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Unilever identifies four ways for sustainable business model to equal economic growth
Unilever has identified four ways for a sustainable business model can equal economic growth. Sustainable businesses are future-fit. Companies that embrace sustainability are showing leadership in tackling climate change and getting ahead of the curve of carbon taxes. They are working to meet consumer demands, while boosting productivity and potentially cutting costs.
Business sustainability is when a company conducts its business without harming people or planet, safeguarding its future business in the process.
Reducing greenhouse gas emissions, protecting nature and delivering social governance are all ways that businesses can make the shift towards sustainability.
Unilever stated that the first way is leading the charge. Smart companies are recognizing the opportunities presented to early adopters of business sustainability. A 2023 report by Deloitte showed 84% of business leaders agree that global economic growth can be achieved while also reaching climate change goals and 75% say their organizations have increased their sustainability investments over the past year, indicating a likely groundswell of action within industry.
Companies making the shift to a sustainable business model now have a chance to mark themselves out as leaders in the field, rather than risk being left behind.
The second way is meeting consumer demand. Customers today expect transparency, responsibility and action from the brands and companies they buy from. According to Kantar’s Who Cares, Who Does 2023 report, 22% of households are actively making more sustainable buying decisions and ‘eco-active’ people are worth an estimated $456 billion (€426 billion) to the fast-moving consumer goods industry.
The third way is creating operational efficiency.
Becoming more sustainable usually demands that businesses significantly change their manufacturing processes, supply chains and other aspects of their business model. The actions undertaken, such as switching to cleaner and smarter energy, saving water and reducing journeys travelled, can also lead to greater efficiency.
Research by McKinsey and Co found that executing new policies to tackle resource efficiencies could, in certain cases, positively affect a business’s operating profits by up to 60%. At Unilever, the company has avoided costs of around €1.5 billion from its energy and water efficiency measures since 2008.
The fourth way is creating growth through purpose. There’s clear evidence to suggest that being purposeful can help companies attain growth, while also serving as a future-minded sustainable business strategy. A study from Kantar found that purpose-driven businesses grew by 175% between 2008 and 2020, compared to just 70% growth for low-purpose brands.
Without a healthy planet, investors can’t have a healthy business. Making the shift to sustainability makes business sense, giving companies a chance to help address the root causes of climate change while simultaneously building their own resilience to its impacts and delivering competitive growth.
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