This blog entry offers the introduction to a series of articles on sustainability-target-driven business.
Companies consider sustainability more important than ever before. However, they increasingly see the strategic benefits they may gain through sustainability-promoting actions to be the measurable short-term benefits available to them. Fewer companies than before see sustainability as the baseline on which to build all innovation and development of products, services and operations. This was learned through the study Yritysvastuu 2021 (“Corporate responsibility 2021”) conducted by the corporate responsibility network FIBS (Finnish Business & Society) in order to find out how Finland’s largest companies lead sustainability work, the practices they adopt, the challenges they face, and what future vistas they see ahead. The question is, how do we help companies integrate the solutions to their sustainability challenges into their core business, with a full understanding of the opportunities brought by sustainability actions for their own business development?
More and more companies today claim that ”sustainability is in our company’s DNA”, ”sustainability is integral to our processes”, or ”sustainability is at the core of our business”. What these sentences actually mean may be left unclear. What they should mean, I clarify in my doctoral dissertation Conducting sustainability-target-driven business.
Sustainability actions in companies tend to focus on their internal improvements. These may bring financial benefits for that individual company, but approached from the point of view of systemic sustainability, these actions often remain completely meaningless. As such, they do not have any impact on the solving of wider ecological or social sustainability challenges. When companies focus on improving the energy-efficiency of their own processes only, or on decreasing their own emissions only, they miss the enormous business potential that would be available to them if they were to help solve wider sustainability problems.
In my dissertation, I propose actions companies can implement in order to steer their business into directions that actually have impact on system-level sustainability as well. However – what does system-level sustainability mean? From a scientific perspective, companies should understand that they form a part of a socio-ecological system in which society and environment set the limits to companies’ operations and growth. These limits may be defined in accordance with scientific sustainability criteria (Broman and Robèrt, 2017). System-level sustainability therefore refers to our desired level of sustainability, a level at which all life – human and nature alike – can thrive in the future as well (Ehrenfeld, 2000). Consequently, sustainability-target-driven business requires that we change our way of thinking about the interdependencies of companies, society and environment and, in addition, what we consider the key element in steering business operations.
How can companies implement sustainability-target-driven business in practice? Firstly, the company should assume a wider perspective from which to examine its operational environment. The company may approach the issue by putting some thought into the wider systems (such as energy and food systems) to which the company belongs. Next, the company should consider its competences, products and services, reflecting on whether they could be of use in solving any sustainability problems in that industry, or if they could help any interest groups in the company’s value network to reduce their harmful impacts.
Sustainability thinking must be truly integrated into the company’s bylaws and values. In addition, the company must establish concrete sustainability goals that are in line with the principles of sustainability. The essential element is that the company align its business strategy in accordance with these sustainability goals and if needed, alter the business model. A sustainability strategy should not be something glued on the surface, but rather all business should be carried out in accordance with sustainability principles. Only then may we say that sustainability is integrated into the company’s DNA and at the core of the business.
This blog entry offers the introduction to a series of articles on sustainability-target-driven business. Working in a sustainability-target-driven mode, a company examines sustainability comprehensively. It adopts scientifically defined sustainability objectives and principles as the starting point for its business development so as to ensure that its operations do not cause environmental, social or societal harm. In addition, where possible, the company takes action to help solve sustainability problems, influencing its interest groups as they strive to decrease the negative effects of their operations. The point of this series of blog entries is to awaken companies so that they may start considering their business in a new light and learn to see their sustainability challenges as opportunities for business development and growth.
Broman, G.I. and Robèrt, K. (2017). A framework for strategic sustainable development. Journal of Cleaner Production, 140 (Part 1), pp. 17-31.
Ehrenfeld, J.R. (2000). Being and Havingness. Forum for Applied Research and Public Policy, 15(4), pp. 35.
Kaisa Manninen, the author, works at Korkia in a managerial position and is especially enthusiastic about projects in which she gets to develop new, sustainable business models. She spends her free time on agility tracks where she practices her agility skills with her Spanish Water Dog Irma.