A Sustainability Framework can help guide an organisation’s Sustainability Strategy by prioritising focus areas that are aligned to the four key sustainability pillars, i.e, the economic, environmental, social and governance pillars. However, identifying, prioritising and developing a sustainability framework is just one part of the challenge, most companies falter in the actual operationalising of the framework.
Sustainability is often an afterthought for many organisations, as it is not prioritised in business processes or decision-making. The focus on short-term quarterly targets hinders the ability to prepare for mounting ESG pressures.
Many current corporate leaders gained their experience within a profit-oriented paradigm. If traditional modes of thinking continue to remain the status quo, sustainability initiatives will be hindered by corporate bureaucracy and a general resistance to change.
Lack of communication on the practicalities and purposes of adopting certain sustainability practices causes misalignment of expectations between the Board and working level. This decelerates organisational transformations and dampens long-lasting, positive change.
Silo sustainability efforts, such as parking “sustainability” under corporate affairs and communications, disconnect it from the core of the business. This creates more challenges for the company in ensuring that decision-making considers the long-term ESG impacts.
Most employees are not familiar with sustainability terminology and frameworks as this domain has historically been the responsibility of external specialists. While new methods and tools designed specifically for sustainability do exist, they’re relatively new, niche and their penetration and adoption are limited.
Sustainability strategy can fail when a company rolls out an initiative while still being rooted within traditional thinking, putting profits above real efforts to create lasting, long-term change. The lack of a clear sustainability structure within a company, paired with the mismatch in tone from the top could potentially drive a company to engage in unethical or illegal practices to achieve their sustainability goals.
One example of a sustainability strategy failing is the case of Volkswagen (VW) and its “Clean Diesel” campaign. In 2015, it was revealed that VW had installed software in its diesel engines that returned false results on emissions tests, making VW’s cars appear to be more environmentally friendly than they actually were. The company had marketed its diesel cars as a sustainable alternative to gasoline-powered vehicles, claiming they were more fuel-efficient and emitted fewer pollutants. As a result, the company suffered significant financial and reputational damage, and its sustainability efforts were undermined. The scandal, known as “Dieselgate,” resulted in a major blow to VW’s reputation, billions of dollars in fines, settlements, and recalls. The company’s stock price plummeted, and many customers lost trust in the brand.
Effective utilisation of a sustainability framework helps to ensure that decisions and actions are made in a way that balances ESG considerations, rather than just focusing on short-term economic gains. To ensure that a framework is operationalised strategically, companies need to take into account the key enablers below.
Clear sustainability governance and oversight structure helps in implementing sustainability strategy across the business, and have clear communications of ambitions and expectations. It promotes accountability and ownership and helps demonstrate the significance of sustainability for a company.
Selecting individuals who are responsible to drive sustainability initiatives forward is important for accountability and decision making. These “owners” are responsible for implementing strategies, tracking performance, and engaging other employees to ensure integration with business units and functions.
Developing detailed timelines could ensure effective execution, keep teams on track, indicate how a project is expected to run, along with who’s responsible for what. It’s an extremely valuable planning tool —one that can be the difference between project success and project failure.
Setting clear and ambitious targets provides a way to measure progress, foster innovation, create accountability, and encourage collaboration. This gives a company a clear focus, and sets momentum for its employees to work towards a common vision of a more sustainable future.
This ensures efficient use of resources and sufficiency of key inputs such as budget and human capital for sustainability initiatives. It also helps to prevent overspending and encourage innovation. This also enables an organisation to use labour efficiently, ensuring that resources are not over or under-allocated.
It is key to then ensure sustainability efforts are conducted in tandem with the ambitions laid out from a business strategy perspective. This ensures that progress made through sustainability gains pushes the organisation forward in the same direction as other business initiatives being undertaken.
Thorough monitoring and reporting can help improve the quality of decision-making and strengthen the effectiveness and accountability of implementation. Reporting also allows good communication to stakeholders on the progress that has been made on key sustainability initiatives that have been made.
In summary, an effective rollout and utilisation of a sustainability framework is critical to ensure a comprehensive and holistic approach to addressing the complex challenges facing our planet, while also promoting responsible and sustainable practices that benefit both society, the environment and create long term shared value for all stakeholders.
Contact Aubrens. We have worked closely with clients across the region to deliver award-winning, tailor-made corporate responsibility initiatives and organisation-wide transformations which help companies encode sustainability in their DNA.
