Research Backs Financial Benefits of Businesses Investing in Sustainable Energy

by / ⠀Startup Advice / January 19, 2013

Sustainable EnergyEverybody likes clean water, healthy soil, and a pollution-free environment. But many companies are hesitant to actually invest in sustainable energy. They see the expenses of altering their infrastructure to run on alternative energy sources as hefty costs with no financial benefit for the company. But that isn’t an accurate assessment of the results of sustainable energy conversion projects.

In fact, new research shows that companies who do invest in renewable energy can experience significant financial benefits. A study conducted in the United Kingdom reveals that consumer attitudes are substantially shaped by a company’s commitment to sustainable energy – or lack thereof.

The study, conducted by Attitudes to UK Industry, says:

  • About 20 percent of investors surveyed believe that the attractiveness of an investment of a company is influenced by its commitment to sustainable energy
  • Some 40 percent of overall respondents say that they trust companies that invest in energy-saving practices and sustainable energy sources more than entities that do not
  • About 75 percent say that companies should explore “greener” ways of consuming or producing energy before opting for techniques that are less eco-friendly
  • Approximately 52 percent say that companies need to do a better job of touting their environmentally-friendly “credentials”
  • Some 35 percent say they would pay more for goods and services from a company that invests the additional revenue into sustainable energy-related projects

The takeaway from this research is fairly straightforward: Consumers are weighing companies’ use of and commitment to alternative energy when making their purchasing decisions. This implies that entities that embrace sustainable energy practices will perform better in the long-term than their counterparts.

The conditions are certainly in place for this prediction to be realized. Environmental advocates and consumer groups are publishing information about more companies’ usage of alternative energy processes (as well as identifying those corporations who are not very “green”). In fact, the London Stock Exchange will make public carbon reporting figures of all companies that trade shares on it beginning in 2013. Also, companies that attempt to upgrade their equipment are finding that newer machines are already geared to be more environmentally-friendly.

In addition, the technology behind many eco-friendly processes has become advanced enough to the point where it can “pay for itself” in a relatively short period of time. And governments are actively providing incentives to companies that convert to these greener technologies. As a result, businesses are installing solar panels on their buildings to use the sun’s energy to heat their water and interior spaces. Companies that operate fleets are converting their vehicles over to natural gas, which burns cleaner than gasoline. And many agriculture-based companies are practicing rainwater harvesting and other water conservation techniques to minimize their need for relying on municipal water sources.

The image of sustainable energy is changing in the business world. In the past, the idea has always been associated with an inconvenient cost outlay. But more and more, that notion is being framed as an investment which can reap financial dividends in the years after the transformation to sustainable energy is complete.

Chris Martin is a freelance writer who writes about topics ranging from buying auto insurance to navigating consumer finances to cleaning your gutters.

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Matt Wilson

Matt Wilson is Co-Founder of Under30Experiences, a travel company for young people ages 21-35. He is the original Co-founder of Under30CEO (Acquired 2016). Matt is the Host of the Live Different Podcast and has 50+ Five Star iTunes Ratings on Health, Fitness, Business and Travel. He brings a unique, uncensored approach to his interviews and writing. His work is published on, Forbes, Inc. Magazine, Huffington Post, Reuters, and many others. Matt hosts yoga and fitness retreats in his free time and buys all his food from an organic farm in the jungle of Costa Rica where he lives. He is a shareholder of the Green Bay Packers.