We get a lot of questions from new clients about sustainability strategy. They want to know things like, What is a sustainability strategy and how do you know if your company has a good one? Is it just about how much money you save through energy projects? Do you need a sustainability policy to have a strategy? What kind of buy in do you need from management?
Here are five tips for understanding what a sustainability strategy is and how you might develop a good one:
1. Use the Triple Bottom Line as Your Guide. Having a sustainability strategy means that you look at business decisions through a broader lens. You consider the environmental, social, and economic impacts of your business decisions over short, mid, and long terms. Instead of a single, financial bottom line, you add social and environmental to the mix. You also expand the financial concept to include broader economic impacts. This is called the Triple Bottom Line. Below are examples of decisions in each of these three areas.
a. Environmental examples: Waste, Water, Energy, Carbon
b. Social examples: Fair Wages, Community Giving
c. Economic examples: Impact Investing, Salary Structures, Meeting Community Needs
Notice how decisions in one area might have impacts in one or both of the other areas. Without actively considering all three areas, a community giving decision might have negative environmental impacts and might be generous, but not address more pressing community needs.
2. Look at Sustainability Reporting Frameworks and Standards. One way to understand sustainability is to look at sustainability reporting frameworks and standards. See what they cover. Take a look at the Global Reporting Initiative (GRI) framework or the International Integrated Reporting Council (IIRC) framework. See if there are extra GRI reporting aspects for your industry. Explore corporate sustainability standards such as ISO 26000 or the AA1000. Check out the sustainability issues list on the Sustainability Accounting Standards Board (SASB) website. While you are there, see if SASB has established specific issues of concern for your industry. By doing this you can:
a. Get the big picture and understand a variety of sustainability issues.
b. Stay up to date on particular industry standards for sustainability that affect your company. Where do you stand? Are you meeting these standards?
c. Consider the key industry drivers for sustainability that emerge from your research. What’s relevant to your industry? What are your risks and opportunities? What might your competitors be working on? How might your customers’ expectations of you be changing?
3. Explore Key Websites. Surf websites of associations, advocacy groups, and other non-profits related to your industry. See if your industry association has position papers or tools related to sustainability. If there are sustainability organizations that focus on your industry, you will find a treasure trove of information. For example, Practice Green Healthcare serves the healthcare industry. The US Green Building Council is all about the built environment. The Green Restaurant Association helps guide sustainability for restaurants, and Green Globe does so for tourism.
4. Identify the Sustainability leaders in Your Industry. Look at your industry leaders and figure out what they are doing to become more sustainable. You can often find valuable information on lessons learned by these trailblazers and avoid their mistakes!
5. Benchmark Your Efforts to Key Stakeholders. Identify what your key partners, customers, competitors – and maybe your investors – are doing to become more sustainable and what your company is doing. When you do this, you get important market intelligence. Where are you falling behind and will that be to your disadvantage? Where do you shine and how can you use that to your advantage? Evaluate the public-facing sustainability information for your company and these key influencers you can:
a. Measure their progress against yours.
b. Compare how they are communicating about sustainability.
c. Think about how/whether their sustainability activities might affect you. Will their level of commitment to sustainability affect your ability to do business with them or compete against them going forward?
Once you have done these five things, you will have a much better idea of what your sustainability strategy should be.
Looking for a systematic way to benchmark? Want a quick and powerful way to communicate about your sustainability benchmarking results to management? Take advantage of a free trial of Sustrana’s new Business Environment Assessment Tool, BEAT! It’s an educational, easy way to get started on developing your sustainability strategy. Check it out.