A growing number of organizations are integrating sustainability into their business strategy—realizing they can do well by doing good. In a recent McKinsey survey, 70 percent of respondents said their companies have a formal governance of sustainability in place. But what exactly does it mean to be “sustainable” in business?



In business, sustainability refers to doing business without negatively impacting the environment, community, or society as a whole.

Sustainability in business generally addresses two main categories:

The effect business has on the environment
The effect business has on society
The goal of a sustainable business strategy is to make a positive impact on at least one of those areas. When companies fail to assume responsibility, the opposite can happen, leading to issues like environmental degradation, inequality, and social injustice.

Sustainable businesses consider a wide array of environmental, economic, and social factors when making businesses decisions. These organizations monitor the impact of their operations to ensure that their short-term profits don’t turn into long-term liabilities.

Examples of Sustainability in Business

Many successful organizations participate in sustainable business practices, however, no two strategies are exactly the same.

Sustainable business strategies are unique to each organization as they tie into larger business goals and organizational values. Below are a few examples of what sustainability in business can look like.

Using sustainable materials in the manufacturing process
Optimizing supply chain to reduce greenhouse gas emissions
Relying on renewable energy sources to power facilities
Sponsoring education funds for youth in the local community
Beyond helping curb global challenges, sustainability can drive business success. Several investors today use environmental, social, and governance (ESG) metrics to analyze an organization’s ethical impact and sustainability practices. Investors look at factors such as a company’s carbon footprint, water usage, community development efforts, and board diversity.

Research shows that companies with high ESG ratings have a lower cost of debt and equity, and that sustainability initiatives can help improve financial performance while fostering public support. According to McKinsey, nearly 3,000 employees said the strongest motivating factors to adopting a sustainable mindset are to align with a company’s goals, missions, or values; build, maintain, or improve reputation; meet customer’s expectations; and develop new growth opportunities.