A sustainable business combines profitability, environmental concern and social commitment.
Sustainable entrepreneurship is governed by environmental concerns and social commitments. As in any business, the sustainable entrepreneur seeks profitability, while reducing the impacts of the business on the environment. Learn about some examples and their main advantages.
The term sustainable entrepreneurship describes the marriage between sustainable development and entrepreneurship.
A sustainable business - or green business - combines profitability, environmental concern and social commitment, ensuring that business activities don’t cause negative impacts on the environment, society, and the economy.
Environmental, Social and Corporate Governance (ESG)
The acronym ESG (Environmental, Social and Corporate Governance) is used to denote the environmental, social and corporate governance criteria that must be observed by companies in order to attract socially conscious investors and costumers.
Describes the company’s behavior regarding issues such as climate change, scarcity of natural resources, pollution or waste treatment.
Characterize how the company manages relationships with its employees, vendors, customers, as well as the community in which it operates.
Governance describes practices and processes used in the management of entities and organizations, in order to ensure that they meet certain criteria, such as:
- Results orientation
In 2017, 48% of investors applies ESG indicators in at least a quarter of their total investments. By 2019, according to data released by Deloitte, this indicator was already 75%.
Green or sustainable businesses
Eco-conscious entrepreneurs adopt business models different from traditional models, trying to achieve the best balance between profit and the environmental impact caused. We highlight some of the main characteristics of green businesses.
- They define sustainability as a priority and pay special attention to the use and conservation of natural resources. Their daily activities are guided by the concern to reduce their carbon footprint.
- They prioritize energy efficiency, using less water, raw materials, and energy in production or in the provision of ecologically conscious services.
- Whenever possible, they focus on the reuse of waste resulting from production processes.
- Focus on renewable energy and reduce dependence on fossil fuels.
Benefits of Corporate Sustainability
The adoption of sustainability as a business philosophy brings numerous benefits to the company, of which we highlight:
- Improved brand image
- Increase in productivity and cost reduction
- Easier compliance with the legislation on force
- Greater ability to attract employees, investors, and clients
- Reduction of the amount of waste produced, as well as the emission of greenhouse gases (GHG)
- Reinforcement of the company’s image with the shareholders
- Increased access to tax benefits
How to make your business more sustainable?
- Use sustainable materials in production processes
- Reduce food waste
- Make responsible use of natural resources
- Use renewable energy sources to reduce your carbon footprint
- Implement recycling processes
- Reduce travel, commuting and fossil fuel use to the bare minimum
- Adopt efficient waste management
- Participate in community projects - or promote your own, such as planting trees.
Consumers and sustainable brands
ESG is becoming increasingly important as more and more customers, investors, and entrepreneurs - particularly Millennials and Generation Z - place greater value on ESG metrics in the buying and investment processes.
Millennials (born between 1982 and 1994)
According to Nielsen, 75% of Millennials are eco-conscious, taking it upon themselves to change purchasing habits by opting for more environmentally friendly products.
Generation Z (born between 1995 and 2010)
Several surveys have concluded that Generation Z consumers prefer to buy sustainable brands, and are even willing to pay 10% more for sustainable brands and products. For consumers of this generation, consuming products and services is not necessarily synonymous with owning them.
4 examples of sustainable brands and businesses
Aurora Solar is a software provider for companies that sell solar panels. In its segment, it’s a leader, with more than 10 million solar panels sold through its software during its nine years of life.
Through the Treeapp application, launched in 2020, it’s possible to plant a tree anywhere in the world. Just install the App, select the reforestation project you want to support and track its impact. All this for free, thanks to partnerships established with companies and organizations around the world that support sustainability. To date, more than 1 million trees have been planted in over 12 countries.
Planet Cents plans to launch the world’s largest e-commerce hub for sustainable products and services.
Recovering and ensuring soil health is critical to a more sustainable future. Biome Makers, through BeCrop, the unique technology it developed, uses 14 million microorganisms to care for soils. More than 8,000 farmers have used Biome Makers and this startup has established more than 200 collaborations, with market leaders such as Bayer.
It’s currently in the process of implementing artificial intelligence technology, backed by its expertise in agronomy, to create a virtual assistant that helps farmers increase yields and the quality of their crops.
Sustainability has become an imperative for both businesses and the planet. Aside from being a necessity, sustainability also presents itself as a real business opportunity. The challenge now is to act while there is still time.