Myths about sustainability

Sustainability: debunking five common myths.

Many businesses may be reluctant to pursue sustainability initiatives because of lingering misconceptions about their perceived costs and benefits. We address five key myths and shine a light on the realities.

Branding association has a big part to play here. Just as some people associate Nike with sports or athletic performance, customers may think of environment protection, ethical practice or social responsibility when they perceive your brand. And this can create demand and loyalty from customers who care about such things.

Research is showing that consumers increasingly do care about the environmental and social credentials of what they buy. For example, in a recent HSBC study, a majority of US respondents said they would spend more on sustainable – organic, antibiotic-free, fair-trade, cruelty-free – products.¹ At the same time, more consumers are choosing not to support companies that don’t show a commitment to sustainable practices and green business initiatives.

In short, making sustainability a higher business priority can help companies access new customers and new green market opportunities, as well as avoid brand damage and reputational risk.

Recent rankings of sustainable corporations have found similar results. Take the S&P 500 Environment and Socially Responsible Total Return Index, an iteration of the US S&P 500 equity index that focuses on environmental and socially responsible corporations. It consistently outperforms the S&P 500.

For example, enterprises of all sizes are increasingly decoupling business growth from environmental impact by adapting to a ‘circular economy’ business model. This means establishing processes to repair, reuse, refurbish, remanufacture and recycle. Many businesses are also cutting costs by reducing their use of energy, water and other resources.

Smaller companies’ competitiveness often depends on being lean, resourceful and nimble, and sustainability enables just those things.

Regulators, too, are demanding increased sustainability reporting. By addressing your company’s sustainability performance, you can avoid management and legal risks regarding improper disclosure, as well as create new ways to drive value.

Destroying the environment comes with severe financial costs, so it is in the best interests of every corporation to preserve resources through sustainability strategies. Companies that recognise the new realities and adapt their supply chains, processes and raw materials accordingly can help to future-proof their businesses and ensure their longevity.

The global economy will surely grow, but so must our stewardship of the planet we rely on. The best performing companies of the 21^st century will be those that recognise this evolving new order and take steps to become more sustainable now.