Sustainability equals environmental challenge
Prior to SDG Monitor launch in November, we run a survey on sustainability and business. We got interesting insight on how companies and organizations from different business fields experience the impact of sustainability, what is the level of competence on sustainability matters and how sustainability is used as strategic tool to grow your business.
Amongst our respondents, sustainability is mostly seen as environmental challenge, main discussion topics being on how to decrease the use of fossil fuels in production and
consumption (66%) and how to recycle and organize waste management (68%). Social issues, such as health, well-being and gender equality or governance issues such as business culture and purpose or corruption and illicit practices are not considered as important as environmental challenges. This trend is also supported by the public discussions.
Terms such as climate change, CO2 emissions or anything that starts with the word green (green bonds, green deal) dominate the headlines of media and are implemented in our rhetoric. But different models of analyzing sustainability, such as United Nation’s Sustainable Development Goals or Environment, Social and Governance grouping, consist of environment, social and governance targets and studies stress that all three are interrelated and that when companies are taking care of all three criteria, it links to greater value creation. (1)
Food for thought
Dominance of environmental discussion or if you prefer, lack of social and governance
dialogue leads us to two questions: Is environmental dominance a cultural question? It may be that we concentrate on environment issues because we can afford to do so and social and governance matters does not concern our wealthy democracies as such. Majority of our respondents were from Scandinavia, where social and governance issues are rather well taken care of (less corruption, rather transparent government bodies, more advanced gender equality, education available for everyone and mostly happy people (Finland the happiest country in the world) (2).
The second question, we should ask is: How does this “one-sidedness” effect on measuring the real impact on SDGs? We should study more the interrelation on social and governance issues into the environmental challenges.
Agenda 2030 and Sustainable Development Goals are originally designed as government level contracts and SDG targets and indicators are largely related to concern the challenges of developing countries. SDGs reach for solving extreme poverty, ending hunger or ensuring basic work or basic health services. If we translate the SDG indicators more to suit for business purposes, we can bring the challenges closer to our business environment and different cultural environments and start identifying the problems that are appearing on our operations, such as absences due to burn out, employee engagement, purpose driven business culture, nutrition of school children, obesity etc. Rees and Eccles (2020) ask businesses to quantify their company ́s impact on people, and state that there is far less scrutiny and standardization of data to evaluate the social impact than to measure the environmental issues (3). Companies should study the impact of social and governance challenges when solving the environmental problems.
(1) Henisz, W., Koller, T., Nuttal, R. (2019) Getting your environmental, social and
governance (ESG) proposition right links to higher value creation. Here is why. McKinsey.
(2) UN Happiness report 2020.
(3) Rees, C & Eccles, R.G (2020) Quantify your company ́s impact on people,
Harward Business Review, September 08, 2020.