Making Money and Sustainable Progress with Ecopreneurship
"Ecopreneurs" who prioritize forward-thinking goal setting may be the new leaders of entrepreneurship – and key to long-term corporate sustainability.
Many entrepreneurs are stuck deciding whether environmental and social ventures will yield profits. Though sustainable development has been deemed “one of the biggest business opportunities in the history of commerce,” most new business owners believe a trade-off exists between environmental or social goals and economic gains. However, researchers from the Kingston Business School found a direct link between profitable and environmental entrepreneurialism.
Entrepreneurship with a Twist
Environmental and social entrepreneurs, or ecopreneurs, lead socially committed, break-through ventures that are driven by environmental, social, and economic goals. But can ecopreneurs operate economically viable businesses while retaining the core business values that motivated its creation in the first place?
In an in-depth case study involving 17 site visits and a series of analyzed interviews, researchers found that Green-Works, a UK-based office furniture redistribution company on which this research was based, retains its core social and environmental values while making money. How? Ecopreneurs gain core advantages over traditional entrepreneurs by forming mutually beneficial relationships with corporations, community organizations, and governments: corporate relationships allow Green-Works to charge more for its products as firms are eager to purchase socially responsible products and services; community ties provide affordable labour alternatives and funding options; and government networking allows the company to push forward stringent environmental regulations that parallel its core values.
What Ecopreneurs Offer
Secure funding through grants and loans not available to other businesses. In one year, Green-Works receives ~£115,000 in donations, grants and sponsorships.
Reduce expenses through unique supplier contracts and charge premiums for their products and services. Earning ~£105,000 from secondhand furniture sales and a net pre-tax profit of £10,000, Green-Works is entirely self-funded.
Employ a lower-cost labour force by hiring disadvantaged persons and volunteers.Green-Works employs more than 30 full-time employees and as a social enterprise, it enjoys free labour from volunteers and board members.
Benefit from free publicity and advertising. The CEO of Green-Works has been deemed “London’s Green Ambassador” by the city’s mayor.
Rethink your Long-Term Vision
For new companies, these advantages are pivotal and may mean the difference between success and failure. Ironically, as the case of Green-Works exemplifies, new ventures that look beyond strictly economic goals can sometimes become the fastest growing and most successful businesses in an industry. Ecopreneurs or not, managers from all industries are able to tap into the financial benefits afforded by looking beyond the bottom-line.
Researchers interested in this area could conduct a similar study, expanding it beyond the confines of a single organization and business model. They may also compare and contrast several different models of environmental and social businesses.
Dixon, S.E.A., and Clifford, A. 2007. "Ecopreneurship–A New Approach to Managing the Triple Bottom Line." Journal of Organizational Change Management. 20.3: 326-345.