How to Incorporate Sustainability Into Your Brand—And Why You Should
First, an example.
You and your team put time, effort, creativity, and innovation into your brand’s packaging. Finding the perfect materials, colors, fonts, text treatments, copy, imagery - it all entailed effort and intention. So when that packaging ends up on the side of the road, or on a beach, or in the middle of a suburban sidewalk, that packaging has turned from a unique and meaningful element of your brand’s image to...litter.
Product packaging continues to make its way into the natural environment, becoming branded litter. Consumers see your discarded packaging on their streets and point fingers at you, the brand, for failing to do its due diligence by the environment.
Enter: Litterati, an application that encourages users to pick up and dispose of litter, but not before photographing and uploading it to the digital landfill where it is time-stamped and geo-tagged. By noting the brand via hashtag, users are creating the largest database of branded debris on the planet - as well as a cleaner world, one piece of litter at a time, writes Chandler Slevin in her Packaging Digest piece on Litterati.
An app like Litterati is just one of the ways brands can capitalize on sustainable practices. Read on for other ideas on how to infuse your brand or company with sustainable practices and reap the benefits - including how FP International does it!
Sustainability is not only a fundamental, long term environmental issue, but also a strategic imperative that affects legislative and regulatory compliance, operations management and organizational effectiveness, brand reputation and financial risks.
By efficiently addressing sustainability management and communications issues, companies can find new opportunities to reduce cost, enhance profitability and avoid risk. But the benefits don’t end there: Environmentally and socially responsible business practices are linked to brand loyalty, both from a customer and employee perspective. Not only that, but sustainability initiatives have a key role in sales, recruitment and business reputation.
How to begin incorporating sustainability into your company’s ethos
When it comes to sustainability, priorities may differ. Each company’s preferences depend on various factors like geographic context or the organization’s size and production type. Regardless of your company’s size or needs, these strategies will help you capitalize on sustainability opportunities:
- Understand legislative and regulatory compliance at national level, as well as international voluntary standards and market-related developments about energy efficiency, emissions, waste management and water conservation. Familiarize yourself and your team with best practices in your area - and with what your competitors are doing.
- Empower public engagement with shareholders and stakeholders about climate change issues and the major risks associated with climate concern, especially in relation with corporate sustainability issues and topics. These are smart topics to be engaged on, regardless - climate change impacts us all, no matter what company we work for.
- Stimulate the market demand for greater disclosure and transparency of rules and information about sustainability related issues, green products and services through effective sustainability communications and public initiatives. This is a great place to engage your communications, marketing, or social media teams. It might even be an opportunity to engage your human resources department by identifying sustainable and eco-friendly events and spaces your brand can be a part of.
- Increase mid-to-long term corporate investments in research and development with an emphasis on clean and green technologies. Again, loop in your marketing department to maximize your company’s visibility on these issue.
- Consider the environmental impacts and resources used across the full product life cycle for your business. This is a great opportunity to audit and assess your current strategy, and potentially implement greener options. Assess everything - for example, does your office have a cafeteria? Encourage a switch to biodegradable materials. Are you located in an office park that’s over-watering during a drought? Talk to facilities management!
Perhaps most importantly, consider what your company produces or creates. Can it be greener? Consider creating and promoting a wide range of green products and sustainable solutions for more environmentally and socially responsible customers, buyers, suppliers and partners.
How will sustainability benefit your company?
Executives are often reluctant to place sustainability core to their company’s business strategy in the mistaken belief that the costs outweigh the benefits - but academic research and business experience point to quite the opposite.
The Harvard Business Review compiled a list of benefits to corporate sustainability - all from a business case perspective. We’ve taken their list and tailored it to your needs, from a packaging industry perspective.
1. Choosing sustainable practices drives competitive advantage through stakeholder engagement.
Traditional business models aim to create value for shareholders, often at the expense of other stakeholders. But sustainable businesses are redefining the corporate ecosystem by designing models that create value for all stakeholders, including employees, shareholders, supply chains, civil society, and even the planet. Much of the strategic value of sustainability comes from the need to continually talk with and learn from key stakeholders. Through regular dialogue with stakeholders and continual iteration, a company with a sustainability agenda is better positioned to anticipate and react to economic, social, environmental, and regulatory changes as they arise.
- Sustainable practices improve a company’s risk management strategy
Supply chains today extend around the world and are vulnerable to natural disasters and civil conflict. Climate change, water scarcity, and poor labor conditions in much of the world increase the risk. But unlike what we consider to be traditional forms of business risk, social and environmental risks manifest themselves over a longer term, often impacting the business across several dimensions - all of which are largely outside the organization’s control. In the agriculture, food, and beverage sector, the impacts of climate change have the potential to alter growing conditions and seasons, increase pests and disease, and decrease crop yields. Meanwhile, disruptions in the supply chain may affect production processes that depend on unpriced natural capital assets (think biodiversity, groundwater, clean air, and climate).
HBR cites a few companies who are doing it right: Mars, Unilever, and Nespresso. All three have invested in Rainforest Alliance certification to help farmers deal with climate volatility, reduce land degradation, and increase resilience to drought and humidity—all of which ensure the long-term supply of their agricultural products. Certification also improves productivity and net income.
- Sustainable practices foster innovation
Investing in sustainability is not only a risk management tool; it can also drive innovation. Obviously, redesigning products or strategies to meet changing environmental standards or social needs pose brand-new challenges - but these challenges also offer new business opportunities. HBR mentioned 3M as an example on this point: the company is integrating sustainability into its innovation pipeline through its “Pollution Prevention Pays” program. The program aims to proactively minimize waste and avoid pollution through product reformulation, equipment redesign, process modification, and waste recycling.
Nike is another big-name company that has embedded sustainability into its innovation process. The brand’s $1 billion-plus Flyknit line uses a specialized yarn system which reduces waste by 80% compared with regular cut and sew footwear. Since its launch in 2012, Flyknit has reduced 3.5 million pounds of waste and fully transitioned from yarn to recycled polyester, diverting 182 million bottles from landfills. At the same time, Nike’s Flyknit system requires minimal labor and generates large profit margins. We call that a win-win.
- Sustainable practices improve financial performance
In case the Nike Flyknit example wasn’t enough, HBR offers another point on the financial benefits of sustainability. Plenty of business leaders operate under the erroneous perception that one can have profits or sustainability, but not both. This is just no longer accurate and shouldn’t be a reason for avoiding sustainable initiatives. In addition to the financial benefits that accrue from increased competitive advantage and innovation as discussed earlier, companies are realizing significant cost savings through environmental sustainability-related operational efficiencies (think of the savings accrued through switching your office’s lighting to an LED, environmentally friendly option, for example).
HBR uses major players Dow and GE as examples: Since 1994, Dow has invested nearly $2 billion in improving resource efficiency and has saved $9.8 billion from reduced energy and wastewater consumption in manufacturing. In 2013, GE had reduced greenhouse gas emissions by 32% and water use by 45% compared to 2004 and 2006 baselines, respectively, resulting in $300 million in savings.
Still not convinced? Consider the process and logistics savings. HBR offers retail giant Walmart as an example. The company aimed to double fleet efficiency between 2005 and 2015 through better routing, truck loading, driver training, and advanced technologies. By the end of 2014, they had improved fuel efficiency approximately 87% compared to the 2005 baseline. In that year, these improvements resulted in 15,000 metric tons of CO2 emissions avoided and savings of nearly $11 million.
Clearly, evidence is mounting that sustainable companies deliver significant positive financial performance - and investors are beginning to value these practices more highly.
- Sustainable practices building customer loyalty
Companies are skeptical about consumer interest in sustainable products – especially where willingness-to-pay is concerned. Some of that is self-inflicted, as early on companies tended to increase “sustainable” product prices substantially and in some cases sold inferior products (e.g. pricy natural cleaning products that did not work as well as their chemical-laden competitors).
This is shifting, though, as today’s consumers expect more transparency, honesty, and tangible global impact from companies and can choose from a raft of sustainable, competitively priced, high quality products. Today’s consumers perceive a higher level of product performance in products from sustainable companies and sustainability information has a significantly positive impact on consumers’ evaluation of a company.
- Sustainable practices can attract and engage employees
Corporate sustainability initiatives aimed at improving employee performance and providing value to society can increase employee loyalty, efficiency, and productivity and improve HR statistics related to recruitment, retention, and morale.
Modern employees are focusing more on mission, purpose, and work-life balance. According to the HBR report, companies that invest in sustainability initiatives tend to create sought-after culture and engagement due to company strategy focusing more on purpose and providing value to society. In addition, companies who embed sustainability in their core business strategy treat employees as critical stakeholders, just as important as shareholders. Consequently, employees are proud to work there and feel part of a broader effort.
There’s no question: sustainability is going mainstream. Companies can no longer afford to approach sustainability as a nice option or lofty goal - it’s time to proactively make sustainability core to business strategy, which in turn will drive innovation and engender enthusiasm and loyalty from employees, customers, suppliers, communities and investors. We hope this post has given you and your team some ideas as to how to get started on incorporating sustainable practices into your business strategy!