Pursuing business growth without worrying about the environmental impact of that growth is disastrous in the short term as well for future generations. Being obsessed with growth hacking can cause more harm than anything good. Such haphazard and irresponsible growth is not in harmony with the protection of the planet earth. Businesses realize the harmful effects of irresponsible business growth in the form of growing climate change. Responsible business leaders aim in the right direction with the right approach and look for ways in which sustainable business growth can be attained without causing any harm to the planet earth. To ensure gender equality and minimize inequities, organizations would also examine their personnel and management systems. They might evaluate the needs of their immediate neighborhoods and determine how they can start or contribute to initiatives that advance the objectives of excellent health and well-being, high-quality education, access to clean water and sanitation, and sustainable cities and neighborhoods. These objectives all contribute to having a positive outcome. Achieving sustainable business growth requires foresight and the right strategy.
Sustainable Business Approach
The approach of sustainability-conscious business leaders is to keep the company’s purpose and actions equally grounded in environmental, financial, and social concerns. Such business leaders are cognizant of creating a sustainable future for the company and their community by aligning their business goals with United Nations Sustainable Development Goals. Their objectives revolve around these goals, and they are conscious of responsible consumption and production. They prioritize ensuring that the supply chain processes in their business are harmonious with environmental goals and are not causing any harm to climate, life on land, and life below water.
Assimilation, mobilization, and transition are the three main methods for adopting sustainability into an existing firm; the latter is the most effective for long-term integration. Businesses that use the transition strategy focus on transforming policies, processes, and attitudes toward sustainable principles while still adhering to some aspects of the present company philosophy. This was mostly accomplished by comprehensive instruction, outreach, and recruiting, which ensured universal acceptance.
Sustainable Business Model
We all live, play, and work on one planet, and as responsible people, we need to take care of our planet for the benefit of everyone. Sustainable business models can also be successful business models, and they can be inspiring examples of models that are sustainable yet successful. It is important to understand that sustainability and business growth are not opposite, but they are complementary to each other. There is a huge opportunity for entrepreneurs in the field of sustainability endeavors as most businesses are taking steps in the direction of ensuring that their businesses are in harmony with sustainable development goals and are not causing any damage to the planet.
The models used to determine sustainable growth make the following assumptions: 1) that the company wants to maintain a target capital structure without issuing new equity, 2) that it wants to maintain a target dividend payment ratio, and 3) that it wants to increase sales as quickly as the market will allow. Sales and assets cannot increase faster than the retained earnings plus any extra debt that the retained earnings can sustain since the asset-to-beginning-of-period equity ratio is constant and retained earnings are the only source of fresh equity for the company.
Investing in sustainable business growth is becoming the mainstream idea for many business owners since it is clear that sustainability will impact future generations in many ways. Efforts in the direction of building a sustainable and resilient future are possible by promoting inclusive culture, quality education, responsible consumption and production, and proactive climate action to mitigate carbon emissions and reduce the threat to the planet due to global heating. According to the latest survey by IPCC, it has become extremely essential to take action in the direction of keeping global heating within the 1.5-degree Celsius limit, and the climate scientists at the meeting have issued an ultimatum regarding that.
Environmental Protection in Business
Many entrepreneurs are developing businesses around environmental protection to create a better world by 2030. They are keeping business growth as well as sustainability concerns in mind and prefer eco-friendly techniques. Business leaders should promote a concept and culture of sustainability in their organization and should promote sustainability initiatives throughout their organization. Every organization should have teams responsible and accountable for championing the cause of sustainable development.
Everyone should be aware that efforts in the direction of sustainability are win-win for everyone and can increase overall efficiency and productivity and reduce operational costs. Sustainable initiatives by the organizations will increase the brand value of the organization in the business market. Making sustainability a core principle of business can be the best step leaders can take. Innovative approaches in business leaders can help them change the old business strategies and adopt business strategies that are more environmentally conscious for driving sustainable business outcomes.
The target set by United Nations to attain sustainable development goals is by 2030, and the USA has decided to be carbon-neutral by 2050. All business leaders and organizations should make efforts to be carbon-neutral as earlier as possible by emulating the great international giants such as Apple, which has committed to be 100 percent carbon-neutral by 2030.
Challenges for Sustainable Growth
Small business owners and executives of large corporations share a common concern about the creation of sustainable growth. However, given the quickly shifting political, economic, competitive, and consumer trends, achieving this goal is no simple undertaking. Business executives seeking the holy grail of sustainable growth face distinct obstacles from each of these themes. For instance, during the past few generations, customer expectations have evolved significantly. Modern consumers are more discerning buyers since they have less spare income than their parents did.
According to economists and business scholars, growth strategy and growth capability are the two foundations that must be taken into consideration to achieve sustainable growth. Companies that don’t pay enough attention to one area or another will fail in their attempts to build sustainable growth methods (though short-term gains may be realized). After all, long-term growth is impossible if a firm has a great growth strategy in place but does not have the infrastructure in place to implement that goal. The opposite is also accurate.