Every t-shirt bought, every coffee ordered, every car driven has an impact on the planet. To be sustainable – long-term as a business – a company must put a sustainability strategy at the heart of its brand.
While only 34% of companies discuss ESG at every board meeting, according to research conducted by the Diligent Institute earlier this year, 71% say it’s integrated into their overall corporate strategies. This encouraging development indicates a growing alignment of ESG objectives across all business activities.
At a recent roundtable, business leaders discussed how sustainability affects every part of a business. “For the longevity of a business, you have to have sustainability at heart. You have to have very clear strategies on what you’re trying to accomplish. It’s understanding that if you start from a set of principles and you really build something for the long term, you’re more likely to be in it for the long haul,” says Jon Lane, CEO of fashion brand Passenger. He adds that sustainability can mean both environmental awareness and long-term success of a business.” You have to build [a company] which continues, which will not be eliminated from the market because it has passed its expiry date. »
To do this, however, companies need to consider how sustainability is integrated into every part of their business, from operations to corporate culture to communications and marketing.
“Customers are interested in sustainable solutions,” says Alex Jennings, Purchasing Director of DS Smith. “So there is a business reason to do it,” he adds, even if the durable solution comes at an extra cost. For the packaging manufacturer, sustainability is infused throughout its operations, from design to production. To achieve this integrated approach, DS Smith’s 700 designers have undergone training in circular design. Not all “recyclable” goods are actually recyclable. To combat this, DS Smith’s design principles are grounded in sustainability and focused on improving recycling.
Likewise, at Passenger, design, sourcing and manufacturing all adhere to the company’s sustainability principles. The company uses recycled fibers and sustainable textiles to reduce the carbon footprint of fashion. For both companies, selecting the right suppliers and deploying sustainable sourcing strategies are key. Lane says, “We try to change people’s mindsets because people just do things because that’s what they’ve always done. Part of our role is to come in and be the goofy bastard who basically says, ‘Well, why are you doing this. You need to change that.
Ideas on how to improve internal processes came from all over the company. “I would much rather be in a position where there are a lot of marginal sustainability gains, rather than too many ‘big bang’ approaches,” Lane says, noting that the company culture encompasses sustainability and sustainability. ‘innovation.
Jennings agrees that culture is key to ensuring sustainability in all of a company’s operations. “You have to make sure you have the right people to help you. Integrating it is such a big cultural shift in an organization that employs over 30,000 people. You have to start at the top. »
But for both, it comes down to business relevance. If the business is not making money, sustainability is neither here nor there. Both have found that sustainable practices can not only attract great talent and provide a competitive advantage with customers, but also improve efficiency and encourage investment.
For growing businesses, the talent pool is a key audience when it comes to sustainability. Dr Anjana Basnet, a lecturer in business at Arden University, sees all business students at the institution take a course in CSR and business ethics as part of their degree. She says sustainability is of paramount importance to her students: “I personally feel that this is where the students are. They have ideas that they will transpose into the real world.
These students would eventually become the workforce for companies such as DS Smith and Passenger. Jennings says, “We need to create safe environments for people to feel comfortable being creative and being innovative and challenging products, processes and thinking. We need to make sure that students understand that there is a business connection between this reader, and not just a moral duty.
However, once this culture is in place, it still needs to be communicated to the company’s various stakeholders. Basnet’s research took her to Nepal to examine sustainability reporting in listed companies. She found that while companies had strong CSR activities in place, they were not communicating them to the investment community through sustainability or annual reports. While UK plcs are required to report, SMEs and unlisted companies are not. “It’s not that it’s not driven,” Basnet says of the durability, “but it’s not communicated to the outside.”
Lane’s experience at Passenger echoed Basnet’s findings. “We’ve never donated a big sustainability report. We just don’t have the manpower to do it,” he says. “If we went away and wrote a report, it would distract us from making small, incremental changes.” That said, the company uses its marketing and consumer touchpoints to communicate its sustainability goal. Part of the customer journey is to engage in initiatives such as Passenger’s tree planting program or its use of recycled fibers.
At DS Smith, which reports annually on sustainability, communications extend beyond this single point of contact. He says the company is working “from top to bottom of our supply chain to challenge our customers and challenge our suppliers around circular thinking about sustainability.”
Diligent Institute research shows that the full board is now responsible for environmental issues in 38% of companies. This marks a dramatic shift from 2019, when just 20% of companies saw the entire board engage in environmental oversight. Similar percentages of companies engage the full board in ESG and sustainability strategies, supply chain risks and sustainability reporting.
It takes strong leadership and an engaged corporate culture to encourage sustainable business practices across an organization. Aligning a company’s operations is crucial to the success of sustainable business strategies. But these ideas must then be put into practice through supply chain and purchasing changes, updates to manufacturing processes, or educational programs. And for these initiatives to truly make a difference, the organization must then share them with the wider organization and the world through an integrated communications strategy.
“If we can tell the story of where the products come from or how we do things, that’s the point of engagement with the customer. It’s all about storytelling and storytelling,” says Lane. “What we want to do is inspire ourselves and people outside that you can make small changes and they will make a difference. But also, hope for the best and ask questions.
Those who ask questions and challenge the processes may discover that they are making the crucial difference in embedding sustainability at the heart of the brand.