The past decade has seen quite astounding advances in industry’s approach to sustainability, with many companies reporting that they’re not only on course to meet their net-zero targets, but are accelerating them by up to five years as they adopt ever-better practices.
The halls of ACHEMA were awash with examples of how many of our blue-chip exhibitors are exceeding shareholder expectations, much to the envy of smaller businesses who may lack the resources, expertise and wherewithal to take the necessary long-term approach.
But there is compelling evidence that some of the bigger players are more than living up to their social responsibilities as industry exemplars by inspiring others to follow suit.
As we have reported elsewhere within this issue, Schneider Electric have now been voted the world’s most sustainable company by Time magazine, not just for its own efforts but the influence it has had on its entire supply chain.
Carbon emissions from their top 1,000 suppliers fell by 27 per cent since they launched a new programme of green measures. At the same time, 21 per cent of the company’s most strategic partners are confirmed to have met their “decent” work standards.
Chief Sustainability Officer Lopez Diaz said this holistic approach ensures ESG is integral to our business strategy and operations,” adding: “We care deeply about the impact we have throughout our ecosystem and the legacy we leave behind us. That’s why we’re determined to accelerate our sustainability program in its penultimate year and bring everyone along for lasting, positive impact.”
Pamela Fandel, who as Head of Corporate Sustainability, described a similar philosophy at Merck: “Sustainability is an integral part of our business and a core responsibility. As a leading science and technology company, we want to use our innovative strength to create shared value for both society and our company,” she said. “Our long-term goals are to support human progress for more than one billion people, to fully integrate sustainability into all our value chains and to achieve climate neutrality.
“Our sustainability impact goes beyond our operations. By integrating sustainability into our value chains, we’re driving change among our suppliers and our partners. Our growing portfolio of greener product alternatives empowers customers to make sustainable choices. And through external collaborations, we’re catalyzing industry-wide change.
“We believe our science and technologies can address global challenges and create lasting value for our business, our stakeholders and society as a whole – and we hope to inspires others to join us on this important journey.”
Similarly, Finland’s oil giant Neste, rated highly in LinkedIn’s careers sustainability ratings, has invested heavily in researching biofuels to pivot its whole corporation into a more sustainable future and bringing others along with them. They are clear about their “high standards” on green issues, insisting: “Our work is guided by the Neste sustainability vision in which we have set ourselves aspirational targets for climate, biodiversity, human rights, as well as our supply chains and raw materials – issues that are all interlinked. Together with our partners we are aiming at a carbon neutral and nature positive value chain by 2040.”
Behind this movement are many big names. Google’s CSO Kate Brandt, who once served the Obama administration as sustainability lead, firmly believes that collaboration should be at the heart of all net zero which, in her words, “requires ecosystem change and these changes can only happen in partnership”. Despite the challenges, sustainability opportunities for small firms are vast.
With smaller and flatter organisational structures, small businesses can often make quicker decisions and innovate more rapidly than their larger counterparts. They also tend to be more deeply embedded in their local communities, which can lead to more sustainable sourcing practices and stronger community ties.
But one drawback is they don’t have a duty to. Large companies meeting certain turnover, or employee number criteria are obliged to make public significant climate change mitigation and environmental actions.
But that doesn’t apply to SMEs which account for 99 per cent of the business community in the UK, according to London-based finance expert Mark Lumsdon-Taylor who asks: “Is that really the point?” He told allthingsbusiness magazine: “Engaging with ESG and sustainability can not only help the planet and its people in so many ways, it can also help your business to be better, improve its profitability and secure its future sustainability. Surely no business needs to be mandated for that.”
It is estimated that up to 90 per cent of an organisation’s environmental impact lies in its value chain, both upstream within the produce supply chain or downstream in its use phase.
That’s why so many countries have introduced laws for supply chain sustainability that require businesses to report on due diligence.
To read the full review, see the Winter 2024 edition below.