Business Profitability and Sustainability
Introduction and Literature Review
Columbia Southern University 2
Business Profitability and Sustainability
The profitability and sustainability of a business are both desirable qualities that each and
every business desire to attain. Profitability can enable a business to achieve a return on investment
as a measure of the efficiency of the business based on the resources that are at the disposal of the
business when compared to the alternative investments. However, this could lead to a strain and
depletion of the available resources. A company that has attained higher levels of profitability and
sustainability can help a business secure financing from financial institutions such as banks. For
example, a company that has higher profitability and sustainability levels have a better credit score
which can help them to borrow higher loan amounts that the businesses can use to further develop
and advance their operations. Higher profitability and sustainability levels have also motivated
investors and employees which has increased the investments and costs incurred in the hiring
process when employees leave to work with the competitor firms. The controversy that emerges is
that business profitability and sustainability is important for business because it increases revenues,
improves the credit score that determines the ability of the business to acquire loans and funding
for future expansion, and the number of investors although it comes at a cost as resources may be
depleted in the process. The advantage of business profitability and sustainability is that it can help
businesses improve employee retention by building helping the employees build their reputation,
providing them with an opportunity for career growth, provide training that increases job security,
improve a firm’s liquidity state, and could reduce stress levels among the employees. On the
contrary, business profitability and sustainability require advances in technology which may
exploit and deplete environmental resources as well as leading to higher stress levels among the 3
employees. The objective of this argumentative essay will be to address the advantages and
limitations of business profitability and sustainability in the business environment.
There are several articles written and published about the critical role that business
profitability and sustainability. According to Beato (2017), business profitability and sustainability
could help to improve employee retention. The ability of a company to hire and retain highly
innovative and competitive employees depends on the ability of the company to remain
competitive in the industry. This way, companies that are highly profitable and sustainable are able
to not only attract a talented pool of employees but also retain them. No one employee would be
willing to work for a company that has poor profitability, but is also unsustainable. The author of
this article confirms that one of the benefits of a business is being profitable and sustainable.
Business profitability and sustainability could also enhance career growth and
development. According to Dang et al. (2019), organizations that are profitable and sustainable
provide opportunities for the employees to grow and develop themselves at both personal and
professional levels. Research shows that organizations that are highly profitable sustainable
understand the importance of investing in the employees (Dang et al., 2019). As such, the
organizations may invest in employee development programs through workshops, seminars, and
even morning briefs to motivate the employees. These programs and strategies are important
because they allow the employees to learn new skills and knowledge about various issues. The
result is that the employees are able to achieve career growth and development that could further
contribute towards achieving better employee retention and attracting more talented and skilled
Furthermore, research shows that business profitability and sustainability could help
businesses to enhance job security for the employees. According to Mounteer (2019), business
profitability and sustainability provide training and improving job security. Training equips the
employees with the right skills and competencies to address the various issues that the employees
may encounter at their place of work. This way, employees do not have to worry about getting
stressed that they will be fired because of their lack of competence and skills to perform effectively
at their place of work. Past literature thus shows that employees are able to improve skill level and
competence as a result of business profitability and sustainability ( Mounteer, 2019). The
employees can improve their efficiency and productivity at work. As a result, the employees will
feel assured that their job position is secured, and thus increase job security. It will also minimize
distraction in the place of work because companies that are profitable and sustainable have the
right resources that the employees may need. The employees do not have to struggle from one
place to the other looking for the right resources that the employees may need.
A business that has training and mentorship programs in place for the employees can help
to improve the reputation of the employees. Through training, the employees will be able to learn
the significance of some of the skills such as diversity, teamwork, and continuous education for
career growth and to develop themselves both personally and professionally. This reduces the
possibility of employees being scared and fearful that they may lose their job position to more
competent individuals. They are equipped with the right skills and are up-to-date with the latest
trends in the market. The employees will be very competent to improve their efficiency and
productivity in the place of work.
Most importantly, business profitability and sustainability can help a business enhance its
liquidity of the business. According to Jasmani (2019), the liquidity of the firm can improve 5
drastically when the firm is profitable and sustainable. Businesses that are profitable and
sustainable have adequate assets to efficiently cover their immediate as well as short-term
expenses. By having sufficient assets, the business can have better collateral and thus the ability to
gain higher loans to expand the operations of the business. This way, businesses that have higher
profitability and sustainability will have better liquidity and can thus secure better loans under
better interest rates.
However, past literature also shows that the process of achieving business profitability and
sustainability could deplete the resources. The process of business profitability and sustainability
possess a challenge to the sustainability of the resources (Benitez et al, 2017). As businesses strive
to achieve profitability and sustainability, they may require to implement advanced technologies to
compete with other industry giants. This may lead to the exploitation of resources, which may pose
a risk to non-renewable resources. Further research proves that the efforts towards achieving
profitability and sustainability could negatively impact the environment ( Srivastava et al., 2017 ).
For example, there is electricity in use, industrial processes, transportation of the products, and
burning of fossil fuels which could all emit pollutants into the environment. This way, the struggle
to attain profitability and sustainability impacts the environment and may deplete resources.
Finally, the need to achieve profitability and sustainability may impact the health of the
employees. The industrial processes and activities that companies may go through to achieve
business profitability and sustainability may lead to employees being overworked and stressed out.
Working hard on a daily basis to achieve profitability may lead to employee burnout. This could
reduce the efficiency and productivity of the employees. 6 7
Beato, A. (2017). Effective strategies employed by retail store leaders to reduce employee turnover
(Doctoral dissertation, Walden University).
Benitez, J., Chen, Y., Teo, T. S., & Ajamieh, A. (2018). Evolution of the impact of e-business
technology on operational competence and firm profitability: A panel data investigation.
Information & Management , 55 (1), 120-130.
Dang, H. N., Vu, V. T. T., Ngo, X. T., & Hoang, H. T. V. (2019). Study the impact of growth, firm
size, capital structure, and profitability on enterprise value: Evidence of enterprises in
Vietnam. Journal of Corporate Accounting & Finance , 30 (1), 144-160.
Jasmani, J. (2019). The Effect of Liquidity and Working Capital Turnover on Profitability at PT.
Sumber Cipta Multiniaga, South Jakarta. PINISI Discretion Review , 3 (1), 29-38.
Mounteer, S. M. (2019). Increasing Profitability in Healthcare Organizations through Employee
Satisfaction Approaches. Journal of Online Higher Education vol , 3 (2).
Ramos, P. C. (2019). Employee retention strategies for executive operation leaders in an academic
nursing environment (Doctoral dissertation, Walden University).
Srivastava, A., Singh, S. K., Tanwar, S., & Tyagi, S. (2017, September). Suitability of big data
analytics in the Indian banking sector to increase revenue and profitability. In 2017 3rd
international conference on advances in computing, communication & automation
(ICACCA)(Fall) (pp. 1-6). IEEE.