Why sustainability is just as important in times of economic uncertainty

Why sustainability is just as important in times of economic uncertainty

When the future looks bleak, companies sometimes decide to focus on cost-cutting at the expense of sustainability and social responsibility commitments.

But while this can seem like a natural reaction in the face of economic uncertainty, research has shown that it may be as bad for their bottom line as it is for the planet. Historically, companies that have upheld their sustainability commitments through times of crisis have recovered faster and more easily than those who didn’t. Let’s find out why.


Lessons from 2008

Over a decade ago, many experts predicted that the 2008 recession would be the downfall of the burgeoning sustainability and corporate social responsibility (CSR) movements. However, this turned out to be wrong. According to the Harvard Business Review, companies that upheld their sustainability practices throughout the recession registered “above average” performance on the financial markets. Other studies have shown that companies with strong CSR policies experience “no meaningful declines in share price compared to their industry peers during crises”. 



How green companies fare better

The above results can seem counterintuitive at first glance, but actually make a lot of sense when you take into account the following factors:

  • Sustainability-minded consumers tend to be more loyal: consumers who are attracted by sustainability credentials tend to form an emotional attachment with the brands they buy from and are generally less price-driven. This means less impact on the company’s sales during times of economic downturn. 
  • Circularity is inherently cost-effective: The circular approach aims to reuse, repair and recycle products. Combined with 21st century manufacturing technologies, it enables companies to reduce their consumption of finite resources such as water and electricity, effectively saving money.
  • A sustainability strategy implies a long term approach: the companies that think carefully about their environmental impact, resources, partnerships, and customer priorities are generally those that avoid making short-sighted, knee-jerk decisions in times of crisis, which translates into better long term outcomes. 


Put simply, brands that focus on building a long term, sustainable approach even in the face of economic uncertainty are more likely to weather downturns successfully. To find out more about how Nissha Metallizing Solutions promotes sustainable business practices, don’t hesitate to get in touch with our team.