Corporate sustainability is a holistic approach that allows corporations to do business in a more sustainable way to better the world around them. To do this, the framework identifies three key pillars which work together to create a successful, sustainable business. But what does it really mean to be sustainable?
Sustainability has become something of a buzzword as we become more aware of the damage that overconsumption and runaway profit-over-responsibility is doing to not just the environment but also the stability of our society.
In short, sustainability is the act of living not just for the moment but by considering the long-term perspective and how our choices now impact the long-term future.
What is Corporate Sustainability?
Corporations have an even greater responsibility toward sustainability than individuals, as the business actions of a corporation have to echo repercussions when it comes to their impact on the world as well as the consumption choices available at the consumer level. By implementing a holistic business model, corporations can practice corporate sustainability.
The pillars of corporate sustainability are a simple framework that allows businesses to consider the long-term repercussions of their operations models and enact strategies that ensure longevity, reduce harm, and positively impact the world.
The pillars describe three key areas that work together and contribute to the long-term perspective: environment, society, and economies. In this article, we’ll describe each in more detail and provide examples of companies excelling in each area.
What Are the Three Pillars of Corporate Sustainability?
Environmental
This pillar is at the heart of sustainable living. A company adhering to this pillar will minimize waste and reduce its carbon footprint, making efforts to reduce over-consumption and excessive carbon emissions. In the long term, eco-friendly practices can become more cost effective and have their own marketing appeal to eco-conscious customers.
These businesses must also focus on their company’s internal values, and upon instilling its employees with a culture of environmental sustainability. This will help to generate support for charitable events to help create a positive impact on the wider world.
SkyCity’s sustainability endeavors have expanded beyond its business practices and even its own internal mindset. The environmentally minded casino company has devoted over $100,000 towards coastal clean-up endeavors and planting native trees, a measure that is vital to the restoration of waterways and reducing atmospheric carbon emissions.
Social
The social pillar focuses not on the natural world but on the well-being of its stakeholders, consumers, communities, and employees. This pillar emphasizes the vital ethical responsibility of a corporation to promote greater empowerment of all the parts of society it touches.
A company must look inward first and ensure the fair treatment of its employees, not just in fair wages but also by fostering a healthy work environment that empowers them in their own well-being as well as professional growth. Through its operations, companies must be aware of any adverse social practices that take place in its supply chain.
Companies excelling in these areas will then reach outward. The shoe company TOMS set out on a mission to donate over 95 million pairs of shoes to children in need.
This was an admirable goal, but what took TOMS further in their dedication to social sustainability was taking on board criticism of the impact this had on local shoe companies. As a result, they revised their strategy to instead donate one-third of their profits to grassroots social impact campaigns.
Economic
The third pillar is likely the most appealing to many corporations, as it aims to promote financial sustainability. This is appealing as its practices ensure the long-term viability of a business, putting a focus on achieving profitability and contributing value to its stakeholders through careful financial management.
This pillar urges companies to shy away from improper risk management to understand the financial implications of any business decisions and investments.
Companies practicing economic sustainability should consider not just the company’s current profitability but the long-term benefits to be gained through careful investment. This synergizes well with the social pillar, as a financially sustainable company provides a safe and stable working environment for its employees.
Banking company Standard Chartered won an award for Outstanding Leadership in Sustainable Finance this year thanks to its robust framework for mitigating and managing financial risk, in addition to considering the social and environmental targets as well. The bank’s portfolio of sustainable assets grew 30% this year, and it has contributed to local economic growth through 660,000 microfinance loans and 20,000 SME loans.
