Creating a sustainable business

It’s not so long ago that sustainability was seen by most companies as little more than a peripheral ‘green’ issue.  Often packaged as useful for reducing energy and waste disposal costs or supporting some worthy community causes, it was rarely seen as central to a company’s core business.

That view is changing, and rapidly. Companies from all sectors are having to confront and adapt to a range of disruptive forces including economic downturn, globalisation, increased urbanisation, intense competition for raw materials and natural resources and a revolution in technology that is challenging the business models of many sectors while forcing all companies to be more accountable to, and transparent with, all their stakeholders.

As a result, sustainability is moving from the corporate side-lines into the mainstream. Faced with a future of uncertain energy costs, looming regulation on carbon emissions, concerns about access to raw materials and the availability of natural resources like water, companies all over the world are waking up to the reality that environmental sustainability is a key consideration.

At the same time those same companies are coming under greater scrutiny about their role in society. Fuelled by the explosion in online social networking, consumers, NGOs, the media and their own employees are holding companies to account about their treatment of workers, the sourcing and quality of their products and their corporate culture.

Developing and integrating a detailed sustainability vision into your long-term strategic plan in a way that creates lasting value whilst also building public trust is a necessary evil for all types of organisations.

CEOs may be missing a key opportunity to meet sustainability challenges by engaging their boards of directors. Having a board of directors that is actively engaged on sustainability issues is an essential driver of sustainability leadership. Board members should look closely at their boards and ask themselves a series of questions.

• Do we have explicit oversight of sustainability issues?
• How much time do we allocate to sustainability issues?
• Do we have any expertise in the sustainability areas that are most material to the company?

So how do you create a sustainable business, let alone monitor that it stays on track, and manage interventions to make improvement? As an organisation, consider the following:

• Identify your issues and goals to determine where pressures are likely to be and raise awareness of what needs to happen to make your business more sustainable.
• Prioritise these issues from both a sustainability and commercial point of view. This will help you recognise and better manage risk, improve efficiency, revenue potential, growth and other opportunities.
• Map the short and long-term ambitions for your sustainability vision, assess the risks, and address any gaps in delivery.
• Support the alignment and integration of your sustainability vision into your overall corporate strategy.
• Develop and deliver a robust sustainability programme that includes prioritised initiatives, enablers, milestones, key performance indicators, and measurable targets.

What is becoming increasingly evident is that a sound sustainability strategy protects a company’s reputation; it drives innovation and employee engagement, it satisfies consumers and attracts and retains top talent; it demonstrates compliance and leads to market differentiation - all key ingredients for long-term growth and profitability.

The message seems clear. Sustainability is largely good for business, which is why executives are integrating it into their corporate strategy. So does your organisation pursue a business growth strategy that creates long-term shareholder value by seizing opportunities and managing risks related to the company’s environmental and social impacts?