In today’s world, there is a growing focus on sustainability in retail, and more and more companies incorporating sustainability principles into the very core of their operations. They are setting standards for Environmental, Social and Governance (ESG) in retail performance.
ESG top companies are taking this a step further and formalising their commitment to sustainability in retail with Triple Bottom Line (TBL) reporting – this means that when reporting on their business to stakeholders, they focus not only on profit, but also on the other two ‘Ps – people and planet.
iVend’s retail technology solution is driving ESG in retail.
Learn more about our state-of-the-art cloud-based POS systems.
Sustainability in retail has a high level of focus, and 90%* of businesses either have or are planning their strategy. This focus is driven in large part by the changing demands of their consumers – shoppers actively want to buy from sustainable retail companies, and 60%** are willing to pay more for ‘responsible’ products. So when it comes retailers’ sustainability initiatives, becoming known as an ESG brand is not only a question of ‘doing the right thing’ but it make sound business sense as well – ESG top companies are more attractive to investors (66%+ consider ESG when investing) and can save costs to improve their bottom line.
When it comes to implementing strategies for ESG in retail, businesses have a ‘secret weapon’ already in place – their retail POS systems. Technology is an enabler for retail, driving efficiencies, customer engagement and profit. But it can also be a way to implement practices that help retailers to achieve their ESG in retail goals. Let’s look at some of the ways that technology can enable sustainability in retail:
Cashless payments – the production, transportation and handling of cash generates a significant environmental impact – from the pulping of trees to make notes, to emissions from manufacture and impacts of having to move cash around. Contributing to a cashless society by implementing a POS system that enables and promotes cashless payments is a positive environmental action.
Online shopping helps to drive sustainability in retail – imagine if 100 people go to their local supermarket, using their cars and producing emissions. Now think about the difference if those 100 people shop online and one truck delivers all their purchases. Using technology to enable online shopping contributes to reducing traffic and emissions.
Digital receipts – those little slips of paper that many people throw away may seem small, but on a global scale, they add up to a lot of trees. In the US alone, up to 4 million of them, not to mention the 13.2 gallons of water, and 4 billion pounds of CO2. By using POS systems that offer digital receipts, retailers are contributing to saving millions of trees, along with the emissions of the paper production process.
is a massive environmental issue – and some of the goods there are surplus items from retailers – resulting from overstocking or the inability to efficiently process returns. Globally, up to 8%++
of all surplus stock goes to landfill. Smart inventory management,
using integrated POS systems can help to put a dent in this figure – retailers can move goods to where they are most likely to be sold, and can streamline returns to get goods back on shelves instead of sent to landfill.
Cloud-based POS systems play a part when it comes to reducing the technology footprint, energy consumption and emissions in a retail operation. Cloud data centres consume less energy than the retailer would use running their POS systems in-house. With a cloud-based POS system, retailers have the option to use smaller, more environmentally friendly devices, reducing their energy consumption compared to the larger fixed POS systems.
Software-as-a-Service (SaaS) – using POS systems purchased under a service model means that retailers only use the resources they need at the time, compared to on-premise systems that had to be configured for growth. Traditional systems meant that retailers were committing to technology that they didn’t yet need, along with its environmental impact.
Forward thinking brands, driven by consumer behaviours, are highly focussed becoming sustainable retail companies. They also understand and rely on the benefits of technology in their business. Now is the time for these two strands to converge to deliver retailers’ sustainability initiatives, with retailers using the power of technology to help them achieve what the market is demanding – an even greater focus on ESG in retail.
What is ESG?
ESG stands for Environmental, Social and Governance and is an approach to running a business, or investing in a business, which recognises that there is more to success than profit. It is part of the overall awareness – in business and from consumers – that sustainability must be a key focus if businesses, communities and the planet are to survive and thrive. Businesses with an ESG approach see themselves as part of the larger picture, contributing to environmental sustainability, social cohesion and an ethical way of engaging with their partners, suppliers, customers and community. Many of today’s investors will only put their money into companies that are run on ESG principles.
Why has ESG become so important?
For many companies, there has long been a focus on sustainability in the way they run their business, but in recent years, this approach has seen a dramatic acceleration in take-up. This has been driven by several factors: a growing awareness of the immediacy of the dangers of climate change; the pandemic changed consumer attitudes and has seen a shift in buying decisions towards more environmentally friendly businesses; and consumers ‘voting with their wallets’ and shifting their spend to ESG brands.