The 4 pillars of a corporate sustainability program
The structure of a corporate sustainability program is the most significant indicator of its sophistication. Yet while corporate sustainability has evolved significantly over recent decades, there’s no handbook on how best to structure a program. As a result, companies looking to embrace the triple bottom line may feel they are building in the dark.
During my time as a corporate sustainability journalist for GreenBiz and most recently working with companies as a sustainability strategist and storyteller for Edelman, I’ve seen my fair share of sustainability structures, and they are as varied as the number of industries under the sun.
The problem with creating a standardized structure guide to serve corporate sustainability programs across industries is: What’s right for a retail company might not be best for an energy firm or a manufacturing business. We are dealing with companies crosscutting industries and operating within disparate contexts.
These four principles can serve as guidelines for executives to develop more effective sustainability structures.
Principle 1: Sustainability rests on a continuum
There is no such thing as a sustainable brand, and there never will be. All that exists are relatively more sustainable companies or — depending on how you look at it — less bad ones. Once you accept this, you’ll be ready to build a sustainability program that will last.
Most major companies have some type of corporate sustainability initiative and policy, and smaller firms increasingly are more active. Corporate sustainability has grown and matured in the past decade in particular. Yet there is a widening gap between organizations taking advanced steps toward sustainability integration and those without in terms of activities, attitudes and infrastructure, according to 2015 research from Siemens.
In other words: On the corporate sustainability continuum, some companies are progressing to the more advanced levels, while others are lagging.
There’s no easy answer as to why, but it’s tough for many companies to move beyond the "low-hanging fruit" stage to the more advanced actions of embedding sustainability into core operations. Failure at the latter is preventing businesses from unlocking the full value and potential that a more dynamic approach might deliver, according to a 2013 KPMG study.
Don’t be afraid to start small, but build into your program’s structure room to constantly grow and push the boundaries of what’s possible.
Principle 2: Identify your core purpose
Before building or renovating a sustainability strategy, executives must first answer a simple question: Why does your company exist? Yes, to make money is the obvious answer, but there’s got to be something more. Companies with a clear understanding of their core purpose are much better-equipped to design and construct stronger corporate sustainability programs.
As I wrote earlier this year, we are entering the age of the purpose-driven business. A growing body of data backs up the idea that consumers want to support brands they perceive as serving a higher purpose than profit. This thinking also allows companies to strengthen core offerings to better withstand future unknowns.
As some of my Edelman colleagues say: "Sustainability is something that should be built in, not bolted on."
Principle 3: Your employees are the mortar
As a corporate sustainability executive, it’s easy to get caught up with which "bricks" to use to build your program — such as specific initiatives, leadership structures and measurement mechanisms. While these are important, none of it will matter without effectively engaging your employees — they are the mortar that holds all the bricks together.
Some 40 percent of companies surveyed attempted to engage employees specifically on sustainability issues in 2014, according to a 2015 report by Ceres. However, of those 613 companies, Ceres classified only 6 percent as "Tier 1," setting the pace on employee engagement.
"Engaging employees in a corporate sustainability mission is essential for success, but employees are often an under-utilized resource in a company’s development and implementation of sustainability programs and strategies," the report said.
Besides the clear business benefits of increasing productivity, decreasing turnover and improving overall morale, educating, inspiring and empowering employees on sustainability are key to ensuring that your program stands the test of time.
Principle 4: Learn how to talk about your sustainability walk
You might think most companies struggle with greenwashing — "talking green" when in reality they're operating in a less than sustainable way. Yet some have the opposite problem: They fail to effectively communicate to stakeholders on their good work.
Even though we live in an awesome age of digitally enabled communication, many companies continue to rely on dusty PDFs to tell sustainability stories. Yes, the annual sustainability report continues to be the bane of corporate sustainability executives' budgets and bandwidths. But this may soon change, I learned during a conversation earlier this year with Michael Meehan, GRI’s former chief executive.
"The information needed to tackle current and future sustainability challenges must clearly inform the user about how the organization sees the relationship between its real challenges and its strategy and operations," he said. "In order for this information to truly support decision-making processes within every organization, it must be more accessible, easier to analyze and available in real time."
In the future, reporting or disclosing for shareholders and regulators will become digital, rapidly updated and tagged.