One of the key components in getting senior management to green light strategic and tactical work in environmental and social responsibility is a well-supported business case. Some areas of sustainability are readily subject to a fairly traditional ROI-based business case, but in some other instances you’ll need to make some “soft” arguments as well. And in some areas, your case will rest heavily on the risk mitigation and/or brand value benefits from your sustainability work. Let’s look at best practices in building your business case in each of these situations.
|Type of Situation||Example||Include in the argument|
|Hard-facts, RIO based||Lighting retrofit||ROI calculation based on expenses (fees, materials) and energy savings (based on reduced utility bills that your solutions provider or energy provider can help estimate); environmental benefits from reduced CO2 emissions; benefits to employees from better-lighted work environment|
|Soft, Risk Management or Brand Value||Removal of volatile organic compounds (VOCs) from product(s)||Risk management (e.g., avoiding VOC-related regulations and product-related lawsuits); environmental and social benefits; possible burnishing of brand image (maybe even market share gains)|
|Blended Argument||Subsidized employee carpooling||Financial benefits such as savings on parking-related costs and possible tax credits; environmental benefits from reduced carbon emissions; brand image benefits from being associated with carpooling programs; better employee recruitment and retention|
In all instances, your case will be stronger if you remember the following:
The second two bullets are parts of your argument that often carry as much weight as the financial/analytical portions. Don’t assume that your business case can rest on hard data alone. And run your argument by a sustainability professional who has experience in a variety of situations and can vet the soundness of your proposition. You’ll be glad you took the time to have a set of trained eyes take a look.