Climate change poses a significant threat to our way of life. But it is also disruptive from a business perspective.
Businesses must not only respond to climate change issues today, but also prepare for future developments. Sustainability should be a key element of any business strategy.
Here, we discuss what the core principles of a sustainable business are:
What is corporate sustainability?
Corporate sustainability refers to a business’s approach to meeting its responsibilities to stakeholders.
However, instead of focusing solely on profit, it considers the social impacts of business alongside environmental and economic considerations.
The three pillars of corporate sustainability
There are three central values of corporate sustainability. A fully sustainable business observes all three pillars.
#1. Environmental
Businesses must now consider the environmental impact of their activities.
Every product made includes raw materials, energy and other resources, not only in its creation and transportation, but throughout its life cycle.
As we move increasingly towards a circular global economy, waste and emissions are no longer tolerated as an unfortunate by-product of business.
Businesses now have a responsibility to investigate, analyse, measure and improve their impact on the environment.
This involves streamlining or modifying processes, such as sourcing different raw materials, switching to renewable energy, or implementing measures to reduce waste and carbon footprint.
#2. Social
Consumers are more informed than ever about the choices they make when spending their money.
Employees are equally interested in a company’s social credentials.
Both groups want to know that a business demonstrates responsibility and care towards its staff, as well as other people involved in the supply chain, and that workers are fairly paid and work in a safe, positive working environment.
The social pillar of corporate sustainability also includes community engagement. This involves activities such as fundraising, sponsorship, and investment in public projects – demonstrating that a company is committed to giving back to its communities.
#3. Economic
The main aim of a business is, nevertheless, to make a profit.
It’s no good reducing emissions and implementing a better maternity leave policy if the company ultimately loses money and is forced to close.
Although equal importance should be given to all three pillars of corporate sustainability, a company must align its strategy with the interests of its shareholders, as well as its employees, supply chain, and customers.
The inclusion of an economic pillar in a strategy enables sustainability strategies to be agreed upon, as it balances the potential costs and time involved in reviewing and modifying activities for the benefit of society and the environment.
Businesses and sustainability: the good, the bad and the ugly
Some businesses have met the sustainability challenge with great success, while others have not performed as well…
Apple
Apple aims to reduce carbon emissions and partner with companies that share similar values.
They use mostly aluminium instead of other materials because it produces lower emissions.
Also, 23 of their partners are committed to 100% renewable energy.
Estee Lauder
The cosmetics company sends zero waste to landfills, as all their waste is either recycled or incinerated and converted into energy.
In its sustainability plan, the company also aims to positively impact the well-being of 10 million individuals through programs focused on health, education, and the environment.
Coca-Cola
With its green label and advertising that places the brand in a meadow, you’d be forgiven for thinking that the global drinks brand was both sustainable and healthier.
However, the brand has been accused of greenwashing after it was revealed that it contained 6.6% sugar.
The brand remains the world’s worst plastic polluter.
Ryanair
In early 2020, Ryanair announced it had become Europe’s “lowest emissions airline”.
However, this claim was found not to be true, and the Advertising Standards Authority promptly banned the ads.
How to adopt the core principles of being sustainable
#1. Adopt a science-based strategy
A science-based approach demonstrates to all stakeholders and the broader community that your business takes its responsibility regarding climate change seriously.
Depending on your business’s activities and size, the amount of data collected will vary compared with other companies. You must collect and analyse your business’s specific data to achieve optimal results.
#2. No greenwashing
A staggering 29% of consumers believe that brands use environmental claims as a ‘marketing ploy’, which shows the suspicion with which they view the companies they interact with. Businesses must understand their environmental responsibilities, as well as the public’s attitude towards them.
#3. Secure buy-in from stakeholders
The most important way to set the right sustainability goals and achieve them is through employee engagement. A business’s greatest weapon in protecting the environment is its workforce. A wealth of information is at every sustainability manager’s fingertips in the form of knowledge, data and ideas.
Internal communication is crucial for getting employees on board regarding sustainability. Businesses must encourage staff in all departments and at all levels to work together to achieve a common goal of helping to save the environment.
Another effective way to garner support is to offer training, which could become part of personal objectives and KPIs. At TSW, we offer a wide range of ISEP courses for staff at all levels, providing your business and its teams with the resilience and expertise needed to work towards a net-zero and green transition.
By encouraging the collection of data and setting both company-wide and individual targets, any expenditure made on achieving sustainability policies can be justified by demonstrating a return on investment (ROI).
