and why you may have no choice
What do we owe to each other? According to Mr. T.M. Scanlon, what we owe each other is determined by our ability to justify our acts.
Now we ask, what do we owe as entrepreneurs? The economist Milton Friedman would say that a company has only one responsibility: “to make as much money as possible” and to satisfy shareholder needs above all else.
He believed that businesses should only worry about their bottom line. And that it was up to the government to worry about any other social issues.
Alright, then let me ask you this Friedman, what happens when shareholder desires and demand for social issues come together in the Venn diagram of today’s consumerism?
I’ll tell you what happens: an undeniable indication that sustainable entrepreneurship is the only way to proceed in doing business in the future.
What is sustainable entrepreneurship?
Sustainable entrepreneurship entails developing a successful, profitable company that has little or no environmental or social effect. It also means allowing your suppliers and consumers to do the same.
Sustainable entrepreneurs are aware of the responsibility they have to society and the planet and are willing to take action toward a net-zero or even climate-positive business model.
Many entrepreneurs value sustainability in their personal life but believe they lack the tools to incorporate it into their businesses. Does this sound like you? Don’t overlook the reality that in today’s start-up climate, sustainability is the most potent instrument for ensuring long-term success.
We know why sustainability matters in business. We also know that your overwhelming task list may motivate you to take the path of least resistance when starting up. But trust us when we tell you that skipping important steps now will only cause more problems in the future.
You will be opening up more opportunities and future-proofing yourself against turbulent ESG (Environmental, Social and Governance) issues.
6 steps to building a start-up and why you should do it sustainably
There are certain steps you’ll be taking to build your company. Let’s look at each step and see how and why ESG must be considered during the process.
1. You have a unique idea
Stop for a moment and think… is your business idea an unsustainable one? If so, you are starting on the wrong foot.
The future will bring many risks and challenges to your start-up. The world is demanding more ESG processes, transparency and compliance. If the very foundation upon which you’ve built your start-up is unsustainable then so too are your business and its profits.
2. You Build your Business Plan
Your business plan starts with the vision and mission statements. What do you stand for? Why do you exist? This is your chance to declare ethics and sustainability as key drivers.
Any market research, competitive analysis or SWOT analysis should consider the ESG implications. Review your internal strengths and weaknesses relevant to ESG. i.e. do you need a lot of water to run your business? Explore the opportunities and threats in the external ESG landscape. i.e. are there regulations concerning the health and safety of your product?
We agree that sustainable business is not an afterthought. It’s a highly beneficial and profitable means to success. So, plan for it.
3. You Need to Find Investors
So your start-up needs funding and is looking for investors?
ESG investing and socially responsible investing (SRI) are on the rise. This means that investors are more considerate of the environmental, social and governance impacts of a potential investment.
Companies with strong ESG policies are more likely to deliver strong returns and profits. They are also more likely to survive as they are future-proofing themselves against the rapidly changing environmental landscape.
Implementing a sustainability strategy from the get-go will give you an advantage when looking for the right investor.
4. You Must Ensure Legal Compliance
Specific sustainability, ESG and CSR regulatory requirements are coming in hot and they’re coming in fast. These non-financial disclosures are already in force for businesses of a specific size and industry and there will only be more to come.
We’re referring to the Corporate Social Reporting Directive (CSRD) which will come into force for some SMEs after 1st January 2027.
It’s essential to ensure your company complies with the relevant ESG regulations from the SEC, European Commission, the Financial Conduct Authority or any other relevant regulatory body.
You don’t need us to tell you that failing to meet any of these requirements could be detrimental to the growth of your start-up.
5. Marketing and Customer Acquisition
Your brand identity and the reason you connect with your target market can be elevated with sustainable entrepreneurship and ethical marketing. Standing out from the competition, building brand loyalty and strengthening your reputation are just a few reasons to develop your marketing plan with a sustainable mindset.
Boost your sales with repeat customers by sending a message that your brand is trustworthy. This attitude is sure to gain you referrals and valuable word-of-mouth marketing.
6. Ask for Help
Starting a business is challenging, to say the least. Entrepreneurs have to wear many hats. They’re marketing, sales, finance, customer service and web design all in one. Don’t be afraid to ask for help in your journey.
Moiety has already helped turn dreams into profits with a sustainable development plan.. Let us help you get off on the right foot. Reach out for a noncommittal call here.