How going green can have a positive impact on your business

Going green is usually overlooked by companies because of a lack of understanding, time or other business pressures. Chris White of Smarterbusiness argues that sustainability can have a positive impact on your business – and its bottom line

Book now to hear Chris give a detailed update on going green at AAT’s Members’ Weekender in May

Throughout history a key question has always been: how do you generate and distribute wealth fairly? It’s not an easy one to answer.

Man has progressed from self-sufficiency to specialisation, increasing the variety and quantity of goods and services, from the barter system, to money (enabling easier exchange and storage of wealth), to the vast economic systems we have today with credit loans and other types of financial mechanisms.

Academically, a number of social sciences have formed models to predict the growth and distribution of wealth with law and accountancy professions ensuring the rules of business, finance and tax are adhered to.

Going green: a new economic model

I believe that we need a further model to guide man’s development and use of the planet – a clear understanding and practice of sustainable living.

Like many terms sustainable can be misinterpreted, and in many people’s mind is akin to ‘subsistence living’ where current living standards are judged to be in conflict with sustainability and therefore need to be reduced. Most individuals would not accept by choice a significant reduction in living standards.

How sustainability can counteract current economic models

What is the problem with our current economic models? Everyone wants to be better off, so the more goods and services generated, the more the individual wealth. The recession has showed what happens to cash when spending exceeds earnings and savings run out.

The economic success of the last 300 years has been built on the back of natural resources being available at low cost, with increased living standards coming from higher labour cost.

This has encouraged efforts by businesses to improve human productivity particularly evident through the 20^th century until the late 1980s with resources looking after themselves; basically it’s easy to get more out of the ground.

Much of the economic success has been based on cheap energy derived from fossil fuels which by their nature have taken millions of years to form. The world’s consumption of fossil fuels means that within hundreds of years they could be depleted, a double hit as oil and gas provide feedstock for producing many materials.

In finance terms we are paying for our lifestyles with the earth’s family silver.

Why we need a sustainable supply of energy and materials

In an ideal world we should be using our capital resources to build the infrastructure for sustainable supplies of energy and materials. This means economic and eventually finance models should take note of resource limitation.

Unfortunately the current price mechanism has limited success with items deemed to have inflexible demand. Note the increased use of oil despite significant price hikes from 1970s onwards and depletion of other natural resources.

I believe short-term resource efficiency and waste elimination through Lean processes are the way forward to mitigate the impact on UK businesses.

Resource efficiency: a model to help businesses go green

My company promotes sustainability and advises businesses on resource efficiency which lowers use without reducing benefits and has a positive effect on the business bottom line.

Resource efficiency is a simple model, but is usually overlooked by organisations through either a lack of understanding, lack of time, the need to continue ‘working’ and other business pressures.  Not only are many businesses sitting on a gold mine of savings, many could benefit from the environmental accolades that the model can bring as a bi-product.

The process has been successfully applied over the past decade and is endorsed by the Government though Business Innovation and Skills (BIS), the EEF and the CBI.

Smarterbusiness.org.uk passionately believes in both resource efficiency and sustainability and subject to eligibility, currently offers a free two hour initial review, on-site for all types of businesses.

Chris White will be speaking on ‘Sustainability in practice’ and offering advice on businesses going green at the AAT Members’ Weekender, Friday 17 and Saturday 18 May.

Watch AAT members talk about the Members’ Weekender:

Chris White is a Business Consultant at smarterbusiness.org.uk.