The Profitability of Green Companies

From: Alex Summers
May 2nd, 2014 | 0 Comments

No matter what you might hear on conservative talk radio or from the Tea Party commentators, the green movement is not going away. Regardless of whether or not you believe in global warming, it’s a safe bet that you believe in profits and companies that aren’t green are increasingly losing out to those that have embraced environmentalism and sustainability. Need proof? Even Monsanto is trying to get more sustainable.

Two years ago Daily Finance published a report that looked at the profitability associated with going green. That article listed IBM, HP, and Johnson and Johnson among the most sustainable corporations in the country and posited that it wasn’t just the impending threat of stricter environmental regulations that led to their shifts in world-view. It was, according to the article, a combination of pressure from consumers and a desire to make themselves more appealing to a consumer base that was getting greener-minded every day.

It’s a trend that continues even now. Today, in news that might surprise some readers, it is the automotive industry that is leading the pack in sustainability measures. Toyota, Ford and Honda specifically are in the top three. But, as the Motley Fool points out, this shouldn’t be surprising. After all, says the article, which industry stands to gain more from going green than the industry partially responsible for our global warming mess in the first place? Today’s drivers care just as much about emissions as they do gas mileage and the price at the pump (which, yes, is aggravating to big oil companies).

It isn’t just big retail that benefits from boasting environmentally friendly practices. Domestic and commercial service based companies have seen a huge boost in their profit margins as well. JaniKing, for example, a commercial cleaning business that operates primarily in the US. Going beyond green cleaning materials, it boasts an employee pool that has been trained in the latest green cleaning techniques and standards. Domestic cleaning companies (like maid services) are going increasingly green as well, choosing natural based cleansers over the harsher options that were so popular a few years ago.

Local and small businesses have also seen a boon in business from choosing the “green” route. They choose greener office spaces and fixtures and then boast about those choices in their marketing materials to help bring in foot traffic. In Portland, for example, most neighborhoods have neighborhood food-co-ops that brag about offering produce from neighborhood based gardens and nearby farms. The people who shop here will happily pay the higher prices for the produce because they appreciate the ability to “shop green” and support local businesses simultaneously.

The facts are clear: going green increases profits. If you haven’t yet chosen environmentally friendly measures for your business, now is the time to get with the program. Here are a few things you can do within the next two weeks to increase your company’s “green score”:

  • Switch to LED light bulbs and install motion sensors for spaces like bathrooms and storage rooms that aren’t used very often to help save on electric costs.
  • Contact one of the major tablet manufacturers about supplying your work force with tablets so that you can take steps to make your office a paper-less office.
  • Switch from disposable break room supplies to reusable (ceramic mugs instead of paper cups for example) and set up a kitchen cleaning schedule. Even better, save money by requiring employees to bring in their own mugs from home.

These are just three things you can do in the next ten days to improve your green score. A quick Google search will likely turn up dozens more.