What is Corporate Sustainability?
Corporate responsibility (CR) is about the impact an organisation makes on society, the environment, and the economy. In recent years there has been significant discussion in the business, academic, and popular press about “corporate sustainability.” The business mindset has shifted. Governments, societies, and stakeholders expect corporations to engage in business practices that are good for people and the environment. This is because sustainable economic growth is no longer just a business imperative, it’s critical to our future.
Corporate sustainability is a business strategy for long-term growth that works in harmony with people and the planet. It is about more than just protecting the environment, although that is core to this approach. A sustainable business is one that works in step with societal and environmental goals, rather than at odds with them.
There are three pillars of corporate sustainability:
- The Environmental Pillar, which includes strategies to eliminate and offset greenhouse gas emissions, use green energy, eliminate toxic hazards, reuse or recycle materials, and manage waste, reducing the carbon footprint throughout the value chain.
- The Social Pillar relates to practices that promote the health, safety, and well-being of employees, customers, and communities. This includes activities like establishing an effective safety culture, ensuring customers have the information they need to use products safely, and protecting access to basic resources.
- The Economic Pillar is about ensuring businesses can survive and thrive to make a long-term positive impact. Examples of this might be reducing costs by using less plastic in product packaging or creating green jobs.
The United Kingdom (UK), along with the EU, has some of the world’s most advanced and complex corporate and investor sustainability laws and reporting requirements in the world. Sustainability is an important economic and cultural topic in the UK, and the UK government is adopting additional policy steps to support its Net Zero 2050 targets. EU law requires all large companies and all listed companies (except listed micro-enterprises) to disclose information on what they see as the risks and opportunities arising from social and environmental issues, and on the impact of their activities on people and the environment.
This helps investors, civil society organisations, consumers, and other stakeholders to evaluate the sustainability performance of companies, as part of the European Green Deal.
In today’s complex and challenging world, corporate sustainability can be a worthwhile goal given the potential benefits for a company, its employees and customers, its shareholders, the greater community, and the planet. Become familiar with the fundamental principles of people, planet, purpose, and profit and prepare to incorporate them into your company culture.