Written by Linda Sampson, CFO, Hewlett Packard Enterprise Canada
Around the world, large corporations are making significant investments in sustainability initiatives, including integrated reporting that accounts for the true cost of the resources and services nature provides and on which businesses depend. Accounting for nature isn’t restricted to just the big players, however.
No matter the size of the business – if small or medium-size, a subsidiary of a larger corporation or a corporate headquarters – finance leaders have an opportunity to influence and create long-term value in every kind of workplace.
Whether you are responsible for the financial results of your company, leading a broader team or are a key financial contributor, there is more reason now than ever to get engaged on sustainability.
Consider these five key trends:
1) Rising costs and greater volatility in inputs
Many companies operate in a low-margin environment for which it’s crucial to anticipate changes in the cost and long-term availability of key business inputs and raw materials. Understanding your organization’s reliance on the services nature offers – such as water, clean air or pollination – can help you evaluate the best path forward.
For example, look at energy. Rising production costs, extreme weather, economic conditions and supply are all contributing to volatility in energy pricing. Integrating renewable energy sources into your business model will provide independence and diversification that ultimately helps to reduce risk.
2) The need to attract and retain talented employees
More and more, Canadians – especially young ones – want to work for environmentally conscious companies where sustainability is embedded into business practices. Initiatives that allow employees to contribute to the community significantly improve morale and ultimately lead to happier employees and lower attrition.
3) The availability of efficient technology at a lower cost
Technology is changing the way we do business. Today, you’ll find products that are more energy efficient, and that have been designed to last over the long term (thereby reducing waste), at a lower price and with better functionality than ever. Using greener technology within your business can contribute to long-term value creation.
4) An increasingly competitive landscape
As competition heightens and advances in technology reduce the average lifespan of companies, enterprises that actively engage in sustainability initiatives are more interesting to potential investors. They have a longer-term strategic view, a stronger brand and a better understanding of how internal and external factors can potentially impact the business. A well-thought-out sustainability strategy (including integrated financial reporting) is increasingly important not only to shareholders but also to investors in small- and medium-size businesses.
5) New revenue opportunities from sustainability initiatives
Forget the myth that diverting resources to green initiatives comes at the expense of higher-revenue-generating projects. A study conducted by the Investor Responsibility Research Center Institute found that revenue from sustainable products and services grew at six times the rate of overall company revenues.
Ready to enhance sustainability at your company, and need a starting point? Check out the Accounting for Nature toolkit. Developed by WWF-Canada with CPA Canada and Hewlett Packard Enterprise, it will help you assess sustainability within your organization and walk you through the steps to develop a longer-term plan that’s good for business and good for nature.
Living Planet @ Work championed by RSA Canada empowers environmentally minded employees to lead sustainable change at work. Today, over 1,300 champions from more than 950 companies are leveraging the program and taking action for the good of business and the planet. Learn more about Living Planet @ Work, or become a champion by visiting wwf.ca/atwork.