In my waste prevention and energy efficiency outreach work, many businesses have told me they require a two year return on investment (ROI) or better to implement projects. Asking business managers what ROI they expect from a given sustainability project helps clarify expectations for a project up front.
Contrast that with the retail lumber company I interviewed for this research project that described their solar photovoltaic project with a seven year ROI as “a cash machine on the roof.” After the $200,000 solar system paid back the initial investment, the company saw the system as “generating money.” Clearly there are more factors at play when people decide whether to pursue a sustainability project than just cost savings.
Branding is important too
The 107 research survey respondents were allowed to give more than one answer to the question about motivations. A large percentage of survey respondents said reputation and brand strength was important as well as cost savings.
Consider consulting firms which have pressure to maximize client work and minimize time spent on non-billable overhead. Environmental consulting firms in particular want to be consistent with their green branding. Yet, someone in the organization must spend time setting up new systems to green operations by volunteering their free time or using non-billable overhead hours.
The sustainability coordinator I interviewed at an environmental consulting firm for this project said that when she started working at the firm, each employee was given a $100/month parking allowance. She found the fact that employees were incentivized to drive their cars instead of take mass transit to be appallingly inconsistent with the firm’s brand, especially since there were government subsidies for public transportation available. She set about to flip the incentive system and lower the office’s CO2 footprint.
There were some people in the office who resisted losing their parking subsidy for convenience reasons but the sustainability coordinator worked through their objections. She set up access to the ZipCar car sharing program for back up rides home or important client meetings. There were environmentally preferable alternatives to the system that encouraged single occupancy vehicle driving, the management wanted to be consistent with their green branding, and yet someone needed to lead the office through the process of making the changes.
Ultimately the sustainability coordinator characterized management’s response to the alternative commute subsidy proposal this way. “They’re super swamped and pulled in a million directions, especially since we are a consulting firm. So it’s not necessarily their priority, but they are definitely supportive if someone else is implementing the project.”
In some industries, green projects give employee morale a big boost
Employee turnover in the restaurant industry is famously high. One microbrew restaurant implemented an employee bike program to improve employee retention. When the bike program was started, employees were asked to contribute a small amount of money for the bike with each paycheck. After working at the restaurant for 1,000 hours, if an employee agreed to use the bicycle to commute to work at least 45 days/year, they received a new bicycle with the company logo and their name on it.
In the past three years the restaurant has purchased 60 bikes for their employees. To make way for bicycle parking, management removed a few car parking spaces. When restaurant guests arrive they see rows of brightly painted bikes out front which lends a welcoming ambiance to the restaurant’s entryway.
According to the owner, funding for the program came out of their operations budget. She felt the expense was more than repaid by the boost in employee morale and worker retention.
Confirmation that the “right thing to do” is a major factor
Above all, the most popular answer to the question “What are your organization’s motivations for doing sustainability” was that it’s the right thing to do.
At a different brewery, one that implemented a dimmable LED lightbulb retrofit, the owner frequently asked the Director of Sustainability “What’s the next big thing? Are we doing what we should be doing? Is there any new technology?” Sustainability is a key part of the company’s mission as the owner founded the brewery with a commitment to make 100% organic beer.
Sustainability even factors into their hiring. When interviewing potential new employees, the hiring team asks “What do you do at home that is a sustainable action?” The Director of Sustainability said “It’s a very simple filter but it helps ensure that the employees we hire will have an interest in sustainability at work.”
Asking for more
Over 99% of all businesses in the U.S. are small and understanding what motivates them to implement sustainability projects will be useful as we encourage them to do more. As we can see from this research, there are complex, interconnected factors at work when businesses decide if they will implement operational greening projects. Small businesses are concerned with how their employees view the organization as evidenced by how long their employees work at the organization. They are concerned with how people outside of their organization view them. They are interested in how future generations will view them: if they did enough to help build a sustainable future. At the same time they want to do more with fewer resources and save money so they can be financially sustainable. Whatever each business’s mix of motivations, we know that the business community plays a vital role in building a sustainable future.