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Sustainable Business Model
Sustainable business models (SBM) incorporate a triple bottom line approach and consider a wide range of stakeholder interests, including environment and society.

Sustainable Business Models (SBM)


Sustainable business models (SBM) incorporate a triple bottom line approach and consider a wide range of stakeholder interests, including environment and society. They are important in driving and implementing corporate innovation for sustainability can help embed sustainability into business purpose and processes, and serve as a key driver of competitive advantage.


A sustainable business will make profits over the long term whilst not causing environmental damage. The sustainable business model provides a competitive advantage by aligning profit and environmental objectives.

Drivers for sustainable business Model:


Many drivers in combination provide a strong business case for sustainability.

Cost savings – using less material and energy means reduced costs and less exposure to volatile raw material prices.

Customer demand/ loyalty/ trust – many consumers now alter their buying habits for environmental benefit.

Regulations - increase in Government regulation, standards, green taxes and incentives.

Supply chain - pressure from suppliers to improve efficiency and become more sustainable.

Employee recruitment, retention and motivation – many employees demonstrate greater commitment when they work for environmentally responsible firms.

Innovation – going green requires a commitment to innovation, which can increase profits.

Moral issues - many companies adopt a sustainability position because of the moral imperative to tackle environmental issues.

Business sustainability requires firms to adhere to the principles of sustainable development. According to the World Council for Economic Development (WCED), sustainable development is development that “meets the needs of the present without compromising the ability of future generations to meet their own needs.” So, for industrial development to be sustainable, it must address important issues at the macro level, such as: economic efficiency (innovation, prosperity, and productivity), social equity (poverty, community, health and wellness, human rights) and environmental accountability (climate change, land use, biodiversity).

Sustainable business Model best practices:

Stakeholder engagement: Organisations can learn from customers, employees and their surrounding community. Engagement is not only about pushing out messages, but understanding opposition, finding common ground and involving stakeholders in joint decision-making;

Environmental management systems: These systems provide the structures and processes that help embed environmental efficiency into a firm’s culture and mitigate risks. The most widely recognized standard worldwide is ISO 14001, but numerous other industry-specific and country-specific standards exist;

Reporting and disclosure: Measurement and control are at the heart of instituting sustainable practices. Not only can organisations collect and collate the information, they can also be entirely transparent with outsiders. The Global Reporting Initiative is one of many examples of well-recognised reporting standards;

Life cycle analysis: Those organisations wanting to take a large leap forward should systematically analyse the environmental and social impact of the products they use and produce through life cycle analysis, which measure more accurately impacts.

Firms that are sustainable have been shown to attract and retain employees more easily and experience less financial and reputation risk. These firms are also more innovative and adaptive to their environments.


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