Common comments and concerns we encounter within our sustainability consulting are that specific sustainability concepts are too expensive or simply do not apply to a given business model or industry. Simply put, in the business world, action must generate return to be sustainable.
Especially in today’s business landscape, business executives are looking for quantifiable return on their investments. Our professional consulting works with executives who, like all, are focused on the initial investments and long-term value of business sustainability. These business leaders want to know: Are we generating a return on our business sustainability actions?
Many companies generalize the initial cost of sustainable development or fail to assign the cost to products and services realizing the value. This often leads to a misunderstanding of the cost/value relationship of specific action. The post, What is the Business Cost of Sustainability, explores the value of providing transparency to business sustainability costs. So in evaluating business sustainability return, what should be considered?
Impacts to sales and revenue:
• Have base sales increased as a result of specific action?
• Will new sales increase as potential market opportunity become available?
• Are there new consumer segments available as a result of modified company products and services?
• Will overall sales increase from applied business sustainability concepts?
Impacts to operating cost:
• Are additional resources going to be required to implement sustainable change?
• How will sustainable actions affect the efficiency of existing processes?
• Will material or service supply cost increase or decrease?
• How will overall long-term variable cost be affected?
Sustainability and CSR communications have impacts as well. Social media has an emerging role in knowledge sharing,management. and engagement. Creating bridges between the corporate world and its stakeholders, social media closes the gap on knowledge management and business intelligence. Specifically so if sustainable communications and performance is valued by your stakeholders.
Companies implementing sustainable business programs today must realize there is a cost/value assigned to all business action. By identifying the actions that add specific value, business sustainability leaders are targeting business sustainability concepts that increase company profitability. Combing those efforts with social media for sustainability, lies a powerful vehicle to build sustainable business communications and value creation by engaging with stakeholders.
Article by Julie Urlaub, Founder and Managing Partner at Taiga Company; appearing courtesy 3BL Media.
