Are Your Business or Entrepreneur Idea Actually Sustainable?

In an era where sustainability is no longer a luxury but a necessity, businesses and entrepreneurs are faced with the challenge of redefining their core values and practices. But what does it truly mean to be sustainable, and how can businesses ensure they’re making a genuine impact?

1. What does it mean to be a sustainable business and what are some examples?

A sustainable business is not just about profit. It’s about understanding what is valuable and what makes life worth living. In an article posted on Harward business school Alexandra Spiliakos [5] writes that “in business, sustainability refers to doing business without negatively impacting the environment, community or society as a whole.” Hence, a business should address:

1. The effect the business has on the environment: This ecompasses business´s carbon footprint, waste management, resource utilization and overall ecological impact.
2. The effect the business has on society: This involves business´s contribution to community development, employee welfare, stakeholder engagement, and societal well-being.

Göran Christiansson’s work highlights the importance of value creation, emphasizing that businesses should look beyond (neo-)classical economics, where value is equated to utility and price[1].

For instance, Christiansson’s venture, Trees and Transition, is a shining example of a sustainable business. By growing, propagating, and selling nut trees, while also offering training and consulting in sustainability, it strikes a balance between economic viability and ecological responsibility [1].

Another example is EY which has been carbon negative the past few years. By implementing a tracking service called Enablon EY was able to track all their scope 1 and scope 2 emissions and use this to decrease their carbon emission.

Moreover, sustainable businesses often employ tools and frameworks to guide their sustainability journey. The Framework for Strategic Sustainable Development (FSSD), for instance, offers a comprehensive approach, emphasizing the interconnectedness of various sustainability issues [2]. Such frameworks enable businesses to holistically evaluate their impact and chart a strategic path towards genuine sustainability.

In essence, a sustainable business is one that harmoniously blends economic prosperity with ecological stewardship and societal well-being. It’s not just about reducing harm; it’s about actively contributing positively to the world.

2. Are you reducing more emissions than you create?

Going further into the first part of sustainability addressed above, we can look into the environmental part of sustainability. The sustainability challenge is vast and interconnected. The Framework for Strategic Sustainable Development (FSSD) underscores the importance of recognizing these interconnections [2]. To be truly sustainable, businesses should aim to reduce their ecological footprint, ensuring they’re not just minimizing harm but actively contributing positively to the environment.

However, calculating your business’s carbon footprint is not straightforward as it is a complex process. However there are 3 step that you can follow [7]:

1. Build awareness in your business. An empirical study from Vietnam [6] found that companies that actively train their employees in being more sustainable will have better results with environmental activities.
2. Collect data: The more data your business collects, the more accurate the carbon footprint will be.
3. Find the right carbon footprint calculator: There are several carbon footprint out there and your business should find one that fits you.

It is also worth mentioning that more and more companies are working on creating automatic “calculators” for companies. Meaning that you could implement a tool into your workflow which will automatically track your carbon emission. As more and more companies are aiming for net zero, this area is developing fast.

These analyses will help you to see where you should improve, and if your business is actually being sustainable.

3. Are you giving more time and value to society than you are using? And is your business bringing more equality to the world?

In the realm of sustainable business, the emphasis has shifted from merely maximizing financial returns to genuinely enhancing socio-ecological well-being. This transition, often termed as the shift from Sustainable Innovation 1.0 to 2.0, underscores the importance of creating holistic value that benefits not just the business but also the environment and society at large [3].

The Sustainable Innovation 2.0 approach is rooted in the belief that businesses should determine what level of financial performance is “enough” or “satisfactory” for them to remain viable, while their primary focus remains on enhancing socio-ecological well-being [3]. This perspective challenges the traditional business mindset, urging organizations to prioritize positive socio-ecological externalities over mere financial gains.

Conservation Agriculture (CA) serves as a prime example of this approach in action. By promoting sustainable farming practices, CA has become a beacon of hope for small-scale farmers in low-income countries [3]. Its impact is multifaceted: it doubles productivity, reduces carbon emissions, and significantly enhances the social well-being of farmers. But beyond these tangible benefits, CA represents a paradigm shift in how businesses view value creation. It’s not just about financial viability; it’s about creating a positive ripple effect that benefits all stakeholders involved [3].

Furthermore, organizations adopting the Sustainable Innovation 2.0 approach often work to address social and ecological problems that have been neglected by others, involve positive externalities, and benefit marginalized segments of society [3]. This commitment to holistic value creation is evident in their endeavors to enhance social and ecological outcomes while ensuring financial viability.

In essence, a truly sustainable business is one that gives back more to society and the environment than it takes. It’s a business that recognizes its broader role in the ecosystem and actively seeks to uplift and empower, bringing about greater equality and well-being for all.

4. Tips to make your business more sustainable and tools to do so:

EcoFeedback: Design products or services that provide real-time feedback on resource use, nudging users towards sustainable behaviors [4].

Behaviour Steering: Create an environment, whether physical or digital, that encourages sustainable actions. This could be through product design, workplace layout, or digital interfaces [4].

Persuasive Technology: Harness the power of technology to subtly shift behaviors. For instance, mobile phones could be designed to discourage overuse or promote more face-to-face interactions [4].

Backcasting: Instead of forecasting from the present, envision a sustainable future and work backward to identify the steps needed to get there [2].

Resource-Based View (RBV): Adopt the Radical RBV approach, which prioritizes socio-ecological well-being over financial gains, ensuring that businesses are not just sustainable on paper but in practice [3].

In conclusion, the journey to sustainability is not a straightforward one. It requires a deep understanding of one’s values, a commitment to societal and ecological well-being, and the courage to challenge the status quo. By integrating sustainable practices and strategies, businesses can not only ensure their longevity but also make a lasting positive impact on the world.

[1] Christiansson, Göran. “How the f*** do I know if my business is sustainable?”

[2] Broman, Göran Ingvar, and Robèrt, Karl-Henrik. “A framework for strategic sustainable development.”

[3] Dyck, Bruno, and Silvestre, Bruno S. “Enhancing socio-ecological value creation through sustainable innovation 2.0.”

[4] Lilley, Debra. “Design for sustainable behaviour: strategies and perceptions.”

[5] Spiliakos, Alexandra. “WHAT DOES “SUSTAINABILITY” MEAN IN BUSINESS?”

[6] Pham, Nhat Tan., Jabbour, Charbel Jose Chiappetta., Usman, Muhammad., Ali, Moazzam., Phan, Hoang-Long. “How does training boost employees’ intention to implement environmental activities? An empirical study in Vietnam”