Sustainable Business Model

In today’s fast-changing world, organisations that strike the right balance between economic and environmental considerations throughout their energy strategy are more profitable and better prepared for long term success. In all senses, they are truly sustainable businesses.
Economic considerations
Sustainable Businesses recognise the importance of operational excellence. They are focused on gaining better cost control and management of their energy, ensuring continuity of supply, and reducing reliance on the grid
Environmental considerations
Sustainable businesses are focused on reducing carbon emissions and improving the environmental credentials of their organisations and their supply chain, to ensure they can meet their net zero targets and harness reputational benefit.

Sustainable businesses keep these economic and environmental considerations in balance with one another when designing and implementing their energy strategy. They are successful because they know they cannot focus exclusively on profit without considering their environmental impact – this would lead to them being punished by consumers, shareholders, investors and employees who are looking to work with environmentally friendly brands. But at the same time, sustainable businesses also recognise that prioritising environmental concerns over financial performance would leave them without a viable business model.

By finding the right balance between economic and environmental considerations, sustainable businesses outperform their competition and drive long term business success. Businesses recognise that customers are choosing to buy from customers who prioritise environmental issues, creating a clear connection between financial and environmental concerns:

believe that offering environmental products and services is very influential in a customer’s decision to work with them
have changed their brand positioning to demonstrate they are environmentally friendly
report increased company reputational benefits from investing in energy technologies

Centrica Business Solutions research - statistics based on a ten country survey of more than 1,500 energy decision-makers in large organisations.

The eight characteristics of sustainable businesses

To help guide organisations down the right path towards becoming a truly sustainable business, we created a Sustainable Business Model, with input from influential analysts and interviews with over 1,500 energy decision makers, as part of our Distributed Energy Future Trends report.

This model identities the eight characteristics that consistently underpin business success. In order to be a truly sustainable business, these traits must be executed in a manner that is both environmentally and economically balanced.

The first six of these characteristics – continuously innovates, adopts long term thinking, challenges legacy thinking, has a relentless customer focus, understands external trends and works to improve the environment – have a direct impact on the way energy is acquired, consumed and managed. Organisations that execute these traits in a way that is economically and environmentally balanced will be best placed to build an energy strategy that drives long term success.

Energy has an indirect impact on the final two characteristics – grows own talent and contributes to local communities. Nonetheless, a sustainable business will recognise that it’s still important to execute these traits in an economically and environmentally balanced way, since these characteristics will affect how successfully the energy strategy is integrated into the wider business strategy, and the results that will be delivered.

Prepare for a more sustainable future

The Sustainable Business Model was developed with the input of 1,500 interviews with energy decision makers in large organisations across 10 countries and 7 vertical sectors. Alongside the Sustainable Business Model, the Distributed Energy Future Trends report was also an outcome of that research. Download the report today to learn more about what it means to be a sustainable business, the changing role of energy, and the steps organisations should take to prepare for a more commercially and environmentally sustainable future.

1. Continuously innovates

Harnessing emerging energy technologies enable sustainable businesses to develop new products, services and processes with enhanced green credentials. At the same time, they recognise that as their business becomes more digitalised, investing in innovative energy technologies can help them to build greater resilience to power interruptions and prevent costly operational failures. Ensure your digitalisation strategy encompasses the energy implementations, and also look at how multiple energy technologies can be integrated, to deliver incremental benefits.

2. Adopts long term thinking
When it comes to energy strategies, sustainable businesses ensure they have specific targets, budgets and actions, alongside a clear roadmap for investment in future energy technologies, to keep them on the right path to becoming a low carbon organisation and meet their net zero goals. But they also ensure this strategy is underpinned by data and predictive analytics, to simultaneously ensure they make improvements in operational performance and cost control. Formalise your energy strategy with a comprehensive, holistic roadmap, to ensure you balance these financial and environmental considerations at every stage.
3. Challenges legacy thinking
Sustainable Businesses embrace new opportunities, including being more flexible in new ways of generating, consuming and managing energy that improve their environmental impact. They also look to unlock new revenue opportunities from their energy estate and look for ways to reuse wasted energy as a power source through the circular economy, in order to become more economically efficient. Start by embedding energy efficiency measures throughout your company as the springboard to go to the next level with smart energy technologies and on-site generation
4. Has a relentless customer focus

Customers increasingly opt for environmentally friendly brands, so sustainable businesses embrace low carbon energy solutions that enable them to build genuinely green credentials into their brand. They also recognise that customers want reassurance that they’re working with companies that have long-term access to resources, so sustainable businesses invest in technology that delivers secure, commercially viable access to energy, while driving efficiency and transparency. It’s prudent to ensure your brand has clear, genuine green credentials that are fully embedded in each area of your business.

5. Understands external trends

Sustainable businesses recognise that the environmental landscape is ever-changing. They’re continually looking to understand external trends so they can be ready to adapt to new policies and regulations, since our research found that they view energy resilience and security as being a top four business risk. But from an economic perspective, they also consider how these external trends will affect their future energy requirements and think holistically about how they will generate cost savings and efficiencies. Energy supply and costs may continue to be volatile, but including detailed plans and targets around resilience in your energy strategy can safeguard your organisation.

6. Works to improve the environment

Sustainable Businesses focus on reaching their net zero goals to become a low emission organisation, and carefully consider how energy contributes to their environmental footprint. They embrace new technologies that enable them to lower their carbon emissions, such as electric vehicles. But they also recognise that an effective energy strategy can help to safeguard their efficiency and resilience. When fully integrated into the wider business strategy, their efforts to improve the environment can help them achieve their commercial goals too.

7. Grows own talent

Sustainable Businesses actively encourage their workforce to embrace their energy strategy. They avoid siloing energy and encourage organisational-wide engagement and collaboration on environmental matters. Where required, they also supplement internal skills with external support, so their workforce can focus on strategic priorities that affect their long-term ability to meet commercial goals, rather than ongoing tactical concerns. To support and spearhead these efforts, consider elevating the role and position of your energy manager to a technologist role and figurehead of all things environmental.

8. Contributes to local communities

Sustainable businesses recognise that they cannot operate in a silo, so work with regulators and generators to balance energy supply and demand, and partner with local businesses to share energy infrastructure. Not only does this improve the environmental impact, but unlocking new approaches to generation and storage can give everyone more control of energy, including its cost and reliability. Consider if there are opportunities to share energy infrastructure or collaborate with neighbouring sites, in order to meet the needs of balancing the grid, and also improve your own carbon footprint.

The insights behind sustainable business

In our report we share the most significant results from our research and introduce our Sustainable Business Model. We outline the key characteristics and action points to become a sustainable business, and how energy can help prepare businesses for a more commercially and environmentally sustainable future.

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