Transform Your Corporate Sustainability Journey by Rethinking These Practices
With the growing rise of corporate sustainability as a priority for businesses, how do you ensure your practices and policies are steps in the right direction?
In recent years, it has become apparent that we need to adopt more sustainable practices — i.e., ones that promote ecological, human, and economic health and vitality — across different spheres of life.
On the corporate front, there’s been greater acceptance of business’ role in building a more sustainable future. Despite this awareness, extractive practices such as racism, environmental degradation, and inequity hinder progress when they are present in company operations.
How can you determine if unsustainable behaviors are negatively impacting your sustainability goals? Bob Ludke, ESG and Sustainability Consultant and former Kindred Advisor, worked with us to develop a Corporate Sustainability Matrix (available to Kindred members here) to help corporate leaders evaluate where they fall on the continuum of corporate sustainability. He identifies traits of extractive companies whose practices lead to highly negative outcomes.
As you evaluate your practices, consider how these characteristics show up in your workplace and how to move your business toward more sustainable behaviors.
Focusing On Short-Termism and Profit-Taking
Pressure on company leaders to demonstrate short-term gains often pushes them to focus too heavily on these immediate results over long-term interests. However, as Eric Ries, CEO of LTSE, noted at a Kindred Talk, the focus on social impact or sustainability is not a trade-off against profitability.
Instead, he argues that taking a long-term view— aligning practices to company goals and values and adopting more sustainable behaviors— will be more profitable than prioritizing short-term financial returns.
Transforming your corporate sustainability journey means investing in the future and creating long-term value for your business. You can use sustainability-related innovation to create new products, transform your modes of production, open new markets, and ultimately, generate more revenue.
Maintaining a Status Quo Mentality
In the past few years, we’ve seen that businesses can no longer afford to ignore the risks posed by an unsustainable society. Taking incremental steps toward progress doesn’t factor the enormity of what’s at stake. For instance, addressing the climate crisis demands that corporations work in tandem with other sectors to make immediate, tangible systemic change.
Additionally, investors, customers, and employees have set clear expectations for business to be a force for good in society. Beyond making commitments and pledges, they expect corporate leaders to take action to address environmental issues and social inequities within their organizations and the wider community.
As a purpose-driven leader, you should understand how your organization’s practices and procedures impact the communities where you operate and serve. Lead with a human-centric and empathetic approach, and implement a sustainable business model with clear and measurable goals that demonstrate the connection between sustainability, profitability, and societal change.
Lacking Transparency and Accountability
As we’ve noted in the past, there is an accountability gap that exists between intent and action for corporate leaders. Building a sustainable future requires leaders to close the gap between the intention to do good and the action it takes to get there.
To become an organization that operates with sustainability principles at its core, it’s important to be transparent about where you are as an organization and to demonstrate accountability for your commitments. In addition to developing a clear and measurable plan, report on progress by using a disclosure framework that covers materiality, risk, mitigation tactics, sustainability targets, and overall societal impact.
This will increase your transparency. Responsible leadership requires a commitment to sustainability and long-term value creation. Regardless of where you are on your corporate sustainability journey, the challenge for today’s leaders is to incorporate sustainability into business strategy and practices in ways that drive systemic change and combat the climate crisis. For more insights, Kindred members can access the Corporate Sustainability Matrix here.
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