The Covid-19 pandemic has marked the beginning of a new normal, and with only nine years remaining for us to meet the Sustainable Developmental Goals, it is pivotal to take actions that matter.
Across sectors and businesses, there’s a push for collective action. Rigorous sustainability frameworks and regulations, powerful civil rights movements, and an increased focus on developing sustainability targets rooted in science are setting the tone. As the global pandemic has had a reverse impact on development, with increased inequalities between countries and socioeconomic groups, company leaders should seize the opportunity to do things differently and increase prioritizing ESG-related topics. We need to learn from our failures and share our experiences to find sustainable solutions that matter.
Develop targets in line with science
The threat of climate change has reached new urgency, and new environmental regulatory requirements such as the EU Taxonomy, the Disclosure Regulation, and the TCFD are coming into place. Larry Fink, the Chairman and CEO of BlackRock, released a letter to fellow CEOs stating that: We know that climate risk is an investment risk. But we also believe the climate transition presents a historic investment opportunity.
This statement signals an important mind-shift as climate-related risks are more than just investment risks. It clearly states that mitigating climate change through science-based targets is vital for creating value for all stakeholders. Since the SBTi launch five years ago, the initiative has responded to the urgent call for corporate climate action with over 1000+ companies joining, representing a market value of over $20.5 trillion USD6.
Broaden the perspective for economic growth
Apart from committing to reducing greenhouse gas emissions at the pace and scale necessary to meet the Paris Agreement goals, there is a shift in understanding economic growth beyond the bottom line. Stakeholders expect top management to lead companies with a clear purpose and strong values. Companies have an opportunity to do things differently when identifying purpose and value. By bringing together multiple stakeholders and requesting that they adopt a long-term view, economic growth can be sustained. Further, economic growth must be inclusive. By minimizing persistent inequalities in organizations, they will gain access to new perspectives, innovations, and ideas contrary to a homogeneous group. Finally, economic growth should be sustainable, meaning that we take care of our shared environment and protect the planet. The broader idea of economic growth can transform our ways of working, resulting in more creative thinking and resulting in a more inclusive and constructive approach to making business decisions.
Identifying priorities, measuring, and reporting on progress
With growing regulatory and stakeholder pressures, there is a risk of heightened sustainability administrational burden in the organization. This risk arises when already high-demand jobs are faced with a broadened scope and additional work due to new sustainability activities. Even though there is no one-size-fits-all solution for implementing sustainability, companies can mitigate this risk by engaging multiple departments and colleagues early to capture their concerns, ideas, and priorities.
Doing nothing, or just doing enough, is not going to cut it. We are in the decade of action, and we all need to come together to avoid the severe environmental and socioeconomic effects of a changing climate. Identifying, measuring, and monitoring sustainability-related goals and KPI’s are a crucial part of creating long-term success. Statistics provide evidence of where we stand and how much work still needs to be done to achieve our goals. They allow us to transparently track, report, and identify the most problematic areas and hence, to focus our efforts on those. With relevant targets, a multidimensional understanding of economic growth, and transparent reporting, organizations possess the right tools to integrate sustainability in their organizations — let’s make it matter.
Klara Nordström I Sustainability Consultant Klara.firstname.lastname@example.org