How To Integrate Sustainability Into Your Business: Review Your Business Value Chain
Sustainability is a business opportunity, not a cost factor.
This topic is a four-part series on the strategies to integrate sustainability into your business. In my previous articles, I talked about defining sustainability goals and Employee Engagement. Other topics in this series are reviewing your business value chain and engaging clients/customers in your sustainability journey.
This is the third article of the series, and it will be focused on reviewing your business value chain.
A business value chain refers to the various business activities and processes involved in creating a product or providing a service. A value chain can consist of multiple stages of a product or service’s lifecycle, including research and development, sales, and everything in between.
Incorporating sustainability into your business goes beyond waste sorting or tree planting; it involves assessing your product life cycle and initiating best practices that will protect the integrity of the environment, care for the health, safety, and well-being of workers and local communities, and at the same time yields profit. The interplay of all these without compromising on any value is where true innovation lies.
Sustainability is a business opportunity, not a cost factor. To operate a sustainable business model, companies need to embed sustainability as part of their strategy, their products, supply chain, and the relationships they maintain with multiple stakeholders; internal and external communication in a consistent manner is critical to changing the business and to maintain integrity between ambition and actions By Michael D’heur.
Most business leaders focus on what happens only within the limit of their business operations. Most of their sustainability best practices focus on the production process, from when the raw materials get to the company until they leave as a finished product.
According to the McKinsey report, two-thirds of the average company’s environment, social and governance footprint lies with the suppliers. Therefore, you can only make excellent and reasonable sustainability achievements if you align with suppliers, distributors, and other value chain members.
Putting all sustainability efforts on the production process alone is not sustainable. It may make you liable for one of the Seven Sins of Greenwashing put together by Terra choice.
You have not fully integrated sustainability into your business if you are still sourcing raw materials from suppliers with high environmental impacts or local communities engaging in child labor.
An in-depth review of your company’s operations, from raw material extraction, transportation, and manufacture to the disposal and recycling, must be carried out, and efforts to reduce the negative impact on people and the planet be put in place.
A business leader trying to incorporate sustainability must be open-minded to identify opportunities for collaborations.
Strategic collaboration with industry pairs, value chain partners, and critical stakeholders promotes the optimal discovery of innovative solutions that drive greater efficiencies, cost reduction, improved packaging performance, and better products, ultimately leading to increased competitive advantages and business success.
More and more companies are collaborating to address complex environmental and social value chain challenges.
One such example of strategic collaboration for sustainable business is when Coca-Cola Company, the United Nations Development Program (UNDP), and a network of partners and stakeholders came together to address a water supply issue in India by developing local water stewardship initiatives.
The CEO of Allbirds shared in the Harvard Business Review podcast titled How Allbirds is decarbonizing fashion, how they had to collaborate with other brands and open-source their technology to bring down the cost curve.
Thank you for reading.
