Making a start on sustainability
Updated: Jan 31, 2020
Wherever your business sits in the value chain, or who you sell to, sustainability is no longer an added extra or "nice to have". The world is waking up to climate change and the effects of exhausting our planet's resources, coupled with growing inequality impacting the financial and regulatory landscape.
These trends are gradually shifting buyer values, preferences and behaviour and raising the profile of sustainability. Consumers, investors, employees and retailers worldwide are increasingly moving beyond a simple "clean and green" view of sustainability, and looking hard at what businesses are offering and how they operate.
Incorporating sustainability into your business strategy can help you thrive in this changing environment – by managing risks and reducing costs, as well as finding new opportunities. And getting started in this area is easier than you might think.
We've put together the guidance below as a starting point for New Zealand exporters from a NZTE perspective, drawing on ideas from local experts and groups as well as overseas bodies like the UN Global Compact and Global Reporting Initiative.
What actually is sustainability?
Sustainability as a term is thrown around a lot, and there are endless definitions. Commonly they stem from the UN definition of sustainable development, "providing for the current generation without compromising future generations. "
NZTE's interpretation of sustainability covers enhancing the wellbeing of local communities and cultures, protecting and restoring natural environments, and maintaining a prosperous and growing economy – people, place and profit. These three elements are interdependent and none of them can be achieved in isolation from the others.
In short, there's room to think about more than just waste or emissions (although these are very important areas) when making sustainability part of your business strategy. Positive impact on people and communities (and on your bottom line) is part of the picture too.
A simple way to get started
Figure out where you stand
Take stock of the positive and negative impacts your business has. Consider environmental, social and economic factors, and look at your whole value chain. This could mean looking at energy and water use, employee rights and benefits, governance, emissions, waste and packaging.
As you do this, you'll find areas of opportunity where you're doing well or could do better, and areas of risk (financial, competitive, reputational) that you need to manage or control.
Find out which areas matter
Once you've mapped out these opportunities and risks, it's time to figure out what really counts.
• What matters to your customers?
• What matters to your employees?
• What matters to your board?
• What matters to your investors – including yourself if you're an owner or part-owner?
• What matters to your other stakeholders?
As an exporter (or an aspiring exporter) this means looking at your international markets as well. The sustainability landscape differs hugely from place to place, depending on environmental and social situations, laws and regulations, and consumer preferences. So knowing your market is crucial.
Prioritise the big stuff
Conduct a simple materiality assessment like the one below from the Global Reporting Initiative. Plot each issue based on importance to your stakeholders (vertical, or Y axis) and the sustainability impacts for your business ( horizontal, or x axis).
By putting all of the issues into this framework, you'll be able to spot any recurring themes and identify areas of high importance and high impact, so you can focus in the right areas first.
There is a wealth of guides and resources available depending on your area of focus. For example if you are prioritising environmental areas such as Waste, Water, and Energy check out the great advice from our friends over at business.govt.nz.
Commit, collaborate, communicate
Here are three key actions to take, once you've identified where to start:
Commit by setting some clear, measurable and attainable goals and targets. Often it will be necessary to establish your baseline first, so you can measure and report on progress. There's lots of guidance available to help with setting such targets depending on your areas of focus.
Collaborate. Sustainability can involve some tough challenges. In order to meet your goals you'll need to build partnerships with new and existing stakeholders, from suppliers to NGOs, government bodies, retailers and other businesses. It also pays to connect and learn from other businesses who have gone through a similar process of embedding sustainability.
Communicate what you're doing for your customers and stakeholders, and get credit for your work on sustainability. Be transparent, and share your goals, your successes and your challenges. Even if you're just making a start, you can demonstrate your commitment to building a more sustainable future and begin to reap the benefits.