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    • Sustainability
    • Article

    CSR – A Stepping Stone towards Corporate Sustainability

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    Highlights

    When someone says CSR (corporate social responsibility), most people tend to hear sustainability. Well, they are not wrong, but not right either. Over the years, sustainability and CSR have been used synonymously due to convenience or lack of understanding. While businesses try to transform themselves into sustainable businesses, the first step is correctly understanding sustainability and sustainable development.

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    Defining Sustainable   inpage
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    Defining Sustainable Intertwined goals Sustainable Transformation

    Defining Sustainable Development

    Some think sustainability is about environmental impact. Others associate it with societal issues, and some with the bottom line. However, business sustainability is all that together over time. 

    The World Commission on Environment and Development published “Our Common Future” in 1987. Herein, sustainable development was defined as the development that “meets the needs of the present without compromising the ability of future generations to meet their own needs.” This, being the most agreeable definition, led to the foundation of three pillars of sustainability: the economy, society, and the environment, informally addressed as profit, people, and the planet.

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    Our biggest challenge in this new century is to take an idea that seems abstract - sustainable development - and turn it into a reality for all the world's people.

    Kofi Annan

    The Intertwined goals of Sustainability and CSR

    While sustainability principles guide the world, CSR is self-regulation through which a business contributes to society via philanthropic or charitable activities. CSR is compliant as most companies must set aside a mandated budget for activities. These activities let them contribute to efforts to reduce social inequality. CSR defines, carries out activities, and then reports the activities done over a fixed period, say a financial year, for societal betterment. If these activities also help increase the revenue, it’s an added benefit. Point in case, research by Harvard Business Review shows key findings below:

    Sustainability is an approach to planning the changes a business needs to make to improve the three bottom lines. Consider a regular charity event organized by a company. It takes care of the concerns in society. Moreover, it can also get tax exemptions for better profits. But it misses out on the third pillar, the environment. In fact, it might have a negative impact if the company didn’t take care of the waste generated during the event. That hit the CSR goals but missed the sustainability ones.

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    Sustainable development is the pathway to the future we want for all. It offers a framework to generate economic growth, achieve social justice, exercise environmental stewardship, and strengthen governance.

    Ban Ki-moon

    From Responsibility to Sustainability

    The move starts with organizational hierarchy, from top to bottom, learning to distinguish between responsibility and sustainability. This will weed out the thinking that we are doing something for the cause when we should be doing it all minus the negative impact.

    So how does a company measure its moves to categorize it as sustainable? By calculating the balance of resources between its short- and long-term supply and demand. Concisely put, a short-term success should never jeopardize long-term survival. Being a sustainable business would mean responding to short-term needs or goals without compromising on the ability to meet future needs. The focus should be on whether the change is sustainable over the long term.

    Companies should focus on whether they are addressing the 3Ps of the triple bottom line. A corporate sustainability strategy should consider the business's multi-dimensional aspects. This includes the economic, ethical, environmental, and social dimensions. Growth and profitability are necessary, but at what cost is a question that would answer and decide the approach an organization takes toward sustainability.

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    We need government and business to work together for the benefit of everyone. It should no longer be just about typical "corporate social responsibility" where the "responsibility" bit is usually the realm of a small team buried in a basement office - now it should be about every single person in a business taking responsibility to make a difference in everything they do, at work and in their personal lives.

    Richard Branson

    Transforming into a Sustainable Company

    Such transformations don’t happen overnight. It starts with first defining a sustainable mission statement. Some common strategies include:

    • Innovation and technology: The focus is on the company’s ability to modify the manufacturing process of its products and services to generate less waste.

    • Collaboration: Network with similar companies to share knowledge and innovation to work towards a global goal. 

    • Process improvement: Educate every stakeholder and employee to survey the processes and create an open culture that supports idea sharing for new and improved sustainable processes.

    • Sustainability reporting: Measure the company's performance against its goals.

    • A green supply chain: Sustainable procurement must start with a sustainable product creation process. Think Circular Economy Model or B Corporation (certification ) model that encourages companies to resource it right.

    As per the 2020 Gartner Sustainability Survey, sustainability spending increased by about 5.8% since 2017, and Covid-19 increased its prioritization of social issues. 

    Corporate sustainability is finding that perfect balance between making a business profitable and growth-oriented while anticipating and addressing the need to achieve societal and environmental goals. Through effective resource management, re-alignment of goals, a green modification of the supply chain, and sharing a clear understanding of the scope and approach, green businesses will not only survive but also thrive.

    Insights

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    Sustainable Travel is the Future

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    How EU Companies can Act to Combat Climate Change

    Report | 30 Oct 2023   Opens in new tab
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    Data centre temperature monitoring: A stitch in time

    Report | 30 Oct 2023   Opens in new tab
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