Just a few decades ago, finding the word “sustainability” among a company’s objectives was uncommon. But, in recent years, more and more companies have begun to embrace sustainability and commit to their contribution to the environment.
Traditional business models that prioritize economic interests above all else have become mostly a thing of the past. Customers no longer value a company solely based on its products or services but instead, also look to its environmental impact to form their opinion.
Consequently, the corporate sustainability model has become a priority for large and small organizations. In this article, we explain what corporate sustainability is and share some strategies to support it.
What is corporate sustainability?
Sustainability refers to meeting present needs without compromising future ones and implementing a business model that is responsible with resources. In other words, as part of its strategy, a company should take into account the social, economic, and environmental factors which are impacted by its activities.
A sustainable company cares about creating social and economic value through its actions, contributing to the development of future generations. These companies prioritize environmental concerns and implement measures to reduce their global impact, such as reducing energy consumption, promoting the circular economy, and adopting the 3R approach: Reduce, Reuse, and Recycle.
Fundamental pillars of corporate sustainability
Sustainable companies create long-term value through their products while ensuring that these products and the processes involved in creating them don’t negatively impact society or the environment. To achieve this, three fundamental pillars are essential in any corporate sustainability plan:
- Social sustainability: Ensuring a company contributes to reducing social risks, such as poverty, diseases, or unemployment, through things like diversity, equity, and inclusion.
- Environmental sustainability: Practicing responsible interaction between companies and the environment, respecting natural resources, avoiding ecosystem repercussions, and contributing to the mitigation of negative effects like climate change and resource depletion.
- Economic sustainability: Carrying out initiatives that contribute to a more efficient economy, generating opportunities that benefit not only the company but also society, such as job creation, access to resources, and growth opportunities.
Benefits of implementing corporate sustainability strategies
There are many benefits to corporate sustainability, some of the most notable for companies include:
Improved public image and competitiveness
As consumers’ ecological and environmental awareness increases, companies recognized for practicing corporate sustainability are better perceived. Positive ratings on environmental, social, and governance (ESG) criteria are associated with improved public image and results.
Talent attraction and retention
Ethics and corporate sustainability play a significant role for Gen Z and Millennials when choosing between employers as proven by Deloitte in its Gen Z and Millennial Survey 2022, where 46% of Millennials and Gen Z’s claim to have rejected a job based on their personal ethics. This survey also shows that employees who are satisfied with the social and environmental considerations of their company are more likely to still work there for a period of longer than 5 years.
Long-term cost reduction
Implementing sustainable initiatives leads to the creation of more durable products or services. Sustainable practices can enhance the efficiency of processes and reduce resource consumption, resulting in long-term cost savings.
Compliance with regulations and requirements
Companies integrating sustainability strategies can mitigate risks related to environmental regulations, resource scarcity, and changes in consumer preferences. Participation in sustainable strategies helps companies comply with regulations like the Sustainable Development Goals and ESG criteria.
5 strategies to support corporate sustainability
Companies that achieve sustainability become more profitable, efficient, and better positioned in the market. To achieve this, implementing the following strategies is essential:
1. Reduce, Reuse, and Recycle
All companies aspiring to be sustainable should start with these steps. The 3R approach involves giving materials or products a second life and minimizing resource usage in everyday actions.
2. Align with the UN’s Sustainable Development Goals
The 17 Sustainable Development Goals (SDGs) in the 2030 Agenda aim to transform the world and encompass challenges such as poverty, inequality, climate, and environmental degradation. Aligning your company’s culture with the SDGs is crucial. If you want to know how to translate the SDGs into your corporate culture, we recommend taking a look at this article.
3. Conduct impact assessment and set clear goals
The path to sustainability involves assessing and being aware of the environmental, social, and economic impact of your company’s operations and products. Identifying key areas for improvement will help develop an action plan with defined goals, such as reducing carbon emissions, using natural resources more efficiently, or engaging in social projects.
4. Collaborate with sustainable partners or suppliers
Working with like-minded partners or suppliers makes it easier to develop sustainable practices throughout the supply chain, from materials to energy, tools, and transportation.
5. Provide sustainability training to employees
The key to a company’s success in sustainability lies in having all employees committed to the objectives. Sustainability training sensitizes employees to environmental issues and sustainable actions to effect real change.
Innovation and technology as drivers of corporate sustainability
Innovation and technology are essential when it comes to finding creative solutions to the challenges associated with sustainability. Technology plays a vital role in improving energy efficiency for example, through monitoring and control systems, while innovation in areas like solar and wind energy enables companies to produce energy in a more sustainable way.
Circular economy practices are another example where advanced recycling and material recovery technologies, along with the adoption of reusable products and services, showcase how innovation and technology contribute to sustainability.
Lastly, digital solutions significantly enhance people’s quality of life, both professionally and personally, by improving energy efficiency, employee well-being, sustainable development, and inclusion.
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