Thursday, February 07, 2008

Why "Going Green" pays off

How important is “going green” to your business? Perhaps more important than you think, not just in terms of saving the environment, but in cutting costs as well, and even recruiting new talent.

In a thoughtful e-newsletter article, Toronto accountants Bennett Gold LLP analyze some of today’s environmental trends. You can skim the first half of the article, which deals with recent legislative developments. The good stuff starts here:

“Don't get the idea that only the corporate giants can benefit from green practices. Some observers suggest that by integrating sustainability into their operations, small and medium-sized companies can boost profits by at least 65% over five years. Companies can save money by using less gas, electricity, and heating oil, as well as trimming waste volume, which lowers the need for some of the labour and machines needed to handle waste.”

“Green” businesses can also expect reduced recruiting and attrition costs. According to one survey, “three-fifths of college graduates and potential employees said ‘ethical management’ is an important factor in choosing an employer. Another global study of graduates showed that nearly 70% of respondents felt that a company's social and environmental reputation is more important than salary.”

That number sounds high to me, but just think of the implications to your business if the true number of graduates who rank “green” ethos over salary is even half that. It suggests to me that a small business can make itself an employer of choice much more easily than its larger, harder-to-steer competitors.

Bennett Gold’s article concludes with five tips for going green. Most seem more geared to big businesses rather than small, but they're worth thinking about.

1. Take an environmentally conscious approach to product design changes. Conduct research and testing on products before regulations impose new mandatory standards.

2. Coordinate efforts with all departments. Look for improvements that can be made in your buildings, workforce, supply chain and vehicle fleets.

3. Ask your marketing department to play a role. Strive to raise awareness among your customers, as well as the public in general, of the importance of new environmental approaches. It projects an image of social responsibility to customers and the community.

4. Work to help develop policy. (Yeah, right. Next.)

5. Expand your C-suite. Many companies are adding a Chief Energy Officer or VP of Sustainability to manage their energy strategies and measure return on investment. Their objective: improve corporate reputations, lower costs and boost profits.

Bottom line: You have a choice between adopting a wait-and-see approach to government regulation and stepping up self-regulation in anticipation – with the hope of seizing a sustainable competitive advantage. (The bad pun is mine, not BG’s.)

Read the original article here.

Update: Is green business a priority to you? Let us know by answering the new poll in the right-hand margin of this blog. It will be "live" for the month of February. Thanks very much. (And as always, if you have a comment, click on "Comments" below.)

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