Are you ready to build your Sustainability Strategy?

The market is evolving and there is a growing awareness of sustainability issues. To be competitive, it is essential to develop a clear sustainability strategy. And to do this, companies need to understand #5 Phenomena characterizing the market and take #5 Guidelines to develop a strategy and integrate it into their organization in a serious and concrete way

#1 Phenomenon: A comprehensive definition of sustainability. The market’s growing awareness forces us to talk about sustainability, considering its three dimensions: environmental, economic, and social. When we discuss social sustainability, we are referring to the principle of Social Inclusion, which can be defined as:

"The process of improving the conditions in which individuals and groups participate in society, enhancing the capabilities, opportunities and dignity of those who are disadvantaged based on their identity"

It is an ambitious goal, directing companies' activities towards enabling people with disabilities and in vulnerable conditions to enjoy full accessibility and participation in society. This opens up new win-win opportunities for both the end users of the solutions and companies themselves.

#2 Phenomenon: The change in public awareness of climate change. This awareness is driven by the increasingly evident, tangible, and concrete effects of the climate crisis. The stance taken by the scientific community in unanimously recognizing the direct link between human activities and climate impact has moved institutions to stop "talking" and actually allocate funds to tackling climate change.?

At the European level, about 80% (1.63 trillion) of the 2021-2027 investment plan [The EU long term budget + Next Generation EU] of 2.018 trillion is dedicated to sustainability-related investments.

#3 Phenomenon: The rise of circular economy business models and their impact on sustainability. The Circular Economy – and the business models that underpin it – plays a key role in this context, acting as an enabler and a glue between the three aspects of sustainability. While immediate impacts can be seen with environmental sustainability and economic sustainability (thanks to initiatives that have a positive impact on organizations, in terms of increased value and efficiency and/or reduced costs), the circular economy also directly supports the social sphere.

How? Using disruptive business models, such as product-as-a-service and sharing platforms, goods can become more affordable and accessible to all

#4 Phenomenon: The extraordinary role played by innovation and digitalization. Can you really imagine innovation that is not sustainable? Digital technologies play a decisive role in the green transition, enabling circular economy models. AI and VR, IoT, Big Data, and Blockchain are at the core of many production processes, improving the use of natural resources by optimizing design, production, use, repair, and recycling. Digital platforms are also an enabler of circular economy models, by creating, for example, exchange networks and enabling the world of sharing.

Innovation is a tool to achieve sustainability goals.

#5 Phenomenon: Sustainability-washing and the importance of standards and certifications. To overcome the risk of sustainability-washing and to verify whether companies are truly eco-sustainable, we have to refer to environmental certifications (e.g. EMAS and ISO 140001, GRS, Global Recycled Standard, etc.). In this regard, the European Commission issued a proposal for the Corporate Sustainability Reporting Directive (CSRD) last April, which calls for the mandatory preparation of a sustainability report by all European companies with more than 250 employees (about 49,000), and the issuance of strict European standards for the preparation of these reports.

Market standards, plus the increased attention and sensitivity of consumers, will help make sustainability-washing more and more complicated.

At this point, given that sustainability has become a strategic market booster, every organization should define and implement a sustainability strategy to ensure the right market positioning and extract maximum value.

So, a question arises: what are the right Guidelnes and steps to approach this process?

?#1 Guideline: Sustainability identity – we need to start analyzing our business through the lens of sustainability, in order to identify the areas of greatest impact on our processes and define our role in the business context we operate in, to outline our sustainable identity and related targets.

Enel X’s Identity: a sustainability booster for internal and external stakeholders

#2?Guideline: Mapping and benchmarking - It is essential to collect real data by analyzing the real impact projects have on the environment and communities. The focus must be on real analysis and efforts, not emphasizing an unrealistic narrative. We also need to use this information to compare ourselves with our competitors, to identify areas where we can use innovative initiatives to set ourselves apart out and gain a competitive advantage by prioritizing projects for future development.

Enel X’s Mapping & benchmarking: We identify projects and activities worldwide, the committment already in place and select Circular Economy and Social Inclusion as strategic levers

#3 Guideline: Sustainability Program - a crucial step is to ensure the replicability of sustainability projects and the generation of new initiatives that can be repeated over time. It is necessary to develop an ad hoc program or methodology to outline these principles and provide guidelines to ensure that new projects can be traced back to these criteria and are therefore replicable, bringing the company closer to its sustainability identity.?

Enel X’s Program: To structure, strengthen and replicate our sustainability initiatives, we have designed our own sustainability program: The Sustainability Boosting Program.

#4 Guideline: Internal culture – the culture of sustainability must be present at all levels of the company, not just top management. All people need to be aware of the company's sustainability values and act as ambassadors, both internally and externally. Communicating sustainability, for example through social networks, has a greater impact if done spontaneously by employees.?

Enel X’s Internal Culture: We started identifying and trained focal point in each region and in each business line supported by strong internal communications, by creating informational materials, workshops, and seminars for our colleagues closest to sustainability issues.

#5 Guideline: Communicate facts and avoiding off-setting – It is essential to show the market what we are doing in the field of sustainability, to strengthen our positioning. However, we must be careful not to base our strategy on telling them how we are compensating for our impact, but rather how we are redesigning our activities to avoid them at the source.?Consumers are tired of generic offsets and hearing about planting, and are demanding more concrete efforts.

Enel X’s Communication: We decided to communicate our sustainability through certifications and metrics providing to our audience concrete evidences of our strong committment in terms of impact reduction and not offsetting activities!

SUSTAINABILITY BOOSTING PROGRAM APPLIED TO ENEL X

The Enel X Sustainability Boosting Program is structured in 4 phases – scoring, boosting, implementing, re-scoring – that make it possible to identify, through certified metrics, the current level of circularity and social inclusiveness of a product or service, and set up a concrete improvement path using innovation, both in terms of reducing environmental impact and improving inclusion.

An example: By applying this approach to our EV charging solutions, we identified a gap in terms of the sustainability of the materials that make up the charging infrastructure. We filled this gap by replacing virgin plastics with plastics derived from recycling. And using inclusivity analysis, we were able to identify a further opportunity: we realized that our infrastructure could be extended to people with motor disabilities who use electric wheelchairs. This led to the creation of JuiceAbility , a device that allows people with motor disabilities to recharge their electric wheelchairs through Enel X's public charging infrastructure.

A small benefit for those who face great challenges every day.