Alina Arnelle, Chief Sustainability Officer at BeCause
In the last few years, the number of corporate sustainability certifications has surged, with more than 400 now recognized globally, according to the International Institute for Sustainable Development. For business leaders, this rapidly growing number of ethical and environmental labels represents both a strategic commercial opportunity and a practical challenge.
A challenging opportunity
Financially, it certainly makes sense to analyze the sustainability landscape and determine which green label best suits your business. Sustainability certifications provide a trusted vehicle for marketing to the fast-growing demographic of consumers who view sustainability as a standard consideration when making purchases. Take the travel industry for example; 75% of global travelers say that they want to travel more sustainably in the next year.
These certifications are a vital tool for capturing consumers’ trust. With high-risk cases of corporate greenwashing rising by nearly a third (30%) in 2024, consumers are struggling to evaluate the truthfulness of businesses’ sustainability claims. To close this trust gap, independent verification by a reputable body serves to augment brand transparency and accountability.
Substantiated claims can also help to attract investors and talent. McKinsey research reveals that 85% of chief investment officers say that ESG is an important factor in their decisions, while a PwC report shows that 75% of job seekers view a potential employer’s societal impacts as important, and 68.6% take its environmental impact into account.
However, the overwhelming number of certifications – all with their own standards, criteria and requirements – makes it challenging to determine which ones are truly worth the investment. Here are three steps to help you navigate the sustainability certification maze:
- Focus on your core business goals
Rather than being swayed by the certification trends set by your competitors, the first step is to base your certification strategy on your business objectives. Are you looking to drive external investment, comply with sustainability legislation or attract a new market segment? Tailor your certification strategy accordingly.
For instance, if you are prioritizing regulatory compliance, certain certifications, such as the ISO 14001 (Environmental Management Systems), offer a credible means of aligning with major legislative frameworks, like the European Union’s Corporate Sustainability Reporting Directive or Green Claims Directive. This certification can help an organization demonstrate that it meets environmental regulations and actively manages its environmental impact.
On the other hand, if your principal goal is commercial, the focus should be on targeting pertinent markets. Certain certifications are more impactful when it comes to reaching different segments. For example, in the travel and hospitality sector, the Green Globe certification appeals to corporate clients focused on sustainability in company travel policies. In contrast, Green Key works better for hospitality providers focused primarily on consumers drawn to eco-friendly travel experiences.
- Treat this as a commercial decision
Until recently, many business owners viewed sustainability certifications as optional add-ons rather than fundamental business drivers. As sustainability expectations continue to rise, this is no longer a viable approach. The right certification can have a significant impact on revenue by strengthening customer loyalty, attracting new demographics, and enhancing marketing opportunities that reinforce brand credibility and differentiation.
For example, furniture giant IKEA has gained a competitive advantage by putting sustainability at the core of its business and integrating a range of green certifications into this strategy. To attract ethical and eco-conscious consumers to its products, the global brand highlights that 97.8% of the wood in its products is either recycled or Forest Stewardship Council®-certified, which means it comes from sources where trees are replanted. Likewise, all the cotton used in its soft furnishings has been certified by the Better Cotton or Cotton Made in Africa initiatives – or certified organic by the Global Organic Textile Standard.
In terms of its property portfolio, IKEA wins over investors and local government planners by ensuring its stores meet either the Building Research Establishment Environmental Assessment Method (BREEAM) or the Leadership in Energy and Environmental Design (LEED) certifications, demonstrating high efficiency and reliance on low carbon energy. By integrating these sustainability commitments across its supply chain and operations, IKEA not only strengthens its brand reputation but also sets a benchmark for environmental responsibility in the retail industry.
- Assess the operational ramifications
As with any strategic decision, operational feasibility and cost must be carefully considered to ensure long-term success. Gaining and maintaining a sustainability certification requires financial investment, staff training and ongoing data management. However, when evaluating the long-term return on investment, it’s important to recognize that many sustainability initiatives reduce costs by improving efficiencies, limiting waste and optimizing resource usage.
On a practical level, the main challenge is the collation and assessment of data from a wide range of metrics like carbon emissions, energy consumption, water usage, waste management, pollution, biodiversity conservation and human rights. This can prove a time-consuming, labor-intensive and inaccurate process that hits many companies financially.
For example, in the hotel sector, many chains still collect these sustainability datasets manually via spreadsheets, surveys and emails. These outdated and inefficient methods cost an estimated $8 billion annually, while missed opportunities to attract and engage eco-conscious consumers amount to $13 billion in lost revenue. In total, ineffective sustainability management costs the industry $21 billion each year.
In this context, streamlining sustainability data management through digitalization is becoming increasingly valuable, prompting a number of entrepreneurial tech start-ups to create a variety of ESG solutions, many targeted at specific industries. These solutions aim to replace outdated, manual processes with automated, data-driven approaches that improve efficiency, accuracy, and scalability.
At BeCause, for example, we’ve built the only AI-driven sustainability data management platform specifically designed for the travel and hospitality sector. The platform not only acts as a centralized data hub but also streamlines data collection and reporting by automating the mapping of properties to various certification standards,
Certification as a route to success
With nearly two-thirds (64%) of consumers ranking sustainability as a top three value driver across product categories, third party sustainability certifications have become one of the best ways to substantiate social and environmental claims, boost transparency, build trust and drive sales. They can also help benchmark your company against industry standards, comply with sustainability regulations, identify risks and strengthen resilience against future challenges. With so many certifications to choose from, selecting the right one requires a clear strategy. It’s best to focus on your key business goals, treat it as a strategic commercial decision and fully assess the operational impacts from the outset.
