Green certification is a process by which a business or organization can demonstrate its commitment to sustainability and environmentally-friendly practices. There are a variety of green certification programs available, each with its own specific standards and criteria that must be met. Some examples include LEED (Leadership in Energy and Environmental Design) for building construction and design and the Forest Stewardship Council (FSC) for responsible forestry management. Obtaining green certification can help a business to attract environmentally-conscious customers, reduce costs through energy and resource efficiency, and improve its overall sustainability performance.
Green businesses help balance economic profits with the planet’s health. Getting your sustainable green business pays off. According to a report by the Shelton Group, 86% of consumers strongly feel that companies should take a stand on environmental and social issues. Therefore, consumers have started taking the commitment to ecological protection into serious consideration when deciding what to purchase.
Investors have noticed these growing consumer demands. Green certification for sustainable business also helps you secure green bonds. Green bonds fund projects that conserve the environment. The projects include sustainable activities across energy, transportation, construction, and other sectors. According to analysts, the annual growth of green bonds has run into triple digits. There aren’t enough green-certified business opportunities to keep up with this growth rate. Therefore, fund managers actively seek new green-certified businesses to maintain a healthy balance sheet while protecting the environment. This makes now the best time to get your sustainable business certified.
Despite the high demand from consumers and investors for eco-friendly products, there still isn’t a central agency that governs, regulates, and certifies green practices. This has led to some companies making false claims about their environmental impact – greenwashing. But we are seeing a growing regulatory movement to debunk false claims. The trade commission agencies of countries can take action against any company making false claims about their environmental impact. Even private parties can sue greenwashing parties for civil litigation.
If you’re seeking to prove the positive environmental impact of your business, respected certifications exist.
The Meaning of ‘Green’
Businesses whose principles, practices, and policies have social and environmental benefits are eligible for green business certification. Green-certified businesses assure consumers that the company is committed to environmental and social responsibility. Green certificates can help make your business products more competitive in the market. However, without a central governing agency, companies can create their own definitions to prove that their products are eco-friendly, organic, natural, or carbon-neutral.
This opens up a lot of loopholes. For example, only agricultural agencies define ‘organic’. But many companies regulated by the Food and Drug Administration (FDA), like companies dealing in personal care and cleaning, are making claims that their products are organic. Another example of loopholes is companies labeling their products ‘cruelty-free’. The label could mean anything but cruelty-free since there is no central agency to provide a legal definition of the term.
This has led to distrust and confusion among consumer groups. Market experts say that 4 out of 5 people do not trust companies ‘natural’ claims.
In the absence of a central regulatory board, many private green certifiers are coming up and filling voids left by governments. Experts caution business owners to tread carefully when dealing with third-party certifications. But that doesn’t mean you should shy away from them. Consumers are concerned about the planet and are increasingly committing to sustainability. The growth in sales of sustainable products has shown that consumers are placing their trust in claims backed by third-party certifiers and government agencies.
Third-party certifiers like non-profits, government, and industry organizations ensure that there is no financial conflict of interest between the business undergoing certification and the certifier. It further ensures that the certificate is credible.
The type of certification you choose depends on your company’s product or service. Search for third-party certifiers that assess a business’s impact across all areas and not just one. Certifying organizations also advise companies about implementing green initiatives associated with the certification. Third-party certifiers give companies access to a network of experts and specialists and help you set up your company for success in the sustainable sector.
How Do You Choose Your Certification?
While searching for a third-party to certify your green business, look for organizations that check all of these boxes:
1. Requires a comprehensive investigation and testing of your business and product.
2. It Is very transparent and clear about its certification process.
3. Has guidelines and standards backed by science and experts.
4. Provides expert guidance during and after the certification process.
5. Managed by a third-party organization such as a non-profit, unbiased industry or government agency.
6. Is recognized and finds relevance with your target audience.
Green certification for sustainable business offers many benefits. The key to a good and credible certification is selecting the most reputable certifying organization that aligns with your company’s principles and values. The application and certification process, costs, and requirements can vary widely between organizations. Some parties certify the entire business, while others certify just the products.
For example, B Corp, a third-party certifier, certifies an entire business operation. The application fee for getting a B Corp certification depends on a company’s annual sales. For companies with annual sales of $150,000, the application fee is $1,000. It can go up to $ 50,000 for sales over $1 billion.
Individual farms and groups of farms can get their products certified by the Rainforest Alliance’s agriculture certification. Each certifier has a different and unique application process. However, with most certificates, you will likely need to:
1. Prove that your business or product meets the issuer’s standards and requirements.
2. Undergo inspections, verification, or testing by third parties that your company will have to pay for.
The renewal period of the green certificate also varies. Some issuers recertify your product or business yearly, while others do it every two or three years.
B Lab certifies companies that care for employees, communities, and the environment. It provides the B Corp Certificate. B Lab is a non-profit organization. It has accredited businesses like Beautycounter (a skincare company) and Patagonia (an outdoor clothing company).
The Carbonfund Foundation provides the CarbonFree certificate. It certifies that a business has low carbon emissions and is committed to further reducing and offsetting its emissions. Some of the companies certified by the Carbonfund include Alaska Airlines.
This non-profit organization certifies that the raw material used by a company came from a sustainable certified source and post-consumer recycled material. Businesses certified by the Sustainable Forest Initiative include National Geographic and Pearson.
Cosmetics and personal-care products seek the Leaping Bunny Certificate to tell consumers that these products are 100% animal-testing-free.
The above are just some of the many green certifications available. When looking for a green certification for sustainable business, there is no one-size-fits-all approach. Before going ahead with a certification, consider the costs and whether you’re comfortable being completely transparent with your business or product. Ensure that your target audience recognizes the green certificate you are pursuing.
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