At GCH Partners we believe the same logic applies to sustainable practices for businesses – in fact, our credo is that “to be sustainable, you must be relevant. To be relevant, you must be sustainable.” But how does relevance relate to sustainability and why is it important?
Every company gets into business with the intention of staying in business. To expand and flourish, companies must remain relevant in the market or be swallowed by competition. We firmly believe that a key requirement of staying relevant in today’s rapidly evolving markets and societies requires all companies to incorporate sustainability practices into their business models. Why? Because this is increasingly what customers are demanding, investors are seeking, employees are requesting and partners are exploring.
There is more to innovation than designing new technologies and automating old procedures. Today, “sustainability” and “social impact” are more than buzzwords that mean a company donates some of its proceeds to charity or plants some trees.
Traditionally, sustainability has frequently been associated with incorporating impactful practices to promote a healthy planet and society. More and more though sustainability is now recognized as critical to improve a company’s cost structure, decrease its risk profile and drive new revenue potential. This applies to all industries and sectors.
Take BMW, for example. It sounds counterintuitive that a producer of high-end cars could embody sustainability—but in 2016, Forbes ranked BMW as the #1 Most Sustainable Company in a ranking of over 100 multinationals published by Corporate Knights.
According to Forbes, BMW earned the recognition for its “efficient use of water, energy, and lack of waste,” as well as its “responsible approach to paying taxes, large innovation investments, low employee turnover, and low CEO-to-average-worker pay ratio.” The company went so far as to link salaries of its senior executives to their sustainability performance.
When committing to reduce the corporation’s carbon footprint and support diversity, BMW paved the way to innovate in environmentally friendly technologies—and created financial incentives to make ethics an equal priority to profit.
Simply put, relevancy —in its many forms— is built on sustainability. It can include clean energy, board room diversity, waste reduction, or human rights. Employing sustainable practices is more than taking care of our communities. It’s taking care of business, too. That is true relevance.