Corporate Sustainability has become an increasingly important topic for businesses in recent years. To be sustainable, a company must balance three key pillars: environmental, social, and financial.
The world’s population is growing at an unprecedented rate and the United Nations World Population Prospects predict that in 2055 the number of people living on earth will reach over 11 billion. Global life expectancy has also improved in recent years but earth’s capacity and resources are finite.
In the past few years corporate sustainability and sustainable strategies are concepts that have become of significant meaning for most companies. It is almost impossible to browse a company’s website or its official reports without finding references to “sustainability” or “sustainable development”.
According to the Brundtland report – the first document that introduced the “sustainable development” concept – businesses are said to have a crucial role in managing impacts of population in ecosystems, ecosystem resources, food security, and sustainable economics in order to decrease the pressure society places on the environment (World Commission for Environmental and Development, 1987).
Sustainability can have a different meaning to different people. It is most often defined as “meeting the needs of the present without compromising the ability of future generations to meet theirs” (International Institute for Sustainable Development).
Sustainability can be divided into three main pillars: economic, environmental, and social. Informally these three pillars are also referred to as people, planet and profits.
If any of the pillars is weak then the system as a whole is unsustainable. It is important that organizations are working on the sustainability problem as a whole, which means taking all three pillars into consideration when making business decisions.
The Environmental Pillar
The environmental pillar of sustainability stresses the impact business activities and business decisions have on the environment.
Most companies are giving the environmental pillar the most attention. Environmental sustainability is defined by processes, systems and activities that reduce the environmental impact of an organization’s facilities, products and operations.
Now more than ever, it is important for companies to be aware how their business activities affect the environment, and to limit and change business activities that have damaging consequences for our earth. Corporate Sustainability is not only good for the environment and society, but it is also good for business. Companies that incorporate sustainability into their operations reduce costs, improve efficiency, and gain a competitive advantage.
Corporate Sustainability is the future of business, and those companies that embrace it will be the leaders of tomorrow.
Environmental initiatives that businesses take include finding alternative energy sources, reducing their carbon footprint, getting rid of plastic bags, and using sustainable materials for the packaging of their products such as paper.
The Social Pillar
The Social Pillar of sustainability is concerned with how companies’ employees but also other internal and external stakeholders are affected and treated by a company. A socially sustainable business, should care about its employees’ welfare and should maintain a connection with its workforce and stakeholders that goes beyond just a business relationship.
Socially-oriented companies help with providing security, individual development and overall health to employees, suppliers and partners. Something as simple as acknowledging your own employees’ work and rewarding them accordingly is significant in order to create a long term loyal workforce.
On a global scale, a business needs to be aware of how its supply chain is being operated. In order to be socially sustainable, companies need to make sure that the work environment along its supply chain is safe, that people are being paid fairly and no child labor is involved.
A company that is known for poor social sustainability practices can quickly lose its reputation and customer base.
The Economic Pillar
The economic pillar addresses the bottom-line of businesses that is their profit. Companies have to make profit to remain sustainable. That said, profit still can’t outweigh the other two pillars. Profit at any cost is not what the economic pillar is about. The economic pillar rather stands for compliance, proper governance and risk management. While these are already met at most North American companies, they are not globally. Corporate sustainability
At Transformation our goal is to focus on sustainability while working to lower risk, creating market-level profits and returns. Our strategy is to integrate the latest technologies – such as artificial intelligence and blockchain – within the industries of agriculture, water, energy, and healthcare.