In my previous blogs " Triple bottom line sustainability concept" and "The Five Capitals sustainability model" I have evaluated frameworks that could be applied to organisations in order to strengthen their sustainable developments. These frameworks, however, focus on certain areas of concern for the businesses. The models encourage organisations to look at sustainability in broader terms.
Today, I will be looking at the internal operations of businesses to make the organisations more environmentally efficient.
The concept
The best way when thinking about applying the Eco-efficiency model would be at looking at manufacturing processes.
The manufacturing process takes materials and energy to produce product and waste. This processes place a load on the environment. The environment has to take the waste and the pollution.
We can reduce the load on environment by minimising the energy used, minimising the materials used, recycle the waste materials and energy.
There are also other activities that business could take to make the processes eco-efficient. for example, re-designing its products. Products could be re-designed to be more environmentally friendly during the consumption as well. Organisations can also partner with others who use the waste as their materials. And finally, operational processes could be re-designed with the environment in mind.
This model can be applied to any system or process and useful for other types of organisation and not only manufacturing. Some educational processes or hospitality.
Eco-efficiency is all about reducing ecological damage while at the same time maximising efficiency. It is a philosophy adopted by many organisations across the world. For example: Nestle, Kodak, Phillips Electronics, 3M. These companies use less water, material, energy and recycle more.
Often the efforts include re-designing the products or introducing practices which reduce or eliminate hazardous emissions or by-products. They also try to reduce human demand on the eco-system,
For this to be effective, however, it need to be introduced across all divisions of business including marketing, operation, production and purchasing.
“Eco-efficiency means doing ‘more with less’ — using environmental resources more efficiently in economic processes.” (University of Colorado)
According to the WBCSD, these are the most critical features of eco-efficient companies:
Producing goods and services with fewer materials.
Producing goods and services with less energy.
Dispersing lower volumes of toxic materials.
Improved recyclability.
Striving to use renewable resources.
Making goods that last longer.
Greater service intensity of products and services.
The benefits
Eco-efficiency is regarded as one of the best tools to encourage transformation from unsustainable business to sustainable one. It is because it aims to create harmony between the economy and ecology. It puts the responsibility on manufactures and producers to be accountable for the impact on environment. This system has been identified as main business approach of the world players.
A business which is environmentally conscious reaps the benefits of sustainable developments. Companies develop processes, products, markets and supply chains so they become more aware of their impacts. This gives them a substantial amount of control and opportunities to increase profits. They use less of resources and improve their production processes which gives the organisation a competitive advantage.
Additionally, eco-efficiency promotes technological innovation that becomes the primary solution to environmental issues. New innovative products live longer, reduce energy, waste and protect the environment.
Companies invest in cleaner processes, systems, production and technologies because they want to improve their technical and innovate capacity. This way they develop new areas of business competency.
Businesses also want to expand to new markets and are aware of more and more environmentally-cautious customers. They also want to retain those which are continuously improve their practices and want to make better purchasing decisions.
Only companies which can develop sustainable and resilient processes can become market leaders.
These way, they can improve their market image and grow. The approach does not only focus on companies become more environmentally friendly, but also become more profitable.
Each company has their own motives and motivations of becoming more green, but we can easily say that it increase the brand and increase competitive advantage.
"Consumers are more interested in aligning their personal values with the brands they buy. If consumers are aware that companies are mindful of their impact on society and the environment, it positively impacts their repeat purchasing behaviour." (The Natural Marketing Institute)
This demographic according to Cone Communications is roughly estimated at 86% of U.S. consumers who make purchasing decisions based on their personal, social and environmental values.
Additionally, financial and investment analysts recognise companies who develop sustainability plans and the value of those businesses is greater than those who do not consider these factors.
Finally, employees want to work in organisations who are 'doing the right thing'. According to Human Resource Management, companies with sustainability programmes report 55% better employee morale, 43% better business processes and 38% improved employee morales.
Bibliography:
1000ventures, Benefits of Eco-efficiencies, Why companies invest in cleaner methods, http://www.1000ventures.com/environment/ecoeffectiveness_benefits.html (Accessed 20.06.2021)
MBN, Market business News, 2021, What is eco-efficiency. Definition and examples
Same B, 2017, The concept of Eco-Efficiency: Why it is so important for the modern world?, World Atlas
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