PwC on sustainability

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August 2015

From good to great: Incorporating science into your company’s next generation of sustainability goals

Megatrends such as resource scarcity, climate change, and technological breakthroughs are changing the competitive landscape. As companies, city governments, and other organizations update their sustainability strategies, what types of sustainability goals will engage their stakeholders and help them prepare for the future?

According to an executive leader who joined us for a recent discussion with other sustainability and innovation experts, “If you’re setting goals you know you can meet, you’re not ambitious enough.”

Unlike first generation sustainability goals which primarily focused on the reduction of a company’s direct environmental impacts, and second generation goals which expanded to qualitative supplier and social goals, third generation goals are based on what science says is necessary, connect more closely to the overall business strategy, and are focused on the outcomes for the business and for external stakeholders.

How can you get started on your company’s journey to bolder third generation goals that positively impact your business?

  1. In addition to understanding your own impacts, it’s important to assess how megatrends such as climate change and resource scarcity will impact your business during the timeframe for which you are setting your goals.
  2. Do a materiality assessment and connect the results to your business strategy. Recent research from Harvard Business School has shown that companies that focus on a smaller set of highly material sustainability issues are more successful. A company’s ability to demonstrate, both internally and externally, how environmental, social, and other trends impact its strategy, operations, and long-term prospects is important to meeting the needs of a variety of stakeholders and in making key decisions about the business.
  3. Look to the future: Set goals that will enable your company and your extended network of stakeholders to thrive in the future. A company’s sustainability goals and strategy can no longer stand in isolation from the overall corporate strategy. Your goals should take a strong cue from both your company’s sustainability and overall strategy and thought of as a way to drive action against these plans and an opportunity to discuss them with leadership, your community, and investors alike to help tell a story of a company poised for long-term success. For example, maybe your company wants to ensure future supply of essential resources. Your goal can then be to source 100% of those resources sustainably.

Creation of your third generation sustainability goals is also a great way to engage your company’s leadership in a conversation about how you can best prepare for lasting success in a resource constrained economy. Contact us to start the conversation about creating an award winning plan tailored around your specific opportunities and challenges.