Adopting sustainable policies is the prerogative of every business today. But what is meant by corporate sustainability? Speaking of development, the guiding principle in corporate choices can only be sustainability.
Indeed, without respect for the planet, its limited resources and the generations to come, it is not possible to imagine a sustainable tomorrow.
In this scenario, companies are also called upon to do their part and adopt responsible and sustainable corporate behavior in line with ESG (Environmental, Social & Governance) principles. Indeed, awareness of this is growing year by year. And corporate sustainability is increasingly becoming an issue that is impossible to ignore.
What is “corporate sustainability”?
Corporate sustainability refers to a company’s practical commitment to bringing to life a business model that not only enables the company’s long-term sustenance. But is also mindful of the environment, social welfare, and fair and forward-looking governance.
It is a concept that culminates in the term Corporate Social Responsibility (or CSR), introduced by the EU Commission in its 2001 Green Paper. There, CSR is defined as “the voluntary integration of social and ecological concerns of companies in their business operations and in their relations with their stakeholders.”
The 2030 Agenda for Sustainable Development, moreover, marks an inescapable path to which institutions, organizations, individuals and therefore also companies are called upon to contribute.
The principles of corporate sustainability: the ESG criteria
The parameters that a company must take into account to implement sustainable strategies are encapsulated in the acronym ESG (Environmental, Social and Governance).
In fact, corporate sustainability means not only the effort to safeguard the environment, but also the ability to operate while taking into consideration other variables such as the social context in which the company operates and the people who work in the company.
1. Environmental sustainability
The concept of corporate environmental sustainability is based on the “Environmental” criteria, which take into consideration how a company contributes to environmental challenges and to combating climate change.
Indeed, a sustainable company is first and foremost an environmentally friendly company, which translates, for example, into virtuous actions aimed at:
- reduce polluting emissions;
- use renewable energy;
- decrease environmental impact;
- curb water consumption;
- carefully dispose of waste;
- adopt circular economy solutions.
2. Social sustainability
The concept of corporate social sustainability is based on “Social” criteria, which have to do with how the company relates to the social fabric in which it operates.
The goal is to adopt a business development model that has a positive impact on the community. Here, then, a company that is attentive to social sustainability will care about issues such as:
- occupational safety;
- workers’ rights;
- equality and social justice;
- the well-being and inclusion of the people who work in the company.
3. Economic sustainability
Corporate economic sustainability refers to “Governance” criteria, which analyze the way a company is administered and the ethics of the decisions made.
A sustainable company is in fact a company that is able to produce value for the community, the organization and all stakeholders affected by the company’s activities, acting with the aim of producing profits in an ethical manner. To achieve this goal, a sustainable company:
- invests in innovation, technology, digitization and research;
- pays its staff and suppliers appropriately;
- has a fair pricing policy;
- favors certified and local raw materials;
- contributes to the development of the local economy;
- makes products and services that are useful and can improve the lives of consumers.
Why is corporate sustainability important?
Proving to be a sustainability-oriented company also means having access to subsidized and dedicated public financing. As well as having a greater likelihood of obtaining private investment.
Indeed, more and more investment funds are focusing their investments on ESG-conscious companies.
Not only that, over time the number of environmentally conscious consumers has grown. And in their purchasing choices they favor companies, products and services that espouse their green philosophy.