Business Benefits of Sustainability
For anyone to accept the premise that social responsibility is a business strategy, we must be able to define and quantify the business benefits that can be derived from adopting this model. This is so that success can be measured, just as with any business strategy.
License to Operate (speed to market)
In business, time is money and each delay in permitting, construction, recruiting and training employees has an associated cost in lost revenue, particularly in a competitive situation when the preferred company can use the time advantage to establish itself in the market, cherry pick the local talent pool and build relationships with customers and suppliers. A company that has a positive reputation has an advantage. While the community may not actively facilitate approval of a permit, community opposition often results in substantial delays and requiring a greater investment of time and money with contentious public hearings and town hall meetings at the minimum to protesting and boycotting that adversely impact hiring and even discourage customers. In short, the community needs to ‘buy’ you before you get a chance to sell them anything.
Each day that a store remains vacant or a commercial lot lies undeveloped is a day of lost sales revenue for the company. The community does not realize the benefits of having those goods or services available, workers are denied employment, and the community cannot collect sales and income taxes.
Whether you define it as enhanced goodwill or reduced opposition, sustainability programs that position the company as a positive corporate citizen can impact the speed with which the company enters or grows within a market. A PR program that fosters trust by engaging the community stakeholders is an essential element to building that dialogue.
Cost Reduction or Avoidance
Most businesses know the importance of investing in preventive maintenance to keep equipment in good working order. In fact, these “expenses” are not considered optional. Those who do not invest in this manner are considered foolish and viewed with contempt. But there are other, direct ways that businesses can save money through a longer-term approach.
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John Friedman, an award-winning communications professional and recognized sustainability expert with more than 20 years of experience, is co-founder and vice chair of the board for the Sustainable Business Network of Washington (SBNOW).
Friedman has served as both an external and internal sustainability leader, helping companies, ranging from small companies to leading global enterprises, turn their values into successful business models by integrating their environmental, social, and economic aspirations into their cultures and business practices.
His insights on sustainability issues and strategy are a regular feature on Huffington Post.
Friedman authored the e-publication The New PR which outlines how companies must modify the way they communicate to meet stakeholders' changing expectations through five proven keys for developing programs that replace "spin" with transparency and unlock the full potential of a sustainability program to build reputational capital. Friedman is currently working on a new book Your Backyard Is My Front Yard.