Sustainability is now a priority for every business, regardless of size. Your customers and the communities you serve want to do business with businesses that are doing good.
According to the PwC Consumer Intelligence Series Survey on ESG, 76% of consumers responded that they would discontinue their relationship with companies that treat the environment, employees, or the community in which they operate poorly.
Conversely, small businesses that embrace sustainability build trust with their customers, communities, and other stakeholders. They often have a competitive advantage with access to new business opportunities and investment as well as greater success attracting and retaining employees.
That’s a pretty compelling business argument for embracing sustainability, but there’s an even bigger perspective.
With 32.5 million small businesses in the U.S. today, your small business is one of the most powerful drivers of the U.S. economy with the ability to have a significant positive impact on societal and environmental change in every community across America.
Sound like an overwhelming and lofty goal for the hardworking, multi-hat-wearing small business owner? No doubt it will take some extra work up front, but instead of making “Be more sustainable” a squishy, undefined item on your never-ending to-do list, incorporate sustainability into your overall business. It isn’t something extra you have to do, but rather it becomes part of your daily operation and culture.
Let’s start by de-mystifying the sustainability puzzle.
There are a lot of terms used interchangeably and confusingly when people talk about sustainability—Corporate Social Responsibility, Environmental Responsibility, DEI, ESG…you get the picture. So, let’s clarify.
The widely used term today is ESG, which stands for Environmental, Social, Governance. These are the three pillars or focus areas small business owners like you can use to develop your sustainable business strategy.
Environmental: What your business is doing to minimize or eliminate impacts on the environment and climate change.
Social: How you assure fair and equitable treatment of your employees, customers, and other stakeholders.
Governance: How you manage your business practices responsibly with transparency and accountability.
Let’s take them one at a time and provide examples of tangible action steps you can take toward building each into your business. Remember, be realistic about what you can do. Depending on your human and financial resources, choose those that are most relevant and impactful to get started.
Evaluate what impact your business has on the environment and seek ways to improve.
TIP: Get your employees involved. They see things in the day-to-day operation you may not.
Waste Management: How can we Reduce, Reuse, and Recycle?
Emissions: How can we reduce our carbon footprint? (electric vehicles, equipment replacement program, etc.)
Water and energy usage: How can we reduce water and energy usage? (LED lighting, Energy Star equipment, shift to renewable energy source)
Packaging and paper usage: Reduce, Reuse, Recycle.
Supply chain: Can we work with more eco-friendly suppliers/partners?
Resiliency: How resilient is the business to climate change and other factors?
Products/Service: How can they be more eco-friendly?
Distribution: Are there efficiencies?
Evaluate your human resources practices and procedures to determine if changes need to be made.
Tip: Don’t forget to review your employee handbook.
Conduct a Company Culture Survey.
Establish a Diversity, Equity & Inclusion Policy.
Evaluate company hiring policies and practices to promote a diverse workforce.
Provide equitable opportunities for career growth.
Provide fair and equitable compensation.
Evaluate your business practices and establish protocols and procedures where needed.
Be transparent about business activities.
Establish checks and balances for accounting practices and administration.
Follow procurement guidelines.
Develop a regulatory compliance program.
Now that you have a handle on your ESG focus areas let’s focus on pulling together an action plan.
Sustainability Jump Start Guide
Inform. Hold a kick-off meeting to brief your team about incorporating sustainability into the business. Make sure they understand what it is and the benefits.
Engage. Engage your team in the ESG assessment and recommendations. Create an honest baseline of where your company is today and tangible action items for improvement.
Plan. Set short, mid, and long-term goals. Be realistic. Plan and budget for each goal.
Tip: If you have limited staff and time, start with short-term goals for some easy wins. Then, tackle one or two bigger goals.
Execute and Measure. Accountability breeds success. Assign responsibilities and create mechanisms for reporting progress. If something isn’t working, find a better approach.
Last, but certainly not least… Promote. You’ve done the hard work and made the investment. Don’t be shy about promoting your sustainability efforts and successes. Proactive communication about your efforts enhances your positive reputation and builds trust in the products and services you provide with customers, employees, regulators, and investors.