Corporate growth  catalyst: sustainability’s new role

By ThePlanetMark Thursday, February 23, 2017

Sustainability practice reflects good business practice we are informed. But, what drives this belief? Quora’s latest research reveals how the individual opinions and actions of a company’s employee base are the litmus test for its ‘sustainability credentials’ and the company’s opportunity for growth, writes John Blackwell, managing director of Quora Consulting.

As a term used to describe the business programmes, products, and practices built around environmental and social considerations, ‘sustainability’ is too frequently seen as a luxury investment or a PR device. However, evidence exists to show that sustainability initiatives create profits, opportunities and good employee karma.

At Quora, our latest research* shows how forward-looking organisations pursue sustainability because it has financial impact. The business value at stake from sustainability-related issues e.g. from rising prices of raw-materials to shifting regulations, is substantial.

“Leading on sustainability is driven largely by our desire to grow.,” an FMCG (fast moving consumer goods) business executive recently told us. “The industry changes so rapidly that we need flexibility.”

Where sustainability gets stuck

Such efforts often get stuck, especially at the business-unit level, where managers focus on their priorities. Research shows that less than 5% of organisations do a good job of providing financial incentives or career opportunities for sustainability performance, so employees fail to see the pursuit of sustainability as beneficial. Success requires both a philosophy and a structured programme to improve performance.

The Climate Change Act commits the UK to reducing emissions by at least 80% in 2050 from 1990 levels and stringent UK environmental legislation commits companies to help meet that target. Therefore, we are entering a new economic landscape that is transforming the way we assess the value of organisations. Strong demand for accreditation and the impact of certification programmes such as The Planet Mark™ is testament to this. But what level of commitment are we individually making to sustainability and what level of awareness do organisations have of these wider goals? (see figure 1*)

Figure 1

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Our research has shown that the only tenable way forward is by changing employee practices; it will have dramatic benefits delivering an eight-fold gain compared to investing in smart building design or green IT initiatives. Naturally, all are valuable, but changing staff practices has a immediate impact. Ecologically sensitive advances in building design and innovations in low carbon technology will improve how we live and work. However, staff make real change happen quickly.

Our survey* highlights strong consensus that it is essential to reduce energy use; 84% of those under 30 and 92% overall stating it is essential. However, views about whether organisations are taking steps, acting responsibly, or encouraging energy savings were split – only two out of three of the under 30’s agreeing this was so compared to four out of five of the rest of the workforce (figure 1*).

Figure 2

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In our research* we used our sustainability assessment methodology to explore people’s personal commitment to addressing environmental challenges and to provide a contrast to the corporate perspective (figure 2).

In reality, there’s very little difference in the views of the younger generations from the rest of the workforce (figure 3) when it came to:

  •  Actively taking steps to reduce their carbon footprint by unplugging dormant appliances, switching off lights, etc. – roughly 4-out-of-5 agreeing
  • Actively taking steps to reduce their carbon footprint through car sharing, taking alternative transport, etc. – roughly 2-out-of-3 agreeing
  • More importantly, only just over half the overall workforce and a third of those under 30 had any trust in the government appropriately legislate on energy reduction.

Figure 3

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Corporate Initiatives will change behaviour

The CDP found that organisations in its Carbon Disclosure Leadership Index and Carbon Performance Leadership Index, selected based on disclosure and performance on greenhouse gas (GHG) emissions, substantially outperformed the FTSE Global 500 and record superior stock-market returns.

Our research* has shown that organisations building sustainability into their operations see immediate benefits, this gives them momentum creating conditions for long-term success.

Moreover, the scale of the financial impact was significant – the value at stake from sustainability issues can be as high as 25 to 70% of earnings before interest, taxes, depreciation, and amortisation.

Sustainability is a long-distance journey; however, research shows that the rewards are worthwhile.

Join us to debate sustainability and the employee lifecycle at the Quora Smarkworking Summit 14 March 2017. As part of the event, Planet First, creator and custodian of The Planet Mark™, will be holding a sustainability workshop.

Click here or on the link below to find out more and register to attend.

  • *The Agile Workplace, 2016
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