Sustainability is an integral part of company growth and always a challenging path. Business executives nowadays deal with an unprecedented and complex mix of technological, social, marketing, and environmental trends which demand a sustainability-based approach. However, some corporates don’t take into account the sustainability aspect because of perceived high costs than benefits. Sustainability affects both society and the environment, and for a business to achieve it, it should embrace long-term strategies meant for having a positive impact on both the environment and society. In other words, it is about making company decisions based on many years coming while considering other essential factors other than financial gains. This study highlights the effects of starting a company and making it sustainable to both people within and outside the organization.
The people, especially the staff working in the company, will develop psychological ownership about the company. In essence, they will develop possessiveness feelings and special connections to the company. According to Bhattacharya (1), psychological ownership is associated with great job satisfaction, productivity, profits, and engagement. An effort of galvanizing companies around sustainability makes psychological ownership a critical concept. Quite often, life is filled with many issues that threaten our wellbeing, whereby human beings have limited resources to mitigate such problems. Therefore, companies can rise to the occasion, fill this gap, and derive a competitive edge by transforming bystanders and stakeholders into owners.
Employees develop a sense of ownership because sustainability happens in three phases; incubation, launching and entrenching. Incubation involves the process of defining sustainability contours by reflecting the business purpose and business roles in the world and making business goals concrete through the generation of the research-based material list throughout the value chain (Bhattacharya 1). Through these two processes, many businesses can achieve significant progress at the incubation stage through demonstration of willingness to accept responsibility for sustainability. Besides, the companies can offer other possible opportunities for action. Also, launching involves introducing a sustainability plan enthusiastically to stakeholders to set up ownership ideas. According to Bhattacharya (1), influencing stakeholders and employees to accept sustainability requires businesses to sell sustainability as an opportunity to contribute to the wellbeing of society and the company in the future. Sometimes there is a need to appeal to the heart, to the head, or sometimes both. Convincing the heart means looking at the differences made, while convincing the head means looking at the cost savings, monetary incentives, and career advancements. Finally, entrenching means making sustainability subject a routine. According to Bhattacharya (1), measuring success and providing sustainability target feedbacks demystifies the contribution of stakeholders, thus moving them to sustainability ownership as their full-time jobs. More often, managers use sustainable goals in evaluating direct reports and comparing departments, employees, business units, and divisions. Similarly, companies can increase ownership through industry-wide participation in driving systemic change.
In the outside organization, companies are able to derive a competitive advantage from stakeholder engagements. Traditionally, business models aimed at creating value for their shareholders while overlooking other stakeholders. However, sustainable business organizations have redefined the corporate world through various designed models which add value to their add value to all stakeholders like employees, supply chains, shareholders, civil society, and the rest of the world (Whelan et al. 1). In other words, this is an idea of creating a shared value whereby all businesses are able to draw economic values through the identification and eradication of social upheavals intersecting with their organizations. Besides, much of sustainability’s strategic value is derived from a continuous conversation with key stakeholders. Regular discussion with stakeholders for sustainability-oriented firms better reacts to social, economic, legal, and environmental changes (Whelan et al. 1). Essentially, poor relationship with stakeholders leads to poor stakeholder conversation and increased conflicts between stakeholders and organizations, thus leading to the disrupted ability of a company to operate on budget and schedule.
Furthermore, the company improves its risk management activities. Presently, supply chains are susceptible to civil conflict and natural calamities as they extend throughout the world. For instance, businesses are affected by water scarcity, climate change, and poor working conditions in various parts of the world. According to Whelan et al. (1), climate change significantly affects business operations, expenditures, and revenues. Business operations get disrupted, expenditures increase, while revenues decrease. Environmental and social risks in business appear in the long term, thus affecting organizations in many ways that are beyond their reach (Whelan et al. 1). Consequently, risk management requires investment decisions made by the company to revolve around the development of adaptive strategies and longer-capacity building. For instance, food, beverage, and agriculture sectors are worst hit by the effects of climate change due to disrupted conditions, increased diseases and pesticides, and reduced crop yields. Disruptions caused in the supply chains affect the processes of production, which rely on natural assets like groundwater, biodiversity, climate, and clean air.
Also, the business becomes in a position to foster innovation. Through product redesigning to meet social standards and environmental needs, companies derive new opportunities (Whelan et al. 1). For instance, Nike implanted sustainability in its innovation process by creating one billion Flyknit lines that used a specialized yarn system that used little labour while generating huge profits. Consequently, Flyknit reduced wastage by eighty percent the normal cut and sew. According to Whelan et al. (1), Flyknit helped Nike save almost 4.9 million wastage by transitioning yarn to polyester. Similarly, CPG companies innovated new items for market access due to rising consumer interests in sustainable items and consciousness to consumer challenges like increased energy costs. Also, another company Proctor and Gamble, assessed their products in the U.S and established that many households spent almost three percent of their annual budget in electricity for washing clothes and heating water (Whelan et al. 1). Later they launched cold-water detergents that required less energy. Innovative systems increase the quality of production, thus reducing environmental costs and impacts, besides increasing global competitiveness.
This study has successfully highlighted the effects of starting a company and making it sustainable to both people within and outside the organization. To people within the organization, they will develop psychological ownership about the company by developing possessiveness feelings and special connections to the company. Also, Employees develop a sense of ownership because sustainability happens in three phases; incubation, launching and entrenching. To the outside organization, companies can derive competitive advantage from stakeholder engagements through various designed models that add value to their value to all stakeholders like employees, supply chains, shareholders, civil society, and the rest of the world. Also, the company improves its risk management activities through investment decisions made by the company, which revolves around the development of adaptive strategies and longer-capacity building. Also, the businesses become in a position to foster innovation through product redesigning to meet social standards and environmental needs.