Eco Business Is the Way to a Sustainable Future

Eco Business

Photo by Jason Leem on Unsplash

In our rapidly changing world, resources are being consumed at alarming rates. 

Oil companies are expanding their fossil fuel operations to fuel faster, more frequent modes of transport. Meat consumption is at an all-time high as more families become middle class. Factories and logistics companies are working around the clock to meet our online, and on-demand, shopping habits.

We’re leading more fulfilling lives than before, in that almost every basic living necessity is available at the click of a button. At the individual level, we’re eating and buying to our own satisfaction. But collectively, our unprecedented rates of consumption are leading to the demise of our planet.

The only way to buck this trend and protect our planet is to practice sustainability in our lives and businesses. Buying only what we need, and trimming waste in everything we do, will help conserve the precious resources our planet gives us.

It’s a philosophy that we at Aspiration live by. We’re a neobank that applies principles of sustainability to each of our business processes, from helping our customers buy carbon offsets for each gallon of gas they purchase to giving back a percentage of our earnings to forest restoration and community development projects. 

We believe that eco-businesses like us are the drivers of sustainable development. In this article, we look at how eco-businesses can help build a sustainable future for our communities.

What is an eco-business?

An eco-business is a business that seeks profits while minimizing its environmental impact

Eco-businesses are found in almost all industries. Most well-known eco-businesses operate in the clothing, food, and clean energy industries.

According to the Harvard Business School, these businesses aim to make a positive impact on the environment, society, or both. They ‘do good’ by solving the most immediate social and environmental issues of the day. 

Eco-businesses may engage in civic issues such as Black Lives Matter by acknowledging how disproportionately climate change affects black and brown communities. They may also help find solutions to address them. 

They may raise awareness about climate issues such as air pollution and deforestation by running advocacy campaigns and funding clean technology innovations.

Eco-businesses are the new trendsetters in the world of business. They’re showing traditional companies how to operate responsibly. By making purpose the main business goal instead of profit, eco-businesses are redefining what it means to bring value to customers.

How do eco businesses compare with traditional businesses?

Traditional businesses, as many people will know, are focused on maximizing profits

When the Industrial Revolution came around in the late 1700s and early 1800s, it ushered in an era of high productivity and profit maximization that resulted in an economic model we now call Capitalism. 

The goal of a Capitalistic society is to increase wealth for its citizens through the means of profit distribution. The more profit a business can generate from its operations, the more wealth its owners and employees can take home.

Traditional businesses, which still operate under this principle, are so focused on profits that they often overlook the impact their operations have on society and the environment.

Eco-businesses, in contrast, recognize that profit maximization alone is unsustainable,  both for the planet and the business. Instead, they focus on the ‘triple bottom line’, which is about generating profit while keeping the social, environmental, and economic impact of the business in mind.

Eco-businesses don’t simply balance profits with feel-good environmental and social impact projects. They work to transform capitalism so that the wealth they generate works for the good of the planet and society. 

Can eco-businesses make money?

Researchers are still studying the profitability of eco-businesses, but the evidence so far suggests that eco-businesses can make money, sometimes even more money than their traditional counterparts can.

How so? The effects of climate change and societal upheaval are becoming harder to ignore. As a result, investors and consumers alike are seeking to support businesses aligned with international commitments to act on climate and civic issues. 

Generating profits while investing millions of dollars in sustainability is, of course, not easy. An eco-business’s products and services still have to provide value while maintaining affordable prices in a market saturated with fierce competitors.

But eco-businesses that adopt sustainable operations early tend to be able to sustain supply chains in the long run and through crises. For example, an environmentally-friendly clothing manufacturer may grow cotton using water conservation technologies that are resilient to the effects of climate change such as droughts.

In addition, eco-businesses make neat profits by building high-quality innovative products that are unique in the market. These innovations may be made from sustainable or renewable materials that help reduce a company’s carbon footprint as well as its water usage. 

As the economy looks to become more volatile, sustainable operations provide the resilience needed to maintain operations and produce products and services that are aligned with the values of investors and other members of the public. It’s this resilience that will help eco-businesses make money through good times and bad.

How do eco-businesses create sustainable impact?

Eco-businesses create sustainable impact by addressing the most pressing environmental and social issues in the world today. Deforestation, excessive waste, and social injustice are some of the problems that eco-businesses are trying to solve. 

They fight deforestation

On deforestation, eco-businesses may use their profits to fund reforestation programs. Aspiration, for example, has a program called Plant Your Change where we round up each transaction our customers make to the nearest whole dollar and use the spare change to plant trees. 

Our forest restoration projects help bring income to local communities and restore vital ecosystems that are sources of food.

Eco-businesses may also work together with suppliers who follow strict forest management requirements to replace trees that are harvested. Some companies may even use recycled wood to make innovative furniture, extending the life of these natural resources for decades.

They create sustainable circular economies

Besides deforestation, waste is another problem that’s destroying the environment. Plastics in the ocean, huge landfills, and excessive use of resources are harming animal and human lives. 

In response, eco-businesses are building circular economies where used materials and collected waste are manufactured into new products. The ‘waste’ is collected, cleaned, and put back into the supply chain in lieu of raw materials that would have to be otherwise purchased. 

Levi Strauss, for example, is recycling plastic bottles and discarded cotton t-shirts to make new jeans. The innovative jeans use 98% less water to manufacture than virgin cotton products.

They support social justice causes

In line with the principles of the circular economy, eco-businesses pass on a percentage of their profits to social movements to fight injustices. Directly supporting social causes allows businesses to highlight the problems inherent in our society and generate the action required to fight them.

Ben & Jerry’s has a long history of doing this. Since its foundation in 1978, the company has donated to gun control, women’s rights and climate change movements. In the wake of the Black Lives Matter protests, they bravely called upon the US government to dismantle white supremacy.

What kinds of eco businesses are there?

Eco-businesses operate in almost all business industries. The 3 most well-known types of eco-businesses that are working to create a sustainable future are electric vehicle manufacturers, clothing companies, and green banks. 

Electric vehicles

There’s been a lot of hype around electric vehicles in the past decade. Tesla’s rise as a futuristic sleek electric car manufacturer has a role in this, but so does our increased awareness that fossil fuel vehicles are damaging the environment. 

While switching to electric vehicles may not yet be a possibility for everyone, they’re definitely key to creating a sustainable future. Researchers have found that an electric vehicle produces lifetime emissions that are three times lower than that of a conventional car. 

Clothing manufacturers

In recent years, clothing manufacturers have come under fire for creating extraordinary amounts of waste. 

The United Nations Environmental Program and the Ellen MacArthur Foundation estimated that 10% of our global carbon emissions come from all the international flights and shipping required to move these products around. And every year, the fashion industry uses 93 billion cubic meters of water – enough for 5 million people to use. 

In response, environmentally-friendly clothing manufacturers like Patagonia, tentree, and Reformation are leading the change against the fast fashion culture by sourcing sustainable materials for their products and restoring ecosystems damaged by manufacturing processes. 

Green banking

Banks may not seem like they could be complicit in the processes that cause climate change. But they are, and to a really terrifying scale.

The 2020 Banking on Climate Change report found that the world’s largest banks had lent $2.7 trillion US dollars to fossil fuel companies between 2016 and 2019. Banks have a massive impact on climate change because they have the money and power to fund environmentally destructive businesses.

It’s not all doom and gloom though. Sustainable banks are on the rise to challenge unethical financing. Banks like Aspiration, Amalgamated Bank, and Sunrise Banks only lend to sustainable businesses and invest in innovative clean technologies that protect the climate. 

The future of eco-business: green banking

So what do eco-businesses need to continue into the future? They need green banks to finance them.

Green banks perform a variety of duties to help eco-businesses grow and fund new innovative technologies. They offer green loans with special terms that allow eco-businesses to expand their product portfolios and hire more staff.

They also help businesses switch to clean energy building improvements such as solar electric power systems and geothermal heating systems. These systems help eco-businesses reduce their carbon dioxide emissions, save costs, and raise their profiles as sustainable businesses.

Green banks are eco-businesses in their own right as well. Most are certified B Corporations that commit to positive environmental and societal initiatives. Many give donations to environmental conservation nonprofits that are working to restore ecosystems damaged by human activity and climate change.

On the community front, green banks offer loans to help community members improve their homes and businesses to become more climate-resilient. Homeowners can get financing to install solar electric power systems for their homes. They can also take out loans to upgrade their cars to electric vehicles.  

Green banks have the means to finance the future of the planet, including the eco-businesses we love and the communities that we are a part of. They are key to making our socially and environmentally progressive ideas a reality. 

Aspiration is an eco-business you can trust 

Aspiration is a neobank that puts the planet first before anything else. We offer financial services and products that help our customers do good for the planet with each transaction they make. Our unique savings account offers 10% cash back whenever you buy from our Conscience Coalition partners, which include sustainable businesses such as TOMS, Warby Parker, and Blue Apron. 

As one of America’s top eco-businesses, we believe that it’s our mission to make the planet a better place. We donate ten cents of every dollar of our company’s earnings to environmental and social causes that help communities around the world lead better lives.

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