Is it time to change your ideas about sustainability?

Many people hear the word ‘sustainability’ and think of environmentalism. That’s a good starting point. With a little help from figures as different as Al Gore and Greta Thunberg, the climate crisis has put the state and fate of the planet on the front pages. Yet, sustainability is more about changing your entire worldview. Like the astronauts’ ‘Overview Effect’, a different perspective reveals the wonder and fragility of living on Earth: how incredible human life is and how interconnected we all are.

In the long-term, business cannot thrive by damaging the planet we all depend on or by harming the wellbeing of current or future customers. (Or indeed, people in general.)

That much seems self-evident from space. But, back on Earth, it’s been far from obvious that mainstream business culture has taken the longer view or the higher ground. Short-term thinking in stock markets (and even more aggressive and regressive business practices) have often endured, even as the evidence has mounted for the wisdom of change.

“It's a feeling of interconnectivity that sometimes just don’t get when you’re in the middle of something “

– Nicole Stott. NASA Astronaut on being in space for 104 days.

Study after peer-reviewed study showed that companies with strong sustainability metrics are likely to outperform their traditional sector peers on a variety of different timescales.

So, how do you synchronize commercial success and sustainable standards? For a start, it’s probably more useful to think in terms of ESG. The acronym stands for ‘Environmental, Social and Governance’. This allows you to break down your sustainability strategies into more specific, actionable goals. But it leads to the more fundamental question: what do we mean by environmental, social and governance? So, let’s start with some basic definitions:

The Environment in ESG. Everything that businesses do requires raw materials and resources from nature.

Think of the rare metals that go into an office computer, the silica needed for the solar panels on a warehouse, or the wood and stone necessary for building a bar countertop in a restaurant. Nature supplies these materials for free at source.

But precisely because they are taken for free, we take a lot of them. We also take them faster than nature can re-stock its own supplies. A Carrara marble slab, for instance, takes millions of years to form. Yet, it only takes a few minutes to excavate.

Because we treat nature as a supermarket with endless aisles of free goodies, we take 100 billion tons of raw materials from it each year. That’s so much than man-made materials now outweigh all of Earth’s biomass.

All of this should make us wonder. Would we run our business the way we treat nature? Surely, giving away every product for free would drive anyone out of business.

?That’s exactly why businesses and governments now focus so much on the environmental aspect of ESG. The “E” is simply there to ensure that we do business in a way that allows nature to stay in business.

The Social or humanity in ESG. The “S” reminds us that it would be quite difficult to run a successful business without caring for the people around us. The social part helps you manage how you relate to employees, suppliers, customers, and the community.

It’s also fundamental to how you address social obligations – such as Fair Tax – as part of an open, functioning society, which provides benefits to business.

The Process and integrity in ESG. The Governance part deals with company ethos and policies. But, on a highly practical level, it also informs strategic direction and day-to-day leadership. It’s about installing transparency and accountability in stakeholder engagement and investor relations and issues like executive pay.

?Naturally, you can find many ways to implement a robust ESG strategy and create a fairer, more inclusive workplace. Common measures include paying the living wage, emphasizing equality and diversity, employing people from less advantaged groups, and supporting local communities.

?Many companies also choose to democratize the workplace by establishing different business models. Just think of co-operatives where each employee is an owner of the organization. You could also create a so-called “teal” organizational structure, in which teams self-organize and manage without traditional command-and-control systems. As long as your intentions are clear, you can build an environment in which to better business.

To get your free copy of our new book on best practices for sustainability in business“Dare to Care. How doing good helps business do better” please drop us a line at [email protected]?