What’s the bottom-line case for sustainable business?


Coca-Cola suspended its brand advertising in the Philippines after Typhoon Haiyan and directed the budget toward relief. Photo via fb.com

“I believe that business has this wonderful opportunity to change the world for the better. Not because we must, but simply because we can.”

That was the crux of the lecture Fred Keller, founder and CEO of Grand Rapids-based Cascade Engineering, gave at last year’s TEDxGrandRapids conference.

He also pointed out, as do other proponents of sustainable business, that businesses are arguably the most powerful force on the planet, and for that reason, they are ideally suited to impact systemic change — for good or bad.

It’s a compelling humanitarian argument for sustainable business practices.

But what about the bottom-line perspective?

Let’s face it: businesses are not humanitarian or environmental agencies. They’re motivated to utilize the practices that are most profitable and conducive to growth, regardless of extrinsic factors.

So what does a sustainable business model offer a company’s bottom line?


Social problems are opportunities

Sustainable business strives to meet the triple bottom line, which examines profits and losses in terms of social and environmental concerns, as well as profit for the individual company.

In other words, it measures not only the financial profits of a company, but also the chain reaction of profits and losses that a company creates in its social and natural environments.

There is a great deal of sense in this holistic approach. After all, a business’ ability to be profitable is directly impacted by the society and natural resources around it. It has a very literal vested interest in making sure these external resources are healthy. Its ability to grow and generate profit depends on them.

Marc Gunther, Guardian Sustainable Business U.S. editor-at-large, points out that "[c]limate change, global poverty and income inequality are business problems as well as social problems. They create risks that threaten the stability that capitalism needs to thrive. More important, they present enormous opportunities to those businesses that find ways to help solve them."

Just like Google, Apple, Microsoft and countless other innovators have leveraged new technology and rejected the status quo to create brand-new industries, the opportunities for businesses to capitalize on sustainable practices are real — and they are plenty.

If the development of agricultural machinery could help eradicate plantation slavery, what advancements in energy efficiency and clean production are our modern businesses capable of?

What leaps and bounds in social progress can be made by a few smart companies willing to try something new?

The benefits are universal — and that includes soft benefits.

In his TEDxGrandRapids lecture, Fred Keller gave the example of employing former welfare recipients.

“This not only improves the condition of the former welfare recipient and saves the state all kinds of money, but it also improves the economy and our local business culture as well.”

Cause marketing

These soft benefits are also brilliantly illustrated in Coca-Cola’s recent bout of cause marketing.

In response to the tragedy wreaked in the Philippines by Typhoon Haiyan, Coca-Cola suspended its brand advertising throughout the country, directing that budget instead toward relief aid in affected areas. The brand also donated an additional $2.5 million in cash and kind.

The result: online brand mentions nearly doubled globally, the company received phenomenal media visibility and successfully elicited strong emotional appeal from its audiences around the world, not to mention in the Philippines.

The best part was that Coca-Cola barely breathed a word about the anti-campaign. Once people caught on to what they were doing, their audience carried the conversation for them.

This wasn’t merely an isolated marketing stunt on Coca-Cola’s part. It required a sustainable business philosophy that was already integrated.

The marketing department did what it did because it adhered to their core, pre-defined commitment to the triple-bottom-line approach: Spending millions of dollars in advertising in a country where hundreds of thousands of people were lacking basic necessities simply didn’t make sense for the local society — so Coca-Cola did what made sense. And the result was increased profitability.

Businesses from local plastics manufacturers to global brands have proven it’s possible to generate record profits and positively impact local societies and the environment by implementing a triple-bottom-line approach.

What could the rest of us achieve if we did the same?

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