Corporate Sustainability Requires Smart Operations and Marketing

Corporate sustainability has been gaining attention from executives and customers alike, and not just when companies are enormous. Many midmarket firms have pushed heavily into sustainable practices, and several have been recognized for it. For example, Sun Light & Power makes use of renewable-source energy, keeps half of its facilities near public transit and uses recycled materials in 75 percent of its office supplies. Similarly, First GREEN Bank has LEED-certified facilities, programs to encourage employee use of fuel-efficient vehicles and special commercial loan packages for companies building sustainable facilities.

Creating corporate sustainability is more complicated than thinking green.

Why Do Companies Go Green?

There are many reasons companies choose sustainability. Owners and investors who feel strongly about going green often want to run a business according to those values. They might also see its financial and public-relations attractiveness, which can result in better customer acquisition and retention. Eco-friendly practices, such as managing waste and ensuring green facilities, reduce operating costs in the long run. According to GreenBiz, private equity firms have turned to sustainability as a way to unlock a midsized company's value, and investors consider it because of its direct relevance to risk management and return on investment.

Any middle market business might wonder whether it should focus on corporate sustainability. The answer is never simple. Here are some primary considerations.

Understand the Meaning of Sustainability

The instant association is often one of eco-friendliness, but that is only part of sustainability. It might include wellness incentives to ensure a healthy workforce, locating your business near mass transit to reduce carbon emissions and providing assistance for social stability in your local community. Companies will have different opportunities to pursue sustainable operations, but it's fundamental that they fully understand what sustainability means to them.

Prepare to Commit

It's not enough for a company to seem like it is interested in corporate sustainability. Executives, employees and investors alike must be ready to make a real effort. There is a term for companies that try to use ecological issues to look good even though they don't have a sincere interest: greenwashing. This is not an area in which to dabble because activists who take it seriously will uncover the truth, and they'll actively make you look bad.

Strategy, Not Just Tactics

Committing requires the company to apply sustainability to its culture and goals. It is a strategic emphasis, not a series of tactical activities, that can push operations into an ecological state. Sustainability can affect how you manufacture products, ship them, source parts or materials, build and run facilities, undertake customer service, interact with employees and work with business partners. It's a value that executives have to consider when they make decisions.

However, Tactics Are Still Important

From the strategic level, a company implements sustainability tactically. It's different for every company, but there are many possible energy-saving practices you can employ: efficient use of energy, water and resources; green logistics; employee transportation planning; eco-friendly building design; smart acquisition of inventory; sustainable office supplies; and community relations. You need to devote the necessary resources and people power, whether they come from upper management, sustainability consultants or employees.

Does your company have a sustainability initiative? What kinds of activities do you do? Who spearheads the effort? Tell us by commenting below.

Erik Sherman is an NCMM contributor and author whose work has appeared in such publications as The Wall Street Journal, The New York Times Magazine, Newsweek, the Financial Times, Chief Executive, Inc. and Fortune. He also blogs for CBS MoneyWatch. Sherman has extensive experience in corporate communications consulting and is the author or co-author of 10 books. Follow him on Twitter and circle him on Google+.


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