For many organisations, 2023 will be a year where the needle gets moved on corporate sustainability.
Many thought leaders were waxing lyrical about it. Sustainability will become a strategic imperative, rather than a nice-to-have. “Strategy success in 2023 will depend on a company’s ability to evolve and prepare for regulatory directives, as well as addressing other stakeholder pressures,” wrote ESG and governance software provider Sphera. Alongside ESG reporting, the impact of legislation such as the CSRD (corporate sustainability reporting directive) will likely force organisations’ hands.
With this in mind, Sustainable Future News spoke with executives and thought leaders who have previously been featured to get their assessment on what organisations need to do in 2023.
Our panel includes:
Dottie Schindlinger, executive director, Diligent Institute
From the perspective of boards and senior leaders, I think the most important thing is to take a look at your overall corporate strategy and make sure that ESG is front and centre in that corporate strategy. So not the other way around – not having a separate ESG strategy and then having your corporate strategy – but the strategy itself should just have ESG baked in. You should be thinking about how reducing carbon emissions and changing the way that we approach the planet and our people [is] part of [y]our strategy to build a sustainable and successful business.
I think if companies were to really focus there, a lot of things get much clearer [in terms of] what to measure, how to measure, who should be doing what, how to structure things. All those questions flow from having a strong strategy. So if you’re going to focus your energy anywhere, go there, focus on the strategy.
Peter Matthews, founder and CEO, Nucleus
I expect business to take its sustainability responsibilities more seriously, transitioning to renewable energy sources, using more sustainable materials in their supply chains, making products easier to recycle and using greater accountability and transparency as a strategy for creating brand preference.
Emma Keller, head of sustainability UK & Ireland, Nestlé
We’re facing into a completely new regulatory landscape. There are consultations coming out of government on all different agendas, which is fantastic. Understanding that kind of regulatory baseline is going to level the playing field and move everybody. For all businesses, it’s understanding that we need to understand our material impacts. Of course, a company like Nestlé, every issue is relevant to us in some way, and we need to be addressing all of them. But there are some key issues where we are uniquely positioned to really drive a significant impact. It’s only by doing materiality assessments, looking at where we can drive that change – that’s the areas we should be focusing on. So that’s really important when looking at the regulatory landscape, because we’ve got to understand ‘where are the things we absolutely need to be complying with?’ but then ‘where are the areas we can go further and faster because we’ve got the unique position to be able to do so?’
I think that’s going to be really important for organisations to make sure they’re meeting that baseline, and the hygiene factors, because let’s be honest, many aspects of sustainability should become just hygiene factors. Things like keeping deforestation free should just be a given as we get towards that, rather than it being a selling point.
I think the other thing we all need to be looking at, is this movement towards transparency and disclosure. We’re seeing things like the National Food Strategy, putting the onus in businesses to disclose and report on what they’re doing. So we all need to be making sure we’re doing that in a credible way and being open. And it doesn’t mean we always have to wait until we’re perfect, but it means being really honest about where we are on that journey.
Meredith Sumpter, CEO, Council of Inclusive Capitalism
2022 is the year that companies began to lead with inclusive and sustainable strategies because of market and investor demand, and because of the greater value a company is capable of when it manages ESG-related risks and realises opportunities. The Council for Inclusive Capitalism’s work in 2023 will be all about advancing a mindset shift for company and investor leaders to approach their business anew with agency and creativity, unlocking greater value creation in the process.
Transitioning to clean energy? It’s important to make progress on climate targets, but you also need to account for the social impact of the transition for it to succeed and for your company to thrive—the Council for Inclusive Capitalism invites companies to make use of our private sector guide on Just Transition to learn more.
Company social impact will also be a focus for us in 2023, with an aim to bring companies and investors together with social standard setters and experts on meaningful and achievable actions companies can take to benefit society through their pursuit of profit. We are just at the beginning of companies realising the powerful role they have in the social space.
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