Corporate sustainability drives innovation and should have a place in a company's vision, argues a new paper released by a team of academics based across the globe.
The report, titled A new mindset for corporate sustainability , emphasized that embedding sustainability--loosely translated as corporate social responsibility (CSR)--into business strategies would lead to innovation.
"Sustainability compels organizations to innovate," Simon Tay, chairman of the Singapore Institute of International Affairs and one of the co-authors of the study, said at a media briefing Tuesday. "[It's not about just] putting on a band-aid or adding extra chemicals, but coming up with new ideas."
Grameenphone in Bangladesh, for example, offers mobile phones that local villagers can buy on a micro-financing scheme and generate revenues by providing access services--via the phone--to other villagers. This program creates a new market for Grameenphone, reduce landfill, as well as offer employment opportunities among the poor.
Tay and five other researchers based in countries that include China and the United States, collaborated on the report over a period of six months, during which the academicians met virtually via Cisco TelePresence. The study was co-sponsored by Cisco Systems and BT.
Tay noted, however, that there was a gap between awareness of the impact of corporate sustainability on the business, and its corresponding action. Pointing to a study by McKinsey & Company in July 2007, he said 72 percent of CEOs surveyed said corporate responsibility ought to be embedded into strategy and operations, but only 50 percent felt their companies actually acted on such plans.
U.K.-based IT research consultancy Butler Group this week also indicated that while organizations that capitalize on opportunities to "work in a more environmentally-friendly way", can have an edge over competitors, many are still "failing to act".
Mark Blowers, senior research analyst at Butler Group, said in a release Monday: "Many enterprises…have not yet recognized the fact that business-as-usual is no longer an option.
"IT management and the use of new technologies have a great opportunity to take a leading role in assisting the organization in meeting these [new] social expectations," Blowers said.
At the media briefing, the Singapore-based Tay outlined 10 ways in which companies can innovate by cultivating a sustainability mindset. He stressed that the recommendations are as relevant to small and midsize businesses (SMBs), as they are to larger enterprises.
Steps to drive sustainability in your business
1. Make innovating for sustainability a part of your company's vision.
Update your corporate vision and mission so that stakeholders can identify the company as sustainability-focused.
2. Formulate a strategy with sustainability at its heart.
Re-think business strategies, not just add sustainability to existing strategies "as an appendix".
3. Embed sustainability in every part of your business.
Create an ongoing process for each unit in the organization to understand its environmental, social and economic impact, then work on innovating in a systematic and integrated manner.
4. Walk the talk.
Get senior management involved and to set the tone for the rest of the organization. Leaders need to explain regularly what sustainability means for the business, the opportunities for innovation and the actual programs implemented.
5. Set up a body at board level that is empowered to make sustainability matter.
Address sustainability matters at the highest levels of decision-making. For instance, a board-level committee can be set up to advise board of directors and work closely with the management team to formulate and evaluate policies.
6. Set firm rules.
Establish a code of conduct stating that employees and stakeholders who don't abide by it have no place in the company.
7. Bring your stakeholders on board.
Identify all the stakeholders of your business and engage them into thinking about sustainability, as well as participate in innovation efforts.
8. Use people power.
Employees are generally proud to be associated with a socially-responsible business, so make sure there are avenues for people to step up and play a bigger role when possible.
9. Join networks.
Get involved with organizations dedicated to encouraging sustainability in business, and be part of indices and rankings that reflect what your company represents.
10. Think beyond reporting.
Align all business systems with the company's vision of sustainability; don't just focus on CSR reporting.
The report on corporate sustainability can be downloaded at www.biggerthinking.com/sustainability/innovation.