Dr. Usha Rajagopal, a respected plastic surgeon in San Francisco, understands the importance of sustainability in today’s economy. When businesses practice sustainability, they can work more efficiently as well as attract socially responsible consumers.
Social responsibility and sustainability bring much-needed goodwill to any business. When a company publicizes its sustainability, such as having a certified energy-efficient building, it will receive more business from customers who are concerned with the environment. Concerned customers will also support a company that recycles most of its waste.
Goodwill derived from sustainability adds value to any company’s brand. The reputation of a company’s brand can have major effects on the company’s bottom line.
Sustainability pays off in efficiency as well as goodwill. Companies that are sustainable produce less waste and use fewer raw materials. This can reduce costs for the business and make it run more efficiently. According to the Environmental Protection Agency, addressing waste can also reduce costs of shipping materials to and from your business. It reduces greenhouse gas emissions, contributing to the health of the entire planet.
A socially responsible and sustainable company has an advantage in permitting, approval, and real estate transactions. A company with poor social capital resulting from unethical decisions and environmental damage may not be able to operate as smoothly as a sustainable company can. Dr. Usha Rajagopal practices sustainability in her medical office and has experienced the positive effects on her business.
Employees appreciate working for socially responsible and sustainable companies. According to Robert Lawless, the chairman of McCormick & Co. Inc., “being socially responsible allows you to attract talent because good people will align with the company that really cares about employees and communities. We link social responsibility to talent retention.” Talent retention leads to lower overhead costs since a high turnover rate is associated with a higher cost of training new employees.
Conversely, having social responsibility problems and being viewed as a wasteful company can drive prospective employees away. This makes doing business more difficult and more expensive in the long run. Recruitment costs are also higher, and unfilled job positions make current employees stressed and less content in their jobs.
Shareholders also appreciate a more sustainable company, leading to higher stock prices and increased profits. The consulting firm McKinsey studied 40 companies to understand their sustainability. They found that between 1993 and 2010, companies considered sustainable gained 31% more stock value than companies with low sustainability. This is a major benefit to the bottom line and should not be overlooked in making business decisions.
Dr. Usha Rajagopal understands that businesses are motivated by profit, but she encourages them to consider making changes to their business model. When companies take the environment and social responsibility seriously, they are able to take advantage of market trends that favor a more sustainable model.
Sustainable companies attract environmentally and socially conscious customers. They can do business more easily in the community. Reducing waste makes companies more profitable, leading to stock price increases. These benefits outweigh the costs of becoming sustainable.
