It’s been said that there won’t be any sustainability in business until someone can make a case for them that makes financial sense. Of course, it also used to be the case that companies viewed their sustainability initiatives as side shows, and refused to invest the capital in them that they needed to really return actual results.

The same old adage applies in business as much as it does everywhere else, you get out what you put in. Ultimately, a business has to be willing to invest money into their sustainability programs, departments, or initiatives, or else the results will be minor or nonexistent.

Luckily, this outlook is starting to change. A recent article from The Guardian has discussed how money is no longer the “dirty word” it used to be in corporate sustainability. Companies like General Mills are spending upwards of $100 million on renewable energy and running an efficient company.

This seems like common sense. The more you invest in sustainability, in improving the lives of your workers, the more money you make, right? But it has taken a shockingly long time for business to come around to this, and many businesses still focus on minor CSR initiatives that are purely for image and not really about helping anyone.

The idea still exists that the way something has always been done is the best way, and that’s simply not the case anymore. The truth is business has an even more important role to play in shaping the future of the world, its peoples, and its environment. Millennials already expect the companies they work for to demonstrate care for the environment and social goals. Generation Z, the ones after us, expect companies to not only care about the environment, but to make decisions on profits factoring in environmental and social issues.

Once, a business could wait for government regulations or consumer pressure before making a decision. Today, the only way for a business to survive in a rapidly more competitive market is to outpace competitors and be able to provide more value to consumers, value that can often be added to by sustainable programs and demonstrating to consumers that all stakeholders are important and valued. Transparency, sustainability, and value are the keywords that will separate those that will survive and those that will not.

What is the duty of a corporation, and is CSR a necessary and effective part of it?

If you’re Milton Friedman, it’s to make as much money as possible for the shareholders within legal limits.

If you’re Kenneth Arrow, it’s to provide CSR to address externalities on 3rd parties, but still with a preponderant emphasis on profits for shareholders, with some concern for stakeholders.

There’s also the newer view that we’ve discussed in class, that CSR for many companies is largely ineffective, and even more problematically, mostly window dressing. It’s a tacked on program that has no real goals, no real results, and mostly exists because businesses feel that it HAS to exist. However, does this mean it can never be a positive force for good?

Not at all, argues Patrick Moorhead in his recent article on Cisco and their CSR program. In the article, he discusses how the CSR program has been a massive pillar in the tenure of their current CEO, Chuck Robbins. He points out their clear goals and progress, and talks about how it’s run like a real business with actual metrics and actual accountability. Their investments and partnerships with non-profits point towards an actual desire to provide genuine responsibility for all their stakeholders is a key argument he makes.

So, is it THAT perfect? Is Cisco’s model the exact type that companies should be working towards?

Well, not quite exactly. Cisco’s model is excellent, and it has some of the things that any sustainable model within a company needs. It has the clear leadership and support from someone at the top of the chain. It also possesses clear goals, target dates, and perhaps most importantly of all, it possesses transparency. Cisco releases reports on their CSR progress every year and is honest about the places they still need to go. Great, right?

But it’s still lacking the thing I feel separates CSR from what a company should strive to be, and that’s a company-wide sustainability drive that is present everywhere, in every department. The CSR initiative at Cisco is still one small area, one that’s hidden away on their website. While their progress is real, there’s no guarantees that it will stay when the CEO leaves. The philosophy and company-wide acknowledgement of the needs and importance of sustainability. While Cisco’s program may be what CSR needs to be, it’s not what business should strive to be. There’s always progress to be made, but making sure that the philosophy and push for the stakeholder is present through every member of the company, top to bottom, is a necessary but tough step.

Still, I can’t fault Cisco too much. Don’t get me wrong, their CSR program is extremely effective, FOR a CSR program. But CSR is no longer the optimal way forward, and business needs to look ahead to having corporations be just as much about sustainability as they are profits. There’s a ways to go, but Cisco is well on the way.

“But how much will it cost?”

It’s one of the first things that will be asked when someone is trying to start a sustainability initiative. One of my first questions for the Zero Waste Market was what kind of budget they were looking at. The sad truth is that for the most part, businesses and consumers ultimate decisions are based on cost.

This becomes especially apparent through recent articles examining the so-called “green gap”, or the gap between consumers who profess to purchase based on a products green attributes and the number who actually do. Somewhat unsurprisingly, people’s self-assessments rarely translate into actual sales. This leads to the question of what is the best way to improve actual sales while still prioritizing sustainability initiatives, whether social or environmental.

The article’s conclusion is that the best way to finally overcome this “green gap” is to drop the focus on sustainability for the most part and focus instead on a mixture of quality and/or price, factors that will make a much bigger impact on consumers.

This argument certainly has a point. If one thinks of certain brands like Patagonia, it is the quality of the goods that determines the sales just as much or even more than the sustainability drive behind it. However, I don’t think that one needs to focus on quality/price and ignore sustainability to close the green gap, but merely integrate the three closer together.

Simply look at the way Unilever has done it. While they are working towards becoming a registered B-Corp, one would never know their work on sustainability simply looking at the packaging. However, they haven’t abandoned any of their work on environmental sustainability and supply chain efficiency. As I’ve talked about earlier in a previous blog, if a company can reorient their design and product philosophy towards sustainable goals, efficiencies and creative thinking can even help erase certain costs, especially in areas of efficiency. Cost, quality, and sustainability marketing don’t have to be opposed, and the correct way to think of closing a “green gap” is ultimately making sure that all of those 3 match up.