Sustainability as a Business Strategy [5 Reading Tips]

environmental protection, digitisation, sustainability, business strategy — Photo by Alena Koval from Pexels

Climate change, the Greta effect and »Fridays for Future« have recently put sustainability and environmental protection at the top of the political and economic agenda. Living and working sustainably as well as being environmentally friendly in both private and professional life thus turns from a nice-to-have into a must-have for a safe future.

With this future in mind, new technologies and the digitisation of processes and activities are being developed and implemented very rapidly today. However, the costs of this exponential growth – although invisible – are becoming higher and higher.

So how do you simultaneously deal with the challenges of digitisation on the one hand and the challenges of environmental protection on the other hand? What is required so that companies integrate a sustainable way of thinking into their (digital) DNA?

Sustainable Digitisation is the Future

It is nice to see that more and more companies want to protect the environment and make promises for the future, such as carbon neutrality for the next decades. However, many of these promises only remain hollow words. More transparency in the approach and measures is required to turn these initiatives into concrete action. How can this be achieved?

Since a challenge can only be overcome if it is also perceived, it is first of all crucial to measure the effects of digitisation which are not evident. For example, streaming services, networks, artificial intelligence as well as data centres are already responsible for three per cent of global CO2 emissions (tendency rising) while only two per cent of emissions are caused by civil aviation.

Once the invisible has become visible, it is the next step to accept reality and act accordingly. In this context, Alexander Birken, Chief Executive Officer of Otto Group, has recently made a very courageous statement:

» We must see ourselves as part of both the problem and the solution. […] We can only build trust if talking turns into transparent measures and if clearly formulated goals turn into measurable actions. «

In my opinion, this statement must be internalised by the entire sector. This is the only way for companies to start adopting sustainable approaches and thus achieve measurable progress.

The Sustainability Strategy Determines the Next Transformation Stage

The path to actually implementing such a strategy, however, will be painful and tough. Just like digital transformation, the »green change« will entail major structural changes. Not only must the reduction of CO2 emissions be tackled at product level – which materials should be used for production? How should products be manufactured, packed and shipped? – but also with regard to internal strategic and operational processes.

However, a plan and leading figures are required for this transformation to be successful. The governments of some countries are already involving ministers in this task. The understanding and trust of everyone involved is necessary as well. As already mentioned, this can also be achieved through transparency.

It can also ensure that customers are willing to pay a bit more for sustainable products or services. Sales partners, suppliers and stakeholders should understand that investing in sustainability leads to long-term competitive advantages – and companies should recognise that rejection among the own employees turns into support if they can take over an active role in the new transformation and feel that the actions pay off for everyone.

Sustainability Measures – Taking First Small Steps

There is no doubt that measures to operate more sustainably have already been taken.

In online commerce, the minimisation of returns is a major topic. By using new technologies, brands and retailers want to improve the shopping experience. The apps launched by ASOS and Gucci are good examples. Other initiatives focus on the optimisation and efficiency of the shipping process. Reconfiguring lorries and their equipment to reduce the number of journeys and local procurement are strategies that are already being implemented.

In other industries, saving resources with the help of digital, intelligent solutions has also become reality. On-demand printing services that avoid overproduction and only manufacture products a customer has actually purchased are another possibility to limit waste. Another example can be found in agriculture. With smart and precision farming, for example, 80 per cent less pesticides are required.

In the fashion industry, there are also more and more sustainable collections and pieces of clothing that are produced in a resource-efficient way. Otto, Zalando, Zara or Adidas are only some examples.

It seems to be a good start. However, we have to take these small, big steps together. At company level, comprehensive plans that respond to all environmental and economic challenges from every angle have to be drawn up. This is the only way to deal with climate change from an economic perspective.