Sustainability is a key driver for growth and success for the majority of small businesses in Australia according to a new analysis by Australia Post and the Banksia Foundation. Turning a mindset for sustainability into tangible actions, however, is often a complex and headache-inducing activity for time-poor and resource-stretched small businesses.
It’s clear that many small businesses benefit from operating responsibly. Sustainable actions help you balance your purpose and profit, respond to stakeholder expectations and future proof your operations. There’s also plenty of research suggesting that sustainability initiatives, such as those aimed at reducing operational carbon footprint, can also help improve a business’ bottom line.
So where can you start your sustainability journey? We’ve identified four steps that can help you establish and maintain sustainable practices in your business:
- Align sustainability goals with your corporate strategy
- Assess your current sustainability practices
- Engage with your stakeholders
- Measure your outcomes and get certification
1. Aligning Your Goals With Your Strategy
To succeed in business, we must adapt to the disruptive environmental, social and digital changes that are already underway. There are many challenges that impact the way our businesses grow, such as scarce natural resources, volatile financial markets, local buying power and the availability of qualified people. Having a focus on sustainability helps you address challenges like these head-on.
Embedding sustainability into your business’ strategy means joining the two together through a series of concrete steps. The first crucial step is to identify clearly why and how sustainability matters to your business. Having a clear vision, mission and set of values provides the building blocks with which to do this, but you can also get started by simply brainstorming the impact you want to have on the world.
Once you’ve defined the impact you want to have, the next step is to understand where sustainability efforts should be concentrated in your business. Now it’s time to identify the areas that have the biggest impact on your business’ sustainability and those that are the most relevant to your products, services and stakeholders.
2. Assessing Your Current Sustainability Practices
Conducting an assessment is the best way to find opportunities to improve your social and environmental impact. A sound sustainability assessment can assist you with evaluating how your business is tracking compared to the best practices out there.
The Materiality Assessment Tool is a great resource for establishing your baseline. Materiality refers to identifying and understanding what issues are significant to your business and stakeholders and prioritising them for action. With this tool, you can map out your ability to impact or influence issues that matter most to your business. This is where your previous work of figuring out your goals comes in handy. After aligning your goals to specific actions with the tool, you’ll be able to develop a roadmap with clear and easy-to-follow sustainability actions for your business.
3. Engaging With Stakeholders
Whether you have employees or not, your business will have stakeholders that you need to consider while you’re moving along your sustainability roadmap. Typical stakeholders include advisors, investors, shareholders, customers, property managers, supply chain partners, members of your local community and more. Anyone who is potentially affected by or can affect your business should be considered.
To engage your stakeholders about your sustainability planning, consider the following steps (where applicable):
- Get buy-in from management, board or advisors. Without buy-in from this group, your sustainability efforts will be more difficult to implement or may not succeed.
- Identify an (internal) sustainability champion. Assess your resourcing and engage someone with responsibility for making sure that things get done.
- Set up a green team. A green team consists of a group of employees who are engaged in advancing sustainability within the business. The benefit of having a green team is that you’ll make sure that everyone gets a voice in your business’s sustainability efforts.
- Engage with your supply chain. Through your materiality assessment process, recognise who, where and what is impacted by your activities. Speak to your key suppliers, producers and manufacturers to get their input and buy-in to your business’s sustainability activities, goals and ambitions.
- Customers. 9/10 consumers want sustainable products and are also adopting a raft of different measures post-COVID to shop and live more sustainably. It makes sense to engage with your customers wherever possible to ensure you are meeting their expectations in terms of sustainability. Many consumers favour companies that are engaging in sustainability actions and your actions can become a competitive advantage.
4. Measuring Your Outcomes and Reporting Your Results
Whatever process you decide on for mapping out your priorities and actions, you’ll need to bring them all together so you can measure the outcomes. You should determine what you want to measure, identify positive and negative project impacts, perform a materiality assessment if you haven’t already, develop metrics, survey stakeholders and undertake data collection, and finally, reporting on your findings.
At the end of your sustainability revamp, you’ll end up with a Sustainability Report – or, a document that describes the non-financial aspects of a business’ activities including an assessment of its wider economic, environmental and social impacts. You can then refer back to this report to aid with risk management, foster responsible business practices and even open up new market opportunities.
While reporting on your sustainability efforts can be a complex process, the following examples provide great starting points and references:
- GRI Sustainability Reporting Standards allow businesses to understand and communicate their impacts on critical issues such as climate change, human rights and labour relations.
- You could choose to utilise the B-Corp comprehensive blueprint for purposeful business. By getting certified as a B Corp, you’ll be able to benchmark your practices and join a growing community of businesses committed to doing good.
- Consider mapping the UN’s Sustainable Development Goals which encourages you to put sustainability at the front and centre of your business strategy and provides an excellent framework for embedding sustainability into your operations.
Remember, as with any reporting, transparency and authenticity is key. Without those qualities, your reporting would be half as effective as it could be for pushing your business forward!
So there you have a framework for building a sustainability program and applying sustainability to your business activities. Once you’ve gone through the steps, you’ll have processes and reporting in place to help you maintain and maximise sustainability in your business.