Sustainability for profit and planet protection

Written by

Tim Greenhalgh

Posted on

January 10, 2020

2020 is the year when sustainability strategies in businesses should deliver the twin benefit of increased profits and effective climate support.

This is a goal that SaveMoneyCutCarbon has relentlessly pursued on behalf of its customers, delivering savings in utility costs through energy and water reductions that benefit the planet.

There has been a definite shift in the dominant business view recently, as many companies shift from regarding sustainability strategies as a drain on profits to realising the potentially huge benefits, both commercial and environmental.

This is in part due to stark warnings from trusted sources, not least the Bank of England, about the absolute necessity for companies to fully embrace sustainability in order to thrive while contributing to the struggle against climate change.

The focus at SaveMoneyCutCarbon is on planning and delivering projects that cut operational costs in businesses through substantially lower utility bills. When a company can reduce its lighting energy costs by as much as 80% and water use by 60-85%, the ripple effect on the bottom line is impressive.

Capital-free savings

SaveMoneyCutCarbon’s UK-wide consultancy services include energy efficiency audits, investment ready proposals and product installation services.

What’s more, companies can benefit from our risk-free sustainability financing, using untapped energy and water savings to improve the bottom line – through capital-free facilities.

There is now a wealth of research available, unlike even five years ago, that clearly demonstrates how companies that focus on sustainability through best ESG (Environmental, Social, and Governance) practices are more profitable in the medium to long term.

For example, detailed analysis by Oxford University and Arabesque Partners in a meta-study  of more than 200 sources entitled proved conclusively the connection between good business sustainability practices and profitability.

Reduced costs

It’s hard to argue against this type of strong data, which shows that most companies focusing on sustainability have improved operational performance (88%), with reduced cost of capital (90%) and a better share-price performance (80%).

The World Economic Forum data shows that companies with a focus on eco-innovation are growing at an annual rate of 15% while many competitors remain flat. Many of these businesses are small and medium-sized enterprises.

And other research from the non-profit CDP organisation showed that corporations actively managing and planning for climate change have an 18% higher return on investment (ROI) than companies that not – and 67% higher than companies who refuse to disclose their emissions.

All this reinforces the evolving business culture that takes sustainability to heart in both senses, profitability for growth and survival and active focus on energy, water, waste as well as community, heritage and ESG.

Attract investors

Sustainable companies have the facility and vision to tap into new green markets, stay compliant with regulations, embrace new products and processes, while also promoting innovation. And they also attract investors.

Barclays, the international investment bank, has found that bond portfolios with companies that have sustainability goals outperformed those without.

Leading companies are cutting costs by using energy efficient alternatives. P&G is saving up to $500 million by meeting science-based targets that reduce environmental imprint while Unilever is pursuing its Sustainable Living Plan to double revenues while halving environmental footprint.

Unilever recorded a 52% reduction in the emissions associated with its energy use, a 44% reduction in the amount of water abstracted per tonne of product produced and a 97% reduction in manufacturing waste sent for disposal since 2008.

Customer acquisition

In terms of focus on customer acquisition and retention, Unilever’s research shows that a third of customers prefer to buy from brands they believe are having a positive impact on the environment or society. And just over a fifth of all consumers would actively choose a company with the best sustainable credentials, even if that company’s products cost more.

Research from McKinsey also shows that the ‘sustainability bonus’ is strong, identifying that main reasons to focus on sustainability are to:

  • Increase affinity with customers through shared values
  • Develop new growth opportunities
  • Improve brand reputation

The ‘sustainability slalom’ is something that no company should fear, as a Goldman Sachs’ study revealed – 72% of companies with business sustainability measures are outperforming their competitors.

The enthusiastic adoption of sustainable business practices helps to improve operational efficiency with streamlined effort and more efficient use of resources, which in turn enhances employee productivity and reduces cost.

And research from the Massachusetts Institute of Technology shows that sustainability and profit are far from mutually exclusive – 37% of businesses report profit from sustainability and one in two companies have adapted business models to capitalise on opportunities.

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