Starting a business means that you are building the road at the same time as you are driving on it. Many of today's entrepreneurs want to build a sustainable business, but are challenged by how to handle sustainability.
Need to have vs nice to have and a consciousness about resources spent is highly relevant in all early stages. This is why startups' sustainability work needs to be directed towards where it makes the biggest impact, today and in their future business. So, how do I know where my startup has the biggest impact?
Mapping out where you as a founder need to focus your sustainability efforts is exactly what PSV Ventures, a Venture Capital with a record of supporting over 400 startups from the Öresundregion in the early stages, has done with their ESG Napkin. ESG stands for Environmental Social Governance and is what investors and corporations are looking for when they want to understand how sustainable a startup is.
And as Alexander Viterbo-Horten, General partner at PSV describes, the focus needs to be where your startup has its core impact. Depending on which phase of building your business you are in, they differ somewhat, but overall there are some key things to think of. For instance, if your startup is a tech company, solving problems that include user or customer data, data integrity is likely to be one.
Inspirational KPIs and potential aspirations:
Collect as little personal data as possible
Only collect data by lawful means
Do not disclose personal customer information, except with clear consent
Directly communicate to customers any changes in data protection polities
Consider how long data needs to be held
On the other hand, if you are offering physical products, your greatest impact will most likely be on the material, production and life cycle of the product.
Inspirational impact metrics and potential goals:
Be transparent about your sustainability benefits and risks
Source materials that are recycled
Design for no waste
Partner up with stakeholders that enables circular value
Measure your footprint
Of course, in some cases you need to consider them both. Are you still not sure of where to start?
Set off with answering these 3 questions, and you are on your way:
What activities in your business effects people (users and non-users) and society?
Get to know your stakeholder’s desires regarding your products sustainable value.
Compare your business with competitors to discover your uniqueness/ niche.
Get the ESG Napkin here!
Get in touch with our Sustainability Coach Karin to talk more about ESG's.
At Minc, we believe in creating something bigger than yourself. We offer everything an entrepreneur needs to go from concept to market in-house. Our international network of advisors and award-winning programs will help your startup scale faster and smarter. Welcome to the startup house of Malmö.