With more consumers flocking toward green businesses, an increasing number of companies have adjusted their operations. As a result, the number of sustainable organizations increased significantly, and for good reason. After all, corporate sustainability management leads to more profitable companies. Organizations have tried different approaches that contribute to a greener environment. Others adjust their transportation routes in the supply chain, while some switch to renewable energy in the workplace. There are truly many ways a business can become more sustainable. One in particular that you might not have paid attention to is expense management.
Expense management refers to a company’s process of reporting, verifying, and reimbursing business-related expenses of company employees. These are all done according to the expense policy. Hence, it’s not just about managing the expenses of employee-initiated expenses, but also it’s about defining the set of rules that help manage them.
Several companies have skipped the phase of managing their expenditures. After all, it’s an additional step that consumes a significant amount of time. But it’s an extra step worth doing, especially if you envision a sustainable future for your company. Here’s how expense management can help you achieve your sustainability goals:
How Does Expense Management Affect Sustainability?
If there’s one thing you must consider in your approach to sustainability, it’s managing your expenses. Producing green products comes with steep costs, so it’s wise to watch out for your expenditures if it’s the profitability you’re after. By doing so, you create more sustainable processes that allow your company to thrive in the long term. There are many other ways expense management can affect sustainability:
Automation Is Your Friend
You have the option to choose between manual or automated expense management. When looking for the best expense management solution, automation is key. That means choosing the right digital expense management software that fits your company’s needs. For instance, a company struggling to manage its financial documents could benefit from automating its expense management process. Although implementing new technology can be difficult at the start, you’ll reap the benefits once it gets rolling.
As you grow, you take on more projects and increase your workforce. Doing this manually requires a lot of time and not to mention, there’s taxing paperwork that comes with it. By harnessing the power of automation, you save more time – allowing your employees to focus on what truly matters for your green business.
Track Your Finances
When was the last time you checked the ROI of your project? Many managers fail to review the costs associated with their projects. It’s imperative that business owners review their company’s financial situation. For all you know, you could be operating at a huge loss. And by tracking your expenses, you’ll have a clearer picture of what areas need more funding.
In short, tracking your expenses gives you more sets of data to work with. This allows your employees to make informed business decisions, taking your company on the right path toward sustainability. Hence, every sustainable organization must monitor their expenditures closely.
Sourcing From Green Suppliers
Ensuring sustainability in your business means sourcing your raw materials from green suppliers. By coordinating with them, you ensure that your company avoids unnecessary costs that come with unsustainable processes. For instance, choosing a green supplier over a non-green supplier helps you avoid environmental costs associated with environmental degradation. And with a sustainable procurement strategy in place, you assess whether suppliers have a vision aligned with your corporate strategy. Hence, you avoid costs associated with low-quality supplies.
Incorporating Expense Discipline In Workplace Culture
To ensure that you fulfill your goal of becoming a sustainable business, it starts with ingraining sustainability in your company’s values. That means creating policies that allow your company to become greener. Expense management starts with discipline, and discipline starts with the intervention of senior management. By properly communicating with the stakeholders, expense management is incorporated into the organization’s sustainability initiatives. Doing so leads to employees prioritizing expense management. And once this becomes a priority, top management must provide employees with sufficient data showing the attributes of costs. Coupled with sustainable policies, this empowers employees to create well-informed decisions for the company.
Why Is Sustainability Important?
All companies must follow the sustainable path for a multitude of reasons. Sustainability ensures the quality of life that we maintain, protects our ecosystem, and ensures that future generations have a world to live in. By incorporating values of sustainability in your company, your employees build sustainable habits as well. This does not only affect what they do at the workplace but also affects what they do outside office hours. These initiatives lead to a healthier environment – securing the future of the generations to come. With all the benefits that go with becoming more sustainable, it’s no doubt that consumers prefer green organizations.
In short, all companies should start their journey towards becoming more sustainable. Managing your company expenses is one way to help you get started on the road to becoming green. You have many options when it comes to implementing this discipline in your company. For those who don’t know how to start, using digital expense management software can be an option for you should the manual process be too tedious. Part of managing your expenditures is also tracking the costs associated with projects. But for all of this to work in the long term, you must incorporate sustainable practices in your office culture. That means looking for green suppliers or switching to renewable sources of energy. Only then will you be able to truly achieve sustainability.
About the Author: Katie Pierce is a teacher-slash-writer who loves telling stories to an audience, whether it’s bored adults in front of a computer screen or a bunch of hyperactive 4-year-olds. Writing keeps her sane (most of the time) and allows her to enjoy some quiet time in the evening before she walks into a room of screaming kids (all of whom she loves dearly) the next morning.
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