SUSTAINABLE BUSINESS TRENDS - Environmental awareness is on the rise and by 2022 it will be increasingly a focal point. Both consumers and companies will look at you. Hamid-Reza Khoyi summarized in 5 points what will be the trends for the current year.
One of the goals that companies will try to pursue for 2022 will be to make their environmental impact measurable. A first step in this direction is to carry out accurate cartoteca or inventory. In this way we can proceed to the verification of the infrastructure, the machinery, the food, the transports of the employees. Once you have made a well-organized list you can proceed to calculate the environmental impact for each item. The process to be implemented is not easy, especially in the start-up phase. To make it easier it is important to start early.
From a practical and economic point of view, in order to start analysing its environmental impact, a company has to bear internal costs, sometimes high, but which, within a reasonable period of time, will bring benefits. Obviously the initial effort will be different from company to company. In order to try to reduce start-up costs, it might be interesting to start from internal surveys, related to, for example, compatible data. Another move not to be underestimated is to think about the building where the company operates.
As an employee, different companies can have different ways, costs and problems in making their environmental impact measurable. But once the process is in place it will be similar to collecting other types of financial data and drawing up a budget. Moreover in the medium-long term this type of approach will bring of the benefits going to reduce also some financial costs. Benefits can also come from communicating and sharing your data with consumers.
Incentives to make your business more sustainable come from all sides. Not least the world of finance. In fact there is more and more the tendency to invest in green realities. This attention stimulates companies, listed on the stock exchange, or with the intention of doing so, to make themselves as sustainable as possible. Not only in the field of green, but also looking at all other aspects of sustainability. To support this, research claims that 53% of the big players in the financial sector say that sustainability will be "central" to their business in the future. These figures should not be underestimated.
The trend for a more sustainable business cannot fail to be consistent. The phenomenon of Greenwashing is widespread. After two years of pandemic, however, consumers have learned to make better choices and to be very careful about this type of behaviour. It therefore becomes more and more fundamental for a company to be consistent with what it does and what it declares. The messages that the business sends must be in line with its actions. Otherwise they risk that everyone turns against it like a boomerang.
The fourth trend is perhaps the one that makes others possible. Choosing to rely on sustainable suppliers and sources greatly simplifies things for our business. In fact in the medium and long term it can also help and bring an advantage in reducing costs. Initially it certainly requires a large investment, but in a reasonable time brings benefits and will weigh on the investment capacity of the company.
State and government incentives can be provided to help companies make this transition, but they change from case to case. Obviously, the issue is very different even if you own or do not own the factories in which you work. Being subject to a rent does not allow the same freedom, of course, to be owners.
This choice will also affect consumers, but not necessarily negatively. Surely you may experience an increase in the prices of the final product. But, as mentioned above, buyers are increasingly attentive to sustainability, so the fact of having a product that costs something more because green does not necessarily mean losing market share.
Moreover, in the medium and long term, relying on 100% green choices makes companies more competitive on the market. Both for the sale of its products and for the choice of its employees. In fact, it will attract more qualified people because they are more interested in turning to employers who believe they are choosing a sustainable path. The same applies to businesses that supply goods and products to multinationals, which must prove to be green in order to continue to comply with their collaboration contracts.
As already widely said, a process of greater awareness of sustainability is underway. This is supported by UN research, in which 70% of people are now more aware of the environment than before the pandemic. Not only 40% want to actively change their habits to live more sustainably. What does this mean for a company? That from now on you will no longer have to look only at the interests of your shareholders, but also at all other stakeholders. This includes investors, employees, suppliers and consumers, for example.
This implies many problems since they are different categories and with needs and interests that do not always match. The only thing they have in common is the need for transparency. So far, the UN is only asking larger companies to make their emissions data available, but that doesn’t mean smaller companies don’t have to. Surely, however, we will arrive at a time when they will also be explicitly asked. We might as well prepare first. Also because it is not a simple process. First you have to make a cultural change. It is a difficult step. But necessary, also because it is not far off a future in which quality brands will arrive that certify the sustainability of a company. Already in recent years there has been growth among the B corp.
Hamid-Reza Khoyi is an accountant, auditor and tax advisor with local, national and international clientele. He works at HRK Partners SA, a company he founded over 15 years ago, which has a staff of 6.