Sustainable development means adopting business strategies and activities that meet the need of the enterprise and its stakeholders today while protecting, sustaining and enhancing the human and natural resources that will be needed in the future. As change continues to affect our lives as well as the fate of business owners, leaders and administrators are becoming more imperative.
Business sustainability is the practice of operating a business without impacting the environment negatively. Making businesses more sustainable starts with being aware of the issue at hand and understanding how important it is to make changes for the business and the world in terms of the sustainable development goals.
Businesses need to apply the concept of sustainable development to their own organizations. There are several ways in which businesses can become more sustainable. Businesses can begin by taking the following steps:
- Performing stakeholder analysis
A company’s existence is directly linked to the global environment as well as to the community in which it is based. Companies must strive towards a society where the global environment is protected.
Sustainable efforts extend to the stakeholder group as well. Companies must choose to associate with stakeholders who are also interested in the sustainability agenda.
- Sustainable development policies and objectives
Companies need to clearly articulate the basic values that the company expects its employees to follow as far as sustainable development is concerned as well as set targets for operating performance of the same.
Sustainable development has elements that include the alleviation of poverty and this can be included in the companies’ policy. Nevertheless, a policy on environmental responsibility is a good place to start.
Companies should have an effective monitoring system to ensure that the policies and procedures are well implemented.
Key things to look out for when setting policies and procedures include:
- New and proposed legislation;
- Industry practices and standards;
- Competitors’ strategies;
- Community and special interest group policies and activities;
- Trade union concerns;
- Technical developments.
- Implementation plans
For implementation plans, companies should consider three to five year plans with about one year milestones.
These plans must include changing the corporate culture and employee attitudes by defining responsibilities and having accountability systems.
Reporting systems are also important in terms of the implementation plans towards sustainable development.
- Supportive corporate culture
For sustainable development policies to see success, an appropriate corporate culture is vital. This can be done through training of employees so that they may understand the sustainable development concept as well as accept and incorporate it as part of the legitimate business objective.
Effective communication and internal reporting systems can also influence corporate culture positively.
- Developing measures and standards of performance
Management needs to assess the company’s performance against external and internal standards using appropriate measures.
The measures used to assess and report on performance will be influenced by the company’s sustainable development objectives, and by standards that have been established by government and other public agencies.
While external standards, measures and reporting systems are needed, they take time to develop and implement.
Businesses should not wait for such standards to be developed before setting sustainable development objectives and measuring the sustainability of their activities, they should invest in consulting to ensure that such needs in terms of sustainability practices are met.
The next step in the process is to develop meaningful reports for internal management and stakeholders, outlining the enterprise’s sustainable development objectives and comparing performance against them.
While financial reports continue to be a fundamental component of corporate reporting, they are now only one of many types of report issued annually by a corporation. Sustainability reporting is also becoming very important. Every business enterprise should publish, at least once a year, an external ‘sustainable development report’. Ultimately, a universal format for such reports will be desirable. In the meantime, managers and boards of directors should decide on the organization and content of reports.
All in all, sustainability, beyond the popularity of the word itself is a business strategy. Companies and organizations can benefit by mapping the objectives of their sustainability strategy with the expectations of the stakeholders: mainly investors and customers. Companies should not shy away from engaging well-funded CSR/Sustainability teams to help in the development of their business model into a more sustainable one.