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Can profitability and sustainability go hand in hand?

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By Alberto Contardo

· 3 min read

Yes, it is possible. 

In recent years, corporate sustainability has become a key issue for companies around the world. The COVID-19 pandemic has accelerated this trend, as companies have realized the importance of sustainability in ensuring resilience and long-term success. 

In this regard, I want to talk about three trends in corporate sustainability that will be key to the success of your company in the near future. 

Circular economy

According to a report by the Ellen MacArthur Foundation, the circular economy can generate significant economic benefits for companies, including a 20% to 30% reduction in material costs and a 30% to 50% reduction in waste costs. In addition, a study by the Inter-American Development Bank shows that companies that adopt circular practices can improve their competitiveness and reduce price and resource scarcity risks. 

Technological innovation

A study by consulting firm Accenture shows that companies that invest in sustainable technologies can generate significant cost savings, such as a 12% reduction in energy costs and a 10% reduction in water costs. In addition, a report by the CDP (formerly the Carbon Disclosure Project) shows that companies that invest in low-carbon technologies can achieve an average return on investment of 33% over three years. 

Transparency and accountability

A report by consulting firm KPMG shows that companies that publish sustainability reports can achieve significant economic benefits, such as improved access to financing and a reduction in the cost of capital. In addition, a study by the CDP shows that companies that publish sustainability reports achieve an average return on investment of 19% over three years. 

The way forward

These trends are key to the long-term success of any company in the current world, and Latin American companies are no exception. By implementing these trends, companies can improve their resilience, profitability, and reputation. 

In conclusion, the circular economy, technological innovation, and transparency and accountability are trends in corporate sustainability that will be key to the success of Latin American companies in the near future. Strategic investment in these trends will create a positive impact on the performance of companies. By investing in these trends, companies can systematically improve their environmental, social, and corporate governance performance, improving their profitability and developing an honest and transparent relationship with their consumers. This will be the only way to create dominant competitive positions in a sophisticated and hyperconnected market where the relationship with stakeholders will be a key factor in the success of your business.

illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.

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About the author

Alberto Contardo has 18+ years of experience in international business in Latin America and Asia, with the last 12 years as an entrepreneur. He lived in China for 7+ years where he started two ventures. Alberto is an adjunct professor in conflict resolution and innovation with experience with Chinese, Chilean, Mexican, and French universities. He has collaborated with organizations such as IDEO, +Acumen, Impact Hub, EF, United Nations, and Deloitte. Alberto is a former competitive athlete, a current calisthenics fan and Vipassana meditation practitioner.

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