As stated in the 2022 Edelman Trust Barometer report, government and media are losing the points of trust, where business still remains the trusted institution. More importantly, respondents indicated that businesses are more likely than the government to take on a leadership role and coordinate cross-institutional efforts to address societal problems in the context of business-community partnerships. So what real actions businesses can actually do?
Back to basics
Technologies and transportation made it easy to constantly and instantly communicate with every corner in the world. And while such globalization has its undeniable benefits, there also are some drawbacks, where the biggest one is that we forgot about the needs, awareness and preference of local communities and the unique benefits they have to offer.
On a bigger scale it implies developing countries who have unique nature and food sources — for them implementation of certain SDGs is more relevant than ever. Rising inequality in developing countries paired with growth in developed regions, and increasingly globalized supply chains are putting a strain on local resources in many regions. To address this, Responsible Consumption and Production goal encourages both consumers and businesses to adopt sustainable practices. Fairtrade International organization helps consumers make purchases that align with their values and supports farmers and companies dedicated to sourcing fair trade products. Based on the Statista report, in 2022 the most sold Fairtrade products in the world were flowers, plants, bananas, cocoa beans and coffee. And it’s not only about food. It’s about cosmetics and home goods that people use everyday as well.
Companies can lose loyalty and customers’ trust if the products or production facility itself don’t align with the local preferences or even historical background of the region. For example, a food producer doesn’t take into account the local dietary habits and is having a hard time attracting customers. Or a company produces tons of plastic waste in a need to pack its goods and harms local nature and people’s health. New and existing responsible businesses should always take into account the region’s specifics and needs and to provide good research not only into the market, but into people, because there’s always an alternative that can benefit both sides. For example, more businesses use plastic packaging alternatives, that have all the same features that traditional packaging, but are biodegradable and do not harm the environment. Modern technologies, like the ones that S.Lab is working on, give the ability to produce packaging on energy and resource efficient mini factories the size of shipping container and don’t harm the environment. Sustainable and responsible ways of doing business benefits the local communities economically, environmentally and socially.
That brings us to the second point — negative public perception. Some businesses may face a community backlash if not caring about the local needs of the region and people: boycotts, protests or negative media coverage. In the modern world companies should not prioritize profits over the well-being of the community and not use exploitative practices. Not considering the environmental impact of business operations can lead to ecological damage, which can result in community opposition and legal penalties. Also, ignoring social issues such as local employment needs, community development, and social welfare can lead to a lack of support and potential conflicts.
Enhancing business success through sustainable practices
Collaborating with local communities and understanding their needs is crucial for businesses building strong, trust-based relationships. When companies engage with locals, they can tailor their operations to support regional development, address specific challenges, and leverage local resources effectively. A good example here is a numerous brands who manufacture footwear and clothes from abandoned fishing nets. Ghost nets pose a big threat to marine ecosystems and thus to the communities that depend on fishing as their source of food and income. So the overall model of cooperation is clear — listen to the community, detect a problem and think how your business can help solve it.
Implementing sustainable supply chain practices. They promote social equity by ensuring fair labor and trade practices and supporting local communities. Ethical sourcing and fair trade practices contribute to better working conditions and economic development of the region. By adopting environmentally conscious practices, businesses can reduce their carbon footprint and promote social justice. Here at S.Lab for example we source agricultural waste, that is the base of our packaging, from local farmers, contributing to the economic and environmental health of the region, and our mini factories can be distributed and placed on the client’s premises, that helps reduce packaging transportation costs and CO2 emissions.
Reducing water and energy consumption. One key aspect of sustainable business practices is monitoring the usage of natural resources. By adopting innovative efficient technologies, companies can significantly cut their environmental impact which can be beneficial in regions with high risk of drought. Using production automation, installing advanced monitoring and optimization systems not only helps reduce carbon emissions but also preserve valuable resources and over time leads to operational cost optimization.
Water is a resource used in the production of almost everything — from cosmetics to energy. A good example of true action is a self-care and cosmetics corporation, that on its sites already use water that is reused or recycled, also implementing “waterloop factories”, meaning that all the industrial water will be re-treated, recycled and reused in a loop. Using water wisely means more clear water for all.
Adopting waste management strategies. Contributing to a healthier environment also means implementing effective waste reduction strategies. Businesses can minimize waste by using alternative biodegradable materials, setting up recycling programs, and finding innovative ways to repurpose or reuse materials. Embracing circular economy principles helps reduce landfill waste, conserve natural resources, and lower costs associated with waste disposal.
There are so many ways to be both profitable and creative. Sunglasses made of coffee grounds, bricks and tiles from used clothes so it won’t end up in a landfill, packaging from agricultural waste, eco leather from apple leftovers — thoughtful waste management is amazing!
For the startups it’s worth mentioning that investors take into consideration a company’s commitment to Environmental Sustainability Goals on the same level as they consider operational and financial background. A strong commitment to sustainability enhances a company’s reputation, making it more attractive to consumers, partners, and employees and plays a big role in long-term success, as growing consumer demand for environmentally responsible products and services means gaining new markets and a competitive edge. As well, investors are increasingly valuing corporate social responsibility, seeing it as a reflection of good management practices and ethical leadership, which are indicative of a company’s overall health and sustainability.
A company, no matter its size, will always have a big impact on the local community. Building trust within the residents and connecting with industry organizations, NGOs, other companies and businesses is becoming one of the components of success. It benefits all parties involved and helps building a healthier business ecosystem. We need to remember that we are the change we want to see. It’s a two-way road, and the result of that cooperation is a flourishing, resilient community and a successful socially responsible business.
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