Business solutions for a post-Covid world
Since the Brundtland Commission coined the phrase “sustainable development” in the late eighties, sustainability has had a bad rap. This is due to its association with added costs, being resource-intensive, onerous, and out of touch with business. People often view it as the fluffy, softer side of business that can be a “hard sell”.
Sustainability practitioners are often seen as “tree huggers” that sing kumbaya around a fire – made of sustainably sourced wood of course. To a large degree, this is understandable as organisations tick-box their way through annual integrated reports, organisational websites and PR statements in an attempt to achieve “fifty-shades of greenwashing”. Adding to the “hard sell” of sustainability is the fact that most businesses are obsessed with using annual financial statements as a litmus test for performance.
Remote, flexible working
The Covid-19 pandemic has, however, created a global crisis that unknowingly mobilised organisations to strive for more sustainable business practices. The viability of a remote workforce and flexible working arrangements have for a long time created heated debates around boardroom tables. But when lockdown hit, it was rolled out in a matter of days. Suddenly, organisations were re-assessing the business case for capital intensive office spaces and virtual meetings, reducing employee commutes, which, in turn, result in a decline in air pollution.
We have also seen many businesses take note of the competitive edge that sustainability has to offer. This is due to the interconnected relationship that sustainability, poverty and equality have in society and the impact that they have on a business’s competitiveness.
This finding has been further supported by investment magazine Barron, which releases a list of the 100 most sustainable companies in the US. These companies also boast impressive fiscal results, with share price growth that was seven percentage points higher than the share price growth for the other companies in the S&P 500 in 2017. This trend is not only limited to the US, but it holds true globally. The preliminary results of the 2018 Global Sustainability Index Institute showed that 400 of the world’s biggest companies – consisting of a combined market cap of $25tn – had doubled their number of statements on Sustainable Development Goals.
On the other side of this business issue is the human aspect. As our children and pets join Zoom calls, we are starting to appreciate that employees are more than cogs in a wheel of large corporate engines. Supply chain and procurement practitioners are hastily trying to map supply chains to understand potential bottlenecks and ensure surety of supply. They are forging closer relationships with suppliers to keep production on track and ensure the survival of all parties involved.
Suddenly the concept of supplier enterprise development and localisation make business sense as businesses view new ways to de-risk supply chains. Business agility and resilience are becoming more than just textbook taglines as alcoholic beverage manufacturers diversify into the production of hand sanitisers. The importance of business and government collaboration in organisational sustainability is further exacerbated by the government’s lockdown rules and product bans.
Beyond annual financial cycles
Covid-19 has catapulted businesses into a new way of working – where decisions are made beyond annual financial cycles; where organisations are willing to sacrifice short-term profit-taking for long-term sustainable value creation; where organisations take on the learning that they can rapidly mobilise when faced with unforeseen challenges; and where risk assessments and sustainability strategies are more than just crumpled up pieces of paper pulled out when searching for integrated reporting content.
Instead of counting down lockdown days to “business-as-usual”, it’s time that we create a new dialogue around sustainability and put an end to “sustainability” initiatives that are unsustainable.