Sustainable Sourcing: The myth of expensive sustainable behaviour

The key finding, for me at least, in Accenture’s latest corporate sustainability survey, was that most decision makers think that it’s currently more expensive to be a sustainable business. What they mean by this and whether they’re right raises some important problems.

The arguments over sustainable practices have often been a short-vs-long-term discussion. But perhaps that’s a source of misconception; in the long-term many businesses will, I believe, have to get good at sustainable practices –but they’ll still have to be competitive and they’ll be fighting to make their investments in sustainability cost-effective in the short term.

The inference is that when you think of the drive to be sustainable as an expensive process, you’re missing the point that, like anything else in business, it’s about making investments count.

That’s done in part through the customer-facing end of the business, though I’d argue that businesses still have some big challenges ahead in order to become convincing and committed conveyors of sustainable products. However, again, that is the challenge of investing in any new idea (acknowledging that sustainability is far from a new idea); generating revenue from something that isn’t yet a necessity.

Of course it’s the back end; the supply side of the business, that we’re interested in. Here too are challenges – testing relationships, visibility into practices, auditing, innovating, and so on. But here again, there’s an element of treating the sustainability targets as an investment.

By setting sustainability, businesses are able to use sustainability as a means to boost their appeal by making big claims as a sustainable brand; but they’re also able to reduce cost, improve supplier capabilities and, most importantly steal a march on any businesses that are lagging, or perhaps waiting for the sustainability to stop being a cost.

This is the key divider between pro-active and late adopting businesses. Just like with technology adoption, those with a ‘wait-and-see’ approach are doomed to be forever behind, forever outdated and forever looking at something they’re increasingly aware as a key driver of growth, as some kind of nice-to-have accoutrement.

When you look at this week’s news and see a company like Nokia – who’s experienced some difficult circumstances in their market of late – and see it collaborating with suppliers and pressing targets onwards and upwards, you probably aren’t struck by how long-termist it is.

Nor is it a company that’s happy to blow through money on a whim. The group, and many more besides, haven’t been weighing sustainability in the balance and waiting for something to shift to make it a more appealing choice. They’ve been busy working out ways to make the agenda work for them – to help them set themselves apart.

Which is why it isn’t a question of being more or less expensive now, it’s a question of whether you have to compete, whether you can compete and whether you can afford not to compete.