Five (plus 1) reasons why businesses need to prioritize sustainability

Sustainability is a key element of many companies' strategies. There are a plethora of reasons why even more companies should prioritize sustainability, i.e. creating a sustainable business and operations. I consider these five (plus one) reasons to be the most important:

1. Investors' requirements
(Access to finance and capital)

90% of management recognize the importance of sustainability. Investor demand for environmental, social and economic (ESG) sustainability is increasing, thanks in part to the Net Zero Banking Alliance. As a result, it is essential that sustainability is integrated into strategy. Investors are increasingly taking ESG performance into account in their decisions, not least because sustainable business and practices lead to long-term, profitable results. If you want to attract funding and capital, sustainability is a key reason why an investor will choose to invest in your business! As CEO and management team, you need to be able to meet these expectations.

2. Consumer demand
(Future-oriented business development and sales)

With an increasing number of millennial and Gen-Z consumers, the demand for sustainability is growing. 73% of Gen-Z consumers are willing to spend more on sustainable products. Companies that prioritize sustainability and build a sustainable business can leverage this market to grow their sales while strengthening their brand. So challenge what you are doing today and see what you can change to develop an (even) more sustainable offer.

3. Regulatory requirements
(Compliance with laws and regulations)

Organizations must comply with the regulatory frameworks related to sustainability, i.e. environmental impact, social responsibility and ethical governance. Examples of sustainability-related regulations are the EU taxonomy, CSRD, CSDDD, Science Based Targets initiative, Global Compact, GRI and ILO. We can see that the EU has a solid portfolio of regulations that have been or will be implemented. This demonstrates the EU's increased focus on sustainability. Those companies that prioritize sustainability and sustainable business have a head start in adapting to new regulatory requirements, reducing risks and improving long-term profitability. In this area, management needs to "step up" and take ownership of compliance, so that it is embedded and prioritized by the organization.

4. Attract and retain the best employees
(Building the optimal organization)

Sustainable operations and business attract many talented people. Do you want employees who want to work for real change in a vision-driven company that makes a real difference to them and to the society we all live and work in? If so, you need to be a company that is committed to sustainability. This includes the ability to create a positive and inclusive workplace and culture that fosters innovation and efficiency, and attracts new talent. Sustainability in practice is an important platform for retaining and attracting the best employees. If you persistently work on and promote sustainability in your internal and external communications, you will see the effects!

5. Lower costs and higher profits
(Create efficiency and profitability)

Sustainability, i.e. sustainable business and initiatives, leads in many cases to efficiency gains and cost savings. For example, energy-efficient processes, waste reduction and a responsible supply chain contribute to improved operations also from a financial perspective. Companies that prioritize sustainability increase their efficiency, reduce costs and thereby improve their bottom line. Of course, at least during a transitional period, you will also see that some costs may increase. This can happen when you choose to replace your fossil-based inputs with sustainable inputs or switch to fossil-free road or maritime transport. Economies of scale and reduced subsidies to the fossil fuel industry will even out this difference. Choose which shifts to make first and map out in your roadmap the path to achieving your sustainable ambition. Then you can set the right priorities to achieve a sustainable business. It is a business characterized by increased efficiency, lower risk and long-term profitability.

+1. För att det är rätt sak att göra

Sustainability is no longer something you choose like any other choice. All companies need to develop and work towards sustainable business and operations to remain relevant. Sustainability in all three dimensions - environmental, social and economic - is the right thing to prioritize today and tomorrow. It is for businesses, for employees, for the value chain, for humanity and for the planet. While this may seem obvious, it is important to highlight this reason!

In conclusion, integrating sustainability into business strategy is essential for long-term success, competitive advantage and positive societal impact.

Anchor supports you in your journey to a sustainable and circular future

We at Anchor Management Consulting can support you in the whole journey from developing your sustainability ambition, through analyzing gaps and helping to create and prioritize your roadmap, to supporting the implementation of your successful sustainable changes. We like to start with a Quick Assessment. This means that within a limited timeframe and at a fixed cost, we review your company's current and desired state in sustainability and create a clear roadmap for change. Whether it's creating a sustainable business, removing barriers to growth, implementing new technologies or improving processes, we'll make sure to support you in making it happen for real.

Contact me to discuss how we at Anchor can help you and your business become even more sustainable and successful!