Going green can be profitable – that is the conclusion of multiple studies that have looked at the financial outcomes of corporate efforts to improve their environmental impacts. By reducing emissions, packaging materials, and waste, Walmart, Unilever, and many other companies have been able to reduce their costs and improve their environmental impact. This has led some to conclude that the best way for corporations to serve society and to operate sustainably is to focus on reducing costs and maximizing their profits.
I think that this is a flawed conclusion. The alternative to this profit-above-all approach is a sustainably effective approach that focuses on the triple bottom line of people, planet and profit. Organizations that practice and integrate sustainability thinking put it into all of their operations – they do not just work on what leads to profits. They integrate sustainability into their very DNA, and everything proceeds from that. These organizations measure themselves in all three areas and structure and design their operations to perform in ways that have a positive impact on all three.
Another huge difference is that sustainably effective organizations don’t look at green or sustainable initiatives as special programs – as mere window dressing. One-off social or environmental initiatives are not enough. A sustainably effective organization makes much deeper and more comprehensive organization changes.
Sustainable performance is a part of everything the company does – from how employees are managed to the overall structure of the organization and how work is designed. It must be part of the company’s identity and embedded into every aspect of the organization. My recent book, Management Reset: Organizing for Sustainable Effectiveness, explains what organizations must do to make this happen.
A number of CEOs see the value of the sustainable effectiveness approach, including Kenneth Chenault of American Express and John Mackey of Whole Foods. In fact, Chenault has said that in order to pursue profits, corporations must act in ways that protect and enhance the world we live in.