketing tool: Do good and talk about it. This old marketing adage also applies to sustainability. If you use renewable energy sources and have anchored CSR in your corporate philosophy, communicate it.
- Loyal customers and employees: Sustainability creates trust. Customers feel good about buying from sustainable companies. This creates trust and makes them perfect brand ambassadors. Employees identify with a green corporate philosophy and support their employers with a clear conscience.
- Clear competitive advantage: Sustainable companies still have a clear advantage. Climate-neutral companies that rely on sustainable business partners gain the trust of customers and employees.
What makes sustainable companies more successful
Sustainable companies are not more successful per se. For success, you have to do something, such as:
- Analyze the demands of stakeholders (customers, employees, stakeholders, business partners).
- Develop sustainability concept and strategy, which is a must for production companies to get credit.
- Integrate environmental and social management (CSR) into the corporate philosophy.
- Successful sustainability communication with transparency and clear messages.
- Use feedback for reflection and incorporate into strategy development.
- Resilience (adaptability) strengthens the company in the long term and increases future competence.
So why are sustainable companies more successful? It's practically the domino effect: sustainable behavior has a positive impact on the working atmosphere. Corporate philosophy and satisfied employees strengthen brand trust and thus customer loyalty. As a result, sales grow. A healthy, attractive company in turn binds employees and satisfies stakeholders.
Obstacles to more sustainability in companies
It is clear to most companies where the path must lead. Nevertheless, some are not consistently tackling the climate-friendly change. There are many reasons for this, such as:
- Lack of expertise in identifying sustainable technologies and business partners.
- Farms are not aware of the long-term benefits.
- Complicated and costly funding procedures, such as for renewable energy.
- Difficult to measure effects such as positive image and higher employee satisfaction.
Why sustainable corporate management pays off
The research project "Sustainable Corporate Management" at Ludwigshafen University of Applied Sciences determined whether sustainability is worthwhile for companies. Most companies act sustainably out of their shared responsibility for the future. Nevertheless, they have to be profitable. But how can this be measured?
For this purpose, there are so-called performance indicators for economic, ecological and social corporate performance. To keep things simple, they are divided into core indicators and additional indicators. They are also the basis for measuring improvements. The survey of SMEs and corporate groups showed that sustainable corporate management pays off.
The most important factors for managers are the media attention and customer satisfaction associated with sustainability. Many companies benefit from lower consumption of materials and energy. They can also reduce their waste volumes and CO2 emissions. Service providers see fewer starting points for ecological improvements because of the lack of production. Through their sustainable commitment, they focus on customer and employee satisfaction.
Investments in sustainable corporate governance pay off. Overall company performance increases and businesses find it easier to access capital.
Sustainable companies are more successful when they act out of conviction. They set themselves ambitious economic, ecological and social goals. Corporate management does everything in its power to conserve resources, avoid waste and increase efficiency. Their uncompromising actions along the value chain give them a competitive edge. They view sustainability not as a trend but as the new normal. To this end, they work with sustainable partners such as Liefergrün, who are committed to the green revolution in parcel logistics.
Even managers who think in the short to medium term are investing in sustainability. They have recognized that it makes it easier for them to find and retain employees, achieve higher prices and access capital more easily.
Sustainability means taking responsibility. It is about securing future prospects for generations to come. Sustainability certainly takes courage, conviction and perseverance. But in the end it pays off. In the long term, it leads to sustainable, profitable companies. So rethinking pays off for a successful future worth living.