Sustainability in SMEs: Why it pays to do things differently
Jonas Reuter
You may think that sustainability is something that only large companies or the government should be concerned with, but that's not true! Medium-sized companies also have a responsibility to society and the environment. However, if you think that sustainability is just another buzzword that will hurt your profits, think again. Sustainability can actually help your company to be successful in the long term.
So why should you change your business practices?
Because it's the right thing to do.
It's time we all took responsibility for our actions and their impact on the environment and society. By introducing sustainable practices into your business, you are helping to protect the environment and improve living conditions for future generations.
Because it pays off in the long run.
Sustainability can help reduce your costs and increase your efficiency. It can also help you to minimize risks and strengthen your reputation and image as a responsible company. Invest in renewable energy, reduce your water consumption and champion the use of recycled materials - all of which can have a long-term impact on your finances.
Because it's what your customers want.
More and more customers are placing value on sustainable products and services. By introducing sustainable practices into your business, you can increase your appeal to these customers and expand your sales opportunities.
But where do you start?
A medium-sized company that wants to become more sustainable has many ways to start. One way is to review and optimize its own business processes to avoid wasting resources and reduce its environmental impact. This includes, for example, introducing recycling systems, using energy-efficient equipment and minimizing travel by using video conferencing tools.
It can be helpful to review your own product range and offer more environmentally friendly alternatives where appropriate. This includes, for example, using sustainable materials, reducing the amount of packaging and promoting products with a longer lifespan. Promoting social and ethical standards in the supply chain can also help to make the company more sustainable.
If it is "so easy", why does nothing often happen?
Lack of focus & time
One reason for this can be a lack of time and focus on the part of managing directors. The managers of a company often have many responsibilities and duties and have to deal with a variety of challenges. As a result, they often lack the time to devote sufficient attention to the topic of sustainability and develop a strategy for sustainable change. This can lead to the topic of sustainability being neglected and no concrete measures being taken to make the company more sustainable. It is therefore important that managing directors take the time to prioritize it as an important issue in order to ensure a successful and lasting transformation towards a sustainable company.
Financing problems
Another obstacle is the financing of sustainable projects. Purchasing environmentally friendly machinery and equipment, implementing energy-saving measures and carrying out audits can be expensive and incur high costs in the short term. Without the support of investors or financing programs, it can be difficult to meet these expenses. This context shows that not only technical or procedural reasons are needed, but also a clear financial perspective and financing concepts to realize the change.
One possible solution to the financing problem is to look for funding programs and subsidies that are available for sustainable projects. Governments and other institutions often offer financial support to companies that want to implement sustainable projects. By taking advantage of these funding programs and subsidies, companies can reduce the cost of sustainable projects and make it possible to make the necessary investments.
Another possible solution is the use of sustainable financing models, such as green bonds. Green bonds are bonds that are issued for sustainable projects. They enable companies to raise capital from investors who believe in sustainable projects. By using green bonds, companies can facilitate the financing of sustainable projects without having to rely on the support of banks or other traditional sources of financing.
Lack of supporters
It can also be the lack of support from employees and management. Without the commitment and cooperation of everyone involved, it is difficult to make and implement sustainable changes. One way to tackle this problem is to involve employees in the planning and implementation of sustainable measures and to inform them about the benefits of sustainable action.
Lack of technology
One obstacle to sustainable change can be a lack of technology and innovation. Many SMEs do not conduct their own research and development due to a lack of resources or knowledge and are therefore often limited to traditional approaches and outdated technologies. Often the internal know-how and potential for developing new products, services or business models remains unrecognized and is dismissed as unprofitable due to outdated pricing models.
One possible solution to this problem is to invest in research and development in order to develop new and innovative solutions in the area of sustainability. By creating resources for research and development, companies can strengthen their internal know-how and drive the development of technologies that can help reduce environmental impact and use resources more efficiently.
Another solution may be to analyze existing know-how and business models in detail and develop modern business models from this. In the long term, demand for sustainable products and services will increase. That is why it is already worth developing new, sustainable business models today.
Forming partnerships and cooperations with other companies or research institutions can also help. By working together with other players, companies can gain access to new technologies and innovative solutions that they could not develop themselves. Partnerships and collaborations can also help to pool resources and expertise in order to work together on the development of sustainable products and processes. This allows companies to focus on their core competencies while gaining access to new technologies and innovative solutions.
If we focus on finding innovative solutions, then every company can contribute to a more sustainable future. So let's be bold and focus on a future in which companies are not only economically successful, but also contribute to a more sustainable society. In this way, we will secure a future for ourselves and our children in which the environment and society are in harmony. A future in which we all win.
About us:
MORGEN is a specialized management consultancy that focuses on the development of new business models for medium-sized companies. In particular, it supports owner-managed companies in their future-proof transformation. Knowledge transfer is at the heart of its consulting activities, which is why the MORGEN Blog regularly publishes articles on key topics such as digitalization, transformation, customer centricity and sustainability.