The Need for Businesses to adopt Sustainability

The Need for Businesses to adopt Sustainability

  • 7th July 2021
  • Mumbai
  • Others

Written By: Shivika Singhal, Akshat Gupta, and Bramhesh Purohit

Consider how our current activities will impact the lives of our children and their children's children's grandchildren. It's figuring out how to avoid depleting the planet's resources or polluting it at a rate that exceeds the planet's ability to replenish them. Development that meets current demands without jeopardizing the future generations' ability to meet their own needs is called sustainable development. Economic growth, social inclusion, and environmental protection are the three pillars of sustainable development. Harmonizing them is critical. Sustainable development requires long-term economic growth, stable livelihoods, living in harmony with nature, and the use of appropriate technology. India has ranked 63rd position in Global Sustainability Index.

“Sustainability is a part of our rise philosophy. You cannot rise if you take more from the community than you put back.”- Anand Mahindra

Sustainability is a business strategy that considers how a firm operates in terms of the environment's ecological, social, and economic variables to generate long-term value. The concept behind sustainability is that establishing such measures promotes firm lifespan. As expectations for corporate responsibility rise and transparency becomes more ubiquitous, businesses are recognizing the need to act on sustainability.

Indian companies reported on the Sustainable Development Goals (SDGs) at a level equivalent to Chinese firms and slightly lower than OECD firms. The most prevalent SDG highlighted by Indians is Goal 13 (Climate Action). Goals 5 (Gender equality), 6 (Clean water and sanitation), 8 (Decent work and economic growth), 11 (Sustainable cities and communities), and 12 (Responsible consumption and production) are also heavily referenced. Professionalism and a decent heart are no longer enough. Environmental life-cycle assessment has been used to measure the environmental performance of a product, individual, firm, city, or country using carbon footprint as an environmental sustainability indicator. A carbon footprint is the entire quantity of greenhouse gas emissions produced by a product or service during its manufacturing, usage, and end-of-life. It comprises carbon dioxide, the most often released gas by humans, as well as other gases such as methane, nitrous oxide, and fluorinated gases, all of which trap heat in the atmosphere and contribute to global warming. MNCs are working on reducing the carbon footprint for eg, Coca-Cola is fiercely dedicated to sustainable agriculture and is working towards sustainably sourcing all key ingredients by 2020 and reducing its carbon footprint by 25% by 2025.
Transportation, housing, and food account for the majority of an individual's carbon footprint. Businesses can reduce their carbon footprint by increasing the efficiency of their office lighting, reducing energy usage in their data center and comms room, optimizing their heating and cooling systems, reducing, reuse, recycling, minimizing emissions from food and food waste, minimizing single-use plastics, and printing as little as possible. Nowadays companies have come up with a new concept of green buildings.

A ‘green' building is one that, by its design, construction, or operation, reduces or eliminates negative effects on our climate and natural surroundings while also having the potential to create positive ones. Green buildings help to protect the environment while also improving our quality of life. Hewlett-Packard, the information technology behemoth, has pledged to improve its sustainability practices, including green building. One example is the company's data center in Hockley, Texas, which was completed in 2010. HP used a photovoltaic solar power system that delivers 280,000 kWh of electricity per year to save energy. The data center also incorporates a method for recycling cooling wastewater by diverting it for landscaping purposes. The building's components were mostly recycled or locally made, with the wood being certified by the Forest Stewardship Council. There are also bike racks and parking spaces reserved for low-emission vehicles. The building received Gold LEED certification as a result of all of these elements.

It is critical to establish a common focus that can integrate the perspectives and efforts of various development participants around the world while taking into account the diversity of geography, society, economics, science and technology capabilities and capacities, and educational standards and levels, to make the process of sustainable development feasible and operational. The GRI was designed to create a global common framework for voluntary reporting of economic, environmental, and social impacts of corporations and, eventually, other organizations.

The GRI Standards provide a standard vocabulary for businesses of all sizes – public and private – to report on their sustainability impacts consistently and credibly. This improves worldwide comparability and makes it possible for businesses to be more transparent and accountable. The Standards assist organizations in understanding and disclosing their impacts in a way that is beneficial to a wide range of stakeholders. The Standards are important to many other organizations, including investors, legislators, capital markets, and civil society, in addition to reporting companies. Starting with the general Standards, the Standards are designed as an easy-to-use modular set. The organization's material themes - economic, environmental, and social – are then used to select Topic Standards. This procedure guarantees that the sustainability report depicts all relevant themes, their associated repercussions, and how they are managed.

Other than this for sustainable development, the currently existing products can be redesigned for the same goal. Current items will be redesigned to be more climate-resilient. Products that utilize a lot of electricity, water, wood, or other natural resources can be made more efficient in the future, as these resources may become scarcer or deteriorated. For example, millions of low-income consumers have long used OMO, a laundry detergent manufactured by Unilever and sold throughout the developing world. Unilever recently updated OMO, introducing "One Rinse" a fresher version that uses less water for laundry and is aimed at those who wash their clothes by hand. According to the company, the new detergent can save 30 liters of water per wash, which will be especially beneficial to people living in areas where there will be water shortages in the future. To reduce deforestation, other approaches to rethink items include making energy-efficient appliances or enhancing the efficiency of wood-intensive devices like stoves.
Businesses can also add services linked to climate change adaptation and natural resource management to their offerings. Microfinance banks, for example, can provide financial services for adaptation practices. While many MNCs are aware that climate change will have an impact on their inputs and outputs, many are still moving slowly in terms of building a resilient workforce and developing adaptation goods and services. Through appropriate incentives and initiatives, policymakers may be able to assist MNCs in accelerating their actions. Companies can decrease their risk, create new markets, and help communities build resilience by properly addressing climate change.

Sustainability is a huge issue that affects more than just businesses. However, several major corporations are implementing forward-thinking environmental practices, which is encouraging. Sustainability is a megatrend that isn't going away any time soon. The Commission on Business and Sustainable Development plays a critical role. The Business Commission will determine how much money the e-commerce industry is worth. In all major areas, the Business Commission will quantify the significant gains for enterprises that take the lead in sustainable development. This will help businesses take action at scale and a faster pace, boosting the private sector's contribution to a more equitable, sustainable, and inclusive society. This is a period in history when businesses must have the willingness to adopt strategies that create long-term value for their firms and the societies they serve, like no other. This is the time to make a better future for everyone.

There is still too much apprehension among company executives and investors to properly accept this new business model. Rather than putting sustainability at the core of their business, companies still tend to rely on periodic corporate social responsibility (CSR). They must recognize that the benefits of operating sustainably are enormous and that this strategy must be more than just a CSR exercise.

Source: News Agencies
Image Source: Google