Which is more important in business: Risk Taking Ability or Sustainability? - GRM Institute

Which is more important in business: Risk Taking Ability or Sustainability?

By Sanandita Mukherjee & Suraparaju Deepthi

PGDRM Batch July 2020-2021

 

Importance of Sustainability in Business

Sustainability basically means “meeting the needs of the present without compromising the ability of future generations to meet theirs.” Sustainability is becoming important for all industries, companies, and other business organizations. 62% of Executives consider that sustainability strategy is necessary to sustain in today’s competitive business world. To be precise, sustainability is a business approach for creating long-term value by considering how an organization operates in the ecological, social, and economic environment.

To quote, here are a few examples of industries strengthening sustainability strategies by taking some effective initiatives

• Nike focused on reducing waste and minimizing its footprint, whereas Adidas has created a greener supply chain and targeted specific issues like dyeing and eliminating plastic bags.

• Walmart, IKEA, and H&M have moved towards more sustainable retailing by collaborating with their supply chains to reduce waste, increase productivity, and optimize material usage.

• Car manufacturers like BMW and Toyota have made strides in energy efficiency and pollution reduction.

 

Importance of Risk-taking ability in business

The 21st-century era has shown us how every successful business ownership involves taking risks. A lot of small business owners have taken risks to get their businesses to where they are now. However, taking risks blindly without efficient planning and forecasting would lead a business to nowhere.

Few reasons why risk-taking ability is essential in business:

• Risks enlarge experience, Even though some risks may not turn out as expected, but an optimistic risk-taker will always count failure as an experience and will always strive for experimenting with new ideas.

• Risk being the medium of innovation, taking no risk closes all doors for Innovation, as it involves changing people’s thinking in a new way, ideas which may have never been used before.

• Risk allows the opportunity to breed in the business. With fluctuating consumer demands, time restraining opportunities come along with a bundle of risks.

 

CONCLUSION

After knowing the importance of both risk-taking ability and sustainability in business, it seems like the latter one plays a vital role in any business organization because companies which incorporate sustainability into decision-making processes can reap significant financial advantages and can attract a large number of investors which is a key to long-term profitability.

Meanwhile, risks in business is not a day to day thing, with the help of innovative ideas and strategic planning, one can find ways to overcome risks. But sustainability is a mega trend that simply isn’t going away as society is becoming more aware of the impact on the environment. Currently, corporations are partnering with innovative green start-ups which pave the way to reach their sustainability goals. To conclude, taking risks for an organization with no sustaining goals/abilities might end up to be a four-day moonlight bloom and then darkness forever.

 

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