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Other sustainable practices are made with the intention of reducing costs and creating more profitable opportunities for businesses. They have numerous long-term financial advantages.

Below, Andrew Richardson looks at three reasons why businesses need to invest in sustainable practices if they want to prosper in 2021 and beyond.

Improve your brand value and reputation

It’s becoming increasingly clear that consumers are seeking alternative and more sustainable options when they shop. Consumers who believe that they have a personal responsibility to maintain global temperatures and reduce pollution and waste in the environment will seek out companies that promote their brand as a sustainable business.

While it’s not only important to employ a sustainable strategy to your business, aligning this plan with your brand image allows consumers to appreciate your organisation’s strong and ethical values. Sustainability is of course essential in its own right, but potential customers are now forcing the issue when it comes to business practices.

A survey by Nielsen found that 75% of millennials (aged 24 to 39) believe that they will change their purchasing habits to reduce their impact on the environment. Furthermore, 90% of this group said that they would spend more on products if they were made sustainably.

Research from NYU Stern Center for Sustainable Business found that between 2013 and 2018, 50% of consumer-packaged goods growth came from sustainably-marketed products. Companies have already begun to take advantage of the value placed behind sustainability. This trend is expected to continue.

Sustainability is an investment, but it can command high prices and drive more sales - particularly in key consumer markets. The social value of your brand is important to consumers and they want to participate in your sustainable processes by supporting businesses that share their values.

Sustainability is an investment, but it can command high prices and drive more sales - particularly in key consumer markets.

Staff retention and job attraction

Investing in sustainability is not just about the planet and your customers. Team members increasingly expect to work for a company that they think is making a difference in the world.

A recent survey found that 56% of workers believe that “ignoring sustainability in the workplace is as bad as ignoring diversity and inclusion”. Even more, 40% said that they would seek alternative employment if their employers did not engage with sustainable business practices.

Employment is one of the biggest investments a company can make, with the cost of replacing one staff member in an SME estimated to be around £12,000. Investing in sustainability can help reduce the cost of recruiting new staff and retaining your best employees.

Of course, employees want to know that their work is making a positive contribution and is ethical but they also believe that if a company cares about the environment, the business is also likely to care about their wellbeing too. Therefore, boosting staff loyalty to the brand. Just think of the impact of your staff going home and boasting about the work they are doing to friends and family.

Preparing for the future with resource efficiency

Sustainable practices also help you to keep costs down through the preparation of sustainable resources and reducing waste. Did you know that waste disposal accounts for approximately 4-5% of the turnover of a business?

This can be identified as an unnecessary cost for businesses, particularly for those who do not practice sustainable recycling or aim to reduce their waste in production or purchasing. Instead, designing products where their excess materials can be reused in different products or by creating by-products in the process, you can dramatically increase your revenue with little additional costs.

One company making a push to zero waste are craft beer brewers Sierra Nevada. The company recycles all its waste ingredients, mainly barley and hops, by sending them to cattle farms to be used as feed for livestock. All their organic waste is also composted on-site to use for the growth of their future ingredients. The company declares that they have saved over $5 million since using this sustainable practice. Of course, the practices will differ from sector to sector, however, Sierra Nevada proves that the measures can be creative and uncomplicated.

Regenerating your own products and ingredients is also a significant sustainable practice. Many sectors, particularly those in manufacturing and energy, use finite sources in production. It is known that these products will run out eventually, and their prices will increase with their scarcity. Even regenerating products can become scarce and expensive in demand and do more damage to the environment. Though wood is regenerative, deforestation is a dangerous practice. Therefore, investing sustainably means investing in your future products, not just philanthropy.

Many toilet paper companies commit to planting trees for every product bought. While we recognise this as tied in with their marketing campaigns, it must be highlighted as a suitable investment for companies that will eventually rely on these trees as production materials. This can be considered for businesses in terms of green energy and conserving water.

Investing in sustainability is investing in the future of your company. Understanding the value of reducing waste and practising regeneration is not just for the prosperity of the planet, but also for your business.

The measures to make your business sustainable are as important for your future profitability as it is for ethical reasons. To save your business from company liquidation, you must adopt new strategies to move forward in the world. Business should always be a force for good and give back to the community through employment and positive consumer experiences. Investing in sustainability is just another step to improve your business and grow your authority and revenue.


There’s little doubt that companies are getting serious about climate change and sustainability. In the last 15 years, companies disclosing sustainability data to the Carbon Disclosure Project (CDP) have increased carbon reduction targets threefold, from an annual average reduction of 2% to 6% today. Moreover, timelines to achieve these goals have narrowed; rather than setting goals 25 years in the future, companies intend to meet their goals in an average of just eight years. Companies are also looking beyond their own operations to examine their entire supply chain, as made clear by recent announcements from companies like Apple, BMW, and Microsoft.

Despite this progress, few companies are on track to meet their climate goals. While many leaders embrace bold targets, they struggle when it comes time to implement because they haven’t established the capital allocation strategies and governance structures needed to match their strategic intent.

The finance department sits squarely at the heart of this challenge. With sustainability goals becoming ever more ambitious and investors demanding increasing accountability, there must be a reimagining of the traditional responsibilities and activities of the CFO and the broader finance function if companies are to overcome barriers to sustainability transformation and meet their targets.

Barriers that slow progress in sustainability transformation

The first barrier is the failure to systematically integrate environmental factors into enterprise risk management. Historically, sustainability issues were addressed within the Chief Sustainability Officer function, receiving only occasional attention from financial leadership. However, earlier this year, 3,000 global leaders convened in Davos to discuss their roles as key stakeholders in a sustainable world and, for the first time, climate change contributed to all five of the top global risks in The World Economic Forum’s Global Risk Report. But for many companies, sustainability still is not considered a core competitiveness issue, and it doesn’t receive the financial and human capital necessary to tackle a challenge of its size.

Sound decision-making relies on accurate and useful data. But companies encounter a significant barrier when their reporting systems fail to capture the data needed to inform capital allocation decisions. Yet, even with improved access to relevant data, many companies still lack the ability to properly manage environmental sustainability. Quantifying climate risks and opportunities is critical to managing exposure to energy price volatility, water scarcity risks, water and waste regulations, and environmental impacts in the supply chain.

From an organisational perspective, existing processes and metrics aren’t designed to foster engagement between sustainability and finance functions which can delay or impede the achievement of sustainability goals. For example, sustainability teams are often brought into project planning too late to influence project design and cannot make an effective case to financial decision-makers. This can lead to finance teams overlooking meaningful short- and long-term financial benefits of sustainability strategies, such as enhanced reputation and reduced climate risk. Without having shared, quantifiable success metrics, such as reduced carbon emissions, teams lack effective incentives to innovate and collaborate across departments.

Finally, for years corporations have cited a lack of available capital as the primary barrier that slows or halts implementation of critical sustainability projects. As a result, a myriad of service models, debt instruments, and new forms of capital have emerged to lessen the financial burden, share risks, shift the needs for upfront capital, and even reconsider the importance of asset ownership. While there’s a growing awareness of sustainable finance strategies like sustainability-linked loans or internal carbon pricing, knowing when and how best to implement them remains a challenge.

By identifying the barriers most acute in their respective companies, finance leaders can take action to minimise the costs and risks associated with sustainability projects and ensure their organisations successfully capture both the environmental and financial benefits at stake.

Stages of integration for aligning finance and sustainability ambition

The rise in increasingly ambitious sustainability goals clearly demonstrates that corporate leaders see value in climate action – both to address stakeholder demands and to mitigate near- and long-term risks. The finance team plays a critical role in realising this value but, to do so, they must be fully integrated into – and feel a sense of accountability for – the company’s sustainability transformation.

Earlier this year, 3,000 global leaders convened in Davos to discuss their roles as key stakeholders in a sustainable world and, for the first time, climate change contributed to all five of the top global risks in The World Economic Forum’s Global Risk Report.

Drawing on our work with global organisations, ENGIE Impact has identified three stages of evolution in this integration process: opportunistic, thematic, and holistic. Progression through these integration stages is essential for companies, both to achieve their sustainability goals on the required timeline and to unlock the full spectrum of direct and indirect benefits.

Stage 1 – Opportunistic: The leadership team of companies in the opportunistic stage often understands the high-level benefits of sustainability programs. Nevertheless, these companies have not set specific targets; rather, sustainability projects are pursued on an ad hoc basis and are typically approved if they meet basic financial thresholds, such as a quick payback.  This narrowly focused approach usually results in limited operational cost reductions and achieves only incremental emissions reductions.

Stage 2 – Thematic: In the thematic stage, a company’s CFO and finance team lead the analysis of company-wide programmes that support the organisation’s sustainability ambition. The company sets time-bound targets across its operations that follow generally accepted frameworks and methodology and has identified a portfolio of similar projects—such as energy efficiency or on-site solar generation—to meet these goals. Typical target outcomes at this stage include reduced long-term costs of energy, increased price certainty, and more efficient use of capital.

At this stage, the CFO also begins to seriously investigate sustainable finance options which allow the company to expand its bank and investor network and lays the foundation for financing a broader set of decarbonisation measures in the future.

Stage 3 – Holistic: A company with a holistic approach develops a comprehensive understanding of the importance of sustainability to the success of its organisation and positions sustainability at the core of its business. Its leadership relies on cross-functional collaboration to set and achieve ambitious corporate goals, such as science-based decarbonisation targets. The finance team takes a lead role in shaping the company’s roadmap of sustainability initiatives that deliver financial returns as well as incremental values such as accelerated decarbonisation, enhanced brand value, decreased risk, and, ultimately, improved market position.

By identifying a company’s stage of integrating sustainability into its finance function, finance departments and CFOs can track their progress to ensure that they’re keeping pace with the company’s overall sustainability objectives and taking actions that contribute to the overall transformational success of the organisation.

With corporations growing ever more ambitious in addressing climate change, CFOs and their finance teams play a central role in ensuring that their companies can meet their sustainability transformation goals. Only by integrating a sustainability mindset can the finance function properly prepare for risks that unlock the true value at stake, effectively structure investments, and adopt changes that drive meaningful progress toward sustainability goals.

Twelve years ago, the UK was in the grips of the ‘Great Recession’ following the credit crunch, which was felt across the globe. In the UK alone, a staggering 50 small businesses closed down each day, with mass unemployment peaking at around 4.9%, according to the Office for National Statistics (ONS).

Almost overnight, leaders and business owners found themselves faced with critical decisions to make in order to keep their companies and businesses from going under. With budgets under severe pressure, this was thought to be the end for the corporate responsibility budget. Yet despite the financial turmoil caused by the financial crisis, sustainability quickly found itself rising in importance as a business priority.

In a 2010 study by Accenture, 93% of CEOs said that they believed sustainability had become a crucial part of their company’s future success. The study marked a major shift among senior decision-makers in relation to sustainability during the recession years. It seemed the sustainable agenda was destined to not only survive the financial crisis but thrive because of it.

Over the next decade, sustainability managed to find a growing momentum in both government and the boardroom, culminating in the landmark passing of legislation in 2019 requiring the UK Government to reduce its carbon emissions to net-zero by 2050.

But now, as the UK edges closer to what the Bank of England has predicted to be the worst recession in 300 years, we find ourselves asking the question: is sustainability resilient enough to survive another economic crash?

The answer to this is yes – because public mood says that it must. Never before has the public been so restless for change. The coronavirus has provided a vital shift in perspective. We’re now seeing widespread support for a Green Recovery model from the UK Government, with businesses prepared to play their part in reinventing ourselves as a more sustainable nation.

Shoppers are now buying locally sourced food, minimising plastic waste and cooking from scratch. Out on the roads, an unprecedented number of us are now choosing to cycle or walk, while many more of us now planning to switch to an EV in the new few years.

Like the Great Recession, the social and economic fallout from coronavirus has challenged us to reassess our values and consider how our daily decisions impact the future world we are building. 45% of consumers say they are making more sustainable choices when shopping and are likely to continue to do so. And according to digital consumer intelligence company Brandwatch, March mentions of purchases made for personal ethical reasons were up 132% compared to December.

Shoppers are now buying locally sourced food, minimising plastic waste and cooking from scratch. Out on the roads, an unprecedented number of us are now choosing to cycle or walk, while many more of us now planning to switch to an EV in the new few years.

This has naturally had a profound effect on boardroom decision-making. In a recent survey by Opus Energy and Haven Power, part of Drax Group, over half (59%) of SME owners agreed that the pandemic has increased the importance of sustainability for their businesses, while two thirds (68%) say that it has made them more environmentally conscious.

Sustainability became so important during the Great Recession because of cost-cutting and finding operational efficiencies. However, business owners also understood the urgent need to regain trust among the public and their customers – trust that was deeply shaken by the failure of the economic system. Many consumers started to vote with their money, choosing to spend with businesses that aligned with their values – much like we’re seeing today.

The need for businesses to openly commit to sustainability is greater now than it was during the last financial crisis. Business owners know that despite the need to stabilise their business, to abandon their sustainable development goals would be highly damaging. They would risk losing any goodwill they’ve created with their customers and wider stakeholders.

Finding the right balance between financial necessities and environmental responsibilities will be crucial to a business’ success. Key to this will be the adoption of a different kind of corporate mindset.

We need to change the narrative away from sustainability as a cost, towards sustainability as a cost saver. When businesses realise that lowering their energy costs can help save money during a time when cash flow is more crucial than ever, energy efficiency and ESG strategies present themselves as obvious short- and long-term solutions, rather than a burden.

There are no healthy people on a polluted planet. In particular, deforestation, the proximity between urban zones and wilderness, and the scarcity of certain animal species, are determining factors in the development of diseases that can be transmitted from animals to humans. As such, at a time of a pandemic requiring the confinement of half of humanity, it is appropriate to analyse this crisis through the lens of the 17 sustainable development goals of the United-Nations, which guide international efforts for a better and sustainable future for all.

Faced with the challenge of protecting the planet, and the effects of climate change in particular, it is essential to develop projects to restore and protect natural ecosystems. The goal is to rethink activities in the logic of a circular economy, to limit their negative impact on nature and to create sustainable wealth. The emergence of sustainable finance is vital for the transformation of the economy towards a low-carbon and inclusive model. Finance must become a tool for health, economic and social development. But how? Finance Monthly hears from Catherine Karyotis, Professor of Finance at France's NEOMA Business School and Anne-Claire Roux, Managing Director of Finance for Tomorrow.

Financial actors must re-invent their activity to support the projects and sectors of the ecological transition, serve the real economy, and preserve biodiversity for a sustainable planet. They must apply best practices to both anticipate transition risks and protect the value of assets, face new risks linked to the physical impacts of climate change, and adapt to regulatory changes. Ultimately, they must enable the transition of the economy to a low-carbon and inclusive model.

The ethics of an investor, a banker, a fund manager, or an insurer go beyond compliance: they have to know how to place their mission of in the present and future contexts, taking into account all economic, financial and ecological dimensions. They can take the opportunity to create wealth, or rather value. To this end, they must identify new sustainable opportunities and put a long-term perspective at the heart of their financing and investment strategies.

Financial actors must re-invent their activity to support the projects and sectors of the ecological transition, serve the real economy, and preserve biodiversity for a sustainable planet.

Already, the entire sector is developing its offers, practices and trade products. Actors are mobilising, initiatives are multiplying, and new professions specialised in sustainable finance are emerging within organizations. However, this paradigm shift will not be possible without expertise and new skills.

A financial analyst must master the accounting and extra-accounting instruments and documents to carry out a joint financial and extra-financial analysis, connecting one to the other and enabling financial policy decisions to be taken in the long term.

A risk manager must know how to assess financial risks in all their dimensions, ranging from credit risk to climate risk to health risk, to then cover them by using derivative markets for this objective, not aiming for speculative short-term gains.

As an asset manager must know how to "price" a bond. Why not do so for bonds labeled "green" or "sustainable"? Likewise, beyond socially responsible investing, how can ESG criteria be introduced into passive management, and how can we revise models by developing a green beta? If we talk about alternative investments, we can also integrate “green” or “adaptation” labels, as well as "green value" into wealth management and into particular real estate investments.


France is at the forefront of green and sustainable finance. French financial players - whether private or public issuers, arrangers, or even extra-financial rating agencies - are the greatest specialists in "green bonds". They are pioneers in carbon accounting and the financing of natural capital. Collectively, the French financial sector constitutes a driving force for the development of sustainable finance internationally, through initiatives such as ‘Finance for Tomorrow’ and the ‘Climate Finance Day’, the ‘One Planet Summit’, or the ‘Network of Central Banks and Supervisors for Greening the Financial System’ (NGFS).

To strengthen this expertise and pass it on to the next generation of financial professionals, it is necessary to reinforce skills in sustainable finance. From an educational perspective, it is up to teachers and professionals in activity, to transmit to students the tools, which will allow them to reinvent the financial system for a secure, sustainable future.

In the aftermath of the COVID-19 pandemic more than ever, sustainable finance must become a tool for recovery and our students must become the future decision makers of a finance serving the real economy, society and the planet.

The distinctive character of Etica’s funds is the rigorous selection of securities issued by companies and countries that show a special commitment to environmental protection, human rights and good corporate governance.

Etica sustains a constant dialogue with the management and exercises its voting rights in the shareholders’ meetings of the companies in which its funds invest, in order to urge companies towards more responsible behaviour and help them achieve this goal.

By embracing ESG criteria, codified in a transparent methodology, the company can manage risk more effectively and seize interesting investment opportunities.

Below, Arianna introduces us to ethical mutual funds and explains the growing appetite for them.

Can you explain ethical mutual funds to us?

In ethical mutual funds, the goal of achieving positive financial returns goes hand in hand with generating positive effects for the environment and society. We measure the impact of our funds’ equity investments, in relation to the social, environmental and governance indicators linked to the United Nations SDGs (Sustainable Development Goals).

Tell us more about the sustainable and responsible mutual funds Etica offers.

 Etica’s funds’ goal is to create yield opportunities for savers in a medium-long term perspective, aiming at the real economy and rewarding companies and states that adopt virtuous practices. Currently, the range is made up of six mutual investment funds plus three sub-funds in the Luxembourg range (launched at the end of 2019 and mirroring some of the SGR's historical strategies), distributed across all risk/return profiles.

In ethical mutual funds, the goal of achieving positive financial returns goes hand in hand with generating positive effects for the environment and society.

As climate concerns have prompted more investors to move their money to ethical funds which support the positive changes they want to see, have you seen an increase in people investing in Etica’s ethical funds?

 Yes, sustainability and responsibility are keywords in the financial sector today. When Etica was established in 2000, this was a niche market, but today it has international prominence and can be described as a mainstream market, exceeding $30 trillion of assets under management worldwide, with 34% growth in only two years and Europe at the top of the rankings (according to the Global Sustainable Investment Alliance).

This strong focus on sustainability and responsibility in the financial world is no accident. According to the World Economic Forum, in only a decade, global risks have shifted from being mainly economic in nature to mainly environmental and social. Not only have these risks become more frequent, but they have also become more significant given the extent of the economic and financial damage they can cause.

What have we brought to the world of investment? First of all, the very possibility of sustainable, responsible finance, which, in 2000, seemed like an oxymoron. Etica has legitimised a new and different way of investing that, as well as the purely financial aspect, takes into account other important variables: the environment, human rights and good corporate governance (ESG).

Who should consider investing in Etica’s ethical funds and why?

The funds of Etica Sgr are perfect for long-term oriented investors who believe that it is important to invest for their future and, at the same time, for the future of the planet: we invest today in what we believe is sustainable for our planet and could generate long-term returns for our clients.

Our strength lies in our belief that sustainable and responsible investment can deliver competitive performance versus the market and, in periods of high volatility, allows financial risk to be mitigated more effectively than traditional investments.

Our mission is: “to champion the values of ethical finance in the financial markets, raising awareness of socially responsible investments and corporate social responsibility among the general public and financial operators”. In other words, to think about investing from a long-term perspective, which takes society and the planet into consideration.

Sustainability and responsibility are keywords in the financial sector today.

All the financial instruments that make up the funds of Etica are selected based on careful issuer screening. Selection takes place both by excluding controversial sectors (e.g. oil, arms, nuclear power and gambling) and by targeting the best issuers from the perspective of ESG (environmental, social and governance) matters.

How do you choose the issuers in which your funds invest?

The careful selection of the securities that make up our mutual funds is a defining feature of our concept of sustainable, responsible investment. Our proprietary methodology, which has a long track record, only accepts issuers that demonstrate that they are both financially attractive and, of course, sustainable from an environmental, social and governance perspective.

Our ESG Analysis and Research Team, made up of expert analysts of environmental, social and governance issues, carries out a double screening process on countries and companies, to identify the countries that best align with social and environmental objectives and the companies most sensitive to sustainability issues and collective wellbeing, creating the "Investable Universe" of funds.

We base our assessment of issuers on a range of sources: specialised databases containing reliable and up-to-date information; affiliated partners such as the ICCR (Interfaith Center on Corporate Responsibility), PRI (Principles for Responsible Investments), CDP (Carbon Disclosure Project), EUROSIF (European Social Investment Forum) and SfC (Shareholders for Change); and NGOs such as Amnesty International and Legambiente. We also examine research in the specialist press and corporate publications (e.g. financial statements and sustainability reports) and assess information gleaned from direct dialogue with companies. We seek to look at companies from all angles to decide whether to invest in them. Our assessment of issuers is based exclusively on information from authoritative sources, and all news is duly checked to protect us from the risk of fake news.


About Etica

Etica SGR was founded in 2000 with the conviction that analysing issuers (both companies and countries), also from an environmental, social and governance (ESG) perspective, offers a more long-term view and potential added value in terms of returns.

It is the only Italian asset management company that has been focused exclusively on socially responsible investment since it was founded.

Its product range is divided into 6 Italian mutual funds, one of which related to climate change, and 3 Luxembourg sub-funds (launched at the end of 2019 and mirroring some of the SGR's historical strategies), distributed across all risk/return profiles, with the aim of offering investors yield opportunities in the medium to long term.

Etica was born out of Banca Etica’s insight and a desire to make the finance and credit sectors more sustainable and responsible. At the start, the company struggled to get investors to see that sustainable and responsible investment products were a different way of investing their savings and that they are not a charity.

Today, 20 years later, investing for our future and for the future of the planet seems to be possible and is much more popular than it was when Etica was founded. However, the company believes in the importance of demonstrating the effectiveness of its strategy through numbers, data and reporting.

Etica is an integral part of a network of excellence in ethical finance: besides being a member of the Forum per la Finanza Sostenibile and EUROSIF, Etica is part of ICCR and a signatory of PRI (Principles for Responsible Investment) and CDP (ex Carbon Disclosure Project). The company was the first Italian asset manager to sign in 2015 the Montréal Carbon Pledge, the initiative that involves a commitment to measure and report the carbon footprint of its investments.

This week Chief executive and chairman Larry Fink sent a personal letter to clients stating the firm would be focusing on sustainability as BlackRock's "new standard for investing."

“Climate risk is investment risk...Indeed, climate change is almost invariably the top issue that clients around the world raise," Fink wrote.

The firm, which manages $6.9 trillion for investors all aorund the world, communicated that it would pulling out of any "high sustainability-related risk" investments such as fossil fuels and that it would be including questions pertaining to sustainability as part of its process when building new client investment portfolios.

Fink also stated BlackRock will be weighing in its shareholder vote on many sustainability and climate issues that arise in shareholder decision making.

The CEO's letter also read: “Climate change has become a defining factor in companies’ long-term prospects.

"Last September, when millions of people took to the streets to demand action on climate change, many of them emphasized the significant and lasting impact that it will have on economic growth and prosperity – a risk that markets to date have been slower to reflect.

“But awareness is rapidly changing, and I believe we are on the edge of a fundamental reshaping of finance.”

In the letter Fink makes reference to climate change as a highly impacting factor in investment models, claiming that this new approach will destroy existing products and create new markets, ridding traditional investments and creating fresh and new opportunities for investment.

“What will happen to the 30-year mortgage – a key building block of finance – if lenders can’t estimate the impact of climate risk over such a long timeline, and if there is no viable market for flood or fire insurance in impacted areas?” he said. “What happens to inflation, and in turn interest rates, if the cost of food climbs from drought and flooding? How can we model economic growth if emerging markets see their productivity decline due to extreme heat and other climate impacts?”

This statement will have significant impact on the proceedings and discussions that take place at the World Economic Forum in Davos next week, as the drive to protect investor value will turn towards climate change and sustainability as key considerations to factor into each and every investment.

Companies need to do more to stand out from the crowd, especially those in the financial services industry, where competition to attract new business is particularly tough. Here Jason Skidmore, Chief Commercial Officer at 3 Step IT, delves into the growing trend of companies’ focus on their sustainability credentials in an attempt to sway potential customers.

Sustainability is not as difficult or costly to achieve as some may believe. Unlike client hospitality, it is not expensive to save energy or spend less on travel by leveraging remote meetings. In fact, it could save your company money. Making sure that lights are not left on overnight is not a difficult policy to implement, and may resonate with your clients more than you realise.

Sustainability is not only important to your clients, but it also contributes to the satisfaction of your employees. A growing number of employees look for sustainable practices in their place of work, and ensuring you’ve implemented these is a great way to boost employee retention and engagement. This, in turn, boosts the reputation of your company.

As well as being a popular trend to follow, sustainability is also becoming entrenched in law. From 2016, UK companies with more than 500 employees must report on their sustainability by law. Not only does this affect companies themselves, but it also applies to their suppliers - if they are not sustainable, then neither is the buyer.

While you’re reading this article, it’s likely that your competitors are already in the process of tightening their sustainability credentials.

This does not only apply to the UK. Similar, or often stricter, regulations are now in force across Europe. For example, companies in Sweden with more than 250 employees must submit more thorough sustainability reports than those in the UK. This trend is only set to expand, meaning that companies across the globe are growing sensitive to the environmental impact of their operations.

While you’re reading this article, it’s likely that your competitors are already in the process of tightening their sustainability credentials. Time is of the essence if you aim to differentiate yourself. When clients assess your practices, it is not enough to give a new, bespoke response. Assessment frameworks like Ecovadis consider the longevity of sustainability governance and implementation - sustainability is not something you should just consider for the future.

No matter how clueless you feel you are when it comes to environmental matters, there are easy ‘quick wins’ which can be implemented straight away. Replacing disposable cups with glasses and using recycling bins instead of just general waste bins are straightforward ways to reduce waste. Switching the lights off, making sure air conditioning is functioning properly, turning down heating rather than opening windows: these are straightforward ways to lower your office energy bill. You can implement simple, standalone practices like these within weeks. This isn’t where you should stop: then the next step is to develop a sustainability policy with a longer-term focus. A good example of this is a more sustainable perspective for IT equipment.

Replacing disposable cups with glasses and using recycling bins instead of just general waste bins are straightforward ways to reduce waste.

Usually, an office laptop is manufactured, shipped, used until it becomes too slow to be fit for purpose, then recycled, or perhaps thrown away. A new one can cost half a ton of CO2e to manufacture – that's equivalent to producing around 6,000 500ml plastic bottles. Increasing the amount of IT that is reused, rather than recycled, could be the most impactful element of your sustainability policy.

A way to achieve this is to implement a circular economy model and remove, refurbish and resell your old laptop for a second life. Creating your own infrastructure to handle this is impractical, but IT lifecycle specialists can help. They can help make your IT more sustainable and reduce your costs, as you get a share of the equipment value they preserve.

Creating more sustainable business practices isn’t as difficult as you may think, and can help your company to stand out from the crowd. Begin by focussing on the small things your business can do and expand this by incorporating the circular economy. IT lifecycle service providers in the circular economy remove the complexity and security challenges of reducing e-waste. When trying to impress sustainability-savvy clients and potential employees, this part of your sustainability strategy could be what clinches the deal.

What is the circular economy?

The ‘circular economy’ is a phrase frequently used in the media and by politicians – there is a huge amount written on the subject, which makes it easy to get confused about what exactly it means.

At its core, the circular economy is a simple principle – it’s about sustainability. It’s an economy that considers the environmental and social impact of the way we buy and use things, and ultimately the way that we can maximise the beneficial use of our resources.

At a practical level, what does adopting the circular economy look like for businesses?

Although it’s a simple concept at heart, truly adopting a circular economy would be difficult to achieve overnight. It requires a change of mindset towards how we can be more sustainable and this needs to be present at every level within a business. Those who adopt the circular economy will design products and services in such a way that:

A recent study indicates that if all EU states were to adopt the circular economy, there would be a potential €1.8 trillion collective economic annual benefit by 2030. There are also, however, further benefits to businesses that adopt the circular economy beyond improved efficiency and reduction of costs.

A recent study indicates that if all EU states were to adopt the circular economy, there would be a potential €1.8 trillion collective economic annual benefit by 2030.

Benefits to business

There are three broad categories of benefits for businesses adopting the circular economy – environmental, social and economic.

The circular economy is grounded in tackling the key environmental issues that we are all familiar with today. Through adopting the principles of the circular economy, businesses can reduce their reliance on using and disposing of the world’s natural resources. Businesses then, through the circular economy, have an opportunity to contribute towards the global effort to tackle climate change.

From a social perspective, a greater understanding of where we source our materials has several benefits for businesses. Consumers’ mindsets have changed significantly in this space recently, becoming increasingly socially and environmentally aware; leading to a tendency for consumers to favour companies that are socially responsible. At the same time, a higher calibre of employee is likely to be attracted to such businesses.

Finally, from an economic standpoint, circular economy driven businesses are at their very heart more efficient and are therefore likely to be more profitable. A report from the Ellen MacArthur Foundation in 2015 emphasised the vast financial benefits for the manufacturing industry if it were to embrace a cyclical design process. Businesses that adopt these principles will also reap the financial benefits of improving energy efficiency.

From an economic standpoint, circular economy driven businesses are at their very heart more efficient and are therefore likely to be more profitable.

What does the future hold for the circular economy?

Although in its relative infancy, regulation in support of the circular economy is coming. As global political momentum gathers around climate change and marine plastic pollution, politicians, stakeholders and ultimately businesses will need to adapt. Those who have already taken steps in this direction will benefit the most.

There are already companies that are shaping themselves around capitalising on the circular economy (i.e. Toast Ale here in the UK).  There is still time for less sustainability-minded companies to take the necessary steps to adapt their business models to position themselves within the circular economy.

 Learn more about how Ditto Sustainability is using their patented technology to play a part in consulting companies as they move towards the circular economy:

While many traditional methods and procedures are still in play, firms are adopting modern and innovative strategies to draw in a hipper and younger, yet more demanding, clientele.

From new technologies to fresher approaches to client service, here are the top trends that are sweeping and changing wealth management today.

A Digital Industry

2018 witnessed a firm-wide and strategic digitalization of wealth management companies. The trend continues to this day as big and small firms reshape the different aspects of their business to embody the change.

As the industry prepares for a generation of younger and tech-savvy clientele, integrating digital strategies to their marketing efforts and creating more efficient client-advisor interaction channels become essential.

Firms that have already taken the lead in implementing a centralized digital management strategy are raising the bar and driving competitors to do the same.

In the words of FinTech Advisor and ASEAN/India Retail Banking and Wealth Management Expert, Arvind Sankaran, “We are witnessing the creative destruction of financial services, rearranging itself around the consumer. Who does this in the most relevant, exciting way using data and digital, wins!”

Sustainable Investing Is Here To Stay

The Institute for Sustainable Investing’s 2017 “Sustainable Signals" report showed that there is a growing interest in sustainable investing and the adoption of its principles among investors. What's even more interesting is that millennials are taking charge.

Millennials take sustainable to the center stage as they search for more socially and environmentally conscious investment opportunities.

This increasing demand for sustainable ventures will continue to push wealth managers to take impact investing more seriously. Thus, the next years may see financial advisors incorporating the environmental, social, and government (ESG) philosophy into their services and financial planning approaches.

The Rise of AI and Robo-Advisors

Taking into account the millennials’ fascination with anything technologically-inclined, it’s not at all surprising that the idea of Robo-Advisors resonated and connected with young investors quite well.

In a statement, the automated investment service firm, Wealthfront, commended the ability of software-based solutions in delivering investment management services at a “much lower cost than traditional investment management services.”

While it can be argued that Robo-advisors can never replace competent human financial advisors in terms of creating customized long term investments or tax and retirements plans, the competition between automated and human advisors have benefited the clientele. For one, it drove the costs asset management down. More importantly, it forced financial planners to step up their game and prove their worth.

Basing on current trends, digital assistants (Robo-advisors, chatbots, and other forms of AI interactions) will continue to play a significant role in empowering client-advisor experience. We might be looking at a future where AI becomes a fundamental element in crafting large-scale hybrid advice offerings.

A Focus on Customer Experience

2018’s World Wealth Report identified that many clients think the relationship they have with their financial advisors and wealth managers falls short of their expectations and can use some improvement.

This is clearly a heads up for advisors and managers out there. In the wealth management industry, customer experience holds great weight for clients. For most investors, client-advisor relationships are critical because they believe in their in-depth implications on the realization of financial and life goals.

These days, investors are gradually witnessing moves towards better customer satisfaction as wealth management companies embrace automation and hybrid models of financial management, and re-engineer their strategies to satisfy demands and ensure that customers have the best possible experience during interactions.

With the new breed of investors putting a prime on user experience and opening themselves to the possibility of switching to other wealth management providers if their expectations aren’t met, the best way forward is to innovate and shift to strategies that put the client and their needs at the core.

But if you have to spend £20 every year on a replacement pair, then over three years that’s £60 spent. It makes more sense to spend that £60 at the start on a pair of shoes that will last three years or more, especially if they are more comfortable and a higher quality.

Your shopping habits have a huge effect on the environment too, and it is certainly suffering for these so-called ‘fast-fashion’ trends. While scooping up a dress for £5 might seem like an exciting bargain, let’s be honest, the price might be more the motivator in the purchase than the style, quality, or comfort. More and more of these clothes just end up being worn once or twice before heading to the bin. In fact, in a survey by Method Home, of 2,000 British shoppers, nearly a fifth admitted to throwing clothes in the bin.

What impact can fast fashion have?

With fashion trends changing faster than ever before, there’s an increasing pressure on consumers to change up their wardrobes faster. But, with our money only stretching so far, many of us are turning to cheaper outlets for our clothing.

Cut-cost fashion must also find somewhere to make savings along the production line. You can’t sell a £5 dress without using cheaper materials and such. This often leads to garments made quickly with non-organic fabrics. Plus, as the Independent reported, the process of dying these clothes is the second largest contributor to water pollution.

While the short-term purchase may be cheaper, the cost to keep replacing the item over the years will add up. If a more expensive version will last a number of years, it could end up being comparatively cheaper.

By its very nature, it is expected that the garment you have purchased will not be kept long, nor will it be expected to last for years. On the flip side, fashion with an emphasis on quality and durability will see you through. This manifests particularly in the threads lost during washing. Cheap clothes tend to shed tiny microfibres when washed, which end up polluting our oceans.

The cost of quality

As Life Hacker rightly states, a high price doesn’t always mean high quality. Here’s some top tips for spotting good quality shoes and clothing:

  1. Spares for repairs — this is like a calling card from the designer. If the item comes with spare buttons, then the item is expected to last enough for it to require a button mend at some point!
  2. Check the pattern matches at the seams — it’s the little things that are the biggest giveaway!
  3. Look for gaps in the stitching — an item that will last will have no gaps between stitches on the seam, and also have more stitches per inch. Take a good look at those stitches!
  4. Don’t look at the price tag — as mentioned before, this isn’t always an indicator or quality. People can, and will, charge good money for a poor product. Take a look at the item itself.
  5. For clothes, scrunch them up a bit take some of the material in your hand and ball it up for a few seconds, then let go. A good quality material will survive and the wrinkles will fall out. Cheap material will stay wrinkled and creased.

Leather ankle boots for example are versatile and can be used for range of occasions, so make sure to buy a quality pair to withstand all those wears! Divide its cost by the amount of times you think you’ll wear it and that will give you the cost per wear. If it’s something you’ll wear every day, definitely check the quality of the item! Remember, the ‘bargain’ comes in how many times you think you’ll wear the item. It’s always recommended to invest a little in timeless staples that can be mixed and matched for a variety of outfits.


Following the recent government announcement of plans to prohibit all petrol and diesel vehicles by the year 2040, Britain is weighing up the idea of switching to ‘green’ driving more than ever before.

New research from leading comparison website MoneySuperMarket has delved into the mind of the consumer to determine just how viable this switch is. The research reveals factors such as the true cost of making the switch to electric driving versus driving a petrol or diesel car. It also explores the number of charging points currently available in major UK cities, a key factor in the viability of the plan to turn the UK electric.

The research also highlights the lack of knowledge currently being shared on the benefits of driving electric and public concerns about the feasibility of the 2040 ban.

Is the British Public Prepared?

With 49% of the British public stating that they have never considered purchasing an electric or hybrid car, it appears that education and pricing are crucial factors in the public’s apprehension to go electric. Some of the key findings from the research include:

51% of people surveyed stated price is currently the biggest barrier to them buying an electric or hybrid car.

Nearly 30% of people don’t buy electric or hybrid cars due to lack of knowledge of how they work.

62% of people don’t know that the Government offers discounts and grants on buying an electric or hybrid car

The True Cost of Driving Green

Beyond public opinion, cost is a major factor in the sustainability of the plan to move to electric and a concern for the public as a whole. Fundamental findings on the cost of buying and running electric, petrol and diesel cars revealed that, although cheaper to run, electric cars are not the most cost-effective motor to own overall. Some findings on the cost of running each car type include:

While the upfront costs of petrol vehicles were the lowest, the average running costs of an electric car are 20% cheaper than diesel and petrol engines, with an average saving of £2,109 across 6 years.

Filling up your petrol or diesel car is 5 times more expensive than electric.

Petrol cars boast the lowest average insurance premium (£697.19), whilst electric remains the most expensive to insure at £923.

If drivers switch to electric in 2018, they’ll save almost £8,000 on running costs by the time the ban is enforced.

Taking Charge in 2040

The government’s plan to turn the UK into a nation of electric car drivers rides not only on the cost of the cars over their lifetimes, but also on the feasibility of fuelling these vehicles. Having an appropriate number of public charging points will be key for the success of Britain’s electric switchover.

Data collected on the number of electric car charging points available to drivers in UK cities bring into question whether the UK as a whole is truly ready for an electric revolution. Whilst the capital performed well, with 210 charging points in Central London, other cities fell short. Large cities such as Liverpool and Cardiff had fewer than 10 raising questions over the preparedness of major UK cities for 2040.

For the full details on the true cost of driving green and how the UK is shaping up, click here to see the full research.


To create an average for each fuel type, an average was taken of 3 of the top selling cars from petrol, diesel and electric respectively. Data for the upfront costs of each of the 9 vehicles were taken from their brand’s site as well as costs of servicing, road tax and MOT prices. The ‘lifetime’ was measured as 6 years with the average mileage of 7,900 miles a year entered onto the site to determine the fuel costs. The overall costs for each model were made into 3 separate averages for electric, petrol and diesel fuel types. The models used included:

-    Ford Fiesta Style – Petrol
-    Volkswagen Golf – Petrol
-    Ford Focus – Petro
-    Skoda Superb Estate – Diesel
-    Vauxhall Astra Hatchback – Diesel
-    BMW 3 Series Saloon – Diesel
-    Renault Zoe Signature – Electric
-    Nissan Leaf Acenta – Electric
-    BMW i3 – Electric

In order to find out the number of electric car charging points per city, the site was used.

(Source: MoneySuperMarket)

Mark Hixon is a Partner at global advisory firm Transform Performance International with over 25 years’ experience advising Fortune 500 companies on their cost management solutions. Here he provides Finance Monthly with 7 ways to manage costs and what considerations to make.

Not long ago, British Airways suffered a huge and unprecedented system failure. Flights were grounded, and the plans of thousands of passengers were at best disrupted and at worst ruined. The scenes at Heathrow and Gatwick were predictably chaotic, and there were suggestions that had the airline not outsourced its IT work, the incident might have been avoided. This, and other recent events, have brought the negative impacts of cost reduction to the fore once again--but it’s unfair.

Cost reduction, when done properly, merely serves as an improvement to a business. It should never be used as an excuse to defend process failures. Of course, there are times when organisations change their service standards and the impact needs to be understood, but these changes should never manifest as process failures. When this is the case, it almost certainly stems from failing to consider the consequences of not funding certain levels of service.

Many organisations embark upon cost reduction or cost management programmes but almost as many fail to deliver the required benefits. Some organisations even find themselves worse off. For nearly 20 years at Transform Performance International, we have worked with clients to improve their existing cost management programmes, and have a found a pattern of recurring errors, all of which can be prevented.

  1. Senior executives are not aligned to the requirements and only provide tacit support. Cost reduction is always popular when undertaken in other people’s business functions but less palatable when it’s done in your own area.

Solution: Use an analytical approach to set targets. In recent years there has been a great deal of intellectual debate as to how to set targets. We successfully developed an analytical approach to segmenting the cost base and setting targets based on activity classifications. This is a non-confrontational way of defining targets.

  1. There is weak sponsorship at the executive level. This is characterised by certain executive members or senior managers paying lip service to the programme and the targets but spending their time protecting their own areas of the business.

SolutionEach person on the leadership team should be set a target and these targets should be embedded into their objectives: ‘failure to hit the target = failure to achieve their bonus’Businesses should also set end-to-end process targets that require collaboration.

  1. A ‘one-size-fits-all’ approach is used to make parts of a business take similar approaches to deliver savings. Most cost reduction programmes start with the premise that a consistent approach is required across all areas of the business, however some business areas are more suited to ‘process improvement’ type approaches whereas others require a service level driven approach.

SolutionDefine a programme of work that considers how savings may be achieved within the various business areas and then apply the tools and techniques appropriate to each area.

  1. The scope and scale of change is not agreed at the executive level so improvement options are rejected or undermined. Cost management programmes often begin with good intentions but as soon as ideas are placed on the table for consideration they are knocked back.

Solution: Hold an executive workshop where a range of ideas are put forward and apply what you learn to frame the overall programme of work.

  1. The dynamics of the cost base are not understood.When targets are set, the real implications of the targets are often misunderstood. This is because the true dynamics of the cost base are not understood.

Solution Segment the cost base and analyse it to find out how much of it is addressable, how much is fixed and how much is variable. Fixed or variable analysis should provide data on how costs vary with volume as well as time.

  1. The root causes of cost are not addressed. When cost-saving ideas are put forward, there is often very little consideration as to what is drivingthe cost within a business.

SolutionUse an activity-based approach to collect data that enables the root causes of cost to be collected. By collecting the data in a structured manner you will be able to see how much of the cost base is affected by each specific root cause. 

  1. The consequences of failing to fund a particular level of service are not well understood. Quite often, businesses suggest reducing levels of service but they do not analyse the risks of failing to support current levels of service. These risks can impact revenue, the ability of the business to maintain a going concern and potentially the end customer.

SolutionAll ideas and suggestions should be assessed in terms of their impact on customer service and the overall risk they pose. Some cost management techniques, such as zero-based budgeting, have this type of risk assessment embedded within the methodology: i.e., every service level is characterised not only by the resource and cost requirement, but also in terms of the consequences of not funding it.

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