The Business of Sustainability
Sustainability means profitability
…for m&e firms
By Ewen Rose - consultant to M&E Sustainability
The word sustainability is beginning to suffer from overuse, but specialist contractors must resist any temptation towards cynicism and apathy because it also represents one of the biggest opportunities our sector has ever seen.
Corporate culture and property values are beginning to drive the sustainability agenda far faster and harder than the Government’s attempts to legislate their way out of climate trouble. Sustainability principles are becoming part of normal business practice, and those companies who take up this challenge will be more profitable in the long term.
There is considerable pressure on companies to achieve higher standards of performance in ethical, environmental and social dimensions thanks to the demands of Corporate Social Responsibility (CSR) reporting. Major investment decisions now take CSR performance into account – hence why sustainability is becoming a boardroom issue.
It is no longer enough for companies to concentrate on financial issues. They are expected to take responsibility for their environmental and social impacts; to understand the interests and demands of all stakeholders, and to demonstrate through greater transparency that they are behaving responsibly.
A company that ignores ethical, environmental or social issues may destroy value through inadequate management of risks, but may also limit value through missing opportunities. Energy prices are also having a more significant impact on profits.
This is as much an issue for contractors providing relevant services to clients as business people in their own right.
Sustainability can deliver real business benefits. A whole new market is developing for renewable technologies such as heat pumps, solar hot water collectors, biomass boilers and so on. There is an even bigger demand for expert design advice and implementation – with a limited number of companies able to provide it. M&E specialists have many of the core skills required to act as sustainability experts for clients.
Consumers and customers want more: they want higher quality products and services; they want better value for money. But increasingly they are balancing their choices against their own set of values, ethics and behaviour. Sustainability issues and climate change will become increasing factors in their purchasing decisions.
The ‘Greening of the Supply’ chain will be more common for larger companies and clients in the future, thus m&e companies need to adapt and be prepared. This will affect their prospects for being considered as a preferred supplier as well as for gaining approval for tender lists.