The ‘S’ word - why a greener approach is needed to sustainability

Neil Grundon, deputy chairman of Grundon Waste Management, says all too often sustainability is focused on financial improvements rather than environmental measures. He believes taking a more joined up view to the ‘S’ word can boost sales, reduce costs and improve environmental performance:

According to that oracle of our time Wikipedia, the definition of sustainability in more general terms, is “the endurance of systems and processes” with sustainable development including the interconnected domains of ecology, economics, politics and culture.

Why then, in most cases when we ask about sustainability, is the response much more likely to be focused on that one area of economics – ie: financial savings – rather than the wider issues of the ecology (environment), politics and culture.

 

I don’t pretend to be an expert in the latter two, but I know a thing or two about the environment and understand the significant differences that focusing on long term resources can make to an organisation’s bottom line.

Let me give you an example – recently I sat on a panel interviewing a new candidate for the position of SBM at a free school.

 

A SBM for anyone unfamiliar with this education terminology is a School Business Manager – or Bursar for those of us of a certain age. It is now considered to be the second most senior role within a school after the head teacher. Their role is to (hopefully) run a straight ship and make sure the teachers are paid on time.

 

The candidate was asked “what sustainability criteria would you apply to the school and why”.

 

I was intrigued – here was my moment.

 

When we, as the panel, had been issued with interview questions prior to the meeting, I had asked what we should expect in response to the sustainability question and was reliably informed that a good response would be to run a “surplus of 3-5% of the annual budget”.

 

That wasn’t quite the answer I was expecting, but the more I looked, the more I found that most people applied a percentage figure or a financial equation to sustainability.

And here was I assuming it was all about conserving our precious natural resources and saving the environment. However, this got me thinking.

Sustainability is the ‘Cinderella’ department

Sustainability teams are sometimes viewed as the ‘Cinderella department’ of big companies. Everyone knows they need one; however where they sit – often between the CFO/CEO and marketing teams – belies their true importance.

According to our potential SMB and his/her sustainability criteria – sustainability could only be met through one of two ways. Either spend less or save more.

But how sustainable is this approach and doesn’t it hide the true value of sustainability?

It has certainly impacted on the waste management industry, which has been seen as an easy target for those who are trying to cut costs; unit pricing has become the driving force from purchasing departments during the recent economic downturn.

As new innovative technologies are adopted, such as Anaerobic Digestion or Energy from Waste, of course the start-up costs have been high. Meanwhile, traditional waste management companies have been driving down prices to meet landfill volumes and the customer has been protected from the realities of a changing marketplace, where landfill will no longer be the driving force in waste pricing.

The resource market of the future

The reality however, is that sustainability teams have the ability to peer further down the road and take a look into the resource market of the future. They can see where true savings can be made – both environmentally and financially – and it’s where they really earn their worth.

This is never so important as when companies share knowledge of where one another’s businesses are heading, it allows those organisations to make subtle changes annually to their processes in order to prepare for the big changes when the market truly disrupts – such as it did in the various food contamination crises which recently hit the headlines.

Those sustainability teams who worked closely with their marketing teams were able to turn this disruption into a sales opportunity, namely because companies which had put food traceability as a critical business priority were able to win out over their competitors by demonstrating the efficacy of their processes.

That’s just one small example of the crossover between sustainability and business success.

The marriage of ‘lentil knitting’ and ‘bean counting’

In an ideal world, sustainability is about both boosting sales revenue and reducing cost.

For our SBM candidate, this means ensuring enough pupils come through the door, that there is the correct teacher to pupil ratio, and productivity is maintained. They also need to identify areas of wastage, such as heating, electricity or indeed stock and, with the advent of free school meals, they need to ensure nothing is squandered and the caterers are providing real value for money.

These are all tasks familiar to sustainability teams up and down the country. I call it a marriage of ‘lentil knitting’ and bean counting’ – blending the need to be green with the need to watch the pennies. It is good plain and simple business sense – my question is why more people don’t see the link between the two.

Oh, and for those of you who were wondering how our candidate replied – “between 5 and 8%”.

Now those numbers add up whichever way you look at it!

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