IMPACTO https://impacto.my Mon, 23 Sep 2019 07:55:52 +0000 en-US hourly 1 https://wordpress.org/?v=5.2.15 The SDGS And Business: New Horizon Or New Smokescreen? https://impacto.my/the-sdgs/?utm_source=rss&utm_medium=rss&utm_campaign=the-sdgs https://impacto.my/the-sdgs/#respond Sun, 15 Sep 2019 15:29:20 +0000 https://impacto.my/?p=510 Are the #SDGs really changing the way that business does business? Or are they little more than a new wave of corporate PR spin?

The post The SDGS And Business: New Horizon Or New Smokescreen? appeared first on IMPACTO.

]]>

The SDGS And Business: New Horizon Or New Smokescreen?


The 17 UN Sustainable Development Goals, adopted by 193 countries in September 2017, are very fashionable now – especially among big companies. But are they really changing the way that business does business? Or are they little more than a new wave of corporate PR spin – a successor to “green-washing” that we might call “rainbow-washing” (referring to the over-eager use by companies of the colourful SDGs mosaic or rainbow wheel to enhance their brand)?


If the sustainability-oriented business groups, like the World Business Council for Sustainable Development, UN Global Compact, Global Reporting Initiative and the Business and Sustainable Development Commission are to be believed, the SDGs represent a massive opportunity for strategic reorientation and widespread innovation. But is that how business sees them? And how are companies actually using them, if at all? Let’s look at this through the lens of risks and opportunities.

Risk

#1

Business ignores the SDGs

There is a very real risk that most businesses – other than large multinationals – will simply ignore the SDGs and carry on with business as usual. After all, the SDGs are a political agreement, with national goals for countries, not for companies. And the track record of business on sustainable development so far – 40 years after the term was coined by the Brundtland Commission – is mixed at best. The UN Global Compact, a flagship standard for sustainable business, still only has 12,500 companies signed up worldwide.

Risk

#2

Business spins the SDGs

Make no mistake: corporate affairs departments and PR agencies love the SDGs! What’s not to like, with all those colourful blocks, catchy icons and good causes. Even more alluring is the SDGs rainbow wheel linked to the UN logo. We have seen this before. After the UN Global Compact was launched in 2000, the term “blue-washing” was coined for exactly the same reason. Companies were using the blue UN logo to appear to be far more sustainable and responsible than they really were. Today, for many companies, it’s the same story all over again, but this time it’s “rainbow-washing” – 17 catchy colours for the price of none.

Risk

#3

Business cherry-picks the SDGs

Another risk is that business will adopt the letter, rather than the spirit of the SDGs. In this scenario, the SDGs become a compliance agenda, with companies doing the minimum necessary to appear credible. And since companies will argue that they should only focus on “material” issues where there is a clear business case, they end up cherry-picking the SDGs, with most remaining neglected. They see little incentive to be ambitious or innovative, so the ISO-standards approach of continuous improvement is adopted, resulting in incremental improvements that bear no relation to the scale and urgency of the problems.

Are these real risks?

So far, the anecdotal evidence I have seen – and even some early academic research – suggests that these three risks are very real indeed and already represent the majority of responses by business to the SDGs. But the SDGs undoubtedly represent a significant opportunity as well.

Opportunity

#1

Business adopts the SDGs

If business sees the SDGs as a systemic agenda for action, and adopts the full package, so to speak, this could really advance progress towards sustainable development. Hence, rather than only focusing on those SDGs that are convenient, cost-effective or strategic for the business, this would mean that companies commit to make some impact, directly or indirectly, on all 17 SDGs. The Port of Antwerp is an example of a company that has made a commitment to this holistic approach in collaboration with the 1,000 or so companies that form part of its industrial zone.

Opportunity

#2

Business innovates around the SDGs

Another opportunity is that companies see the SDGs as an innovation, rather than a compliance agenda. For example, instead of being content with taking some climate action (SDG 13), they commit to ambitious, science-based targets, such as 80%-90% carbon reductions, or carbon neutrality, and charge their R&D departments with finding creative solutions to get them there. In this scenario, SDG 12 (responsible consumption and production) becomes the engine of innovation to achieve all the other SDGs, by embracing hybrid business models like those emerging from the resilience, exponential, access, circular and wellbeing economies.

Opportunity

#3

Business transforms the SDGs

The best hope for the SDGs is that business sees them as an urgent wake-up call to reform our outdated industrial economic system, which is no longer fit for purpose. In this scenario, companies adopt a collaborative approach to challenging and transforming the perverse “rules of the game” in our global markets (such as subsidies for fossil fuels) and advocate for policy reforms that raise minimum sustainability standards and internalise negative externalities (such as through a carbon tax). In essence, business uses the SDGs to embrace the overarching goal of creating integrated value.

How is your organisation doing on the SDGs?

Wayne Visser is a professional idea-monger, storyteller and meme-weaver. His work as a strategy analyst, sustainability advisor, CSR expert, futurist and professional speaker has taken him to over 70 countries in the past 20 years, where he has delivered over 300 talks and lectures and served over 130 clients. Wayne is also on our Global Advisory Board and would be available to have a conversation on sustainability for your business.

The post The SDGS And Business: New Horizon Or New Smokescreen? appeared first on IMPACTO.

]]>
https://impacto.my/the-sdgs/feed/ 0
Ensuring #Sustainability to #Future-proof Business: From #ShareholderPrimacy to #StakeholderCapitalism https://impacto.my/ensuring-sustainability-to-future-proof-businesses/?utm_source=rss&utm_medium=rss&utm_campaign=ensuring-sustainability-to-future-proof-businesses https://impacto.my/ensuring-sustainability-to-future-proof-businesses/#respond Tue, 10 Sep 2019 16:29:03 +0000 https://impacto.my/?p=518 To what extent are Malaysian listed companies focused on long-term shareholder value and societal goals instead of short-term financial results?

The post Ensuring #Sustainability to #Future-proof Business: From #ShareholderPrimacy to #StakeholderCapitalism appeared first on IMPACTO.

]]>

Ensuring #Sustainability to #Future-proof Business: From #ShareholderPrimacy to #StakeholderCapitalism


To what extent are Malaysian listed companies focused on long-term shareholder value and societal goals instead of short-term financial results? Are these listed entities leveraging corporate social responsibility (CSR) and sustainability agendas merely to enhance their brand equity, publicity and to build stakeholder relationships? Or are they strategic or transformative in their approach to managing their businesses sustainably? To better understand the landscape, I embarked on analysing the CSR and sustainability reports of Malaysia’s top 25 listed companies.


The evidence was both encouraging and enlightening. Encouraging because, Malaysian listed companies seem to be evolving in their understanding of how transformative CSR and its principles of creativity, scalability, responsiveness, glocality and circularity can be integrated into their business, thus taking them through radical strategic changes.

Enlightening on the other hand because many listed companies have yet to transition towards transformative CSR, which is all about identifying and tackling the root causes of our present unsustainability and irresponsibility.

This can be achieved by innovating business models, revolutionising their processes, products and services as well as lobbying for progressive national and international policies. All this would mean contributing to the nation’s transformation.

Notable cases

Nestle began in Malaysia way back in 1912 and over the years, it has demonstrated creativity, responsiveness and circularity in designing and implementing its sustainability roadmap. For instance, Nestle (M) Bhd boasts Malaysia’s biggest Halal Centre, while overseeing over 500 products to meet the needs of consumers.

All of Nestle Malaysia’s factories have a zero landfill status, which simply means effective waste and resources management. The multinational company is committed to long-term thinking in dealing with health-related issues such as obesity and mal-nutrition through sustainable intervention programmes with schools.

Moreover, Nestle’s innovative farming techniques are intended to reduce emissions and efficient use of resources such as water. Not only is the global brand aligning their CSR agenda with their core business, but they are committed to addressing specific social, environmental and ethical dilemmas, working in partnership with multiple stakeholders.

Indeed, global brands such as Nestle do have the resources and capability to drive change and influence behaviour, an essential element to build a community of responsible citizens committed to creating a sustainable world. They can set an example for local companies seeking guidance and successful models of implementation.

Another model organisation is Axiata Group Bhd, which continues to set an example on how organisations can be both strategic and transformative in their CSR approach through creating digital ecosystems and supporting the national agenda of digitisation.

The Malaysian multinational company is continuously changing its business model by looking at renewables, by reaching out to the rural population, and through their green base stations, which generate electricity for off-grid villages.

I have also studied some leading banks, which are completely charitable in their approach, focusing mostly on community involvement and development through ad-hoc projects and campaigns.

My view is that they need to look at (i) strategic philanthropy (i.e. by focusing on areas related to their business) and (ii) supporting venture philanthropy (i.e. by investing in social enterprises or financial technology which could introduce innovative and affordable financial/banking solutions to tap the unbanked population of Malaysia).

Most recently, I stumbled into a leading multinational enterprise, which is involved in recycling campaigns but only to raise money for other charitable initiatives, rather than looking at it as a ‘circular economy solution’ which can help evolve their business model/s while promoting green consumerism.

Despite some limitations, there are many inspiring success stories on how listed companies are emerging as a powerful and influential force, garnering positive consumer response in terms of participation and action for championing various sustainability causes of the nation – from green lifestyles to fair labour standards and equitable income distribution; from gender equitability to inclusive healthcare; from universal design and infrastructure to environmental protection and conservation.

Significant contributions on these causes would help accelerate development and transformation of the nation, too. However, there are also some fundamental issues on how listed companies perceive or fit sustainability/CSR into their bigger scheme of business:

  • Beyond compliance and publicity gains, listed companies may not appreciate the value of investing in a sustainability roadmap with transformative CSR elements and solutions.
  • Listed companies continue to struggle with their ‘short-term’ approach to creating profits and shareholder returns, even when investor community, regulators and even market forces continue to emphasise on the need for socio, economic and environmental performance of organisations.
  • Sustainability and CSR continue to be driven by public relations experts or corporate communication departments which also limit their application in the context of business. Hence, sustainability and CSR are seen as cost centres and tools for promotional/reputational purposes without much practical value for long-term business growth.
  • The C-suite and the key management of listed companies may not necessarily have the right orientation on sustainability and its transformative, progressive and innovative solutions for business.
  • Listed companies may be motivated by awards, visibility and stakeholder relationships, rather than designing long-term CSR/sustainability strategies and blueprints with a transformative agenda.
  • CSR and sustainability are not supported by in-depth third-party assurance which should ideally be a multi-stakeholder/expert panel rather than a large accounting firm. The objectives of third-party assurance must shift from ‘winning awards’ to ‘critical analysis of their CSR and sustainability strategies’, thus helping Malaysian listed companies to break free from their syok sendiriattitude.

A good revelation is that Malaysian listed companies need to take stock of their sustainability journey by conducting a one-time self-assessment of their CSR maturity, their organisational DNA in context of their CSR goals and of course, their preparedness to adopt/embed the principles of transformative CSR.

Irrespective of their main drivers (awards, publicity, social good, environmental integrity, shareholder returns, profits , investor value, etc), what is essential is to acknowledge the need to slowly evolve and transition from traditional CSR efforts towards transformative CSR, which will allow companies to future-proof their businesses, grow sustainably and also meaningfully contribute to the development agenda of the nation.

I see Malaysia at the cusp of transformation, which might fetch the country a ‘developed’ economy status by the year 2020. However, the role of corporate citizens alongside the Government is extremely critical in shaping both the agenda and the outcomes of this process of transformation.

While, it has been an endeavor to keep welfare of the citizens at the very centre of Malaysia’s new economy model (NEM), it is crucial – as the first step – for businesses to define what this ‘welfare’ means to their organisations and their stakeholders as well as in the bigger context of development.

This in itself could be a new beginning to define and articulate CSR & Sustainability vision and mission statements.

Kishore Ravuri is a certified sustainability reporting specialist and a certified CSR2.0 assessor and advisor.

The post Ensuring #Sustainability to #Future-proof Business: From #ShareholderPrimacy to #StakeholderCapitalism appeared first on IMPACTO.

]]>
https://impacto.my/ensuring-sustainability-to-future-proof-businesses/feed/ 0
The Underbelly of the Sustainability Business: Are Leaders Thinking and Doing Right? https://impacto.my/the-underbelly-of-the-sustainability-business/?utm_source=rss&utm_medium=rss&utm_campaign=the-underbelly-of-the-sustainability-business https://impacto.my/the-underbelly-of-the-sustainability-business/#respond Sat, 10 Aug 2019 16:33:47 +0000 https://impacto.my/?p=524 Are popular products advertised as ‘environmentally friendly’ truly sustainable? Or is there a bigger picture hiding behind the green labelling and marketing campaigns?

The post The Underbelly of the Sustainability Business: Are Leaders Thinking and Doing Right? appeared first on IMPACTO.

]]>

The Underbelly of the Sustainability Business: Are Leaders Thinking and Doing Right?


Over the past decade, shoppers have been moving towards more sustainability-conscious purchases. This is largely due to a growing awareness of the consequences of consumerism on the environment. According to a recent online survey of consumers from 60 different countries, 81% of respondents said that they consider the potential environmental impact in their willingness to buy a product.1 With a growing demand for sustainable consumerism, businesses are responding by releasing ‘green’ products and services that feed into the altruistic soul of their customers. The shelves of our supermarkets are ever-increasingly laden with alternatives to plastic. Corporations are pledging to source more environmentally-friendly material in their products. This is all good news, right? Should this not be a cause for celebration that we are now able to easily live without focusing on the burden of harming the environment? If only it was that simple.


Despite the noble efforts of many shoppers to reduce their environmental impact, the expected benefits are often much smaller than expected. In fact, studies have shown that the resulting footprint of consumers who believe they are making responsible purchases do not actually change much. This gap between environmentally-friendly behaviour with actual impact is known as the Behaviour Impact Gap (BIG) problem 2. So, yes, the sustainability market is expanding. Unfortunately, the reality of the products offered by the industry is not always as it seems.

As many buyers happily purchase items advertised as environmentally-friendly, there lies a bigger picture behind the ‘green’ labelling and marketing campaigns. What is often missed from the story is the actual environmental impact of the item throughout its history, not just when it reaches our stores. It is not enough to say something is better because it’s biodegradable or uses fewer materials for production. Every detail needs to be examined to aptly capture its actual environmental footprint. This process is called the Life Cycle Assessment (LCA), which considers a range of factors for the development of a product, including manufacturing, transportation, energy consumption, raw materials and eventual disposal. When conducted, it’s often discovered that our favourite conscious-free products are actually more harmful to the environment than we intended.

Some misinformed, ‘eco-friendly’ examples include:

#1

Reusable Bags

There is an almost universal consensus on the detrimental effects that single-use plastic has on our global system. These non-biodegradable products are quickly filling up our land and marine environment, which seriously endangers the ecology of these spaces. Wildlife often chokes on or consume disposal plastic bags. Plus, plastics do not decompose. Instead, they will break down into microplastics, inadvertently contaminating our soil, water and, eventually, our food supply. So, the decision to ban plastic bags in many regions has been a valiant effort. More and more shoppers are now bringing along reusable bags when they head to the market, proudly playing their part in environmental conservation.

While the utilisation of reusable bags is definitely a critical factor in keeping plastic safely away from our beloved wildlife, many are unaware of the actual environmental impact of these products. Shoppers have to understand how these ‘eco-friendly’ bags are made, as well as how to fully utilise them to properly cancel out the environmental impact of plastic bags. As reusable bags are generally studier, the manufacturing process may leave a greater environmental impact than plastic bags. This is largely due to the way the source material of these bags is grown and processed. For example, despite being a renewable material, the production of cotton consumes large amounts of water, energy, pesticides and fertilizers.

According to an LCA conducted by Denmark’s Ministry of Environment and Food in 2018, when marine litter was taken out of the equation, single-use plastic bags have the least environmental impact among all shopping bag materials. However, it is important not to downplay the scale of the problem that plastic litter plays on the environment. The point is that other options also come with their own environmental baggage (excuse the pun). The study determined that to properly cancel out the environmental impact of single-use plastics, we’ll need to monitor the number of times each reusable bag is used – polypropylene bags and paper bags should be used 37 and 43 times respectively, while cotton bags need to be used a whopping 7,100 times! 3

Therefore, to make a truly informed decision on reducing our footprint when buying a shopping bag, all considerations must be taken into account. Even if buyers choose the most ecologically-friendly material, other factors also come into play in its overall footprint. For instance, the location of production determines the greenhouse gas emissions related to transporting the items, while printing designs on the bag come with the significant environmental burden of using ink. It would be best to choose a bag made from recyclable materials that do not have any printing or decorations. Additionally, regardless of the type of bag, it’s crucial that we use it as many times as humanly possible. When the time comes to finally retire the bag, do not allow your deceased companion to become litter. Give it the right send off by recycling or repurposing the bag.

#2

Metal Straws

The next victim on the agenda of solving the global plastic problem was plastic straws. Who could forget the horrifying video of a straw stuck inside the bleeding nostril of a turtle?  It’s likely that this image was what pushed many to move away from using plastic straws towards more reusable options. While there are many choices available, many are opting to buy metal straws in hopes to reduce their environmental footprint.

Since the conversion to reusable straws is a relatively recent movement (compared to its plastic bag counterpart), it is trickier to determine the environmental impact of metal straws as its LCA has yet to be conducted. However, just by considering the processes involved in steel production alone, we can get an idea of the product’s actual role in environmental degradation. Mining practices used to produce steel often consume significant amounts of energy and resources, while also releasing harmful substances, such as toxic air emissions, wastewater contaminants and hazardous wastes, into the natural environment.

After the processes used to produce the metal straw is completed, we can consider the other details involved in its supply chain. The packaging and transportation element of its distribution plays its own role in carbon and waste production. For instance, it’s a common practice for people to buy their reusable straws online, often from international vendors, thus getting their items shipped directly to their doorstep. This unintentionally adds to 20% of marine litter associated with international shipping 4, as well as more than 2.6% to global carbon dioxide emissions 5.

The best option for most would be to just forgo the use of straws altogether. But it would be unfair to discount those with medical or dental-related issues that make this a complicated scenario. Plus, there are drinks that require straws to access its sweet nectar, such as coconuts and bubble tea. For those, it is better to opt for other, more ecologically-friendly straws, such as bamboo, papaya or even glass straws. Although, keep in mind that there hasn’t been a study on their life cycle either!

#3

Sustainable Fashion

As one of the world’s most polluting industries, the fashion industry does not have a strong history of sustainable practices. The annual gas emissions released from textile production is more than the emissions associated with international flights and maritime shipping combined 6.Producing cotton is also resource heavy, using up to 20,000 litres of water to produce a measly 1kg worth of cotton (equivalent to one t-shirt and a pair of jeans). Additionally, the heavy chemicals used in creating our garments during processes such as dyeing and bleaching causes tremendous water and soil degradation.

In response to the growing concern of their environmental impact, many brands and retailers are making concerted efforts in minimising their footprint. For example, they’ve adopted new technology and initiatives that greatly decrease the water, energy and chemical consumption of production by up to 50%. There is also more of an effort in getting material from responsible sources, such as bamboo and upcycled fabric.

With significant progress being made in minimising the environmental impact of garment production, many brands are proudly labelling themselves as green fashion. Unfortunately, despite increased responsibility from the sector, it is predicted that the fashion industry will triple its consumption of resources by 2050 6. This prediction is due to the growing appetite for fashion. The rise in fast fashion is shortening the life cycle of garments. As consumers chase the latest clothing trends, the rate of clothing disposal is rapidly increasing. In fact, in the UK alone, it is estimated that $38 billion worth of clothing currently kept in closets have not actually been worn for over a year 7. With this lack of consumption control, the ecological impact of frequently buying new clothes surpasses the desired effect of purchasing from sustainable retailers.

The apparent ‘sustainable’ sources of material are also questionable at best. For instance, bamboo is often marketed as the greenest option for our fabric, due to its ability to grow quickly; it is naturally pest-resistant; it rebuilds eroded soil; and the stems shoot right back up after harvesting. This means that bamboo is able to be grown without any chemical fertilisers and pesticides 8. Due to their supposed sustainable properties, the demand for bamboo fabric have been rising. Unfortunately, this means that farmers in China, the only country that commercially grows the crop, have been succumbing to unsustainable practices to maximise their yields and profits. Firstly, they are choosing to monocrop bamboo. This inadvertently decreases the biodiversity in the area while also exposing it to pests, thus making pesticide necessary. Furthermore, farmers are actively clearing existing forestland to make room for their bamboo plantations.

To truly minimise our footprint, the first step is to reduce our consumption of new clothes. Fight off those desires to be trendy. We do not need to look as if we’ve stepped off from the pages of a magazine. When we need to really buy clothes, opt for preloved or recycled clothing, then use these clothes for as long as possible. If the garments become damaged, then, like any other product, we should either repair, recycle or upcycle. These choices may make us seem less ‘in-fashion’, but at least we’re fighting a good fight.

The post The Underbelly of the Sustainability Business: Are Leaders Thinking and Doing Right? appeared first on IMPACTO.

]]>
https://impacto.my/the-underbelly-of-the-sustainability-business/feed/ 0