Green on purpose?

As a business, you’re not in it for philanthropy. But more and more, what you are into, must drive positive change and resonate across the ESG principles of doing good for people, society and the planet. Regulations are one thing. Stakeholders, from consumers to employees, are another – and they gravitate towards sustainability. But let’s be honest: Itis easier for some companies than others. Some, especially newly founded companies, are born with sustainability in their DNA, others are able to pivot to become sustainable, and then there is a large bulk taking the necessary steps incrementally to achieve ESG goals. 

Calibrating the purpose during turbulent times 

With converging crises such as the climate crisis, the mental health crisis, and a war in Europe, businesses have a lot of turbulence and complexity to navigate. However, a shared understanding of the necessity to find more sustainable ways exists. The UN Sustainability Development Goals (SDGs), the EU Green Deal, and the COP meetings, though more or less successful, as well as new consumer patterns favouring companies with a clear sustainable profile and trailblazing companies, are markers that transitions are in full swing. 

Increasingly, sustainability is an integral factor to be considered when defining purpose. So, if sustainability isn’t already part of your purpose and aligned with your business strategy, it’s time to calibrate your compass and see your purpose and core narrative from the bigger perspective.

The ticket to the future is green 

Global 100 is an annual ranking of the world’s most sustainable companies based on criteria such as sustainable revenue, products, investments and management. Corporate Knights, a media and research company, is responsible for the list. At the top of the 2023 list, we find Schnitzer, a 116-year-old metal scrap company. According to Schnitzer, mining has been underinvested in recent years. Combined with the shortage of minerals and metals, steel, copper, aluminium and nickel, their business model of reusing and recycling has propelled the business to the top of the list. By 2025 it is their ambition to reduce Scope 1 and 2 greenhouse gas emissions from recycling operations by 25% from 2019 levels and to reach net-zero GHG emissions for all operations by 2050.

Schnitzer’s position in the lead shows that even companies rooted in old industries can contribute significantly to sustainability. The list features many legacy companies that have changed their business models, revised their purpose and positioned themselves anew. And from a Danish perspective, it is worth celebrating that companies such as Novozymes, Vestas and ?rsted, with individual ways to reach sustainability goals, have made it to the list.

The green transition is about finding a new way, a balance between driving profits and not driving society over the edge.

A purpose set in stone … is stone-dead

Some are (almost) religious about the purpose and claim that it shouldn’t change since, after all, it is the business DNA we are talking about. However, these days, if a company rooted in the “old economy” doesn’t evolve, it is at risk of becoming obsolete. Something that could be observed in the wake of digital transformation, which left some of the renowned legacy brands behind. Reading the sign of the times, evolving and pivoting if necessary is vital for staying in business. While business models and purpose aren’t set in stone, they also shouldn’t be altered yearly, but refraining from revisiting purpose and ensuring it stays in touch with how the world is changing is a sure road to extinction. 

A business model that embraces sustainability comes in many shapes and sizes. 

People and planet goals don’t have to come at the expense of profit

Naturally, businesses should be profitable and pursuing profit shouldn’t be suspect. But companies cannot drive profits at the expense of sustainability. Not everybody can be a 116-year-old scrap company with recycling in the DNA, so the task is to discover new ways where there isn’t a conflict between profits and planetary survival – where profits, rather than being the primary goal, are an outcome because the business is sustainable. The list of the 100 most sustainable companies testifies that people and planet goals don’t have to come at the expense of profit. Indeed, profit and purpose can co-exist. It is time to be green on purpose.

Further reading 

If you want to read more about the power of a sustainable purpose and how businesses navigate regulations as well as stakeholder expectations, take a look at the report “The sustainable purpose as strategic game changer”

Contact

Reach out to us if you want to learn more about how Make? can help your company develop a sustainable purpose and how to release the branding potential of your sustainability efforts and reporting.

Rasmus Engelhardt, Sr. advisor corp. comms., [email protected], +45 22 49 24 46