Do well and do good
Putting sustainability at an organization's heart
The COVID-19 crisis has challenged organizations in every industry to reimagine their business and focus on getting to the “next normal.” What does the future look like beyond the pandemic? Challenges related to environmental and social issues remain as large as ever, and no organization is immune. How can companies leverage intelligent solutions to put environmental issues and social impact at the heart of a business model—while increasing transparency and unlocking long-term value for your enterprise and stakeholders?
Three sustainability transformation leaders from Deloitte discuss strategies for identifying actions and demonstrating impact across the entire value chain.
The demand for visibility
For Vincent Kruse, senior manager at Deloitte MCS Ltd, stakeholders, be they customers, employees, investors or regulators, are demanding more visibility into a company’s sustainability efforts, far beyond the value reporting on “large sets of old data.” He points to Beyond Tomorrow, a joint initiative between, SAP, the United Nations (UN), Deloitte, and Hewlett-Packard to design and develop a platform that could be used by organizations and governments to show how companies are moving the needle towards achieving the UN’s sustainable development goals.
The general population’s growing awareness of climate change, human impact means stakeholders are also demanding that visibility through the products they purchase and where they invest their money. Companies that ignore the demand do so at their own peril. Dr. Siobhan Gardiner, senior manager at Deloitte MCS Ltd, cautions: “If companies don't step up and address these sustainability challenges across all functions of their business, not only are they going to get left behind by their customers, but given the changes that we're seeing in the environment, they will not be able to function because either their assets will be under threat or the supply chains will start falling apart.”
Bahare Haghshenas, partner at Deloitte Denmark and executive director of Acacia, the Sustainable Innovation Hub, encourages new thinking about the move towards sustainability. “We need to ask different questions about what we do today and collect data that is more transformative. We can’t just check boxes on a list.” She holds Denmark as an example of this approach, a country that has created national and local measuring points to ensure and accelerate its sustainability movement, like reducing emissions 70% by 2030. “We need to gather data that will push us to do more, not tell that what we’re doing today is good enough.”
Three essential steps
Data must create a framework for action-oriented insights and decision support to accelerate a move towards sustainability. Dr. Gardiner offers three essential steps for companies who want to affect meaningful change in their organization:
- Start at the top–Embedding a sustainability agenda should begin with board-level leadership. “Without that executive backing, a sustainability strategy will struggle to become ‘business as usual’ and end up siloed in a communications or advocacy team.”
- Empower hearts and minds–Leaders across all functions should get behind sustainability mentally and emotionally, and be empowered to act meaningfully.
- Don’t do it alone–The entire value chain must be active participants to move towards targets together.
As a final thought, she offers that reporting is nothing without action. “Inaction is the greatest threat to climate change and sustainability.”
Haghshenas advises companies to focus on a few goals, place them at the core of business–“it’s not an ‘additionality’”–and then apply the force multiplier: Innovation. “If we don't get to that, 10 years from now, we will still be talking of reporting, compliance and legal frameworks. We will never transform and meet the demands for sustainability.”
Mindset of circularity
Sustainability transformation will require new ways of doing business–from new regulations, production and service models, to new products and measurement systems–and collaboration across sectors and industries. It will also require what Haghshenas calls “a mindset of circularity,” an ethos of reusing, sharing, repairing, refurbishing, remanufacturing and recycling.
All of which is brought to life at Deloitte through Acacia, its sustainable innovation hub located in Copenhagen. With an ecosystem of partners, including UN Development Programme, business hubs, universities, sustainability and communication experts, they have created the world’s first national measuring points on the UN’s sustainable development goals.
Kruse points out that on the journey to sustainability, companies will (rightfully) question the impact to the bottom line. “We have the technology that will provide the actionable insights to achieve net zero targets or sustainability development goals and year over year growth from a financial perspective.”
The reality is sustainability is still widely perceived as a cost, making it difficult to create the business case around it. Says Haghshenas, “I think we need to break down that barrier and one way to do that is to start talking about, and measuring ‘value’ in ways other than commercial or financial terms.”
As a final thought, Dr. Gardiner offers, “The companies we work with eventually have a vision that includes doing well and doing good at the same time. These are not mutually exclusive goals.”
Want more transformation insights from enterprise leaders? Visit deloitte.com/SAP to download future podcast episodes or listen to previous ones.