With the 51st anniversary of Earth Day just around the corner, there’s one word that every businessman or woman should be thinking about: sustainability.
Inspired by the dire needs of climate change, entrepreneurs across the globe are taking a new approach to business. And as they’re proving day after day, even during a pandemic, you can build a business that makes a profit, has scalability, and impacts the world for the better. You can use sustainability as an asset.
But do you have to? Is sustainability a nice-to-have or a must-have?
We went to GLOBIS faculty to hear their thoughts.
April 2021 Questions & Answers
Q: Why should business students be thinking about sustainability?
“Are you ready to lead?”
A: Simply put, business students need to be thinking about sustainability because that’s what’s required in today business environment.
A business can be passive or proactive towards sustainability, but can’t skirt around sustainability. Governments are putting up stricter regulations and heftier fines, competition is touting its green programs, and consumers are demanding healthier and more environmentally friendly products.
Businesses should really take a proactive approach towards sustainability, even though it requires deeper thinking and more determination in execution. By putting real focus on sustainability, businesses can push for greater innovation, uncover new markets, lower operating costs, improve brand value and reputation, and create an uplifting working environment. Leaders don’t treat sustainability as a nice-to-have or an isolated corporate CSR effort—it’s an integral part of a company’s overall strategy.
Are you ready to lead?
“It is a choice, but…”
A: It is up to the sense of value of each student.
If the student believes that human sustainability is critical for their lives, they should just go for it. Business can be a great help for changing human behavior, as well as corporate behavior. Learning about business can accelerate a student’s social and environmental initiative.
Though it is a choice, if a student put lower priority on sustainability, I would remind them that corporations can hardly survive without considering sustainability. Companies that harm human sustainability are penalized by the capital market, recruitment market, and business transaction market. For example, Apple Computer recently committed to becoming 100% carbon neutral in its supply chain by 2030. That means businesses in their supply chain that cannot achieve carbon neutrality will lose their contract with Apple.
We’ll see more and more of this in the future, so business students should definitely be thinking about it.
“The roles and responsibilities of managers have inevitably changed.”
A: It has never been more important for leaders to nurture a lasting impact on our planet, communities, organizations, businesses, and homes. Over the last twenty years, the way we think about management has changed dramatically.
In the past, management was defined in the context of competition. Winning that competition meant our life was enriched. It meant satisfaction, even self-realization. However, with climate change, we’ve entered an era in which the survival of humankind is in jeopardy as a direct result of our economic activities. The roles and responsibilities of management and leaders have inevitably changed.
Business students need to learn to lead in the new era. Doing business sustainably is how they will find happiness and satisfaction in their careers and lives.
Q: What is your top advice for entrepreneurs hoping to build sustainability or environmental impact into their business model?
Build it into your business model.
A: Make sure you build sustainability into a sustainable business model! I’ve seen too many entrepreneurs, especially social entrepreneurs, long on passion but short on making their own businesses sustainable.
The concept of triple bottom line (TBL)—profits, people, and planet—is not new, but it is incredibly hard to achieve. There are so many temptations and so much pressure that will draw entrepreneurs’ attention to financial gains, sometimes for very sensible reasons. Passionate entrepreneurs need to be steadfast to their original aspiration, let go of some near-term gains, and meet the seemingly insurmountable challenges along the way. That’s why it’s exceedingly important for entrepreneurs who want to build sustainability into their business model to walk the extra mile.
Make sure your startup venture itself is financially sound.
At the end of the day, your startup can make an impact on our society and the environment only if it stays alive (and hopefully achieves prosperity).
Create a doushi platform.
My advice is to create a doushi platform.
Doushi (同志) is a Japanese word meaning “same mission.” For entrepreneurs to change the behavior of many citizens, they need to create a movement and involve millions of participants. For that purpose, it is critical to create some kind of platform that connects people with the same mission.
For example, mymizu has connected people who want to stop using plastic bottles. They did that by successfully building a network of restaurants that are willing to serve free water, even to non-customers. Pirika, too, created a community app on which members applaud each other when they pick up litter on the street, beach, etc. Mosaic created a peer-to-peer lending platform that encourages homeowners to install solar panels on their roofs.
Each of these entrepreneurs built doushi platforms and facilitated interaction in the network. This approach accelerates both a business transaction and social change.
Consider needs, strengths, and speed.
A: First, determine what your customers are struggling with. What do they need, or what will they need in the future? Think about the customer’s perspective and how to solve their troubles.
Next, consider what you can do that no one else can. The internet has helped spread information faster than ever before—all of the obvious solutions are already underway. Future entrepreneurs need to think deeper and come up with ideas no one else has thought of yet.
Lastly, get your business started as soon as possible. The faster you move, the faster you can fail—and the faster you can fix what doesn’t work. That will help you gain experience quickly. With so many competitors, experience is very important.
Tomorrow’s entrepreneurs will face unique challenges, but they also have so much potential. I can’t wait to see what they come up with.
Want more GLOBIS MBA faculty insights? Click here for more Critical Questioning.