Sustainability is fulfilling our own needs without compromising the ability of future generations to do the same. It goes beyond environmentalism.
In addition to natural resources, we also need social and economic resources. Good corporate governance must include policies relating to sustainability.
Sustainability is crucial to the functioning of your company and society as a whole. Your company’s sustainable practices can impact your community more than you may realise, so your board must have policies on the various aspects of sustainable practices.
What is sustainability?
Being sustainable is a social responsibility to do everything possible to work and live life without negatively impacting the world, its inhabitants, and future generations.
Many believe three pillars of corporate sustainability must be considered in all company operations: environmental, economic, and social.
To be sustainable is to develop a low- or zero-impact business strategy that can be continually enacted without noticeable negative consequences on the environment, society, or the economy in the present or future.
To operate efficiently while considering these three pillars, you must assess your company’s business and financial sustainability.
Investors also frequently consider a company’s sustainability before moving forward with any investments.
Knowing this should further convince you, as an effective leader, to include sustainability in your company’s business strategy and discussions during board meetings.
Encouraging sustainability will help lead your company and board of directors to success while benefitting the environment, community, and economy.
For corporate governance, you must address your company’s sustainable business practices. This means that you must assess all products and services provided by your company to ensure sustainability for all parties involved. A sustainable business operation should not negatively impact employees, suppliers, customers, or the environment.
The way company operations impact the environment, economy, and society is vital information that you must continually monitor. It’s also essential to ensure all your supply chains are sourced ethically and promote sustainability.
Business sustainability positively impacts the community, but it can also enhance productivity, customer satisfaction, and brand value.
Consumers are more inclined to associate themselves with companies that guarantee sustainable practices.
Incorporating sustainability into corporate governance
To effectively incorporate sustainability into your corporate governance strategies, you must understand how it can affect every facet of a company. Once you do, you’ll be able to integrate sustainable practices into your daily operations, board meetings, and director training.
Here are four ways you can integrate sustainability as a member of the board of directors:
Assess current sustainable practices
You must evaluate current business and financial sustainability practices. Assessing the sourcing, production means, team member satisfaction, and profitability can help you guarantee your company is operating sustainably.
Being financial sustainable can be easily attainable if a company has good reporting practices. By improving reporting practices, you can help ensure all necessary information is easily accessible when needed. This adjustment can enhance company accountability while also providing accurate depictions of operations and profits.
Plan for the future
Planning for the future is a critical aspect of being sustainable. Even if a company is thriving in its current state, you must ensure this success remains sustainable. If business practices are not socially, economically, or environmentally friendly, it is up to those responsible for corporate governance to resolve any shortcomings.
Encourage sustainable values
As an effective leader, it is up to you to encourage sustainable values, both in and out of the workplace. When you govern a company, your responsibility is to set an example for the board of directors and team members of what sustainable business and financial practices look like. Encouraging sustainable values creates a domino effect — when others also partake in sustainable practices, it benefits the company and society.