Lou Cysewski, an Entrepreneurs' Organization (EO) member in Seattle, is co-founder and CEO of Coolperx, the world's first net carbon neutral merchandising company. She's on a mission to transform the merchandising industry from a toxic environmental polluter to a conscientious connector of people and values. We asked Lou how entrepreneurs can build and grow more sustainable businesses. Here's what she shared.

Why Sustainability Matters

Promotional products represent a nearly $30 billion industry that produces about $24 billion in landfill waste in the United States every year. The reason for the immense waste: On average, recipients only keep promotional swag for eight months. This is the industry I'm in.

To build a drastically different merchandising company, I had to make decisions that were both sustainable and directly impacted our bottom line.

Since day one, we've built our company with sustainability in mind. Last year, we took it further: We began tracking the carbon footprint of products we didn't produce but sold--and discovered a massive amount of untracked carbon. We realized that, regardless of our efforts to reduce and reclaim the emissions we knew to track, we were missing the biggest emissions contributor.

To solve this issue and empower others to account for their true climate impact, we developed our proprietary "Climate Cost Index." It enables us to evaluate the environmental impact of all our products--from concept to end-of-life--and make informed decisions regarding product materials, packaging, and shipping practices that align with our sustainability goals.

All these decisions came at a cost. The road to profitability was not a straightforward one. To remain true to our values and sustainability practices, we often declined to work with companies that weren't willing to make the necessary investment in ethically sourced products. But today--like many others, including Patagonia, West Paw, Rubicon, and Siemens--we've demonstrated that sustainability can be both the right and smart thing to do.

Indeed, sustainability can become hugely profitable in the medium to long run. For example, studies indicate nearly six in ten consumers are willing to change shopping habits--and pay higher prices--to reduce their environmental footprint.

It's true that sustainability supports customer attraction and retention. It's also true that having a strong environmental mandate equally supports talent attraction and retention. Today's employees seek more than a paycheck. They want to feel good about their work and play a role in making the world a better place.

Investing in a sustainable business model played a pivotal role in supporting our company's sales, employee engagement, and performance--among a long list of additional benefits.

How to Jumpstart Sustainability in Your Business

Either driven by a strong desire to protect our one and only Planet Earth or adapt to changing customer trends, companies are increasingly embracing sustainable goals. However, while they understand the why, they often struggle with the how.

The most significant idea I share with companies ready to make this investment is to create an ecosystem where sustainable practices flow throughout their entire supply network--not just their individual company. It's one thing to reject practices that are harmful to the planet and yet another to require business partners, vendors, and suppliers at every level of the supply chain to do the same.

Here are 10 steps toward achieving that goal:

  • Articulate what sustainability means for your business: What specific sustainability-related challenges does your organization face?
  • Once you've identified your focus areas, set clear, measurable environmental goals and KPIs.
  • Enact sustainability processes and programs to reach these goals.
  • Hire or train the talent you will need to run said processes and programs.
  • Regularly measure your sustainability performance.
  • Report both internally and externally on your sustainability performance.
  • Conduct risk assessments on suppliers/vendors before engaging in agreements to ensure they share and uphold the same, agreed-upon environmental values.
  • Incorporate accredited cradle-to-grave carbon life cycle analyses on all products and durable goods you purchase.
  • Require suppliers/vendors to report on actionable sustainability metrics.
  • Recognize and prioritize suppliers that hit sustainability benchmarks.

Again, these steps can be costly and time-consuming but are worth it to both protect the environment and improve business performance.

Please don't take my word for it, though: Oxford University and Arabesque Partners conducted a meta-study, From the stockholder to the stakeholder, based on a detailed analysis of 200-plus sources. It confirmed a correlation between good business practices in sustainability and economic profitability. The results were remarkable: 88 percent of the 200 sources reviewed found that companies with solid sustainability practices have better operational performance, ultimately resulting in better cash flow.