5 Key Steps to Building a Sustainability Strategy
Today brands are facing increasing pressure from consumers, governments, NGOs, investors and insurance companies to have a positive and active role in protecting people and the planet.
As a result, a growing number of businesses are promising to take action towards the 2030 Agenda for Sustainable Development set by the United Nations. Sustainability is no longer optional and is increasingly becoming part of the business bottom line.
Understanding what sustainability means for a brand and learning how to create a successful strategy is key in ensuring a business’s long-term operations and unlocks investment opportunities that are tied to the UN Sustainable Development Goals (SDGs).
Sustainability is becoming a key part of the overall business strategy with some players now publishing integrated annual reports that combine environmental, social and financial data. Coca-Cola, for instance, released its first combined global “business and sustainability” report in 2018.
According to Euromonitor International’s Sustainability Survey 2019, 66% of the industry professionals believe that sustainability initiatives are critical to success.73% consider that although these initiatives are an important component of the company’s value proposition, businesses still need to improve their sustainability strategy.
This article proposes a five-step formula that can help brands plan a successful sustainability strategy:
Talk and engage
The first and most critical step when planning a sustainability strategy is building a winning business case for sustainability. At this stage companies usually face conflicts between sustainability and competitiveness, two areas are traditionally seen as opposed to each other.
A convincing business case will focus on the connection between sustainability initiatives and business benefits (value creation and risk mitigation). This step is crucial to engage senior leaders on sustainability topics.
Assess and prioritise
The second step is mapping and prioritising related risks and opportunities across different markets. Every industry has its own sustainability challenges and opportunities depending on the markets where they source, manufacture and sell their products.
This step is key to attracting investors and ensuring good financial performance. Identifying these risks and opportunities also helps to protect brand reputation and company operations as well as complying with, or even getting ahead of legislation.
Commit and collaborate
The third step involves proactively setting targets and goals as well as working in partnership to accelerate sustainable business innovation. There is an increasing number of companies setting up science-based targets.
The best option for brands to overcome complex sustainability challenges and achieve bold commitments is to build the right partnerships with key stakeholders, from NGOs, governments and academia, to suppliers, retailers, logistic companies, innovative start-ups and waste management companies.
Measure and report
The next step involves selecting the right metrics to keep the sustainability strategy on track. There is no point in setting goals if you will never know whether you achieve them or not.
Although the SDG framework provides a set of 169 targets and over 200 metrics that can be used to track the progress towards these goals, our Sustainability Industry Survey reveals that in 2019, just above a third of the professionals were aware of their company engagement with the SDGs.
Educate and communicate
Communication plays an essential role in any sustainability plan. Brands that disclose their results and learnings, both internally (with the shareholders) and externally (with governments, investors, customers, employees, business partners and local communities) are perceived as more transparent.
An increasing number of brands have a division dedicated to updating websites with information about their sustainability priorities, targets, initiatives and results. Global companies are launching powerful messages and catchy slogans to demonstrate their actions and commitments to build a more sustainable future.
To understand more what sustainability means for a brand, download our white paper How to Become a Sustainable Brand.