Why Is Sustainability Important? It’s Good For Business.

Kermit the Frog used to sing, “It’s not easy being green.” Well, being green is not only getting easier; it’s becoming essential for businesses, large and small.

Sustainability has been defined by the US Environmental Protection Agency (EPA) as a blend of policies and strategies that meet society’s present needs without compromising the ability of future generations to meet their own needs. What was initially met with resistance has been replaced with the realization that, when enacted with planning, innovation, and company-wide buy-in, sustainability initiatives can have positive effects. In a January 2012 report, “State of Green Business 2012,” published by GreenBiz.com,  it was found that over half of Global Fortune 250 companies saw a gain in financial value from their sustainability initiatives and that 48% of S&P 500 companies are now reporting environmental and social performance indicators.

What was once considered a “feel good” effort is now a financial necessity, and often, a financial boost to a company’s overall profits. Compliance with more stringent environmental regulations may have been the impetus for movement but according to Kurt Kuehn, CFO of UPS, there are five reasons why companies should care about sustainability. If done correctly, these initiatives can:

  • Cut costs
  • Mitigate risks
  • Generate revenue
  • Drive innovation
  • Improve employee development and retention
  • Benefit the environment

So what exactly are some of the most successful companies doing when it comes to sustainable initiatives?

  • Con Agra reported savings of $22 million in 2012 by optimizing and improving their packaging, thus reducing 3 million pounds of material; improving palletizing and logistics; and conserving 646 million gallons of water; among other initiatives.
  • Darden Restaurants, parent to Red Lobster, Olive Garden, Longhorn Steakhouse, and others has already cut its restaurant-wide water consumption by 15% in 2012, three years earlier than its 2015 goal.
  • Walmart, ranked #1 retailer for onsite generation of renewable energy by the EPA, reduced plastic bag waste globally by 42 million pounds, which translates into 3.1 billion bags!
  • FedEx estimates that, before the end of this year, they will have improved the fuel efficiency of their U.S. vehicle fleet by 22% compared to 2005.

These are just a few of the ways companies are saving money and the environment simultaneously. But at Corcentric, we’re most aware of the negative impact that paper has on sustainability. Here are some disturbing facts:

  • When looking at what makes up the largest component of waste, paper and paper products make up the largest percentage, at 36% of all waste products.
  • In a lifetime, the average North American will throw away 600 times his or her weight in garbage, and 36% of that will be paper goods.
  • According to Xerox, 45% of paper printed in the office ends up in the trash before the end of day. That equals trillions of sheets of paper at billions of pounds of paper per year.
  • More than 13 billion invoices are generated annually in the U.S., accounting for 10% of all trees cut down worldwide.

So, knowing all this, what can you do in your company?

  • First, for any sustainability initiative to work, it needs buy-in from the top, down. It needs to actually be an integral part of overall corporate strategy.
  • Raise awareness and education regarding your company’s sustainable practices, and encourage employees to practice their own, such as carpooling to conserve energy.
  • Discourage paper when possible; encourage employees to work digitally and avoid making paper copies of documents.
  • Implementing AP Automation and converting about 50% of your paper invoices to electronic invoices could save nearly one million trees and 240,000 tons of paper per year.
  • Encourage your Procurement team to promote sustainability with your suppliers.

For our part, Corcentric’s groundbreaking workflow and AP automation software has turned the entire purchase-to-pay process into a paperless solution for clients nationwide, while increasing overall efficiencies and reducing costs.

Most important, once you’ve implemented initiatives, track the savings your company realizes through a decrease in energy and material costs and an increase in employee productivity. You’ll be surprised how easy it is to be green.

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