What is sustainability?
If it is possible to satisfy the needs of the present in such a way that the opportunities of future generations are not restricted, this is sustainable behavior. We can speak of sustainability when this principle is realized in three dimensions: with economic efficiency, with social justice and with ecological sustainability. The realization of these three dimensions should form the objective for all decisions.
Why companies should operate sustainably
“Sustainability” has now become a buzzword. But it has now also become clear that we are overexploiting our nature, the health of our employees and managers as well as the earth’s natural resources and damaging our climate if we do not operate sustainably.
Of course, everyone thinks first of themselves, of their profit, i.e. selfish and not altruistic. But Game Theory shows us that we are dealing with a commons problem. Natural resources that we consume will then no longer be available to us. Everything works in cycles. And this is how our actions affect us. If we do not operate sustainably, we will deprive ourselves of our livelihood.
That’s why sustainable business is important for everyone. The public’s openness to sustainable action is gradually becoming apparent. That is why sustainable business is increasingly being rewarded by customers, suppliers, service partners, our own employees and financial investors. The products of sustainable companies can already be sold better than the products of non-sustainable companies.
Companies that operate sustainably are more valuable on the capital market than companies that do not because company valuation is increasingly influenced by intangible factors such as know-how, brand strength and reputation. If institutional financial investors and customers recognize sustainable business, this may partly be due to the spirit of the times, but as long as it promotes commitment to sustainability, it is a good thing. Financial investors evaluate investments based on future performance. They believe that companies that operate sustainably will have higher future earnings than those that do not operate sustainably; and that makes sustainably working companies valuable.
Legal requirements also require sustainable business in all three dimensions – for an efficient, socially and ecologically justifiable use of resources. The pressure to operate sustainably is increasing for economic reasons, but it helps to preserve our livelihoods and make companies valuable. So it’s worth doing business sustainably.
How can companies become sustainable?
A first step towards sustainable action is to understand the status quo. This can be done by determining the ecological footprint; a further step is then to really sustainable.
Every company can make contributions to sustainability and contributions to circular economy.
A commitment to sustainable action through PR messages makes it more difficult for companies to behave differently and can actually support the implementation of sustainable behavior.