Growth Strategies Require Sustainability

More consumers choose where to spend based on a company’s sustainability focus and goals.

April 26, 2021

Nestle-sustainability-efforts.jpg

NEW YORK—What started as a green to gold movement for businesses to control costs has morphed into a nebulous term that encompasses initiatives like energy efficiency, water reclamation, recycling and food waste. This changing definition has challenged companies of all sizes to set strategic plans that focus on more than the bottom line.

Rather than using profitability as a success measurement, a triple bottom line perspective on people, planet and property—explained in the NACS Sustainability Playbook—allows businesses to consider the positive and negative impacts of business decisions along these three dimensions.

Last week Nestlé CEO Ulf Mark Schneider commented in a CNBC “Mad Money” interview that “Today’s consumer asks even more than before for sustainability. They want to know that we are treating the planet well; they want to know we’re taking care of the next generation.”

Nestle’s sustainability strategy highlights its commitment to halve its greenhouse gas emissions by 2030 and achieve net-zero carbon emissions by 2050. “I think there’s a good business case emerging, and that’s what we’re pursuing,” Schneider said.

Nestlé is focusing on packaging-free solutions, simplified packaging, functional paper and recycled, biodegradable or compostable materials.

“The younger, the better educated and the wealthier consumer, the more interested they are in environmentally sound products and practices,” Schneider said. “Digital these days means that there’s total transparency about your supply chain, so people do understand what you’re doing for the planet and they reward the companies that are leading this trend.”

“[W]e're doing all of this in a way that will allow us to grow our businesses and edge ahead of our competitors,” said Schneider in a blog post. “For consumer-facing businesses like ours, it's clear that consumers are putting more and more emphasis on environmental stewardship and transparency. Ignore their needs and they will ignore our products.” 

Jeff Lenard, NACS vice president of strategic industry initiatives, shared in an interview with Forbes the industry’s sustainability journey, noting initiatives 12 years ago like the Congreenience Store exhibit at the 2011 NACS Show and more recently the online NACS Sustainability Playbook.

“What makes one store preferable over another? If location, price, customer experience, convenience and product assortment are all roughly equal then Purpose and Sustainability may be the tipping point factor,” notes the article.

Lenard pointed out that in the mid-2000’s, the convenience retail industry’s sustainability focus was more on the environmental elements and efficiencies related to energy, water and utilities.

Fast-forward 13 years, Lenard said that NACS convenes a consortium of convenience retailers each quarter within the sustainability space to identify strategies that drive their businesses forward.

“As we look at this journey and those in our industry and those who shop in our stores, we need to look at how we tell our sustainability story. What does it mean in terms of definition, and what does it mean to them? How is it making a difference? Why will the product they buy with you taste better because of your sustainability initiative?” said Lenard.

Recognizing that every company is at a different place in their sustainability journey, NACS created an online resource that can help convenience retailers take credit for initiatives that are performing well and identify opportunities to do more.

NACS is also creating a benchmark to measure energy use within the industry and help earn the coveted Energy Star Certification. E earning the Energy Star Certification—a brand recognized by more than 90% of Americans—can instantly give a store a leg up over its competitors and can be cited in ESG and CSR reports with confidence.

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