Today organizations are more aware of their actions’ environmental and social impact. Increased regulation and a more connected and aware workforce have forced organizations to invest more in sustainability practices. Whether it’s the desire to protect the environment or keep energy costs low, sustainability is becoming an integral part of businesses.
The big question which still lingers in the minds of business owners and managers is – is sustainability profitable?
Is sustainability profitable?
Sustainability has become increasingly important for businesses in recent years – and it’s not just for the good of the environment or to improve your company’s public image. Being sustainable can save your business money in the long run by reducing operating costs and protecting you from things like resource shortages and price fluctuations.
On the surface, sustainability and profitability seem contradictory, but they are not. Sustainability can drive revenue and profitability. And to do that, businesses need to be able to convert sustainability data into meaningful management insights. This is where sustainability analytics comes in.
Power of understanding your sustainability data
Sustainability analytics helps them capitalize on this by looking at data surrounding factors such as energy and resource use, greenhouse gas emissions, and more. By taking a closer look at these areas, companies can learn how to improve their sustainability initiatives and run their business more resource-efficiently.
Companies can now use the latest tools and techniques to conduct real-time or near-real-time sustainability analysis of large volumes of data in three dimensions: past, present, and future. They can make more informed decisions about sustainability initiatives and their impacts.
Benefits of sustainability analytics for businesses
Let’s count the benefits of implementing sustainability analytics in your business –
- Reduce supply disruptions and price shocks
Sustainability analytics is important for companies for several reasons – but chiefly among them is that it can decrease resource use, reducing its vulnerability to price or supply volatility. In addition, sustainability analytics can help companies anticipate future changes in supply and demand, so they can make informed decisions about resource purchases and lock in supplies at lower prices.
2. Get ahead and stay ahead of the competition.
Thanks to social media and the internet, companies can no longer get away with sustainability-related misdeeds deep in their supply chains. With advanced analytics, companies can track and measure their sustainability practices, showing prospective business partners and customers that they are serious about sustainability.
3. Comprehend upcoming risks and prepare accordingly
A company that uses advanced sustainability analytics can avoid potential risks to its reputation by monitoring environmental impact, resource use, and labor practices within and throughout its extended supply chain. By identifying risks early on, companies can prevent them from becoming headline news.
How to integrate sustainability analytics into your business
1. Learn from the past and integrate the lessons into future operations
In addition to focusing on future growth prospects, companies need to realize that it’s important to take a step back and analyze past performance to gain valuable insights. By examining the historical performance metrics, you are currently measuring, you can ask yourself whether they are still relevant to your sustainability goals. Doing this will help ensure that you are on track to meet your goals and make progress toward a sustainable future.
2. Understand the present
The tools and techniques for analyzing sustainability have advanced significantly in recent years. If your current systems can’t generate insights in real-time, or if they need to be fully automated and linked to performance dashboards, it might be time for an upgrade. Clear mechanisms for governing and managing sustainability data are critical to ensuring your organization can make the most of this important information.
3. Create models for future sustainability
The latest tools for sustainability also include modeling and scenario analysis to help you understand the complex interactions of economic, social, and environmental factors that will affect your future sustainability strategies and performance.
4. Analyze non-sustainability data
Sustainability analytics has largely been concerned with resource-oriented aspects such as energy use, water consumption, and materials consumption. However, other factors that can impact sustainability performance are also being considered. These factors include operational data like employee headcount, production levels, facility productivity, sales volume, hours of operation, and external data such as weather.
By tracking and analyzing these data points, companies can get a more holistic view of their sustainability performance and identify areas where they can improve. The analysis that results from using this method is more accurate and relevant to real-world conditions.
5. Turning insights into actionable steps
Results from the analysis can help a business if they’re carried out properly, but this is only sometimes the case. People are often part of the problem regarding failed implementation, so they must also be included in the solution. Awareness and training programs can encourage employees to act correctly.
A business-first approach to make the most of sustainability analytics
Sustainability analytics is a powerful tool that companies can use to assess the cost, impact, and performance of their sustainability initiatives in both – past and present. This data can help businesses anticipate future conditions and requirements, which can help them unlock hidden value and build a more resilient enterprise.
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