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Sustainability is a factor that businesses will inevitably have to consider in the years to come. Predictions are that sooner or later sustainability reporting will become mandatory and the British government has already made the first step in that direction by announcing that businesses listed on the London Stock Exchange will have to report on their greenhouse emissions starting from April 2013.
Writing for Financial Director website, Jan Chmiel, CEO at the Institute of Environmental Management and Assessment (IEMA), points out a series of reasons why sustainability reporting should be universally adopted and explains why companies may benefit from it.
First of all there is the direct effect of business on the environment, Chmiel says. It is impossible to deny that economic growth and overpopulation put extreme strain on natural resources. Businesses need to know how the whole process of production is affected and is affecting the environment.
Bearing in mind that resources are not infinite, it is no surprise that the more they are used, the more expensive they become. That is why governments across the globe are implementing taxes, levies and new forms of regulation. By knowing exactly what resources are used and for what, businesses can optimise their use and reduce their costs.
Ultimately, businesses that show respect and responsibility for ecological issues are set to improve their brand reputation and attract more investors, which in turn will lead to an increase in revenues, Chmiel believes.