It is a recognized driver of innovation providing enormous opportunity for business. Consultancies such as McKinsey and large corporations like Target have created successful whole divisions related to it. Colleges and universities are offering more programs and degrees to meet the demand for it. Investors are investing in it, and consumers are demanding more of […]
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It is a recognized driver of innovation providing enormous opportunity for business. Consultancies such as McKinsey and large corporations like Target have created successful whole divisions related to it. Colleges and universities are offering more programs and degrees to meet the demand for it. Investors are investing in it, and consumers are demanding more of it. Most importantly, entrepreneurs are incorporating it into their core values, differentiating, and innovating new business models and products and services due to it. They all see opportunity in it.
The “it” is sustainability.
If you are considering diving into sustainable venturing, you may be wondering what is involved in being a sustainable entrepreneur. Generally, the term entrepreneur is found to mean “one who creates value by bringing together a unique combination of resources to develop and pursue economic opportunity.” This definition can vary slightly in the minds of individuals and still allow us to have a well-understood exchange without any discontent or misunderstanding. The definition of sustainable or sustainability, on the other hand, poses some issues.
There is still no consensus on the definition of sustainability in the business realm, which has hampered discussion at all levels. However, the most commonly agreed-upon definition comes from the Brundtland Report out of the United Nations from about 25 years ago. Here it was defined as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”
Most commonly, people hear sustainable ventures characterized by concepts such as the “Triple Bottom Line” or as involving the 3Ps of people, planet, profit. The ultimate goal is to hit the trifecta, by successfully balancing considerations of all three components in the business venture.
- People — Is about the behavior of ventures regarding both social and ethical issues. High-level considerations include but are not limited to treatment of the venture’s workforce, protections of human rights, as well as guarding against child labor.
- Planet — Considers natural resources and the natural environment. Protecting the ecosystem takes form within a sustainable venture as it seeks to do no harm, the least harm possible, or even be regenerative.
- Profit — This is the undeniable essence of the business venture. Profit relates to financial returns of the venture, as well as the allocation of those financial returns between investments in things like equipment or infrastructure as well as the distribution of gains among those invested in the venture.
So, if purpose and profit are not then fundamentally at odds, but at balance, and there is opportunity to be had, what makes for a successful sustainable venture? Among other things, one tool to assist the sustainable venture is a list composed by Freya Williams in her book “Green Giants.” It is a list of six internal business drivers that when used together have driven sustainable brands to success.
- The iconoclastic leader: A leader who is fueled by deep conviction and a rebellious attitude;
- Built in, not bolted on: Embedding sustainability values throughout the entire organization;
- Disruptive behavior: Disruptive innovation that uses sustainability to spur the development of radically better products and services;
- Purpose beyond profit: Having a higher purpose that ignites the company and which customers relate to and reward;
- Mainstream appeal: Mainstream appeal with positioning and packaging stripped of the crunchy clichés that alienate the average customer;
- New behavioral contract: Establishing a brand new “behavioral contract” with consumers and other stakeholders based on transparency, responsibility, and collaboration.
Everything considered, I suppose we could define a sustainable entrepreneur as an individual who creates socially and ecologically sustainable value by bringing together a unique combination of resources to pursue an economic opportunity. He/she does so while realizing that there is no line drawn in the sand about how much social or ecological good is good enough. Ultimately, a sustainable venture’s emphasis or weighting of social and environmental values will reflect the values of the founders themselves.
Best wishes to those aspiring entrepreneurs who are looking to — and seasoned entrepreneurs who already are — doing well by doing good.
Karen Livingston is a business advisor at the Small Business Development Center (SBDC) at Onondaga Community College. Contact her at livingsk@sunyocc.edu