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Co-creating sustainable businesses

Sustainable business models

ESG is often considered through a compliance lens. However, businesses are increasingly recognising the opportunities that come from building more sustainable and inclusive business models. With the global drive towards Net Zero and the UN Sustainable Development Goals, stakeholders expect businesses to be sustainable and net positive – profitable with positive outcomes for people and the environment.

There's a convergence of business models: profit-driven entities are aligning with purpose and impact, and mission-oriented not-for-profits and social enterprises are reshaping their business models. They are diversifying revenue streams, enhancing resilience and reducing dependency on philanthropy.

Embracing a long-term strategy while recognising and balancing short-term trade-offs can improve a company's triple bottom line over the longer term. Move your business to a sustainable and inclusive future with innovative and purpose-led business practices.

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How we can help

At MinterEllison, we tailor solutions that combine our diverse legal expertise, industry knowledge and deep understanding of ESG. In designing these solutions, we understand the context our clients are operating in and balance the 'real world' marketplace against principles of sustainable operations, ethical procurement and supply chains.

Our expertise extends from guiding start-ups, peak bodies, large corporates, SMEs, not-for-profits and government on all aspects of developing and embedding purpose-driven business models and shifting supply chains.

Explore our services:

  • Sustainable strategy: advice on sustainable business and supply chains promoting inclusive employment, environmental and circular economy, for purpose value capture and monetisation of positive externalities
  • Entity formation: constitutions and shareholder agreements, from for-profit to NFPs, trusts and foundations, cooperatives, incorporated associations, Traditional Owned entities
  • Governance: NFP support, fiduciary duties, and comprehensive ESG framework development
  • Sustainable finance and Impact investing: for social entrepreneurs and purpose-driven entities, encompassing sustainable finance, impact investing, and outcome-based contracts
  • Philanthropic initiatives: expertise in grants and venture philanthropy
  • Certification: including B Corp, Social Traders, Traditional Owner requirements, certification guidelines and appeal processes, certification trademarks and product stewardship programs
  • Procurement: meaningfully integrating social and Indigenous procurement within supply chains
  • Regulatory and tax: ASIC AFSL requirements, ACNC registration, DGR endorsement, tax advice including structuring and rulings
  • Collaborative Models: developing shared value and collective impact models including peak bodies, industry platforms, new impact frameworks and certification regimes
  • Strategic partnerships: facilitation between corporates, social enterprises, joint ventures and alliance arrangements
  • Mergers and acquisitions: transaction work in the context of mission-aligned organisations
  • Traditional Owner business: advice and support on governance, joint ventures and alliances, and transaction work for Traditional Owner businesses
  • Risk management and assurance: truth in labelling and impact audits, development of robust ESG frameworks and processes

Shaping sustainability standards

Our people are recognised internationally and domestically as thought leaders and expert advisors - sitting on technical working committees, steering groups and advisory boards shaping sustainability standards, sustainable finance, certifications, and the development of credible measures and taxonomies operable across jurisdictions.

As certification and assurance frameworks are required to ensure integrity and trust, MinterEllison is at the forefront of building the market for net positive companies to thrive.

Exploring For-Purpose Business Models

Thinking of being purpose-led whilst still profit-driven? Not sure how to balance impact with financial return?

Our team can work with you to consider a business model that addresses the ESG issues, changing market and community standards, whilst ensuring long-term viability and stakeholder and community trust. With you, we can co-create the strategy, the best business model, advise on governance, source and negotiate sustainable finance, obtain certifications and more.

We are known as market-leaders in this sector, advising large corporates, start-ups, SMEs, Traditional Owners and government.

What purpose-led business model could you move to?

What is a Social Enterprise? Navigation Show below Hide below

A social enterprise is a trading entity (for-profit or not-for-profit) that uses its revenue or business model to achieve a social, cultural or environmental mission and deliver public benefit . There are several different impact models from direct benefit, cross-subsidy and profit redistribution. With Governments and corporates increasing their social procurement targets, certification with Social Traders enables access to dedicated social procurement policies. Traditional Owner businesses may fall within this framework but there are also dedicated Indigenous procurement opportunities.

What's the idea behind a B Corporation? Navigation Show below Hide below

B Corporations, or Benefit Corporations, are for-profit companies that are externally certified by B-Lab to meet rigorous standards of social and environmental performance, transparency, and accountability across 5 areas - workers, customers, governance, environment and community. Businesses wishing to become a B Corp in Australia will need to have or adopt governing documents which include a commitment to a ‘triple bottom line’ approach to business.

How does a Not-for-Profit Organisation differ? Navigation Show below Hide below

Not-for-profit as a descriptor is misleading - not-for-profit organisations must make profit to be sustainable and avoid insolvent trading. It is simply what you do with the profits - Not-for-profit organisations are non-distributing businesses whereby profits are reinvested back into the organisation's mission. They can still pay wages, director fees, take out loans and have structured impact investment. These are capital efficient businesses, often with a variety of tax concessions available recognising the public value they create.

Corporates are moving to circular business models? What and why? Navigation Show below Hide below

The circular economy business model is a move away from the "take-make-dispose" sequence, instead shifting supply chains to design out waste, minimise resource input by using expensive resources more efficiently, and ensures that economic activity works in harmony with environmental sustainability. There is an increasing prevalence of product stewardship programs (many voluntary but which may become mandatory over time so consider getting ahead of the regulatory headwinds). For companies looking to create circular business models, it is important to consider a strategy - retain product ownership, product life extension or design for recycling - that aligns with the company’s capabilities and resources and addresses the main operational constraints.

Can you explain the concept of a Triple Bottom Line Business? Navigation Show below Hide below

Triple Bottom Line (TBL) businesses focus on three pillars: People, Planet, and Profit. This approach ensures that companies measure their success not just through financial gain but also through social and environmental impacts, aiming for a comprehensive view of sustainability and a net positive strategy.

Case studies

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WISE Grant

Collaborated with top Australian philanthropic organisations to structure a $3.4M peer fund supporting early-stage social enterprises. This bolsters growth, impact, and job creation for those facing employment hurdles. The new WISE Grant offers $4 million to enhance employment outcomes for workforce-challenged individuals."

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B Corp certification

Advised a number of listed and private companies on the constitutional modernisation for B Corp compliance and certification. As part of this, we advised on the impacts of B Corp certification on directors duties and social washing risks.

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Social Enterprise Australia

Assisted with the establishment of Social Enterprise Australia, the peak body for social enterprise in Australia and contributed to the development of its social enterprise national strategy.

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Civik - social enterprise partnership between Ventia and White Box Enterprises

Assisted with the establishment of Civik - a new work integration social enterprise seeking to create 250 jobs for people who face barriers to employment, all while addressing the labour shortages facing the telecommunications industry. Civik was built around an anchor contract from Ventia who was looking to boost their capacity to meet demands of a major project with NBN Co.

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Certified Sustainable

Assisted with the establishment of a registered charity, and the development of a new sustainability certification framework for agricultural producers to improve soil and plant health while promoting climate-resilient farming and related enterprises.

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Climate Measurement Standards Initiative (CMSI)

CMSI is an industry led collaboration between banks, insurers, scientists (CSIRO) and research institutions, regulators, Investor Group on Climate Change (IGCC) and others to develop accounting standards and Apps for physical climate risk reporting aligned with the Taskforce for Climate Related Financial Disclosures (TCFD) and accounting standards. MinterEllison are legal advisors to the initiative and part of the Steering Group.

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https://www.minterellison.com/environmental-social-governance/sustainable-business-models

Our multi-disciplinary team can help with all your ESG needs.

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