Steps to secure a positive future for all

“SUSTAINABLE development requires concrete and urgent action… and can only be achieved with a broad alliance of people, governments, civil society and the private sector, all working together to secure the future we want for present and future generations.”

In recent years there has been significant discussion about “corporate sustainability”. In some cases the term is used as a synonym for “sustainable development” and in others it is used to describe “corporate social responsibility”. But what in fact is corporate sustainability, how does it relate to these other terms, and why is it important?

Generally “corporate sustainability” can be viewed as a new and evolving corporate management paradigm – an alternative to the traditional growth and profitmaximisation model. While corporate sustainability recognises that corporate growth and profitability are important, it also requires the corporation to pursue societal goals, specifically those relating to sustainable development – environmental protection, social justice and equity, ethical behaviour and economic development.

Sustainable balances the need for economic growth with environmental protection, social equity and good governance. The contribution of sustainable development to corporate sustainability is twofold. First, it helps set out the areas that companies should focus on: environmental, social, and economic performance. Second, it provides a common societal goal for corporations, governments, and civil society to work towards: ecological, social, and economic sustainability.

Yet sustainable development by itself does not provide the necessary arguments for why companies should care about these issues. Its basic premise is that corporate managers have an ethical obligation to consider and address the needs of society, not to act solely in the interests of shareholders or their own self-interest.

Contribution

There is however an ongoing debate about whether “corporate social responsibility” is obligatory. What is usually in question is not whether corporate managers have an obligation to consider the needs of society, but the extent to which they should consider these needs.

For companies, the overall aim is to achieve a positive impact on society while maximising the creation of shared value for the owners of the business, its employees, shareholders and stakeholders.

Corporate social responsibility has become a standard business practice and the establishment of sustainability is a crucial component of a company’s competitiveness. This means having policies and procedures which integrate social, environmental, ethical, human rights or consumer concerns into business operations and core strategy, in collaboration with stakeholders.

A sincere approach towards corporate social responsibility often requires a serious reformulation of corporate purpose and decision-making structures. Such change also implies the adoption of a corporate culture which actively encourages employees to consider how the company might be able to do better in the world.

At present, the incorporation of corporate social responsibility programmes by businesses on a fundamental level appears as prevalent as ever. However, the jury is still out as to whether companies have it within them to embrace a broad or multifaceted vision of the concept.

Sustainability behoves the corporate to be a driver in global development through the promotion of good governance and financial support. In terms of corporate social responsibility they need to integrate the concept of social impact into their core business strategy.

Finally, corporates need to realise that society is best served by corporations that have aligned their goals to serve the long-term goals of society. The Sustainable Development Goals offer a useful roadmap.

Baker is the chairperson of the Iqraa Trust, South Africa. This article is an opinion piece and derives from presentations at the Critical Conversations in Sustainability Seminar Series hosted by Regent Business School in association with The Mercury and other private, public and civil society partners.