business plan for sustainable development

Once only the responsibility of sustainability managers, ESG performance and sustainability are today considered key areas of strategic focus for organizations, often reflected in Sustainability Action Plans developed by organizations.

Looming investor pressure, consumer awareness and the understanding that sustainability is an important tenet in risk management and corporate governance has seen responsibilities shift and awareness ripple across both departments and management levels. The tidal shift has been embraced by organizations as they champion decarbonization. It presents ever-growing opportunities for innovation and increased investments towards green technologies, which ultimately accelerate sustainability.

Much like operational plans are developed to future-proof an organization’s success, so too are Sustainability Action Plans in helping to achieve a low-carbon business fit for the future. In this article, we lay out practical guidance on how to create a Sustainability Action Plan along with recommended inclusions and structure. We also provide a free Sustainability Action Plan template for download to support your sustainability and environmental, social and governance (ESG) goals.

What is a Sustainability Action Plan?

A Sustainability Action Plan is created by an organization to detail how it will achieve sustainability goals over time, particularly if ambitious targets have been set, such as achieving net zero by a specific time frame. It is usually a static document that details a two to five-year timeline of objectives, although this period is at the organization’s discretion.

Its purpose is to embed ESG and sustainability across an organization, within all business operations. The path to a Sustainability Action Plan typically starts with a vision at an executive level, with the Sustainability Action Plan serving as the detailed strategy of how the vision will be achieved.

To complement the Sustainability Action Plan, organizations often release annual Sustainability Reports that detail the organization’s progress against the objectives. Together, Sustainability Action Plans and Sustainability Reports function as an important communications tool for organizations to illustrate their sustainability journey to a wide audience of stakeholders.

Sustainability Action Plans are not mandatory, rather, they are an initiative of an organization who wishes to make a positive impact on their sustainability performance.

In addition to planning and internal reporting, many organizations disclose their sustainability performance via various ESG reporting frameworks. In some instances, the data collected for the production of a Sustainability Action Plan can be used to support the reporting requirements of frameworks such as GRI, GRESB and SASB.

And vice-versa, organizations reporting detailed information to ESG reporting frameworks may export some of those responses to their Sustainability Action Plans to illustrate how they are performing against their goals.

This task is made easy with Envizi’s ESG Reporting Frameworks module which allows organizations to collate responses for both external and internal reporting frameworks in one place. In addition to collating responses, the module includes functionality to extract responses for use in documentation such as a Sustainability Action Plan.

Who needs a Sustainability Action Plan?

Organizations of all sizes can make steps towards making their business operations more sustainable and positively contributing to their community and environment. Smaller organizations should consider the resource requirements of developing a comprehensive Sustainability Action Plan and achieving those objectives over time.

For larger organizations, a comprehensive Sustainability Action Plan is ideal for outlining the long-term vision and plans to satisfy investor requirements, to change consumer attitudes and to take advantage of opportunities. This is especially the case once pledges have been made, as the next stage in the process is to work out exactly how the organization will achieve those pledges.

How to create a Sustainability Action Plan

A Sustainability Action Plan requires dedicated commitment across all levels of an organization, and it can be transformational as it requires a top-down approach with cultural change, realignment of values and leadership endorsement. As a result, there are several considerations to take into account when developing a plan.

The consultation process and stakeholder engagement

Much like corporate annual reports require the input of an executive team, the Board, finance department and other internal departments, so too does the process of creating a Sustainability Action Plan.

It requires extensive consultation across the executive and leadership levels, committees and even the community (depending on the sector and type of organization) to establish targets and accountabilities. At the center of the consultation process is an organization’s Sustainability Manager. In many organizations, the person in this role is responsible for developing both the business cases and doing the work to support the implementation and management of programs within organizations to deliver on their objectives.

Whether the organization has a Sustainability Manager or not, they may also choose to use the services of a sustainability consulting firm to guide them on the process and support their objectives.

Other examples of stakeholders involved in the consultation and implementation process may include:

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Establishing benchmarks

The Sustainability Action Plan will involve setting outcomes, actions and targets. Therefore it’s important that an organization understands its current ESG performance with accurate data to inform future benchmarks. Using an ESG and sustainability reporting software platform such as Envizi can simplify emissions calculations and automate the collection of energy consumption data, which will be required when reporting on the progress of the plan.

What is included in a Sustainability Action Plan?

Inclusions in a Sustainability Action Plan can vary depending on the type of organization, its size, and the sector it operates in. For example, a start-up or an independent education center such as a school may choose to focus on smaller initiatives to start implementing changes at the business.

Examples of achievable initiatives at this level could include:

• Using water tanks
• Gardening, such as a vegetable garden
• Recycling system
• Turning off lights when not in use
• Using energy-saving bulbs
• Implementing a printing policy

Larger organizations with ambitious goals and extensive resources could include initiatives such as:

Councils and municipalities

• Reducing Scope 3 emissions from suppliers
• Implementing a mass tree planting scheme
• Providing a community shuttle bus
• Introducing cycle routes
• Installing LED lighting

Property developers and organizations

• Optimizing HVAC equipment performance
• Using local labor and materials
• Incorporating water and waste reuse strategies
• Ensuring sustainability is part of client consultation and scoping
• Incentivizing staff remote-work opportunities

Manufacturing

• Reducing GHG emissions in the upstream supply chain
• Reducing power usage in data centers
• Investing in renewable energy sources
• Electrifying the transport fleet
• Upgrading energy-intensive equipment

Commercial real estate

• Developing a demand-side energy management strategy
• Minimizing waste
• Implementing renewable energy
• Improving  GRESB score
• Implementing end-of-trip facilities

Structure of a Sustainability Action Plan

Whilst the structure, inclusions and scale of a Sustainability Action Plan are at the organization’s discretion and stem from the initial consultation process, there are a few inclusions we recommend to ensure a Sustainability Action Plan which reflects an organization’s commitment to sustainability:

Sustainability values

Background on the organization’s view of sustainability and its core values which motivate the development of the Sustainability Action Plan.

Executive message

Endorsement at the C-Level usually from the CEO, outlining the organization’s commitment to sustainability.

Mandatory frameworks

If the organization operates within a sector which legislates reporting to a framework, this section would outline the requirements of that legislation or policy to provide stakeholders with context around the motivations for the Sustainability Action Plan.

Consultation process

Outlines how stakeholders participated in the development of the Sustainability Action Plan (such as workshops and forums), and which stakeholders were involved.

Methodology and review process

Outlines how the targets will be measured and progress monitored, which could include how regularly a Steering Committee or other key stakeholders will be updated. A Sustainability Report could be one of the vehicles for communicating this progress.

These are broad outcomes that steer the detailed actions and targets in the Sustainability Action Plan. Examples of outcomes could be “Decrease energy usage by 2025” or “Educate stakeholders.”

• Secondary outcomes These could be complementary outcomes which help to group actions within the broader outcome. Examples of secondary outcomes could be “Transport” or “Energy and emissions.”
• Action The tangible actions that will be undertaken to achieve a specific target within that secondary outcome, and broader outcome. Examples of actions could be “Replace inefficient HVAC systems” or “Develop recycling policy.”
• Target Specific KPIs placed against the actions to ensure progress is made. Examples of targets could be “100% of older HVAC systems replaced” or “75% increase in electronics diverted to e-waste programs.”
• Responsibility Assigning champions to action the targets could include listing departments or position titles.
• Timeframe Assigning specific months or quarterly timeframes ensures that targets can be realistically achieved.

The structure of a Sustainability Action Plan varies widely, and care should be taken to ensure that the inclusions of the plan, including the targets, are achievable for the organization.

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How to Develop a Small Business Sustainability Plan

If you’re a small business owner, you may be wondering what you’ll gain by adopting a small business sustainability plan. In a word, plenty! Regardless of your industry, adopting sustainable business practices can improve your bottom line—in both the traditional and the environmental sense.

Your cost savings, reduced risk, positive brand association, improvements to the environment and public health, and ability to meet demands for eco-conscientious products and services will more than offset the costs of up-front integration of sustainability initiatives. In other words, your small business sustainability plan’s initial costs are a wise investment!

What Is a Business Sustainability Plan?

A business sustainability plan is simply something an organization develops to achieve goals that create financial, societal and environmental sustainability. A business impacts communities and resources, so taking these steps to sustainability is in the best interests of the environment, the business owner and the consumer.

Reasons to Build a Sustainable Business

Making the case for a sustainable business is simple: an environmentally friendly business can be a profitable one. You can decrease your business’s negative impact on the environment and potentially save money. Just take it from the many  companies around the world that generate at least $1 billion a year in revenue from sustainable products or services. These companies manufacture everything from burritos to sports cars. Collectively, these businesses generate more than $100 billion in annual revenue from their green product lines alone, and they can outperform competitors by nearly 12 percent annually.

Small businesses can easily scale these practices and implement them in their own organizations through a small business sustainability plan. From saving money and promoting public health to improving public relations, the benefits of building a sustainable business might surprise you.

Benefits of a Small Business Sustainability Plan

• Reduce energy use. From installing ENERGY STAR products and appliances to using LED light bulbs and automatic taps, if you reduce waste, you will increase your business’s efficiency, potentially save money on energy and contribute to overall small business sustainability. You can even start small: encourage employees in energy-saving practices such as turning off lights, carpooling, or telecommuting whenever possible.
• Improve public health.  Be committed to going beyond mere compliance with baseline government standards. A sustainable business will implement changes that reduce emissions, improve air quality, and identify products that reduce concerns about health and safety liability. This promotes higher standards of public health and environmental protection.
• Be a trailblazer.  Not too long ago, no one thought a sustainable business could also be a profitable one, so many industries still lack sustainable companies. Become an inspiring voice of advocacy beyond the four walls of your organization, and blaze trails by creating value for employees, consumers and the public. The visionary thinking and passion behind your business sustainability plan will be remembered—and will yield dividends—for years to come.
• Attract green-conscious consumers—and publicity. Improve public relations with your sustainable business by becoming attractive to Earth-conscious consumers and raising your brand’s value. And remember to let the public know when you implement your environmentally friendly policies. Learn more about the  benefits of running an environmentally friendly business here !

5 Steps to Sustainability for a Small Business

If you’re ready to develop your small business sustainability plan, we’re here to help! With these five steps to sustainability based on going above and beyond mere regulatory compliance , you’ll be equipped to make your business more up to date and efficient. The result will be rewards for both the environment and your bottom line.

Step 1: Learn about Sustainability

The first step in creating a small business sustainability plan is learning what, exactly, sustainability is all about.

• Knowledge is power. Use your resources wisely! There are many guides out there that offer suggestions on sustainability as well as renewable and sustainable energy. Use them as a jumping-off point.
• Profits, people and planet. Internalize the idea that sustainability within your business means managing your triple bottom line: your financial, social and environmental impacts, obligations and opportunities.
• Going green vs. going sustainable. You may be wondering, what is a green business? Green products and services directly reduce the environmental impact when compared to other products and services— sustainability is a broader concept. It’s about the long-term, multifaceted impacts and implications of your products and services. But you can use green language in your small business sustainability plan and campaign using green goals to measure your total sustainability success.
• Out with the old (way of thinking). Forget the outdated “take-make-waste” worldview, and adopt the “borrow-use-return” model. It’s all about a perspective shift. The key is to see the business, the self, the economy and the household as connected with—instead of separate from—the environment.

Step 2: Assess Areas of Improvement

If the federal government and major corporations can find ways to improve sustainability, so can your small business! It just takes some research.

• Learn the laws. From local development laws to self-regulation in your industry to international treaties, many standards are already on the books in terms of sustainable practices. The Environmental Protection Agency ’s website is a great place to start in your research.
• Check your compliance. At a minimum, your business should be in total compliance with any laws or standards already in place. Research cost-effective ways to improve compliance, such as through pollution-prevention techniques and innovation.
• Assess global issues. Research issues such as global warming, energy and fuel crises, and ecosystem decline to see whether your practices are a contributing factor. This will guide what small business sustainability goals you set in terms of improvement.

Step 3: Find Opportunities

Start embracing the entrepreneurial spirit of innovation and asking yourself the hard questions: check out these opportunities for creating the best small business sustainability plan possible.

• Innovate. Success in implementing sustainable business practices is directly related to innovation. If you want to meaningfully reduce waste and energy consumption, you’ll need to innovate, whether you’re a start-up or a thriving business. From problem solving to finding cheaper and better ways of doing things, innovation ranges from simple changes to implementation of complex new technologies.
• Get employee input. Bring in employee ideas and support; employees will take responsibility for things like energy efficiency and come up with solutions that will help you implement and improve sustainability.
• Self-reflect. Ask yourself a few questions, and you’ll find numerous opportunities for improvement: What strengths does my business bring to the table that can play a unique role in sustainability? Does my company create an overabundance of waste? Do the companies I work with create mass amounts of waste?

Step 4: Create a Vision

Your vision for sustainability is all about what makes you and your business tick.

• Find your company’s passion. What is your company passionate about? Choose from a few environmental issues (e.g., global warming, air pollution, waste disposal, water pollution, urban sprawl), and focus on where you can have a meaningful impact.
• Be specific about your small business’s vision. Create a separate vision for each section of your small business, from those on the front lines to those working behind the scenes in different departments.
• Define your sustainability model’s terms. Be sure to define a few words that describe your business’s specific sustainability model. This will help you give your employees the ability to take ownership of your overall vision.

Step 5: Implement Changes

The final of the five steps to sustainability is an exciting one. Implementation!

• Communicate clearly. Adequately communicate your new sustainability plan across your entire company. Educate your employees to ensure successful implementation, and make sure all leaders are involved.
• Change policies. Ensure your current policies align with your sustainability plan. If not, create new ones that are specific to different departments and employees.
• Review performance. Create specific, measurable and attainable written goals, and develop metrics on how to track the success of your changes. This could be as simple as comparing a previous energy bill under the old policies with a new one that comes after you’ve implemented changes.
• Get feedback . Have your leaders in the company report back to you on any difficulties they encounter in implementing changes to policies, so that you can troubleshoot how to fix them while still staying true to the sustainability model. This will help you identify opportunities for more small business sustainability.

After you’ve taken the five steps to sustainability, make sure you can substantiate your sustainability claims before going public with the environmental advantages of your products or services. You can avoid making unqualified claims by following the Federal Trade Commission’s guidelines and general principles that apply to environmental marketing. You’ll learn how consumers will interpret your claims and how to support and qualify your claims without being misleading. Then you’ll be ready to let people know about your small business sustainability plan. The financial, societal, environmental and public relations rewards are sure to follow!

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Why You Need Sustainability in Your Business Strategy

• 06 Nov 2019

In today’s ever-evolving world, debating whether to incorporate sustainability into your business strategy is no longer an option. Considering a values-driven approach when developing business strategies can be vital to long-term success.

Before getting into why sustainability is essential to successful business strategies, it's important to define what sustainability in business is.

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What Is Sustainability in Business?

In short, sustainability in business refers to the effect companies have on the environment or society.

A sustainable business strategy aims to positively impact one or both of those areas, thereby helping address some of the world’s most pressing problems.

Some of the global issues that sustainable business strategies help to address include:

• Climate change
• Income inequality
• Depletion of natural resources
• Human rights issues
• Fair working conditions
• Racial injustice
• Gender inequality

Although it may sound like it, sustainability in business is not purely altruistic. As Harvard Business School Professor Rebecca Henderson notes in the online course Sustainable Business Strategy , you can't use business to do good in the world if you're not doing well financially. Doing well and doing good are intertwined, and successful business strategies include both.

Many of today’s firms have adopted the triple bottom line , which suggests that organizations should focus on more than just profits, or the “bottom-line,” and also measure their environmental and social impact. These focuses can be referred to as “the three Ps,”: people, planet, and profit. Quite often, this sustainable approach to business ultimately boosts business performance.

Why Is Sustainability Important?

In addition to driving social and environmental change, sustainability initiatives can contribute to an organization's overall success. It may seem counterintuitive that spending more money on sustainable business practices can boost a company’s profitability, but studies show that the most sustainable companies are also the most profitable.

Environmental, social, and governance (ESG) metrics are often used to determine how ethical and sustainable an organization is. According to McKinsey , companies with high ESG ratings consistently outperform the market in both the medium and long term. While sustainability strategies might be an investment in the short term, they can lead to long-term benefits.

Benefits of Sustainability in Business

1. you’ll protect your brand and mitigate risks.

Ending up on the front page because of a scandal is a CEO’s worst nightmare. Not only do improper practices damage an organization’s reputation and cost it customers, but dealing with a public relations disaster can divert valuable human and financial resources from the core business.

You don’t want to become the company that allowed an oil spill or forced employees to work in unsafe conditions. By instituting a sustainable strategy that protects the environment and your workers, you also protect yourself from any damaging incidents.

2. Being Purpose-Driven Is a Competitive Advantage

Sustainability doesn't detract from business goals, and infusing your company with purpose can help attract a motivated, skilled workforce that drives financial success . In a Facebook Live discussion , Henderson noted a recent study showing that 89 percent of executives believe an organization with shared purpose will have greater employee satisfaction. Additionally, 85 percent say they're more likely to recommend a company with strong purpose to others.

Making your company an organization that does good in the world—rather than just a place that provides a paycheck—can be a competitive advantage when attracting the best talent.

Related : HBS Professor Explores the Impact Purpose Can Have on Your Organization

3. There's a Growing Market for Sustainable Goods

A 2019 study found that 73 percent of global consumers are willing to change their consumption habits to lessen their negative impact on the environment, and sustainable product sales have grown by nearly 20 percent since 2014. Millennials in particular are more willing to pay more for products that contain sustainable ingredients or products that have social responsibility claims. If your organization commits to sustainable products and practices, it could gain market share by converting sustainability-minded customers and increasing sales.

4. Cooperative Action Can Drive Change

As an individual, it can feel overwhelming, isolating, or simply impossible to effect change in a meaningful way. That’s not the case when the most innovative, successful, and powerful companies are collaborating to solve some of the world’s most pressing problems. While governments struggle to address public goods problems, purpose-driven companies working together to address these issues have experienced great success.

For example, palm oil is cheap, versatile, and found in about half of all packaged products, including soap, lipstick, and ice cream. But palm oil production has resulted in record greenhouse gas emissions and contributed to climate change.

In light of this, consumer goods producer Unilever committed to only using palm oil from certified sustainable sources in 2008. The organization cooperated with its competitors—as well as governments, NGOs, and indigenous peoples’ organizations—to lead an industry-wide adoption of sustainable palm oil. As a result, Unilever continues to be a thriving organization, and the world has reaped the environmental benefits of sustainable palm oil harvesting practices.

The Value of Sustainability

Sustainability doesn’t mean sacrificing profits or putting success on the backburner. Instead, it has become a crucial element to any organization’s successful strategy. A business that doesn't factor in sustainability risks is less successful in several measures, including profitability, growth, and employee retention.

By integrating sustainability into your business strategy , you can find success because, rather than in spite, of sustainability.

Do you want to take a more values-driven approach to business? Explore our three-week online course Sustainable Business Strategy and learn how organizations can succeed financially while also playing a role in solving some of the world’s most pressing problems.

This post was upated on March 22, 2021. It was originally published on November 6, 2019.

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