Why 60pc of Kenyans are only buying from sustainable firms

Employees hold the biggest sway in influencing businesses to adopt eco-friendly practices, a new study indicates in what points to a growing need to proactively engage the workforce in sustainable practices.

At the same time, consumers are increasingly becoming more aware of the need for sustainability. Six out of 10 Kenyan customers with knowledge of the topic say they would only buy from sustainable companies by 2022.

This is according to findings of the recent State of Environmental Sustainability in Kenya survey by the Kenya Climate Innovation Centre Consulting.

More than regulators, the public and media, company staff wield the biggest influence in moving a business towards the path of environmental sustainability, the study revealed.

What this means is that by engaging employees in sustainable practices with incremental greener tweaks to daily processes and tasks, a firm can easily meet its sustainability goals and lower its overall carbon footprint. Therefore, organisations should design their eco-policies with staff in mind towards energy and water resource use conservation and minimal waste generation, including cutbacks in plastic and paper use. This should clearly outline what is expected of each one of them as part of the bigger goal.

Is sustainability expensive?

However, embedding sustainability in a business is most often viewed as expensive. While it may be true that some sustainable features such as green energy installation can cost sizable sums of cash, most everyday sustainable practices are quite affordable, including reminding staff to switch off office lights and computers when not in use.

Environmental footprint is almost always associated with the size of resource use such as energy and waste production.

It is encouraging to note that local companies are steadily getting conscious of their environmental performance to improve on it, thanks to increased calls for environmental accountability in the corporate world.

One of the key drivers of this trend is the influence of various stakeholders. This includes employees, who it turns out, are the most powerful change agents (28 per cent) of sustainable corporate operations, followed by regulators (25 per cent). Community environmental groups and the public (21 per cent) come next in the pecking order of influence over company practices, while competitors (14 per cent) and trade association (seven per cent) complete the top-five list. More tellingly, the study reveals that the media carries the least influence over companies’ sustainable behaviour at five per cent. This calls for more synergies between corporate Kenya and the media in promoting sustainability, given the significant role the fourth estate plays in shaping narratives and trends and ultimately influencing positive behaviour change in the society. Climate change, in the absence of sufficient mitigation measures, would likely be the next pandemic and the role of the private sector in preventing possible planetary fallout cannot be downplayed.

With potential health and environmental risks associated with companies’ production of goods and services, the focus should urgently stretch beyond profitability towards people and the planet.

Leading Kenya and indeed Africa towards a sustainable development pathway requires homegrown solutions tailored to the unique needs and sustainability challenges of local economies.

To this end, corporate sustainability should be built around responsible utilisation of natural resources, adoption of circular economy principles, and sustainable manufacturing and service delivery including staff welfare.

Kenya’s Vision 2030 economic blueprint places the exploitation of natural resources at the heart of the country’s economic growth but also warns of negative consequences should it be handled in an unsustainable manner.

Whereas the local economy is heavily reliant on agriculture and tourism, it is increasingly tilting towards manufacturing and the service sectors.

While climate change is the single biggest threat to agricultural activities, the growth of other sectors comes with the exploitation of natural resources and the environment, equally making them prone to the climatic changes.

Further, population growth and rapid urbanisation mean increased effluent discharge, something that calls for effective disposal mechanisms.

It is, therefore, encouraging to note that a growing number of enterprises are promoting and adopting sustainable consumption and production practices in line with sustainable development goal 12.

Aware of the economic and social benefits that accrue from sound environmental management practices, more firms are increasingly taking steps towards sustainable production and consumption.

This includes better waste management in line with set policies and standards, alongside the adoption of a circular economy to ensure extraction of maximum value from resources while recovering and regenerating materials from them at the end of their service life.

As a good practice, it is laudable that more and more organisations are strategically communicating their environmental scorecards to their stakeholders through sustainability reporting. This is the highest mark of environmental accountability at the corporate level and ideally, all firms should join the green bandwagon. In the study that involved 852 companies sampled across 18 sectors, employees reported that they expected their firms to operate in an environmentally sustainable manner.

Only 12 per cent of the polled firms were members of the UN Global Compact Network — the world’s largest corporate sustainability initiative. The rest displayed interest to join the movement. Besides employees, the report indicates that regulators are a significant sustainability driver through enacted laws requiring firms to increase their environmental accountability.

Sampled firms also disclosed that their competitors, based on their sustainability reporting, influenced them towards environmental responsibility. However, media influence on firms’ environmental performance was markedly low. The difference in the levels of stakeholder influence may be explained in part by the stakeholder’s interests and the associated firm’s potential gains and losses from the influence.

For example, non-compliance with environmental rules could expose firms to fines, penalties and license revocation. This gives regulatory bodies some power over the legality, existence and operations of a firm. However, reliance on enforcement in meeting environmental requirements could see firms only meet the minimum acceptable standards, with little effort to enhance performance.

Equally, most employees nowadays want to see their jobs as a way of contributing to the betterment of the world, besides their paycheck.

This explains the recent trend where top talent has increasingly been gravitating towards companies with clear-cut sustainability agenda with better working conditions and regard for the environment.

On the customer side, green consumerism is expected to heavily influence purchase decisions in the near future. Sixty-six per cent of firms reported receiving demands from consumers to conduct their operations in an environmentally sustainable manner.

Barriers to eco-friendly practices

The biggest barrier cited by firms is the lack of support from relevant institutions to seamlessly implement environmental management practices. Firms also felt a lack of incentive to invest in environmental projects, saying the field promises limited returns hence a weak business case to get involved in.

To this end, forging strong networks with relevant support organisations such as the UN Global Compact could accelerate the adoption pace of sustainable practices.

A majority of Kenyan firms cited legal demands, customer requirements and good long-term relations with suppliers as among the reasons for adopting environmental management practices. To this end, eco-friendly practices may add value to a firm’s brand, build customer loyalty and improve revenues and enhance a company’s reputation.

The report recommends firms to align their business operations with nationally determined contributions, which outline low-carbon and climate-resilient development pathways, alongside other national development strategies. The government, on its part, should use the dynamic space of voluntary environmental schemes as a test-ground on how to tailor-make mandatory requirements.

Mungai is CEO, Kenya Climate Innovation Centre