Sustainability now considered economic and environmental
The vast majority (86%) of businesses now define “sustainability” as both environmental and economic, according to our latest energy research.
Our annual research revealed some other interesting trends.
Customers are driving change
Consumers are now becoming more selective in their buying behaviors and are, more and more, choosing suppliers that have a lower environmental impact. Of the most customer-focused businesses we interviewed in our research, 49% are trying to work with suppliers with decent sustainability credentials. In keeping with this, being “socially and environmentally responsible” is now a top three business priority for 43% of businesses - a significant jump from 2017, where it ranked a low sixth on respondents’ priority lists.
Perceived risks are growing
Businesses are also changing in how they view risk. Today’s businesses are faced with a diverse and ever-evolving range of risks – including cybercrime, natural disasters, financial risk, and disruption to their existing business models. In addition, as more and more businesses are pursuing digitalization initiatives, they are also increasing their reliance on energy. Energy resilience and security is now in the top 4 areas of perceived risk for businesses. By taking a more innovative approach to energy, businesses can ensure a reliable supply, and meet important environmental targets. Organizations which view energy as a strategic asset, rather than a cost, continue to outperform their competitors in terms of revenue growth prospects, reduced costs and brand reputation.
Energy is an increasingly vital part of an overall business strategy
As an increasing number of businesses are changing their legacy thinking around energy, they are making it a fundamental part of their overall business strategy. In fact, our research revealed a positive improvement in organizations’ energy maturity, with the proportion of organizations that consider themselves “very advanced” in terms of their energy leadership - that is having a detailed energy strategy which works seamlessly with the organization’s wider business strategy and implementing it - increasing by 6%. Back in 2017, we saw that organizations were beginning to think differently about energy, and this is a trend that has continued – the number of organizations with an energy strategy containing defined targets, actions and budgets has increased. Sustainable businesses lead the way with 87%, a clear 20% more than all other businesses.
Yet only 1 in 8 businesses are doing it successfully
Despite all of this progress, our research revealed that only 1 in 8 businesses can actually be classified as “sustainable businesses” – according to our Sustainable Business Model.
Those that are successfully balancing their economic and environmental priorities meet all of the eight criteria outlined by our model. In particular, sustainable businesses are implementing more advanced energy solutions which can lead to better operational efficiency, the ability to control risk and improve resilience, and drive better financial performance. For instance, 63% of sustainable businesses are investing in energy efficient solutions, compared with 28% of other businesses.
What does this mean for your business?
Becoming a sustainable business isn’t something that can be achieved overnight, and the journey can be challenging. Many successful businesses are complementing their internal expertise by engaging a third party, like Centrica Business Solutions, to help them understand the energy market and associated technologies, build business cases, engage stakeholders and support implementation.
Download our full report to learn more about the outcomes of our research, get practical advice on how to evolve your business, and find out how we can help.