This post represents part two in our '5 Steps To A Business Sustainability Plan' E-Book. If you want to view the "5 Steps To A Business Sustainability Plan", click here.
While business sustainability goals are great to improve branding, reduce operational costs, and help the environment, a problem called 'Greenwashing' has emerged in recent years that undermines the purpose of corporate sustainability. Greenwashing occurs when businesses set sustainability goals that are "all talk, no action."
This article will focus on a framework to help your company execute on your sustainability plan. Key word, execute.
Plan - Long Term
We addressed long term sustainability planning for your business in Part 1 of this series, so we will not dive into detail here.
In setting goals for your company, make sure they are big enough to inspire (and possibly intimidate) your team. Setting audacious goals forces your team to stretch and be creative in finding opportunities to improve company sustainability.
Remember, if you set an intimidating and audacious goal for your company and come up short, you will still have made great improvements in your company. As the saying goes, "shoot for the moon. Even if you miss, you'll land among the stars."
Execute - Short Term:
In order to achieve the big, audacious, and inspiring goals your company set in Business Sustainability Part 1: Goal Setting, your company must organize and channel its resources to execute on sustainability opportunities.
OKRs:
Fans of John Doerr's famous business book "Measure What Matters" are familiar with the term "OKR" which means "Objectives & Key Results." OKRs provide an effective framework to drive organizational change, as they divide business plans into two parts, planning and execution. Teams who embrace OKRs are aligned towards common goals and measurable strategies to achieve those goals.
In the case of corporate sustainability, sustainable goals set by the business represent "objectives". "Key results" are the 3-5 main projects or activities which must be completed in order to meet the sustainability objective. Key results usually thrive under shorter timelines and are commonly monitored quarterly.
Over time, as the team executes each key result, the big, audacious sustainability goal becomes closer and closer to reality.
Sustainability OKR Example:
XY Software, an insurance software platform, set a sustainability goal ("objective") of 50% reduction in greenhouse gas (GHG) emissions in the next 5 years. This certainly represents a big, audacious goal, as the company's operations must produce an average of 10% less emissions each year for the next 5 years to meet the goal.
Objective: Reduce company-wide total GHG emissions by 50% in the next 5 years.
XY Software plans 4 sustainability action items ("key results") which will allow them to reduce their emissions to meet the goal.
Key Results:
Install solar on 100% of the company's buildings.
Implement energy management & carbon-reduction software to drive energy-efficiency gains throughout company's offices and data centers.
Use fossil fuel-run assets less frequently or only to meet periods of peak demand.
Leverage sustainable finance products to incentivize material sustainability improvements.
By combining the sustainability objective with action-oriented key results, XY Software can now keep the end-goal in sight while methodically taking steps towards its achievement.
Actions for Business Sustainability:
Listed below are a few common steps companies take to implement sustainability
Clean Energy: Installing solar, or procuring energy from a 'clean energy provider' is usually the most direct route a company can take to increase sustainability. Because modern business requires electricity to function, changing the source of the company's electricity establishes a solid foundation on which company sustainability can be built.
Energy Management Software: Energy management & emissions monitoring software gives business leaders a view into the inner workings of their operations. Energy management solutions help to reduce energy costs and usage, identify business processes which produce emissions and waste, and track progress towards company sustainability goals. Large cost reductions in energy operations are usually accomplished through HVAC and lighting control system management, refrigeration and manufacturing process optimization, energy metering, and equipment management.
Sustainable Finance: Using a Sustainable Finance product to fund a business incentivizes greater alignment between the sustainability goals and operations of the company. When sustainability objectives are met, companies earn lower interest pricing on their corporate debt. Sustainable Finance allows companies to boost profit margins and reduce operating costs while actively working towards sustainability targets.
Supply Chain Optimization: Companies seeking to align with sustainability 'best practices' analyze emissions across their whole supply chain. This analysis is usually performed through a 'product lifecycle review' where the company calculates emissions from all parts of the product's life, beginning at the raw materials suppliers, to manufacturing, distribution, and ending with the product's disposal.
Sector-Specific Technology: Energy efficient technology now impacts virtually every industry. From AI data center management and ultrahigh-density storage for technology providers, to electric motors for transportation and manufacturing companies, businesses are achieving levels of sustainability which were previously unavailable. Industry-specific trade associations and industry media outlets are great resources to learn about new innovations in each specific sector.
Overall, there are many options for taking action towards sustainability. With a proper framework and OKRs in place, companies can execute on opportunities to improve sustainability, boost profits, and stand apart from the competition.
We hope you found this article valuable for your company. If interested, you can download a copy of our '5 Steps To A Business Sustainability Plan' to learn more about the full process of establishing a strategy for your company.
With FreeWorld, you can build a free sustainability framework and apply for Sustainable Financing to reduce your company's carbon footprint and boost profit margin in 2021, all for no cost.
Profit with sustainability.