Question

Using the ‘business case for sustainability’ (and any other relevant theory from the subject), explain how businesses can change perceptions of profits as a ‘callous slur’ in the context of sustainability. (500 Words)

Answer 1

Business case for sustainability

Sustainable business is a way to develop healthy corporate growth. Its an important tool for a business in long-term development. Sustainable growth in a business increases the value of stake holders, and the business as a whole. Sustainability management focus not only in the finanacial perspective, beside it focus on socio-economic and technological factors.

In order to be sustainable, a business must :

• have a clear strategic direction.
• be able to scan its environment or context to identify the opportunities for its work.
• be able to attract, manage and retain competent staff.
• have an adequate administrative and financial infrastructure.
• be able to demonstrate its effectiveness and impact in order to leverage further resources.
• get community support for and involvement in its work.

A business case for sustainability intends and realizes economic success through focusing on financial and non-financial factors. There are some non-finacial aspects a business should look into for the achievement of overall objective of the business. A performance measure which focus on both financial and non-finacial measures is the Balance Scorecard. It outlines four key areas where a business environment are measured as per long term and short term needs rather than focusing on profit alone.

The four perspective in a balance scorecard are

1. Financial perspective : The various financial measures used by a business are profitability, revenue growth, cost control etc..
2. Customer Perspective : This perspective focus on customer satisfaction.
3. Internal Business Perspective : This perspective is measured through the lenses of quality and efficiency related to goods or services or other key business processes.
4. Training and Development/ Learning and Growth perspective : The key breakthrough performance measures of his perspective is human capital, infrastructure, technology, culture, etc..

All these financial and non-financial indicators helps the business to be sustainable.