This article was contributed by former and current members of NCIA’s Sustainability Council, including lead author Laura Wilkinson Sinton and Shawn Cooney. Shawn Cooney and David Schwartz are also contributors. Fred Whittlesey and Gabe Cross are Emily Long and Mike Lomuto, NCIA’s DEI Manager.
“Everyone speaks about changing the world. “Nobody talks about changing oneself.” – Leo Tolstoy
For cannabis companies, sustainability can be confusing. In a federally-illicit cannabis market, the reality is that individual businesses can make a difference by taking steps to reduce their environmental impact. This is a catalyst for systemic changes across the entire industry. Is sustainable the same as recycling? Does it mean regenerative farming? Compostable packaging?
It could refer to any or all of these things depending on the industry vertical. It refers to a group of seemingly small steps that add up to a greater collective impact.
Sustainability The ability to live and develop in this generation without depleting future generations’ natural resources
These are the top 3 reasons you need to pay attention and get involved.
Your future depends on it.
The cannabis industry is seeking legitimacy from both institutional and private investors. Institutional and private investors have stated that a strong sustainability plan is essential. The Security and Exchange Commission will establish reporting standards for publicly traded companies, and ESG reporting (Environmental, Social, and Governance), will be required. You must start reporting metrics if you are looking for capital or investors in the immediate future. You may find yourself playing musical chairs and end up with a “nosebleed”, if not, seat at the table. Consider another point: the number of cannabis-related women has been declining rapidly. Pay attention to your hiring practices, and be aggressive in promoting inclusion. Investor boards are composed of women and they will scrutinize your leadership gender balance metrics when you approach them. They’ll be looking at both social and environmental statistics, so inclusion can give you a competitive edge. Include minorities and people affected by the “War on Drugs” should also be on your list.
Your customers are demanding it.
Calivate recently conducted a survey and found that 79% of cannabis retailers customers (the revenue drivers), indicate that they prefer environmentally-conscious brands through their purchases. With their forward-looking ESG reporting, and social justice activism Wyld is a shining example of the power that their market positioning can bring to their business. Wyld has made it a competitive advantage. It’s yours. Customers prefer to purchase their weed from women (46%), people of color (44%), and veterans-owned businesses (44%). These types of metrics can be combined with sustainability reporting. You will gain different perspectives and customer acquisition perspectives. It’s more than about the lowest price or the highest THC. All indicators indicate that ESG reporting will play a greater role in the future with customer loyalty and investor satisfaction.
It is actually much easier than you might think.
You can measure and set benchmarks based on your vertical. These metrics are most likely already measured, but they do not apply to sustainability reporting. Investors will be impressed by your efforts to improve them through both money-saving strategies as well as social indicators. These are some easy ways to get started, either monthly or quarterly depending on the size of your company.
Water. Most manufacturers measure water consumption in indoor and outdoor plants. You can establish a baseline of your current water usage and then measure it quarterly to see seasonal changes. You can then develop strategies to reduce consumption, such as low flush toilets or watering more often throughout the day and less volume.
Electricity/Power. Everybody, no matter their vertical, has to pay a power bill. Setting a quarterly benchmark, and implementing reduction strategies (including working with local utilities and time of day) will help you save money and power consumption. Use lower-wattage LEDs. Avoid using bandaid solutions to environmental control, such as adding more large dehumidifier units or installing multiple systems that only perform one function. Diesel generators are not recommended for indoor cultivation facilities in major California cities. You will be in serious trouble with all authorities and it could cost you your license as well as any downstream customers. You and your brand’s reputation will be harmed by the news cycles. You must be aware of the dangers of making quick money with polluting, cheap energy. It comes with a price. It’s unsustainable.
Waste. Any vertical can measure its waste output. All verticals can measure their waste output. Many cannabis packaging companies, such as Sana Packaging, use recyclable oceanic plastic lids for glass bottles. Wyld now uses compostable child-proof packaging, which is a major breakthrough in the industry. Different manufacturers have different ways of dealing with waste, depending on the process.
It is important to get started. Even if you don’t think you need it right now, you will in the future. Make sure your CEO is 100% on board. Without the support of your CEO or investors, it will be difficult to achieve your sustainability goals. You must give them data and reasons your company will profit financially by these actions, and encourage them to participate in the process. You may need to hire an environmental sustainability consultant or professional to collect the data needed to show the executives the financial benefits. You can do it yourself if you’re a small company.
This free website provides a way to get started if you’re feeling overwhelmed. You can input your sample data and view instant graphs.
Only if you are available for it.
The post Blog: Three Things Your Company can Do for Sustainability (And Why you Should Care) was originally published by The National Cannabis Industry Association.
