The Importance of Corporate Sustainability
Individuals, organizations, and governments alike are all increasingly prioritizing sustainability as an essential part of their policies. At a time where society is becoming more aware of their impact on the environment, their collective movement towards a sustainable future is leading to huge changes in the corporate landscape. Leading conglomerates like Siemens, Samsung, and Honda are showing that sustainable innovation is a key priority in their business models, paving the way for other companies to commit. Corporations are even partnering with innovative green startups to help reach their sustainability goals.
What is Corporate Sustainability?
Corporate sustainability can have different meanings depending on the business context. Fundamentally, the concept of sustainability can be defined as “meeting the needs of the present without compromising the ability of future generations to meet theirs.” That being said, three primary pillars are often associated with the topic of corporate sustainability: social, environmental, and economic (often known as people, planet, and profits). Combined, these core components help corporations embrace sustainability in a way that is beneficial to efficiency, sustainable growth, and shareholder value.
The 3 Pillars of Sustainability
Contrary to its name, the economic pillar is not about profit at any cost for the corporation -- it’s about corporate risk management. The importance lies in the balance between profit and ethics. Although a change in the supply chain may bring short-term financial gains, it should be viewed with extreme skepticism if there is any risk of potential damage to the corporation’s reputation. On the other hand, the economic pillar also provides a counterweight to extreme sustainability measures that corporations are sometimes pressured to implement, such as entirely abandoning fossil fuels.
Overall, corporate policies should not be self-defeating nor dangerous to their long-term growth and reputation. The economic pillar essentially makes it possible for corporations to continue making sustainability changes at a gradual and financially stable rate.
The social pillar is all about having the support of employees, stakeholders, and the community. Treating employees fairly and having a respectful supply chain process leads to increased productivity and creativity, as well as strong retention and engagement. Overall, practicing sustainable social strategies in the long run results in a workforce with greater skills and more motivation. Creating a strong, community oriented culture encourages employees to be innovative -- who have the ability to improve upon existing products, processes, and business models. On a global scale, the social pillar means knowing where and how your supply chain is being filled -- sustainable labor, safe work environment, fair wages, and respectful to the community.
The environmental pillar is arguably the most important out of all three. Sustainable corporations are often the most innovative because they are constantly reviewing existing processes to find better, greener alternatives. By reducing their carbon footprint and packaging waste, corporations are also able to see a positive impact in their public reputation and financial returns. Some common goals that help corporations both save money and reduce their environmental impact are implementing transportation management systems, reduce carbon emissions, and improve packaging. As awareness around environmental issues increases, it is important to have a mission of green sustainability to build a reputation with consumers as eco-friendly.
Why is Corporate Sustainability Important?
The three pillars of corporate sustainability - economic, social, and environmental - work together to help organizations strive for more sustainable practices. Businesses need to move from an outdated sense of fast profits at the expense of the environment to a more mutual interdependence and eco-innovation. Adopting sustainable practices not only helps the environment - corporations have proven that sustainability initiatives lead to an improved brand image, reduced costs, happier shareholders, increased productivity, and countless more benefits. Sustainability is here to stay.