Sustainable growth. We’ve been hearing that word a lot lately. There is new information regarding environmental crises such as climate change, the Green New Deal, decline in biodiversity, wildfires and deforestation. With the emergence of retail brands that are ethically manufactured and geared towards fair trade, you’re bound to encounter the word at some point. It’s like that hashtag that people keep using and you only kind of know what it means.
However, the concept’s reach is far more than just environmental. It is also very much deep-rooted in financial models. Being unaware of it in the earlier stages of business related decision making could lead to long-term consequences, socially, economically and environmentally.
Let’s focus on the first 2 elements and break down what exactly sustainability means. Why is sustainability important and how does it affect small businesses?
How It Works
The word ‘sustainability’ is like a flavor of the month for businesses. It’s like the business world version of “lit” or “mood”. Many corporate giants such as Walmart and McDonald’s have been “high-key” adapting it as a central priority moving forward. This move has become a catalyst in pressuring other companies to commit to the same approach. Not just environmentally, but also in terms of how they plan to deliver goods and services.
Defined by the Brundtland Report as “Development that meets the needs of the present without compromising the ability of future generations to meet their needs.” It is a type of economic growth that is characterized by “low growth rate, absence of pollution, and greatly diminished environment impact.”
Bottom line, sustainable growth is a type of economic development that gives us our needs today. This is without harming the ability of future generations to meet theirs. To do that, there has to be less changes over time in the value of goods and services. There has to be no pollution and we have to stop harming the planet.
The way it works from a business standpoint begins with long-term planning. It can start with the model, when a business starts getting its ROI. It is when a business invests in long-term product and marketing strategies. When it starts making the money back through profit.
“To frame decisions in terms of years and decades rather than on the next quarter’s earnings report”. In the decision-making processes, businesses need to consider more than just profit and loss. They also need to consider how it can operate in the social, environmental, and economic environments. These strategies are incremental to ensure that a company will still be in operation for years to come.
This aspect is probably the most overlooked, misunderstood, and underrated approach to sustainable development. “A sustainable business should have the support and approval of its employees, stakeholders and the community it operates in.” Emphasis on employees and community. There are plenty of ways to preserve this kind of support, but it all comes down to reasonable wages, equal pay, fair treatment for employers, and a conducive working environment.
It goes hand-in-hand with ensuring that businesses are responsive to the welfare of their employees by investing in their health benefits. That they are providing opportunities to learn and grow within the organization. As well as being flexible with their schedules, which small businesses particularly excel at. In a report published by Zenefits, it was found that over 67% of small businesses have at least some form of flexible time arrangements. And 78% of employees reported in the survey strongly agreed that these types of arrangements have increased their productivity.
When it comes to community engagement, businesses have often partnered with charities and nonprofits to support causes. They also contribute to fundraising, scholarships, and funding of local projects. All this seems a bit too cliché, because we’ve seen it many times over. Having the support of the community builds public trust and this is the most valuable asset a company can have. On a global scale, businesses need the awareness of how exactly their supply chain is being fueled. “Is child labor going into your end product? Are people being paid fairly? Is the work environment safe?”
Sustainable Economic Growth
For a business to be economically sustainable, it must be profitable. But profit isn’t the whole story, neither can it defeat the environmental and social components. It also includes “compliance, proper governance and risk management”.
This also means good governance. For corporations, this means that directors and C-level management should be on the same page in terms of the interests of shareholders. In terms of smaller businesses, it means that their operations are in line with the interests of the local community. The processes in these operations are adding value to the business strategy. Their products address end-users (users that already use their products).
On both ends, economic sustainability means transparency and accountability. It’s more than meeting the ROI and being profitable. It is more than marketing techniques and creating a hype around the brand to make it more lucrative. It means making long-term strategies to address key elements in business practices that could have considerable impacts to their operations, both environmentally and socially.
As a small business, it’s much easier to address these situations. There are no layers of bureaucracy to go through. This is an example of where size is at an advantage, because it enables individuals within the company to communicate more openly. Making sure everyone is functioning based on clear and accurate information. This builds trust internally and strengthens the company as an institution.
Branch Out with SeeBiz
It is important to remember that there is no instant gratification when it comes to sustainable growth. It doesn’t happen overnight. It’s not something that businesses can “just do well”. Sustainable growth is a symptom of good decision-making. It’s something that happens, because businesses chose to grow by investing in their employees, being transparent with their operations and supply chain management, while having the foresight of long-term value. It’s about making significant investments to prepare future generations for what we already know is coming.
With SeeBiz, you can maximize your business growth by connecting and discovering distributors, manufacturers, and other retailers. Eliminate long turnover periods with marketing materials by uploading product catalogs. Save overhead costs with trade shows and networking events by building an online presence. The platform is designed to be versatile and adaptable depending on how you scale, where the rewards outweigh the financial expenses, as well as the expense of labor.