I recently read an article on Guardian Sustainable Business about whether sustainability makes business sense. In a perfect world ideals and business would align perfectly, but as many long-running and new businesses enter into the sustainability and social responsibility world they sometimes find it is costly. So what helps business owners make the choice between profitability and responsibility?
When you ask someone interested in social responsibility why it makes business sense, they'll ramble off reasons like lower operational costs, better branding, more opportunities for innovation, higher employee morale, and of course, making the world a better place! But the initial stages of implementing deep-rooted social and environmental programs that provide benefits cost money. The Guardian article takes it to a personal level and asks you whether you'd want to make money while doing good by working for a responsible company or make more money working for a not-so-responsible company. It's a choice that businesses have to face everyday- should we be an early adopter or a conventional business?
An example I frequently like to use when debating this controversial subject is the first iPhone. When Apple released the first iPhone, it was around $800. Sure it was a new state-of-the-art technology that rapidly became a leader in the cell phone industry, but there were only a handful of people that were willing and/or could afford to adopt the innovation. Similarly, in initiatives like switching to a renewable energy supplier or donating some percentage of your company's profits to a community fund or nonprofit, it is unconventional and costs more than say, doing nothing. You must initially feel the sting in your wallet before you reap the benefits. (Granted, the sting lasts much longer after installing solar panels than after booting up the iPhone Gen 1).
So what's the payoff? Well, some businesses choose CSR because it can potentially increase their profit. Others choose it because it just makes sense. To them, choosing the local, organic produce supplier helps their community's economy and is a healthier choice for their consumers. To them, an alignment between their personal beliefs and business practices is a fundamental reason why they're in business in the first place; that they don't think their beliefs should compromise their business.
Our new series of blog posts, titled Doing Well by Doing Good, will focus on some local and nonlocal businesses that have chosen to integrate sustainability and social responsibility into their business either for profit or because they believe in doing good. Stay tuned for our next post!