Article | Fabulous Women

Why put sustainability at the heart of your business?

Posted on 07/04/2018

What does Apple, Unilever, Volkswagen, and Google have in common? Other than being business leaders with high turnover, they put sustainability high on their corporate agenda. In fact, in the US, sustainability now plays a permanent part in seventy per cent of business programs. 

Unilever is a classic example of a company that puts its values at the core of its business. You might recall the recent take over bid that Kraft-Heinz proposed. Cited as one of the biggest takeovers in corporate history, Kraft-Unilever would have been valued at £200bn and controlled 3% of the global packaged food market. Unilever’s CEO, Paul Polman would have earned £12m in shares under the sale.  

Despite these business advantages, Unilever fiercely resisted the offer, which harks back the controversial takeover of Cadbury by Kraft in 2010 that resulted in thousands of job losses. Polman, is a strong advocate for sustainable business and global concerns such as poverty and climate change. The company initiated a sustainability programme to reduce Unilever’s environmental footprint in 2010. Arguably one can suggest the rationale that the Kraft-Heinz takeover bid was rejected due to their differing values.

Why do companies place such importance on sustainability and what then, are the key business benefits of adopting a sustainable business model? 

1. Improved Reputation – did you know consumers vote with their wallets on responsible product or services? When a consumer selects an item, 60% of their decision-making process is influenced by the reputation of the company; with only 40% of decision-making based on the product or service.

Further, we are seeing more and more the power that social media holds. Consumers are leading conversations that hold companies accountable for their actions. Social media has the potential to damage a company’s reputation, quickly and to a greater, global scale. Conducting your business activities in a responsible and transparent manner has never been more important.

2. Enhanced relationships – 88% of consumers are more likely to buy from a company that supports and engages in activities that improve society. As Polman states – “consumers want more. They see food shortages, malnutrition and climate change, and a government that doesn’t address it. Companies that do this will get a competitive advantage. Those who don’t will put themselves at risk”. 

“This is a unique opportunity for multinational corporations to improve the battered image of big business….growth at any price is not viable. We have to develop new ways of doing business which will ensure that our growth doesn’t come at the expense of the world’s diminishing natural resources.” 

3. Differentiate your business – Using sustainable business activities provides a platform to engage your audience with interesting and noteworthy stories that differentiate your business from others. 

What separates companies such as Apple, Unilever, Volkswagen, and Google is that they are rated amongst the top sustainable businesses by consumers. This demonstrates that sustainable business models can build strong, credible and globally recognised brands. 

4. Command a more premium price point – Sustainability is your competitive advantage. 55% of consumers are willing to pay more for products and services provided by companies that are committed to positive social and environmental impact.

 

Back Author : Jon Scott

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