How can businesses implement environmentally friendly initiatives and what are the benefits? 

The Minister for Small Business, Bruce Billson says energy and resource efficient measures are a key focus for small business owners.

“We’re finding there is a greater awareness of environmental responsibility as a normal part of doing business.

“In a number of areas it [energy efficiency] can broadly be described as waste reduction, whether it be waste in materials and resources or in terms of energy and water, and that’s largely been because of a great concern about higher energy and input costs – that’s largely where the focus has been according to the Australian Bureau of Statistics (ABS),” he explains.

The ABS’s Australian Energy Use, Electricity Generation and Environmental Management, Australia, 2011-12 report, which applies to business owners that employ between zero and 19 people, uncovered around 11 percent of small businesses had engaged in environmental education and training for their staff, Billson says.

“There’s quite a deal of awareness raising, and a lot of that is driven around cost savings and the way in which businesses want to present themselves to their market place.”

The report found 32.7 percent of small business owners were recycling or reusing materials, however they also identified challenges associated with the shift – 28.4 percent saw the costs involved, as well as payback time as major barriers for improving energy efficiency.

In a bid to help small business owners better achieve energy efficiency; Billson says the government has introduced aggregated small business measures as part of its direct action environmental strategy.

“It allows small businesses to come together and say ‘if all of us changed our refrigeration systems to use a more energy efficient process we can save X amount of emissions’ and present that for funding through the competitive tender process, which enables small business to be a part of that direct action to reduce our emissions and improve our competitiveness as an economy,” he explains.

CASE STUDY: KFC

Michael Clarke, the head of environmental initiatives at KFC says the brand’s corporate social responsibility program includes four pillars, one of which is dedicated to the environment.

“Our philosophy is really to minimise our impact on the rest of the world that we operate and live in, and we have put a lot of strategies in place to help minimise that impact.

“We’ve made some substantial investments in things like recycling and putting energy efficient equipment in our stores, and we’ve redesigned some of our stores to minimise their impact on the environment,” he explains.  

For the last three years Clark and his team have been tracking the kilowatt usage of each of their stores, and overall the results seem positive.

“In the last two years we’ve dropped our kilowatt hours per store by about 10 percent, which is almost like turning off the lights at 600 stores, but at the same time our sales and transactions have grown, so we’re serving more customers, we’re selling more chicken and we’re using less electricity,” Clark says.  

THE COST FACTOR

Clark says new initiatives are trialled in company-owned stores first, which means franchisees aren’t required to fork out additional money until they know the measures are effective. 

“We apply new initiatives within our around 150 company stores, test them, make sure they work okay, prove the model and then we tell our franchisees about them.”

Clark acknowledges the environmental initiatives tend to incur a cost, however he believes the investment is worth it given there is a payback.

“There is an upfront capital cost but typically a two to three year payback, so you make savings after that.

“We’re happy to invest capital provided there’s a return, and most of these initiatives have a pretty fast return. We tend to pick the ones that offer the best return and biggest savings,” he adds.

Keep an eye out for part two of the eco feature, where we take a look at the key intiatives KFC has introduced to reduce its carbon footprint and their effect on the brand’s bottom line.