Sustainability representing environmental, social, and governance (ESG) issues is becoming a critical element in how companies do business, especially in the recent past.
This is being driven by sustainability, which more and more companies are becoming aware of. In addition, stakeholders recognise that this is a strategic priority that can help firms navigate significant risks and opportunities if well implemented.
Unfortunately, only a few companies have organisational structures designed with sustainability in mind and inherent benefits. This will call for treating sustainability as a material business issue and investing in proper structure to enable it within our organisations.
On the contrary, many companies still see sustainability as a marketing and public relation matter and hence have not given it the importance it deserves.
With increased awareness, firms are taking steps towards implementing corporate sustainability in their internal business operation and developing new, more sustainable trade models.
Indeed, more and more companies are having sustainability-related management targets and reporting on the same on various channels, including their sustainability reports, on social media and websites.
As firms look into the implementation of corporate sustainability, there have been some struggles in having a proper arrangement for managing sustainability issues. Adoption of such system should become a common practice.
Companies need to invest in building such a system to succeed in their sustainability journey. Where necessary, sustainable companies should also assist those in their supply chain to implement such strategies.
The benefit of investing in a sustainability management system is that it will help enhance the company’s journey towards sustainability.
The system will provide management with the relevant data, which will enable management to make the right decision within the sustainability domain. With no system, data becomes unavailable or if available, it lacks accuracy resulting in the wrong decisions.
The sustainability system will also assist firms in navigating and managing the various external pressure expressed towards the company by the stakeholders.
The system will provide the interface for interaction with the stakeholders especially those outside the company’s boundaries such as consumers, investors, civil society and governments.
As management establishes a sustainability management system, it will be paramount that the system has the necessary feedback loops where corrective actions can be taken based on the results and performance of the company.
There is a need to have a continuous improvement mindset regarding sustainability as this will have an effect on the business performance.
To build sustainability management tools, companies should consider existing sustainability management frameworks. These should be supportive with the ability to help the users take into account various aspects of sustainability as they develop the sustainability systems.
Examples of such frameworks include the SDG compass, administered under the UN Global Compact, Global reporting initiatives (GRI)Partnership, the Measuring Impact Frameworks by the World Business Council for Sustainable Development (WBCSD) and the natural capital protocol.
The management systems frameworks are useful when a company is building or improving its sustainability management system, especially when it does not have profound experience of such processes.
They provide a procedure for the development process and this helps to define the important aspects which are needed to be managed, provide inspiration for the process, and in some cases, provide a link between the company actions and its societal impacts.
The frameworks are customisable for firms. Hence, they allow selecting of the most relevant issues and aspects that the company should pursue based on its industry, size and geographical location.
Companies need to engage experts who can help them to design the management system for sustainability. It will link them and sustainability strategy of the organisation and at the same time, build capacity.
In pursuing sustainability, it is essential to foster its awareness and understanding of issues faced within the company. To those ends, sustainability governance becomes a critical element towards this journey.
There might be a need to establish a sustainability department that actively leads the journey and communicate with the relevant departments and sections.
It should submit regular reports in implementing sustainability within the organisation to the board and provide input to management on ways and means of improving the sustainability aspects of the business.
The concept of sustainability is undeniably compelling. There is an emerging paradigm where business and society are interlinked, creating value for stakeholders.
Under this emerging paradigm, a business is no longer separate from its stakeholders. Of course, there will be hurdles and challenges as companies pursue sustainability but having a proper sustainability management system will help businesses to overcome such challenges and assist them to shape their new business landscape.
Done right, both business and stakeholders’ benefit, which is the essence of sustainability.