How to Incentivize Businesses to Give Up the Benefits of Unsustainability

May 27, 2021 0 By Frankie Wallace

More of us than ever before are taking our responsibilities to the planet seriously. The increasing potential for future generations to be saddled with the irreversible effects of climate change has galvanized us to take action — small personal efforts as well as sweeping cultural alterations — that can help us to avoid catastrophe. However, businesses haven’t always been as quick to act  

A 2019 Environmental Protection Agency (EPA) report, “Sources of Greenhouse Gas Emissions,” found that industry is responsible for around 23% of emissions. That’s to say nothing of other waste and pollutants that companies produce. However, it is too often the case that businesses see environmentally-conscious improvements as detrimental to their bottom line. Part of the challenge as we move forward is incentivizing such businesses to move away from these unsustainable activities.

We’re going to take a look at a few of the primary areas to focus on in this regard. Where can environmental needs and business imperatives meet in a way that is beneficial to everyone and spurs meaningful change? 

How to Incentivize Businesses to Give Up the Benefits of Unsustainability

Highlight Cost Savings

One of the significant elements that affect a business’s bottom line is its overheads. There is often a misconception among business leaders that green practices tend to increase the operating costs of their companies. While there may be some additional outlay for new technology, this is more often an investment in reduced overheads. To gain the support of businesses, energy providers, employees, and campaigners must draw their attention to how this can positively impact their profit margins.  

Starting small can often be a good approach. Relatively low-cost but impactful energy-efficient alterations are helpful here. Replacing the lightbulbs throughout the building with light-emitting diode (LED) options, while slightly more expensive in initial outlay, have significant cost-saving benefits. As outlined noted, an average business utilizing 25 LED bulbs can save around $3700 per year. This is as a result of the fact that these both use lower amounts of electricity, and they tend to last longer than regular bulbs. This kind of small, yet quantifiable savings can make sustainability more attractive to decision-makers.     

The adoption of small actions can then be parlayed into other measures that both have a more significant impact on the environment and a reduction in operating costs. Recognizing how energy-efficient measures, in particular, can produce positive effects, stakeholders can then introduce concepts such as electric vehicles for deliveries, or hydrogen fuel for their fleets that is both green and costs less than regular diesel usage.  

Focus on Taxes and Deals

Even with the knowledge that energy-efficient measures tend to reduce overheads, some businesses might not consider this incentive enough to discard unsustainability. Therefore, it can be helpful to focus on another financial aspect that can sway company interests. Taxation and government support can be important points of income and profit retention for companies. As such, highlighting elements of economic assistance can be a useful part of ongoing efforts to convince business leaders to shift toward sustainability.  

However, while there have been green tax breaks and grants for some time, a lack of clarity or even understanding about what is available or applicable to certain activities can be detrimental to making the case for change. As such, staff, campaigners, and local business associations could provide well-researched information on breaks that apply to specific businesses. For example, there are federal tax credits available for switching to electric car use or investing in green production and distribution methods. Highlighting grants that can take the sting out of initial outlays can also be a push in the right direction.       

One of the more complex but impactful aspects to draw business leaders’ attention to revolves around starting relationships with green energy providers. In some municipalities, connecting with these providers early on can ensure that businesses can negotiate the best long-term deals on their electricity costs. Many municipalities are often open to engaging in power purchasing agreements (PPAs), which see green businesses and government entities locking in a low-price consumption deal for 5 — in some states upwards of 15 — years. This is a saving that is unlikely to be matched by fossil-fuel providers, and so it’s wise for stakeholders to introduce local business leaders to these opportunities.  

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Staff and Customer Preferences

Employees and consumers are the lifeblood of any business. Without them, a business cannot function, let alone thrive. As such, one of the key incentives to draw businesses away from unsustainable practices is to highlight the fact that they stand to lose both customers and staff in significant numbers. 

Consumers are becoming increasingly savvy about the businesses they choose to support. The rise of the internet age has made it easier for them to gain access to information about the environmentally harmful practices that companies engage in, and what efforts their favorite brands are making to reduce the impact of climate change. Indeed, as it becomes clear that certain government strategies — such as the reduction of plastic pollution — are not succeeding on their own, there is an expectation for businesses to play a more active role. When customers see which companies have a greater interest in preserving the health of the planet and those living on it, there is a growing potential for them to shift their allegiances accordingly.   

The same goes for staff. While it may have previously been the case that employees were willing to accept jobs with unsustainable businesses, this is becoming less the case today. Millennials and Gen-Z are better educated than previous generations and are more committed to joining and staying with companies that have a strong set of values and can help them make a positive difference. It is therefore imperative for companies who want to attract and retain the best talent to demonstrate not just environmental sustainability, but keep it at the core of their company values. 


One element that has kept some businesses from adopting sustainable practices has been the potential effect on profit. Therefore, much of the incentive to convince companies to make changes should revolve around the financial advantages — overhead savings and tax breaks among them. However, it’s also important to help businesses to understand that their customers and employees are increasingly demanding that these standards aren’t just healthy for the bottom line, but are a genuine part of the company’s values.

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