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Do you prioritize business sustainability when you develop your business plans? Business sustainability, also known as corporate sustainability, examines the effect your business has on the environment, society and more.1

When reviewing business sustainability, you should focus on three key areas:

  1. Environmental: Do your business practices support a cleaner, greener Earth?
  2. Social: Do your business practices help your community?
  3. Financial: Is your business making a profit without sacrificing the elements above?

As you can see, business sustainability means far more than eco-friendliness in today’s world — although that is an important component. Running your business with a sustainability mindset can help you reduce your environmental impact, increase profit, positively affect your business’s reputation and set your business up for success in the long term. In short, there are many financial and ethical benefits to operating with sustainability in mind.

In this article, we’ll discuss how businesses incorporate sustainability practices into their strategies and some potential steps you can take to in your own organization to prioritize sustainability. While there are many ways to achieve a more sustainable business, this article provides several ideas from which you can begin thinking about how sustainability can benefit your unique business.

Why is business sustainability important?

While environmental impact is one part of business sustainability, you must look at the holistic picture. A sustainable business should operate with all three of those elements in mind, forming a balanced strategy. While you may lean more into one over another, they are all important factors in your business’s long-term success — and profit.1

Research shows that businesses that prioritize business sustainability tend to outperform the market in the long term. In an extensive study, McKinsey found that businesses that invested in environmental, social, and governance priorities yielded greater returns on their assets and potentially even a competitive advantage.2

In the end, business sustainability is not only beneficial to the world around us, but to your success as well.

How can I make my business more sustainable?

As previously stated, the three pillars of business sustainability are environmental, social and financial. There are several strategies you can incorporate into your business to better align with one or all of these pillars. As your business grows in maturity and capability, you should re-examine each factor to ensure you’re still making a positive impact in each area.

Here are several tips for crafting a sustainable business strategy by addressing all three pillars:

Environmental sustainability

Environmental sustainability is one of the easiest factors to measure. It is also the one that might have the greatest immediate impact on the way your business operates. Environmental sustainability largely focuses on reducing your carbon footprint. You can do that by reducing your energy usage and the waste your business puts out. Environmental sustainability is great for the planet but can also have a positive impact on your bottom line.3

Here are a few tips for quick green upgrades that both you and the planet can benefit from:
  • Go paperless by incorporating digital systems into your business
  • Use sustainable products and supplies where possible
  • Make energy efficient upgrades, such as LED lightbulbs
  • Buy green energy

To keep track of your improvement in this area, try to benchmark your current levels of waste, energy usage and spending — then be sure to measure throughout your improvement process and after.2

Social sustainability

The social pillar of business sustainability is people-focused. It seeks to align your business values with those of your customers and stakeholders, including employees and the communities in which you operate. A business that prioritizes social sustainability is more likely to retain good employees and attract new ones, as well as have a better reputation in its industry and communities.

Here are a few ways you can be a more socially sustainable organization:
  • Choose ethical partners (supply chain, suppliers, etc.)
  • Provide employee benefits that allow them to thrive in life, not just work
  • Support your community through scholarships and investments in public projects3

Operating ethically and with good faith toward the people that interact with your business can go a long way toward your business’s success

Financial sustainability

The final pillar of business sustainability is one in which you are likely already invested: financial sustainability. This pillar deals with the profitability of your business. Businesses of all sizes have responsibilities to their stakeholders, whether it’s customers, employees, investors, or other stakeholders. Fortunately, investing in the environmental and social pillars of business sustainability will often result in greater profitability. But it’s important to keep financial sustainability in mind when determining those investments.

Here are a few ways you can work on your financial sustainability:
  • Practice transparency in your business and accounting methods
  • Avoid conflicts of interest that may be determinantal to your business
  • Engage a board of directors to advise you on important decisions3

Stay up to date

The world is always changing, so your business must always be ready to face that change in order to survive. Because of this dynamic, business sustainability is an ongoing goal your business should continually be investing time and capital into. Staying on top of the latest trends in environmental and societal concerns, technology and more can help you set and accomplish goals that let your business keep pace with the rapid rate of change.

Many reputable news organizations such as Reuters and The New York Times have sections dedicated to environmental, social and business trends. Use these resources to stay up to date on the world’s current trends and to adjust your business sustainability plan accordingly.

Sustainability isn’t one-size-fits-all

While the tips we’ve outlined so far are great places to start your business sustainability journey, keep in mind that there is no single right answer when it comes to approaching sustainability. Every business is different, so your priorities must align with your business’s goals overall.

When reviewing business sustainability, you should focus on three key areas:

  1. Environmental Sustainability: Protecting our environment by recycling and reducing waste and water use, and making investments in renewable energy and sustainable debt instruments.
  2. Diversity, Equity & Inclusion: Advocating for the success of each associate in an environment where everyone is appreciated, engaged and respected.
  3. Financial: Is your business making a profit without sacrificing the elements above?
  4. Communities & Giving: Supporting local and national charities and volunteering within our communities.

We focus our resources on the long-term sustainability of our business and the communities where we live and work. These pillars help us prioritize our values and support our mission to protect people, businesses and futures with extraordinary care. We also choose to be transparent about our sustainability efforts through our annual Corporate Sustainability Report.

Our approach will likely be different from yours. However you choose to incorporate sustainability into your business, make sure it supports your own values and mission as well.

Why is sustainability in business important?

According to research by Accenture, companies with high ratings in business sustainability have, on average, higher operating margins than those that don’t. That alone is a good reason to turn your focus to business sustainability. But the other factors, such as your business’s reputation, customer retention, and your ability to hire and keep top talent, can also be impacted by your business sustainability efforts. As you continue to build your small business, incorporate business sustainability practices into your strategic plan and daily tasks. It will likely result in a healthier business in the long run.4

Nationwide helps small businesses succeed and thrive. As you turn your focus to business sustainability, make sure you have the coverage and resources your business needs to meet the future head-on.
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[1] “What does ‘sustainability’ mean in business” Alexandra Spiliakos, https://online.hbs.edu/blog/post/what-is-sustainability-in-business (Accessed June 2023) 
[2] “Profits with purpose: How organizing for sustainability can benefit the bottom line” Sheila Bonini and Steven Swartz, https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Sustainability/Our%20Insights/Profits%20with%20purpose/Profits%20with%20Purpose.ashx (Accessed June 2023)

[4] “Why all businesses should embrace sustainability” Knut Bjarne Haanaes and Natalie Olynec, https://www.imd.org/research-knowledge/strategy/articles/why-all-businesses-should-embrace-sustainability/ (Accessed June 2023)

The information included is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts. It is the reader’s responsibility to comply with any applicable local, state, or federal regulations. Nationwide Mutual Insurance Company, its affiliates and their employees make no warranties about the information nor guarantee of results, and they assume no liability in connection with the information provided.