Understanding The Environmental Sustainability in Business

Implementing environmental sustainability in business is believed to promote the company's longevity. Learn how to make your business more sustainable here.

Paying attention to environmental, social, and governance (ESG) issues are becoming increasingly crucial for all companies in all industries. An organization’s performance in the ecological, social, and economic surroundings is taken into account while using environmental sustainability in business to create value over the long term. 

Following the latest survey from McKinsey Global, 83% of C-level executives and investment professionals believe ESG programs will create more shareholder value within five years than they do today, and here is the reason.

Why Does Sustainability Matter?

Implementing such technology in the sustainability of a green economy is believed to promote the company’s longevity, which is the cornerstone of sustainability.

Companies realize they need to take action on sustainability procurement. The realization aligns with the expectations for corporate responsibility to rise, and transparency becomes more common. The days of using only good faith and professional communication are over. 

For large international firms, the message from COP26 was plain and unmistakable; profit relies on integrating business strategies with sustainability goals.

Understanding Sustainability in Business

Understanding The Environmental Sustainability in Business

To understand the context of sustainable economic development and initiative in business settings, let us look at some big corporations and their crafted industries. 

Nike and Adidas have significantly improved. While Adidas has established a cleaner supply chain and committed to having nine out of ten of its products made from sustainable materials by 2025, Nike has concentrated on waste reduction and using renewable energy. 

Both Unilever and Nestlé have made significant pledges; Unilever wants to have net-zero emissions from their products by 2039 and to have a supply chain free of Deforestation by 2023. Nestlé has pledged 100% recyclable or reusable packaging by 2025 and net zero greenhouse gas emissions by 2050.

By fostering collaboration throughout their supply chains to save waste, boost resource productivity, and optimize material use, Walmart, IKEA, and H&M have helped the retail industry progress toward being more environmentally friendly. 

IKEA is taking steps to utilize entirely renewable energy across its value chain, and H&M has committed to using 100% recycled or sustainable materials by 2030. Walmart has stated that, by 2040, it will have canceled out emissions from all of its cars and switched to low-impact refrigerants.

Read more: Indonesia’s Rapid Development for the Green Energy Transition

The Importance of Environmental Sustainability in Business

Most species will only survive past the 21st century if corporations behave responsibly as global community members. 

“The human-caused rate of extinction of species of both plants and animals at present is hundreds of times higher than the natural rate in the past,” Environmental Sustainability writes. 

Now is the perfect time for businesses to join the effort, reduce emissions and waste, and help create a habitable planet. Following the Paris Climate Accord, corporations may significantly impact and be responsible for 60% of emissions reductions by 2030. 

Going green can help you cut business expenses. Although “greening” your company requires an initial investment, putting sustainability first will ultimately result in cost savings. Saving money can be achieved, for example, by the use of more effective lighting or innovative material reuse. 

Although switching to solar energy requires an initial investment, it pays off: a typical commercial building owner will save $500 or more a month on power. 

How to Incorporate Sustainability into Your Business

Understanding The Environmental Sustainability in Business

There is no hard and fast rule on how businesses can incorporate sustainability efforts into their brand. InCorp Indonesia (formerly Cekindo) is present to help aid your business licensing needs and company registration needs, thus allowing you to streamline your business process and focus on sustainability.

Below are a few practical steps you may consider in transitioning to sustainability. 

Ensuring Proper Integration and Minimal Divergence 

The company’s strategy and efforts to promote sustainability must be in line. 

This task is to be shouldered by the company’s management. We frequently observe that divergence weakens sustainability efforts by preventing them from being genuinely committed to and prioritized.

Addressing Compliance Issues

Companies must deal with compliance, which frequently refers to laws governing waste management, pollution, energy efficiency, and regulations governing human rights and labor practices. Investors are also concerned about the issue of compliance. 

90% of institutional investors stated that they would now consider a company’s sustainability performance more when making investment decisions and were more likely to divest from companies with poor sustainability performance.

Configure Engagement

Engagement should consist of all levels. First and foremost, ensuring board member engagement is essential, as they are vital stakeholders. 

It is also necessary to engage the organization broadly so the company can fully leverage its actions across the entire business. Beyond internal engagement, there is also a need to collaborate with the ecosystem to produce better solutions.  

Why You Should Implement The Sustainability Concept

People consider sustainability positive; therefore, businesses with green principles are keen to highlight them. Going green demonstrates to others that you care about things other than just your bottom line. 

You can benefit from promoting your company and creating your brand identity. Sustainability is a gold mine for organizational and technology advancements that produce gains on both the bottom and top lines to ensure a positive impact on your business growth.

Environmental sustainability, as discussed above, has a myriad of benefits – both internally for the business and also externally for the environment. Embracing such a transition would allow for there to be growth and compliance with regulation and also would open doors for investment. 

Contact Our Consultant

Post Verificator

Verified by:​

Pandu Biasramadhan

Pandu is the Consulting Manager at Cekindo. He has extensive experience in working with government agencies. Notably, he has provided market-entry solutions for enterprises in Indonesia and managed regional partnership channels in Southeast Asia. At Cekindo, Pandu aspires to lead the consulting team to provide top-quality market-entry services and maintain a portfolio of global clientele. His specialty is market-entry advisory and business process outsourcing.