Social progress and equality, environmental protection, conservation of natural resources and stable economic growth — these are the four key objectives within the UK Sustainable Development Strategy.

As we discussed in our previous article on Social Impact Success, social action of start-ups on this front has become particularly important. Acknowledging these efforts through the Social Impact Award is a testament of ingenuity and innovation, which can only happen when entrepreneurship combines with social action.

However, governmental or organisational incentives are not the only competitive advantage to going green. What else do businesses stand to gain from sustainable action? Keep reading to find out.

What is the green competitive advantage?

Competitive advantage refers to factors that allow a business to produce goods or services better or more efficiently than its rivals. A green competitive advantage means businesses can do so through environmental activities.

How does this work? For one, the UK places heavy significance on sustainability. UK consumers have been found to increasingly prioritise factors such as brand reputation, ethics, and sustainability in their purchases.

More so during the Covid-19 pandemic, where concerns around the climate crisis by E.ON show that over a third of British consumers prefer buying from companies with strong environmental credentials. Consumers are willing to pay premium prices that go up to 3% higher, too.

Green competitive advantage is a keen marketing strategy that is only emphasised by strategic cost management, wherein going green proves to be a cost-efficient expenditure with a 100% ROI.

How to do it?

Switch to green energy

When grey and cloudy weather are the norm, popular options like solar panels tend to be considered as a wasteful expenditure. However, research shows the opposite as the UK has more than enough sunlight, at similar levels to France or Spain even, to power solar panels.

Initial installation may be a little pricey — prices can range from £40,000 – £80,000 for small to medium businesses, and £160,000 – £400,000 for medium to large enterprises, Yet, estimates on solar panel costs by Hoymiles show that the 25-year expected lifespan can actually save up to an incredible £28,000 a year on your electricity. This means that businesses will have paid off the initial costs after 8 years.

With government incentives, reaching an ROI is even faster. Environmental relief by the UK government allows companies to claim up to 130% of their capital allowances back when buying energy efficient, or low to zero-carbon, technology for businesses. This means that for every pound invested, companies can save up to £25 on taxes. This is a win-win situation that allows companies save whilst improving their business.

Switch to green packaging

Plastic is currently a cost-efficient solution only because it’s so abundant. Recognising this, lawmakers enacted the Plastic Packaging Tax in April this year. Here, companies using plastic with less than 30% recycled material will have an added tax at a rate of £200 per metric tonne. Thanks to this and the law of supply and demand, sustainable packaging materials that are sought-after and at a higher scale of production will effectively decrease their prices in the long run.

Establish a green branding

Take the extra step to file for sustainability certifications that will allow you to advertise your credentials, and encourage you to be consistent in your practices. There are various certification bodies available in the UK, including B Corp, which requires you to achieve a score of 80 out of 200 to certify, or ECO, UK’s only cross-spectrum ethical accreditation.

Becoming a certified sustainable business means committing to environmental friendliness. While going green may involve higher investments now, this could save you and the environment a significant amount further down the line, more so when further regulations like the Ten Point Plan affect workplaces nationwide. Start today, and you’ll see better days for your business and the environment sooner rather than later.

Article written by Roselle James