Sustainability: Is It a Good Choice for Small Companies?

By Jennifer L. Miller
2010, Vol. 2 No. 10 | pg. 2/2 |

The various studies described show that it may be possible for small businesses to choose an environmentally friendly way of doing business. While the change will take work, there are several approaches that have been identified that can make the change possible. With changes possible and short-term advantages quantifiable, there is still debate about whether or not strategies produce long-term economic benefits.

No matter the size and structure of a company, debate still exists as to whether sustainability efforts are economically justifiable. The common belief is that most changes that need to be made for a company to “go green” are more costly than company’s current cost structure. With this notion, it becomes essential that a company can see strong economic benefit to implementing these new environmentally friendly processes. However, one recent author (Crosby, 2010) believes that a company can form a long-term relationship perspective through a “green advantage” with consumers. Crosby (2010) justifies ideas about the longevity of the green movement saying that consumers are beginning to realize more and more that environmental practices cannot be overlooked. They are essential to the vitality of the planet. With this belief in place, companies can feel safe moving towards green production because consumers will come to expect green practices from manufacturers (Crosby, 2010). In his discussion of green produces, Crosby (2010) uses Toyota as an example and their production of the Prius which almost single-handedly changed the way consumers felt about green automobiles.

While environmental practices can be a struggle to justify for companies of any size, it is helpful for researchers to understand that this issue affects all companies. It is not industry specific and it is not size specific. Essentially, it is important that all companies eventually make the transition to environmentally friendly practices in their respective industries. The most notable negative side to transitioning to sustainability strategies is the cost. This negative effect can be mitigated over time as researchers are able to find more evidence that sustainability is beneficial in the long-term.

As sustainability practices move forward and evolve it is important to understand how these concepts will likely affect companies’ and consumers’ futures. With increasing consumer awareness of the value of green practices, it will become more essential that companies “go green.” The problem, however, is knowing how to bridge the gap between current production means and a green form of production. How do companies mitigate costs and how do they justify re-engineering their products? Research in this area will highly beneficial to companies as more and more strive to make that leap to green production and processes. Researchers Young and Tilley (2006) propose an idea they term “eco-effectiveness.” This next level of environmentally friendly practices encourages companies to shed their “depletive” images with consumers (Young and Tilley, 2006). In other words, companies need to allow consumers to see that their production practices are not depleting resources. To change the consumer perspective and to effectively and efficiently switch to eco-friendly practices, companies need to develop an attitude that their production and processes are, instead, “regenerative” (Young and Tilley, 2006).

The study of green practices will definitely be an ongoing topic of interest and research going forward into the next 3 to 5 years. Several researchers how pointed companies in the right direction on how they might be able to uncover the competitive advantage they seek through green practices, however, there has yet to be much solid research on the financial reward of green practices and sustainability. Researchers will continue to try to shift the thinking of business managers from the traditional profit-obsessed business strategies to a more holistic sustainability strategy. In order to make this change, it is likely that changes will be more to business and the training of future business leaders. This “rethinking” concept will need to start in training in order to make a solid transition.

The move to sustainability practices has become a popular topic in recent years. With “going green” at the forefront of consumer minds, companies are eager to make changes. However, these changes do not come without concerns as “green” practices and switching to green production involves costs. But, researchers will continue to find ways to ease managers’ minds about the transition and help companies rethink how they do business.


References

Cordano, M., Marshall, R., & Silverman, M. (2010). How do small and medium enterprises go “green”? A study of environmental management programs in the U.S. wine industry. Journal of Business Ethics, 92, 463-478.

Crosby, L. (2010). Sustainable Relationships: Market forces and relationships can lead to a more sustainable future for us all. Marketing Management, 12-13.

Epstein, M. (2008). Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social, Environmental, and Economic Impacts. San Francisco, CA: Berrett-Koehler Publishers.

Gibbs, D. (2009). Sustainability entrepreneurs, ecopreneurs and the development of a sustainable economy. Greener Management International, 55, 63-78.

Gundlach, M. & Zivnuska, S. (2010). An Experiential learning approach to teaching social entrepreneurship, triple bottom line, and sustainability: modifying and extending practical organizational behavior education. American Journal of Business Education, 3(1), 19-29.

Tilley, F. (1999). The gap between the environmental attitudes and the environmental behavior of small firms. Business Strategy and the Environment, 8, 238-348.

Young, W. & Tilley, F. (2006). Can businesses move beyond efficiency? The shift toward effectiveness and equity in the corporate sustainability debate. Business Strategy and the Environment, 15, 402-415.

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