Addressing Leadership Challenges in Green Entrepreneurship

Ours is a resilient planet. Countless natural systems are in place that can heal the wounds we’ve inflicted if we’re willing to let them. There is an ample need for sustainable businesses that can scale back human impact on the environment.

But the entrepreneurs leading such companies also need to be resilient. They face many challenges – balancing goals and resources, complying with ever-changing standards, and timing things just right.

Below, we will discuss these challenges in detail. Note that each of these challenges is interconnected, as are the natural systems they seek to protect.

What if you’re not starting your own sustainable company but want to work for one? Familiarize yourself with the challenges below, and use this knowledge to develop the right competencies for resume perfection.

Challenge 1: Goals, Costs, and Finances

There is a reason why organic produce or clean cosmetics are more expensive than their competitors: producing goods in a sustainable and environmentally friendly way is often more expensive, especially in the initial stages. Why?

Production facilities—whether your own or outsourced—may not have been fitted for eco-conscious production methods. Equipment may need to be purchased or replaced. Experts may need to be hired.

The materials used to produce goods may be more expensive. Also, finding sustainable shipping methods may be important, especially for e-commerce businesses. Often, carbon-neutral or carbon-offset methods require higher shipping fees. Some of these may be passed onto the consumer, but some may be “eaten” by the business as well.

To cover these costs, startups usually turn to angel investors and venture capitalists. Some are looking for eco-conscious businesses to support, while others may be skeptical of the impact or viability of such projects. Grants and investments for green businesses can be highly competitive. Thus, acquiring the needed funding can be a challenge.

Sometimes, the challenge is simply balancing what you want to do—your sustainability goals—with what you can reasonably accomplish based on your current resources.

Finally, if your business is already established, you may need to find more sustainable ways of doing what you already do. This can require new hires or redistribution of resources for research and development.

All of this also takes time, which is our next challenge.

Challenge 2: Timing

As already mentioned, making changes to your process, materials, or company culture takes time.

If you’re working with a brand-new startup, it may take time to acquire the necessary investors. Market fluctuations can make this process more difficult.

Timing is also important when considering the market at large. In our fast-paced, internet-driven economy, fads often come and go. Agile businesses may be able to make a lot of money if they time advertising campaigns or product releases to match the ebb and flow of whatever is going viral.

This, however, can be an unpredictable process. Outside factors can undermine even the best-laid plans. For example, another brand’s bad press may make consumers wary of those with similar claims. The conflict between nations or social turbulence may cause supply-chain issues, delaying production or even making certain items impossible to obtain responsibly.

Finally, rapidly changing technologies add to the challenge of timing. A business may spend a lot of time, effort, and money adopting the latest green technologies, only to find that these have become obsolete, replaced by something new, in a few short years.

Challenge 3: Governance and Compliance

Just as markets and technologies change, so do laws. Many nations, states, and regions are pushing for stricter policies to help avert climate change.

When running a sustainable startup, this likely falls into line with your company’s goals. But the cost of abiding by and the timing of such laws could make compliance a challenge.

Sometimes, international trade laws may change, making your access to raw materials, facilities, or manpower more difficult or expensive. Or, environmental laws may change so that your company’s policies no longer meet the same “green” standard.

Policy changes may also limit your access to funds such as grants for sustainable businesses. You may suddenly find that you no longer meet the requirements for business size, number of employees, goals, compliance, or something else, and lose needed funding.

Key Takeaways

Running a sustainable startup takes resilience, but the effort is well worth it. Current conditions make such a shift vital to our planet and our survival. This need opens up a lot of economic niches as well.

Eco-conscious entrepreneurs should strive to balance their company’s goals with the resources they have to make the biggest impact. They must heed changing technologies, economic conditions, markets, consumer interests, and world events. Finally, they must understand and anticipate shifting governmental requirements and maintain compliance.

There is a great need and opportunity for sustainable startups. You’re now equipped to face the challenges – get out there and make a difference!