the ability to be maintained at a certain rate or level.
"the sustainability of economic growth"
avoidance of the depletion of natural resources in order to maintain an ecological balance.
"the pursuit of global environmental sustainability"
In the fall of 2018, I went to a residency at Green Mountain College where I was working towards my MBA. The head of the program, Dr. Jacob Park, began our first meeting by talking about consulting work he had done recently. He said that he had to begin by spending the first several minutes explaining what sustainability means, which is typical.
The problem, he said, is that “sustainability” is a polarizing term. There’s no universally agreed-upon definition as it relates to business. It’s subjective. Because of that, talking about sustainable business comes with a burden of proof.
It might be better, then, to think of these ideas in terms of leading to innovation or organizational effectiveness.
So, what does it actually mean? The answer is both very broad and very simple.
The simple idea is that sustainability means you’re creating value for your business in the present while operating in such a way as to ensure that future generations will have the same opportunities.
A sustainable business examines its impacts on the environment, society, and the economy, and works to constantly improve them. Patagonia founder and sustainability rockstar, Yvon Chouinard, has said in interviews that attaining sustainability isn’t possible. However, it is still imperative that we try.
Responsible Resource Use
Addressing our environmental impacts means that we have to take care of our natural resources, while we also use them in our daily lives and businesses.
But we have enough right now – why should we change what we do when there’s still more? Fair question. The answer is because most of the resources on this planet are finite, we can’t actually survive without them, and our children’s children deserve them too.
For example, there is only so much water on this planet, and everything living requires it to survive. This isn’t new information.
We use it in our daily lives for everything from cleaning & cooking, to watering the garden. And everything you have – all the stuff you buy - has used water too. We use water when we manufacture clothing and cars, build houses, etc. The computer I’m writing this on, and the electricity powering it right now has required the use of water.
But, the question we need to be discussing isn’t merely what we’re doing wrong, it’s how can we do better?
How can we use fewer resources when we make products?
How can we change our processes so we don’t damage the environment and people around us?
How can we waste less, in business and as a society?
How can we incorporate long term thinking while still enjoying profit, organizational growth, and nurturing a healthy economy?
The first step is to become more aware of what we’re doing:
What resources are we using, how much, and what is the condition of them when we’re done?
How much waste are we generating?
What is the lifecycle of the products we’re making: Are they destined for 30 minutes of use followed by thousands of years in a landfill – like the dreaded plastic straw?
In daily life, how much of what you purchase has been made of *virgin materials vs recycled/repurposed ones?
What other choices can we make instead?
How can we be more innovative and move towards a sustainable future?
*In case you’re not familiar with the term, when I say “virgin material”, I mean a resource that has been extracted from the earth and never used before the construction of the product it is now. This matters because, while most of our resources are finite, some can be grown and used sustainably. We need to move in the direction of the latter.
At least until Elon Musk opens up interplanetary industry for us.
Seriously though, the use of resources is just one of many aspects that make up the vastness of sustainability. And there’s a great deal more to talk about in the category of environmental sustainability - but we’ll get into that more another time.
Moving from environmental impact to social impact – what does that mean?
Corporate Social Responsibility
Examining your business’s social impact means taking an honest look at how the way you operate affects people and communities that you interact with. These are your internal and external stakeholders.
Are your employees happy?
What kind of culture have you created?
Are you hiring with equality and diversity in mind?
Does your operation take something from the community that they need?
Do you give anything to your community that would create shared value?
Do you directly improve your community?
How transparent are you with your stakeholders about your operations?
It’s not good enough to simply be benign – a sustainable business makes the world around it better. And there are many ways to do that. Some companies give to charities, which is fine, but it’s also a passive approach.
Giving to a charity that gives $0.10 of the dollar to help hungry kids in another country doesn’t improve your community. By all means, donate to wherever you’d like, but thinking more locally will result in impact you can actually see. We will discuss some ways to do that in other posts.
What about the impact of your supply chain? A company can be dedicated to improving its direct impacts, and still miss the larger picture. Not knowing the impacts of your supply chain can cause you problems too, as Nike discovered back when they got called out for working with manufacturers that used child labor.
The third part of examining environmental, social, and economic impact is, of course, economic. Every company has to make money to remain in business. It’s not greedy to want to do well financially, so let’s just clear that up. A financially stable company can do a lot more to improve the world than one that went out of business because they couldn’t afford their overhead, right?
So, what does that mean: “economic impact”?
Well, where is the money going that your company generates:
Are you paying your employees fairly?
What is the ratio between the highest-paid person and the lowest? More than 30:1? Is it over 300:1, as we’re currently seeing some corporate CEOs bring in?
When buying materials, is it better to choose the larger company that is in another state or the smaller, closer one that has higher prices?
Are you investing in your local economy and buying from the businesses in your community, or sending your money to corporations in other states?
These aren’t easy questions.
If you’re a public corporation then you’re legally obligated to create profit for shareholders, so how do you move towards being more sustainable - especially if it might cost more in the beginning?
If you’re a small business, then every dollar makes a difference between surviving and thriving.
The truth is that operating sustainably saves your business money. It opens up investment opportunities from impact investors. It creates goodwill between you and your consumers - strengthening your brand. It puts you ahead of the competition in terms of future regulations, saving you time and money for compliance.
Most importantly, sustainable thinking is a mindset that allows you to create your business strategies to plan for the long term in an uncertain and quickly-changing landscape.
Sustainability in a Nutshell
Businesses that operate responsibly in the 21st century will track their environmental, social, and economic impacts, and then carry out initiatives to improve them. The future of the world includes a rapidly growing global population, with quickly advancing technology, and billions of people aspiring to a higher standard of living.
For all of us to be healthy and thrive in our lives and businesses, we need to make choices that keep the future of our resources in mind.