Green Economy: some tips for sustainable business

Getting a startup to be born and carried out in full respect of the environment is a categorical imperative nowadays, where attention to sustainability is at its highest, both among consumers and investors. That is why you absolutely must know every aspect of the so-called Green Economy: in particular, you must know precisely what it is, what benefits it ensures to entrepreneurs and what, on the other hand, are the risks. Not only that: you also need to know the certifications to be obtained and the best practices to be implemented to make your business environmentally sustainable.

Let’s clarify: what it means to be green

First of all, as mentioned above, we need clarity on the definition of green economy. More and more often, among entrepreneurs and would-be entrepreneurs, one hears this concept repeated, but few really know what the green economy is. After all, in recent years, the growing attention to environmental issues has led to the spread of various definitions related to the meaning of green economy.

definition of green economy

Green economy is generally understood to be a particular theoretical model of economic development in which productive activity is taken into account by assessing not only the benefits arising from its growth, but also the impact on the environment and society brought about by its activity. At the same time, however, the so-called green economy can also be defined as an economic form in which investments, whether public or private, are aimed at reducing CO2 emissions and pollution in general, increasing energy and resource efficiency, avoiding biodiversity loss, and conserving the ecosystem.

At the institutional level, UNEP (United Nations Environment Programme) has defined “green” as an economy that can improve human well-being and social equity, as well as, simultaneously, reduce environmental risks and ecological scarcity.

The European Commission, on the other hand, has defined the green economy as an economy capable of generating growth, creating jobs and eliminating poverty while safeguarding nature’s resources on which Earth’s survival depends.

Finally, the OECD (Organization for Economic Co-operation and Development) on the concept of “green growth” has referred to economic growth that reduces pollution, greenhouse gas emissions and waste, thereby ensuring that natural assets continue to provide the resources and services on which people’s well-being is based.

What are the advantages (and disadvantages)

Now that you are a little clearer on the definition of a green economy, it is important that you also know what benefits your startup can have if you decide to promote an environmentally sustainable culture.

In this regard, you should know, first of all, that your company can benefit from an increase in its turnover related to export growth, because the foreign market is particularly keen on favoring “green” companies.

A company that operates in an environmentally sustainable way is more attractive not only in the eyes of consumers (an aspect that translates into higher sales volume, in Italy as well as abroad) but also to those of potential professional collaborators and investors. This is also accompanied by another factor that you must take into account for your startup: in recent years there has been a significant growth in incentives in favor of green economy companies.

That’s not all: economic savings are also linked to reduced consumption of electricity, printing, and raw materials.

Keep in mind, however, that the green economy also has disadvantages: the main ones involve higher production costs, related, in particular, to the price of infrastructure and technologies needed to successfully complete production processes that are environmentally sustainable.

Environmental standards and certifications

It is necessary to emphasize, having reached this point in our analysis, that there are precise environmental standards and precise certifications that define how companies manage to implement the right eco-sustainability measures.

Do you know what ESG means? It is an acronym that stands for “Environmental,” “Social,” and “Governance” and identifies the 3 dimensions through which a company’s sustainability performance can be measured.

ESG criteria

The fact that ESG criteria use standardized and shared parameters makes such measurement objective and accurate, as well as very effective in assessing companies’ commitment in this direction. It will be useful for you to know that among the cornerstones of ESG is the principle of Carbon Neutrality, understood as the ability to reduce greenhouse gas emissions and create the best conditions for them to be reduced to zero.

Be careful not to underestimate the importance of the above, because investors are increasingly using ESG criteria for their investment choices.

Consider that the 3 ESG criteria represent the sublimation of the 17 Sustainable Development Goals (SDGs) encompassed in turn in a major program of action that identifies as many as 169 targets or goals. In September 2015, representatives from 190 countries gathered at the United Nations to sign a common commitment to achieving well-defined goals for development, well-being and environmental protection. A veritable 17-point list was drawn up to be pursued by 2030 and beyond:

the sustainable development goals

Clarity must now be shed on the aforementioned environmental certifications: they are distinguished into product environmental certifications (aimed at goods or services) and process environmental certifications (aimed at the production process and the organization of the production structure). It is also important to know that some environmental labels are mandatory (such as, for example, energy labels for household appliances), while others are voluntary (i.e., required by companies themselves).

The international standard ISO 14001 is a voluntary environmental product certification that applies to all types of companies and is intended to demonstrate that the certified company has an adequate environmental management system to control its activities in a consistent, effective and sustainable manner.

ISO 14001 environmental certification generally goes hand in hand with the European EMAS regulation, another voluntary tool for companies, organizations and public bodies. Member companies undertake to produce an environmental statement, explaining what they have achieved and how they intend to proceed in the future to improve performance with a view to eco-sustainability. The EMAS regulation also ensures benefits and an economic return for participating companies.

You must know, then, Ecolabel: it is a voluntary European environmental certification mark, granted only to those who meet high environmental standards, since the criteria are very strict and defined on a scientific basis.

Some practices to follow

“The world is a beautiful place and it is worth fighting for”,

Ernest Hemingway used to say. But how can companies “fight back” to protect the world? In the next few lines you will discover some best practices to follow in order to operate in an environmentally sustainable way.

Involve employees in implementing sustainable behaviors

If you want your startup to operate with full respect for the environment, you need to be concerned that all your employees and collaborators are aware of this and motivated to do their part to contribute to the success of your mission. For this reason, it is crucial to make them aware of environmental protection, involve them in implementing sustainable practices, and encourage them to adopt behaviors in this direction.

Reduce emissions of polluting gases

Measuring, reducing and offsetting greenhouse gas emissions, such as carbon dioxide (CO2) and methane, are theoretical expedients that any “green” company must be able to translate into practice. There are many ways to do this: in addition to production processes, special attention should be paid to the resources used and the travel to and from the company.

Finding local resources (including human resources)

Thinking “local” is a great way to put green economy tricks into practice: sourcing raw materials and supplies locally and hiring staff from the area where your company operates does, in fact, mean that you can reduce CO2 emissions (as well as fuel-related costs).

Encouraging work from home and encouraging green mobility

There are other ways to reduce the CO2 emissions associated with your employees’ car journeys: encouraging working from home, for example, gives you the opportunity to keep movements to a minimum (i.e., to appointments that necessarily require physical presence) and thus help reduce air pollution. Should it not be possible to adopt smart working in the company, there is an additional solution: you can decide to encourage green mobility, perhaps by using electric company vehicles.

Reducing waste

Reducing waste is another categorical imperative for “green” companies, as well as a practice that, as mentioned earlier, allows you to benefit from financial savings. Again, there are many avenues available to you: you can, for example, recycle waste or reuse it, or use recycled materials from the outset.

Recycle waste or reuse it

Waste management is a central issue for every business. In this regard, always keep in mind that the basis of proper waste disposal and reuse is the adoption of effective waste separation, through appropriate bins and containers. Remember, too, that your company’s scraps and waste can prove useful, if not directly for your business, for other local businesses that focus on recycling.

Using recycled materials

The sourcing of raw materials is another area of crucial importance in the green economy: you must necessarily examine the provenance of the raw materials you use and assess, should the need arise, whether or not there are alternatives that can ensure an ethical production cycle, such as recycled materials.