Increase your competitive advantage by contributing to a sustainable world
As an owner of a small- or mid-sized enterprise (SME), you’re likely hearing more about sustainability and the importance of incorporating sustainable practices into your business.
But of all the pressing issues that business operators have on their to-do lists, achieving sustainability goals is perhaps the most challenging. As sustainability is a broad area, knowing where and how to focus your efforts can feel overwhelming.
Whether you want to deliver products that are better for the planet, attract customers who are making more ethical purchases, or build business resilience in a fast-changing world—creating a sustainability strategy is worth considering for companies of all sizes.
Implementing sustainable practices isn’t only a smart investment in the future, it can also position you now as a proactive and conscious company that’s listening to the pressing issues of our time. Good for business and good for society, being sustainability-minded can help you stand out among your customers, employees and community in both your neighbourhood and around the globe.
What exactly is sustainability and ESG?
While the terms “sustainability” and “ESG” are often used interchangeably, it’s important to understand the difference between them and what they mean to SME owners.
Sustainability is about creating value for your company and stakeholders, without negatively impacting people, the environment, communities or society as a whole. Sustainability means balancing your company needs with the requirements of present and future generations.
Environmental, social and governance (ESG) are the three pillars of sustainability in business:
- Environmental sustainability is about the strategies, systems and practices you put in place to protect and benefit the planet. These can range from energy efficiency or waste reduction measures to climate change or biodiversity protection programs.
- Social sustainability is about how your company impacts and interacts with people, including your employees, customers and suppliers, as well as the broader community. The social pillar includes health and safety, diversity and inclusion, and human rights.
- Governance is about the leadership, controls and standards you have in place to manage your business effectively and responsibly. Examples include documented policies and procedures, following relevant laws, and upholding ethical and transparent business practices.
Each area involves risks and opportunities that your company should consider when making business decisions.
How sustainability impacts your business
Although the conversation around sustainability has been largely confined to big business and government, that’s quickly changing. As the world grows increasingly concerned with issues such as climate change, workers’ rights and fair trade practices, SMEs are also being held accountable for the way they do business.
With the rise of digital commerce and globalization, the impact of your business practices can stretch across borders, especially if you deal with customers or suppliers overseas. And the supply chain decisions you make could have a significant positive or negative impact—ranging from your local community to another continent. Also, any company pursuing business opportunities in international markets, or with multinational enterprises, may have to meet certain ESG requirements to be awarded new contracts or partnerships.
By demonstrating a commitment to sustainability, you could gain a serious competitive advantage. Adopting strong ESG practices can ultimately help you reduce business risk, access new partners and opportunities, attract customers and recruit employees. On top of that, your commitment to ESG can help improve the environmental, social and economic standards in Canadian and global communities.
How to integrate sustainability into your business
Lately, many business operators have told Export Development Canada (EDC) that they understand the importance of sustainability and having an ESG plan. But they often don’t know where to start. Most entrepreneurs and SMEs have limited time, resources or expertise to take action. As a result, they may not get around to the initial task of assessing the current state of their business from an ESG perspective, let alone making decisions to effectively embed sustainability practices into their operations.
That’s why we’ve created a series of free resources on sustainability for SMEs. These resources include easy-to-navigate “101 guides” and “checklists for action” that break down ESG topics into short content blurbs, with just the right amount of information for busy entrepreneurs. You can explore topics one by one, or simply choose those most relevant to your business
Small steps are key to success
When it comes to implementing sustainability and ESG plans, it’s worth adopting a “progress over perfection” mindset. Focus on taking small steps as every business has its own unique circumstances—and the approach you take may be different than that of another company.
EDC encourages SMEs to take time to build knowledge, start small and slowly scale up, then set priorities that align with your business goals. Over time, you can build a sustainability mindset into your company culture and find ways to differentiate your business from the competition.
Whether your business has 15 or 500 employees, and regardless of your industry, now is a great time to become familiar with sustainability and put good practices in place. EDC resources can help you get started and equip you with the tools you need to gain a competitive advantage in a changing world.
- Build your knowledge
Learn more about the business landscape around sustainability and the issues most relevant to your business.
- Understand risks to your business
Depending on your industry, customer base or trade opportunities, you may need to accelerate your sustainability timeline. Understanding the business risks associated with inaction can help focus your efforts.
- Start small and scale up
Consider sustainability as a marathon, a long-term journey. You don’t need to attempt everything at once. Break your efforts down into manageable steps and tackle them one at a time. Focus on “quick wins” that are easy to action in the short term.
Focus your time and resources on ESG issues that matter most to your company and stakeholders. Prioritize initiatives that best support or complement your company’s purpose, products and services.
- Align with your business goals
Sustainability shouldn’t be viewed as separate from your other business strategies. Integrate it into your decision-making and operations.
- Build a sustainability mindset into your culture
Appoint a dedicated person or team to drive your sustainability efforts. Educate and engage employees.
- Find opportunities to differentiate your business
The fast-growing landscape of sustainability is full of possible business opportunities.
Promote your sustainability efforts, so your customers, employees, partners and other stakeholders know what you’re doing.
This information is part of EDC’s series on sustainability topics that matter to SMEs, to help Canadian companies build their business in a responsible and sustainable way, and boost their chances of international success.
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