Sustainability & Growth: You can't have one without the other

What is Sustainability?

At one point in American history, the whaling industry personified American prosperity. It employed thousands of workers, fueled thousands of homes & businesses and it created fortunes for many. There was just one problem: the whale stock was depleting, hunters continued harpooning and today nearly all the whales are gone. Within a few years, an industry that had thrived for a full century collapsed entirely. This example represents how a business can make their enterprise unsustainable.

So here is that word again, sustainability. What exactly is it?

The word "sustainability" originated in the 1980s when nations had to find ways to grow their economies without destroying the environment or sacrificing the well-being of future generations.

Today, sustainability has become the buzzword for a large variety of social and environmental causes, but in the business world it stands for a very powerful idea that a sustainable corporation is one that creates profit for its shareholders while protecting the environment and improving the lives of those with whom it interact.

Sustainable organizations work towards preserving natural resources, including water, air, and all sources of energy.

An organization built on the principles of sustainability is built to last, and the only way to succeed in today's interdependent world is to embrace sustainability.

The Sustainability "Hot Spot"

"Sustainability is not about sending a check to a charitable organization, though there is nothing wrong in doing so," says Martin Michael, Vice President, Energy Solutions at Avanceon, whose headquarters are located in Exton, PA.

Martin continues, "The sustainable company conducts its business so that benefits will naturally flow to shareholders, customers, business partners, and the communities in which it operates."

Sustainability is the overlapping of the interests shared by your financial stakeholders and that common ground shared by your nonfinancial stakeholders. This common ground is called the "Hot Spot," where the goal of profits blends with the goal of the common good.

The best-run companies around the world are trying to identify and move into their own "hot spots," and they are discovering new ways of doing business in order to get there and stay there.

Take for example, a major company that started out in "everything electrical." In years past, this organization fought the U.S. Environmental Protection Agency (EPA) to avoid responsibility for polluting our rivers.

Today, this very same company has developed a new initiative that goes beyond compliance that will ultimately benefit society and the long-term health of the organization. Their main goal is to create clean technology to help its customers reduce their environmental impacts, primarily carbon emissions. This company announced it will double its annual investment by 2010 in clean energy technologies, and they project revenues from eco-friendly products to double as well.

The overlap between winning increased market share and supporting healthier lifestyle habits is also a hot spot for a major cola company. This major company, known for sugary sodas, purchased several "healthy product" companies. Subsequently, this "healthy-product" hot spot is the fastest growing segment for the cola company.

But healthy products is not all this company is doing. They are working on other hot spots, and they are working towards the goal of cost reduction such as improvements to reduce their energy, waste, and packaging. This social responsibility has helped this major cola company grow their earnings per share and in turn make their company more sound for decades to come.

"When companies try to be viable for the long term, they manage their business based on principles that will strengthen rather than undermine the company's roots in the environment, the social fabric, and the economy," says Martin. He continues, "A business that strives to fit as much of its activities into that "hot spot" zone should have real long-term advantages over its rivals."

"Avanceon is also working towards finding that hot spot, not just for ourselves but for other organizations as well," says Bill Fenn, Director, Energy Solutions at Avanceon. Bill continues, "Take for example, our iBoiler service, a total steam management solution which provides a benchmark for performance and helps keep a plant focused on operating with efficiency in mind. We can help our customer save 10% in fuel costs as well as reduce their carbon footprint by showing them how to optimize their boilers' performance."

"A company can spend down its capital for a while, but generally not for long. A firm that works on principles of sustainability is built to last, says Martin Michael. "We have seen a huge influx of interest in our iBoiler service, "he continues. "Companies today know that a good place to start their sustainability effort is to begin looking at their boilers which are a major source of heat production and power, but consume huge quantities of fuel and electricity."

Avanceon is an Exton, PA-based solution provider to industrial and manufacturing companies worldwide. Avanceon is a CSIA Certified Member. For information on how you can get started on your sustainability plans, please call Martin Michael, Vice President, Energy Solutions at 610-458-8700.