Many believe that engaging in environmentally-sustainable practice is the right thing to do. But much evidence exists to prove that incorporating the environment into one’s operational, marketing, product development and human resource planning is also the profitable thing to do. In addition to reducing a number of administrative and operating costs, environmental initiatives can attract the attention of new customers, increasing revenues at the same time.
One of the most immediate benefits realized by businesses that consider their environmental impact is reduced operating costs. Simple, immediate actions such as reducing the use of everyday office materials like paper and toner will result in lower administrative expenditures. Reducing waste, by reusing or recycling, can cut back on monthly waste management fees, replacement and maintenance costs. For businesses prepared to invest in capital improvements – particularly those that help manage resource consumption - the long term savings can be substantial. According to SaskPower, compact fluorescent light bulbs, which are available for almost every size and style of fixture, use 66% less power and last eight times longer, resulting in less waste going to the landfill.4 And federal government research indicates that energy retrofits in existing buildings can save 20% in energy costs.
Consumers are increasingly conscious of the environment and expect their suppliers and service providers to be as well. These green consumers are not equally discerning and the profile of one sub-sector can be significantly different than that of another. But regardless of where they fall on the green spectrum, the emergence of this unique and active market presents an opportunity for businesses to differentiate themselves from the competition and capture new market share.
The majority of employees in both Canada and the United States, 71% and 75% respectively, consider social responsibility and environmental commitment when selecting employers. Considering the human resource challenges that today’s tourism industry must contend with, it is in a company’s best interest to be seen as a preferred employer and having an environmental plan in place helps. The presence of a plan enables employers to openly discuss environmental issues and strategies with prospective employees during the recruitment and interview processes. Upon joining the organization, employees can then be invited to join management in the implementation of that plan which helps solidify a strong bond between the employer/manager and the employee.
Brand is an intangible yet invaluable corporate asset that represents a company’s worth or reputation in the marketplace. That worth is largely founded on quality, trust, and credibility. Environmental initiatives can protect and enhance a brand, but corporate claims about environmental practises must be accurate and substantiated or the credibility of that company could be permanently jeopardized. For example, when Ford used Kermit the Frog to sing ‘It’s Not Easy Being Green’ it did little to convince consumers that their SUV’s, typically high volume gas consumers, are truly the best environmental alternative. In fact, some speculate that it generated distaste for the company for attempting to distract from the facts of the matter. On the contrary, communicating a quantifiable and verifiable commitment to the environment can help engender trust and loyalty with customers, employees and community. The most reliable and trusted sources of this information are those that money can’t buy. Consumer reports indicate that purchasing decisions are mainly influenced by a product/company’s reputation (21%), word of mouth (19%) and brand loyalty (15%); dollars spent on green advertising impacts their decisions only 9%.
Companies that undergo a rigorous assessment of their environmental impact are better equipped to understand and manage risk, and are likely to be better managed companies overall. Legal, financial, and environmental risks pertaining to regulatory requirements, industry standards and NGO demands are often addressed through the environmental planning process. Reducing consumption of natural resources, such as water, energy, wood and minerals allows one to reduce risk associated with volatile commodity and energy prices. By eliminating hazardous materials, you can reduce the risk and costs associated with spills and injuries.