The word sustainability is being heard, written, and said all around the world. Both individuals and corporates seem to want to get involved and take part. However, what does sustainability actually mean? And how do companies become sustainable? – Well, to start with, firms have to change their business models to be able to capture and deliver value in a sustainable way in the economic, cultural, and social context. Many companies across different industries use different strategies to minimise their negative effects on the world. Their goal is to reduce their waste, carbon footprint, and polluting emissions, among other deteriorating impacts, in order to be a caring firm that gives back to the society.
Sustainability is not a newly-adopted concept though. Many firms have been applying sustainable strategies for many years. For instance, popular strategies are reducing the use of plastic, becoming eco-friendly with their packaging, recycling, and using renewable energy. COVID-19, however, has evolved sustainability’s interest from a trend to a demand.
The billion dollar industry of fashion currently produces 20% of global carbon emissions. They are associated with being one of the largest consumers of water, energy, chemical substances, water pollution, and air pollution. Which has led to various multinationals such as Zara, H&M, Uniqlo amongst many others to become innovative and create solutions. The newest uprising strategy is to design entire clothing lines made out of recycled materials. In this strategy, firms collect recycled materials and recovered textiles, which eliminates waste. Zara’s Join Life collection will account for 20% of its offering by the end of 2022. Other strategies Zara, the largest fast fashion retailer, is using, is to transform their facilities and stores into being entirely eco-friendly, as well as creating an in-store recycling donation program. However, how effective are these initiatives? Well, according to Amina Razvi, the executive director of the sustainable Apparel Coalition, “sustainability is a long journey”, and every move is a contribution. Multinationals taking a step to be sustainable and revalue their work to improve their impact might be a small step, but what lies behind is the most significant effect. In doing so, other companies will follow, they will too become more responsible, and overall increase consumers’ interest and ethical values in purchasing from sustainable companies. Thus, decreasing consumption from environmentally damaging companies who do not react to the situation. Overall, drifting the consumer trend.
Nevertheless, the fashion industry is far from alone. The second most polluting industry is food retail. The percentage rate involved in food waste is outstanding. Let alone in the UK, individuals waste as much as 1.9 million tonnes of food every year. According to a report, globally wasted food accounts for 8% of all greenhouse gas emissions. But, why is this happening and what are firms doing about it? To start with, food waste is divided into two sections. One being food loss, which involves individuals buying more than they need and end up throwing away uneaten food. It also includes food which spoils in transportation and never arrives at stores. Secondly, according to the US Department of Agriculture’s (USDA) Economic Research Service (ERS) food waste entails “food discarded by retailers due to colour or appearance and plate waste by consumers.” Companies and individuals have to work unison to reach beneficial results and reduce greenhouse gas emissions from food waste. AgriMax is an organisation founded by the European Union that addresses the situation the industry encounters itself in, and provides sustainable solutions. The platform consists of converting crop and food waste into organic compounds through bio refinery, and then be used for food packaging, and agricultural chemicals. It also promotes webinar sessions to offer tips to individuals on how to recycle household food waste. Simultaneously food retail businesses such as grocery stores, are applying strategic operations to reduce their food waste yet maintain their consumption profit. For instance applying expiration date tracking. This allows grocery stores to automate the checking of expiration dates on products, to promote store discount on soon-to-expire products, to reduce waste, while at the same time earning extra revenue in the bargain.
So. Sustainability? According to the Brundtland’s Commission final report, “Our Common Future”, sustainability is defined as “meeting our own needs without compromising the ability of future generations to meet their own”. And how do we do this? The trend of applying sustainable approaches or strategies to business operations and models has been driven by society. However, many companies need assistance in order to achieve such modalities.
Corpstage is a consulting firm providing advisory services aimed at helping companies achieve goals, as well as guiding them through the entire process based on their industry, business, and financial needs.