Make Sustainability Part of Your Business Model

What is sustainability?

Sustainability is a business’s ability to continue operating over time without having a negative impact on the environment or communities in which it is active. For businesses, sustainability means minimizing waste, avoiding exploitative supply chains and adhering to ethical labor practices. Achieving sustainability goals means continuous scrutiny of company policies, from understanding how raw materials are sourced to examining employee compensation packages and workplace conditions.

How to develop a sustainable business model

Sustainable practices can positively affect your workforce, the environment and your customer base. Of course, focusing on sustainability is sometimes at odds with the bottom line. A sweeping change in company policies to implement sustainability practices takes serious time and effort. This adjustment period can go more smoothly with the proper strategies, including the following tips. 

1. Make sustainability part of your mission.

Making sustainability part of your business model can be difficult, and it is often more expensive or complex to implement. To do so authentically and effectively, sustainability should be a core part of your business mission, not just a marketing move or a public relations talking point.

“We wanted to create a value proposition that felt authentic to us, something that hopefully makes a positive difference in the world,” said Molly Fienning, founder of sunglasses brand Babiators. “Sustainability is infusing more and more of our own at-home lives. We [wanted] to begin taking steps and making business decisions that care for the environment today and every day, even if they cost a little more in the short term.”

Fienning’s and her partners’ eco-friendly commitment runs deep. It’s reflected at every level of their business, be it the compostable frames of their sunglasses, their packing and shipping materials, or the Italian manufacturing facility they partner with. For your business, you may have similar considerations. You may also think about corporate partners, investors, worker conditions, or waste management and recycling. Any of these elements can incorporate sustainable and ethical principles.

Regardless of your business’s moving pieces, defining sustainability as a vital part of its values will naturally inform your decision-making and create a more sustainable business model.

2. Think outside the box.

It can be difficult for small businesses to find partners that are both ethical and affordable to work with. Most established supply chains, for example, are not set up to meet sustainable and ethical principles.

“A truly sustainable business model or supply chain is a step change, where you must think about disrupting the current business structure in order to make major changes to address more of the market,” said William Crane, founder and CEO of OrbAid. “Your company and your suppliers need to think more like strategists to create new industry structures.”

When creating the supply chain for Babiator’s sunglasses, Fienning and her partners had to spend a long time exploring their options. Less-expensive suppliers didn’t meet their requirements for an ethical production process, while the industry-standard plastics used to make most sunglasses weren’t eco-friendly. Their search eventually led them to a facility in Italy. The manufacturer produces a plant-based, plastic-like material, where they could also have their sunglasses manufactured according to their standards for worker treatment.

Whether you’re trying to create an ethical supply chain, looking for eco-friendly packing materials, developing a marketing plan or trying to solve any other challenge that arises in your business model, thinking outside industry norms can often lead to a more sustainable solution. Don’t be afraid to look overseas, emulate businesses outside your industry or see what previously unknown resources are available to you.

3. Accept imperfection.

Fienning and her partners work hard to incorporate sustainability at every level of their business. Their packing materials, for example, avoid plastics, and the packaging sunglasses come in is compostable. But Fienning admits perfection is often out of reach.

“Perfection is not possible,” she said. “But all those small steps in the right direction will add up to a significant distance over time.”

Greenbar Distillery in Los Angeles has made imperfect, sustainable practices part of its style by rejecting the heavy, “luxurious” bottles favored by many competitors and using more environmentally friendly lightweight glass.

Though your business model should strive to incorporate your sustainable and ethical principles at every level, that may be outside of your budget or industry or other limitations. That shouldn’t stop you from doing what you can from the beginning.

As more sustainable businesses enter the market, you may find other supply chains, materials or partnerships become both available and affordable. Then, as your company grows and expands, you’ll be better positioned to effect change in your industry or take advantage of solutions that were once outside your budget.

4. Embrace social marketing.

The movement toward sustainable business has a strong online presence, with devoted followers of #zerowastelife, #minimalistliving, and other sustainability practices on social media and blogs. Taking advantage of these social communities can help you reach a wide and engaged audience, even with a limited marketing budget.

“Our marketing efforts … have really been focused on making beautiful outdoor photography,” Fienning said. These images, she explains, are popular online, which has helped interest in the brand spread naturally in social media communities.

Consumers interested in sustainability are also active in finding and sharing products made by ethical brands. So, as word spreads that your business is dedicated to protecting the environment and ethical practices, your consumer base may begin to grow. 

5. Build a community.

In addition to using the preexisting online community, you can expand your brand’s presence and marketing impact by making a conscious effort to build your own community. Seek out popular bloggers who fit with your brand’s ethics and image, create a branded hashtag, and devote time to engaging with your followers and customers online.

Don’t forget to reach out to other sustainable brands. These businesses are often deeply invested in promoting the work and products of other sustainable businesses to their own customers.

“There are other really interesting green products out there from other cool companies, and we’d love to help boost those brands and their efforts,” Fienning said. “I am thrilled when I see any company genuinely trying to be more eco-conscious, because we are all starting a wave that will get stronger the more people join the effort.”

This sort of community sharing and support is essential to the growth of sustainable businesses. Interacting with other ethical brands can help you access new resources and markets. It can reinforce the value of creating a business that meshes with your personal principles if you ever find yourself doubting or struggling. You may even encourage others in your industry to start incorporating sustainable principles into their own business models.

“All these small changes, these businesses’ baby steps, add up to make a difference,” Fienning said. “If we make a … change in the right direction for our business today, maybe we inspire others — our customers, our competitors — to do the same.”

Why is sustainability important?

Sustainability is important for ethical, environmental and business reasons. The benefits of running a sustainable business include:

• Improved morale and reduced employee turnover: Part of running a sustainable business means engaging in sound business practices and offering competitive compensation to your workforce. Providing attractive benefits like extensive paid time off and flexible work hours can boost company morale. Satisfied employees are more productive than stressed workers and are more likely to stay with the company for a long time. Employee turnover can be expensive and preserving the institutional knowledge of long-time employees is valuable.
• Reduced environmental impact: Sustainable businesses reduce their environmental footprint. Reducing damage to the biosphere doesn’t just mean ensuring the generational well-being of the planet, it also means tangible benefits for the company. There are a wide range of tax incentives and government grants businesses can obtain when they run demonstrably sustainable companies.
  
• Stronger brand appeal: Consumers want to support sustainable brands, but they’re also adept at sniffing out insincere promises and greenwashing. By building a genuinely sustainable business, you can boost customer loyalty and strengthen your relationship with your existing customers. In addition, you may also attract new customers who are ethically conscious. Of course, you’ll have to walk the walk in order to retain their business in the long run.
  
• Stable long-term business model: Sustainable businesses are just that: sustainable. That means you can count on your business model working year in and year out. Naturally, you should regularly revisit it and adjust your planning as the market evolves. But when you’re grounded in sustainability, you can count on a certain level of solidity that unsustainable businesses may not.

Sustainability may often be discussed as a moral imperative, but as you can see from the benefits above, it’s also good business. Investing in sustainability may represent an initial cost and mean retooling some aspects of your business, but in the long run these efforts will pay dividends.

What to avoid when building an ethically conscious business

When you’re trying to build an ethically conscious business, be sure to avoid these common pitfalls. 

• Paying lip service without action: Don’t make bold claims about the importance of sustainability or the role the business community has to play unless you’re willing to spend the time and money to engage with those efforts yourself. If consumers think you’re hypocritical or phony, even if you do ultimately make significant investments in sustainability, that reputation will be hard to shake.
  
• Exaggerating contributions: Just as bad as fabricating your commitment to sustainability is exaggerating it. Don’t claim to do more than your business is actually able to do. Never claim you’re engaged in projects or efforts that you’re not, and don’t over-emphasize your role when you only play a small part. Consumers appreciate honesty and will respect your commitment to sustainability at the level you’re capable of.
  
• Excessive marketing: If you overdo your marketing efforts around sustainability, it may give off the impression that you’re only in it for self-gain, even if your intent is sincere. Consumers who are interested in sustainable and ethically conscious brands will do the research. You’ll only need subtle indications your brand invests in sustainable business practices.

Sustainability can be a win for people, profit and planet

When you commit to sustainability and ethical practices in your business, it can be a win for everyone involved. Your workforce, your customers, the planet and your bottom line can all benefit if you make a genuine commitment and effort towards improving your business’s operations. Don’t let short-term costs outweigh long-term gains, both for your business and for society. 

Tejas Vemparala and Isaiah Atkins contributed to this article. Source interviews were conducted for a previous version of this article.