Sustainable business can provide a mechanism to influence environmental, commercial, and social development in different ways. The industrial development of environmental management is reflected in the growth and development of commodities, management of the services sector, the use of renewable resources, and waste management as a by-product to mention a few. The major threats to industrial pollution from the environment if sustainable strategies are not used to manage business activities. A sustainable business adopts the principles, procedures, practices, and policies of all elements of the business to improve business continuity, environmental protection, social welfare, and social responsibilities. While traditional business practices affect energy, climate change, and ecosystems day by day, the importance of sustainable businesses is increasing rapidly.
What is a sustainable business?
Sustainability covers a wide range in scope, such as scarcity of energy sources, eco-friendly, pollution-free, social or political stability. It focuses on environmentally friendly activities, such as sustainable practices everywhere in society. A sustainable business has processes of managing business that improves the economic conditions of a country, protects the environment from the adverse effects, and finally ensures the positive response from the society. Business processes that take into account the environmental effects yield a positive outcome on the company’s long-term shareholder returns and business profit maximization.
Why a sustainable business?
Reducing the quantity of waste, reusing wasted materials, and recycling them as by-product or as raw materials for other products can decrease costs through environment-friendly processes. Increase in revenue and cost-saving are major benefits of a sustainable business. The benefits businesses derive from using sustainability standards; operations, procurement, sales & marketing, stakeholder engagement, and sector-wide changes include cost reduction, increased profitability, productivity growth, improved reputation, supply security, legal compliance, enabling policy environment, and level playing field.Industries can change their ability to enhance their business performance and green innovation by focusing on three predictors of sustainable business advantages; assimilation, acquisition, and transformation
Sustainability elements give business some eco-advantages through profitability improvement such as, reducing the use and cost of resources, saving money through digitalization, improving budgets for higher incomes, obtaining investment capital, establishing business status and high business growth, and obtaining incentives from the government through tax incentives.
According to CDP, supply chain emissions are on average 5.5 times higher than the direct emissions produced by a corporation. If your business reviews its supply chain and can make changes, the rewards can follow. For retail and e-commerce businesses, it could be something like using a reusable plastic pallet to reduce the reliance on single-use plastics.
For those in the food and drink industry, it could be the introduction of rotating crops to improve soil fertility – a step that helped France become the world’s most sustainable food country in 2019. The report: Now, Next and how for Business from HSBC, surveyed 8,650 business decision-makers in 34 global markets and has revealed that for many businesses, becoming more sustainable is beneficial for their bottom line.
It also capitalizes some competitive advantages by attracting innovations and perceptions of green consumers, improving brand reputation. It mitigates risks by meeting legal requirements and regulatory compliance, predicting new regulations, engaging stakeholders proactively, and improving risk management processes.
Sustainable business practices
The society faces different financial, industrial, economic, and environmental crises due to mismanagement as well as misuse of social and natural resources. Sustainable practices, capabilities, strategies, and impacts around the world are considered highly crucial issues of every business practice through the positive effect on the economy, society, environment, and business. For instance, climate change is one of the complex and hazardous threats to business and sustainable development. The growing effect of climate change demands a more holistic approach to reduce and prevent the adverse effects of climate change. Climate change, environment protection, environmental stability, and environment-friendly products are directly related to sustainability practices and sustainability strategies.
Internal environmental management and sustainability information systems influence directly and positively on purchasing, cooperation with customers, designing, and investment recovery information systems are also an important force for providing necessary information to consumers, management team, decision-making team, and different groups of stakeholders at the managerial decision level, strategic level, and operational level. It creates opportunities to enhance profitability and productivity. Also, the increasing uses of advanced information systems increase paperless information communication accurately and efficiently.
Sustainable information systems
Sustainable Information Systems (GIS) is an integrated form of information and communication system that directly supports environmental sustainability initiatives across the economy. It connects all the functions of business through technology. Additionally, it established the colloquial term information technology and corporate information systems to overcome the challenges of sustainable practices. It focuses on information systems that design and implement sustainable business processes through reducing transportation costs, enabling sustainable processes and practices, implementing a fleet management system, tracking environmental information, monitoring firm’s waste product management and operational emissions effectively, and improving economic and environmental performance
Development plans gain sustainable technology benefits from sustainable business practices. In addition, different technological benefits of ensuring a sustainable environment through practicing sustainable strategies are
- Technological recycling
- Reducing general expenses
- Purifying of water & air
- Improving budget for higher profits
- Conserving energy
- Regenerating ecosystems