There is a common misconception when referring to sustainability, and that is to think solely in environmental terms. But things change when we talk about building an ESG strategy, as we begin to understand the holistic nature of actual sustainability.
It is not rare for people to immediately associate sustainability with environmental causes, that being CO2 emissions, water usage or renewable energy sources, just to mention a few examples.
But, it is in fact rare to see people link together sustainability with social and governance issues. Social endeavours can easily be misunderstood as philanthropic, and governance is the long forgotten branch in the ESG tree.
Nonetheless, these misconceptions do not take away the fact that building an holistic sustainability and ESG strategy is key for any business or organization today. So the question here is, how holistic is your company’s ESG strategy?
The holistic meaning of sustainability
Although foreign to some, the true meaning of sustainability is far beyond just environmental connotations, and in fact refers to a wide range of issues or topics.
Its holistic nature is what makes sustainability such an important term to understand, specially in this day and age, and specially for businesses and organizations who have as much to win from sustainability as to loose from choosing to ignore it.
Building a sustainable world is not just one with fewer emissions and plenty of resources. Yes, this is crucial, but sustainability is also about creating an equitable distribution of such resources, for example; or making sure the exploitation of such is done responsibly, respecting human rights and labor laws.
It is precisely this holistic understanding of the term sustainability that we feel is essential for company leaders to understand, as it is the only way to ensure a healthier planet and society.
Luckily, this is where ESG comes in and offers some more clearance and guidance for companies to approach such a diverse range of issues by combining them all under the same lenses of sustainability.
Building a holistic sustainability strategy through ESG
We can all agree how ESG helps guide the way towards becoming a sustainable organization, as it gives us quite a few clues on how to tackle the issue, namely by focusing on environmental, social and governance topics or risks.
In fact, this is the way through which many investors and other stakeholders make sure the companies they support, financially or otherwise, are on the right path, this is, the path towards becoming a sustainable business.
And in this path, businesses find much more complexities than environmental risks or opportunities. In fact, there are many other, non-environmental issues that arise from environmental or climatic issues themselves.
It is this interconnection of many different factors that, on the one hand, make sustainability a holistic endeavor, and, on the other, make ESG almost the perfect way to understand the latter point.
How to approach an holistic sustainability strategy
Let’s take an easy example and imagine a situation where a company wants to exploit certain natural resources in a given place. Of course, it should start by planning how to carry out such activities in a way that allows nature to thrive in spite of the exploitation.
However, if we want to call this operation sustainable, we need to consider how this affects the community, by asking, for example, are we creating jobs? If so, what kind of jobs? Is the community benefiting from such exploitation? In what ways?
These and many other questions are crucial to developing an holistic sustainability strategy; this is, one that does not harm the environment or add up to climate change, takes care and respects the people that are or could be affected by their operations, and one the makes sure to carry out all business activities lawfully.
The holistic nature of ESG risks
The same way as ESG opportunities are to be managed in a holistic way, as we have explained before, the same mindset applies for its risks.
A sustainability business strategy is to be holistic in all of its facets, including when considering risks and its role in not only avoiding them, but tackling them responsibly. But what does a holistic mindset look like when speaking about ESG or sustainability risks?
According to a recent report, this means taking into consideration many risks or issues that have originally been attributed to governmental authorities, and taking accountability for businesses’ potential, and often real, negative impact.
To put an example, we can think of how many businesses choose externalization in order to reduce costs, but the impact this has on communities, if such externalization is not handled responsibly, could easily backfire agains the company.
In other words, human rights, labor rights, equality, diversity, the right to a healthy environment etc., are all aspects of ESG risks companies need to handle if they want to develop an holistic ESG and sustainability strategy.
Raising sustainability awareness across the organization
As we mentioned at the beginning of this article, many misunderstand the term sustainability as having solely environmental connotations. Of course, after reading this we know nothing is further from the truth.
But how can we change this narrow mindset? We believe raising awareness and giving individuals the right tools to act upon sustainability in a holistic way is what will drive change effectively.
In DoGood we believe that working collectively can help us find that which alone may seem unattainable or useless. That is why we think the workplace is the perfect environment to find that collective eagerness to make a difference, both for the sustainability and purpose of the company and a more sustainable way of being for all.
Through our technology we are able to activate and track employees’ impact, creating engagement that translates into improved ESG metrics, reputational value and an overall positive impact for the environment and society.
