Sustainability 

Sustainability Advisory

|SUSTAINABILITY ADVISORY

  MAC has delivered projects across all stages of the sustainability value chain, from developing strategy to creating journey maps, as well as designing and implementing projects, and providing support for monitoring and measuring the impact of sustainability initiatives. We believe that organisations can progress from risk-based sustainability strategies, to a level where sustainability creates bottom-line results and value for stakeholders. At the highest levels, organisations can partner with other stakeholders to transform business ecosystems that result in new, sustainable outcomes.Alignment and integration: the business case for sustainability  In the realm of sustainability lies both risk and opportunity. Companies that fail to address their wider societal and environmental impact will endure more frequent scrutiny and exacerbation of risks such as negative public sentiment, as well as the loss of social, and in some cases legal, licence to operate. Equally, companies that re-invent their products and services to harness the potential of the entire value chain, and work with stakeholders to reshape their industry in a way that creates shared value, can become industry leaders. Since the rise of sustainability theory in the early 1990s, businesses have been undergoing a slow but steady transition from focus on a single, profit-driven bottom line, to consideration of what is often referred to as the triple bottom line of economic, social and environmental value. Today, mapping value against a “Six Capitals” or an equivalent broadly-based model is more common, with leadership incorporating concerns for manufactured, financial, human, social, intellectual and natural capital elements into their scorecards. As a company’s approach to sustainability matures from reactive to strategic, it becomes critically important to make the right choices, implement sustainability initiatives, measure impact, and engage effectively with stakeholders.MAC’s approach to sustainability strategy developmentOur approach to developing an organisation’s sustainability strategy starts from the belief that it should be fully integrated with business strategy. In defining the sustainability strategy, two key questions need to be answered:
  • What is the company’s desired level of sustainability maturity?
  • Where should the organisation focus to maximise the sustainability impact?
Question one: sustainability maturityAnswering the first question requires an evaluation of various sustainability levels, from an ad hoc approach through to the achievement of collective impact.The journey from risk mitigation to strategies that provide lasting impact1.PhilanthropyPhilanthropy signifies an ad hoc approach to sustainability, where attention is given to conforming and meeting the most pressing needs and worthy causes, with little or no strategic alignment to business requirements. Initiatives to improve performance are often not aligned to the business strategic objectives and may not have lasting positive impacts.2. Risk and compliance: corporate social responsibilityAt this level, a company is committed to building a reputation as a responsible corporate citizen and managing the impact at a strategic level. The organisation is taking cognisance of its impact on key stakeholders. It is taking steps to minimise negative impact and implementing initiatives to make a positive impact that are aligned to business objectives. Areas that pose risk to the organisation in terms of impact and importance to stakeholders, are prioritised as focus areas.3. Shared valueAt the shared value level of maturity, the organisation is shifting from merely aligning sustainability focus to business objectives, to adapting business strategy towards shared value for stakeholders. Changes to the business model that result in benefit for society may now be required. Reconceiving markets and products and redefining value chain productivity are some of the ways in which shared value can be pursued. As described by Porter and Kramer (2011): “Shared value [is not] about ‘sharing’ the value already created by firms – a redistribution approach. Instead, it is about expanding the total pool of economic and social value.”4.Collective impactAchieving global or industry-wide systems that are truly sustainable requires multi-stakeholder co-operation and innovation. This is the objective of the collective impact maturity level where the objective is to redefine the business ecosystem. Industry clusters are the result of the co-operation between multiple stakeholders working towards the creation of value to all parties. Question two: maximising impactIn asking where the organisation should focus to maximise its sustainability impact, as shown in the figure below, the answer lies at the intersection of business strategy, the potential impact resulting from business activities, and the stakeholder context within which the organisation operates.Bringing together the organisation’s strategic intent and focus areas, a sustainability strategy can be defined that includes the following elements:
  • Strategic sustainability focus areas and initiatives.
  • Defined sustainability measures and targets.
  • A roadmap towards achievement of sustainability goals.

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Senior Executive – Sustainability

Harry Steadman

harrys@macgroup.co.za