75% of businesses find sustainability challenging

The business sector should adapt to new sustainability challenges, including energy efficiency, if it is to survive.
Published: Tue 23 Aug 2016

Businesses need to do more to address the combined force of global megatrends according to a new Institute of Environmental Management & Assessment (IEMA) sustainability report, “Beyond the Perfect Storm: The Corporate Sustainability Challenge”.

Only 7% of professionals surveyed as part of the research for the report said that “sustaining the business model” is their organisation’s primary motivation for engaging in sustainability. The report shows that the three main reasons for organisations engaging in sustainability are to improve reputation, address client expectations and transform their business, but many face challenges such as finance, lack of management support and clear strategic or operational alignment. In fact, 75% of professionals indicate that sustainable procurement is proving to be a significant ongoing challenge.

Business as usual approach must change

The report highlights the fact that businesses can no longer rely on a “business as usual approach” as it is “driving us past the planet’s environmental and social boundaries.” The report points out that it is still not too late for businesses to turn their backs on “sustainability trade-offs” towards a new age of innovation and resolution of sustainability challenges.

Building on IEMA’s 2014 report “Skills for a Sustainable Economy: Preparing for the Perfect Storm”, the new report warns businesses that innovation is required to  tackle issues like climate change, population growth, loss of natural capital, water stress, resource scarcity, food supply and other global development challenges.   

Innovative business models and new ways to measure return on investment are needed to enable businesses to transform. This is where the strategic and the tactical skills of Environment and Sustainability Professionals are central to this change.  

Nick Blyth, IEMA’s Policy Lead and the report’s author, says that unless a transformative switch away from short-term thinking can be introduced, businesses - individually and collectively - will be unable to reap the rewards. “Organisations can transform and mature towards the ambition of the truly sustainable business, but they need to establish a long view and look way beyond the “perfect storm”. The urgency is clear but so too is the opportunity with very real tangible, financial and reputational benefits for those organisations at the vanguard.”

Companies leading in a sustainable way

While there are clear struggles, the report offers inspiring examples from forward-thinking companies that are “smashing” their sustainability goals. These companies include Marks & Spencer, ArcelorMittal, London-based office supply firm Wiles Greenworld and global professional services EY. These companies show what is possible when long-term sustainability practices are adopted.

Marks & Spencer (M&S) wants to build on "the most comprehensive, wide-ranging sustainability plan in retail" by fitting out its entire UK estate with LED lighting by 2025. M&S's head of facilities management Munish Datta says that setting "uncomfortable targets" has become essential for M&S to make its stores and office buildings more sustainable. While LED lighting is certainly not new, M&S aims to take this innovation to the next level but carrying out a mass-scale rollout.

Datta heads up M&S's Plan A initiative, which has seen energy use across the company's buildings fall by 36% since its 2007 launch. Datta says that there is a need to prioritise behaviour change and translate energy savings into a “language that resonates with staff” in order to maximise the potential of energy efficiency programmes. “Nothing works better in retail than linking energy performance to people’s bonus - it gained real traction,” he said. People make buildings work – engaging colleagues is really important. We have to raise awareness of personal behaviour in stores.” He added: “I believe that about a quarter of the 36% energy benefit that we’ve had was through communicating with people.”

Under Plan A, M&S has achieved zero-waste targets and has successfully pledged to the RE100 initiative, a collaborative, global initiative of influential businesses committed to 100% renewable electricity, working to massively increase demand for - and delivery of - renewable energy.

The company has seen a £625 million net benefit from its sustainability strategy, with £30 million generated from energy savings last year alone.

Steel manufacturer, ArcelorMittal has developed 10 sustainable development outcomes which involve the sustainable way in which the steel is manufactured and how resources are used. It also involves the way in which the company develops new products and how it supports staff, communities and the environment. efficiency measures at its steel plants, making its business and customers more resilient to future increases in energy prices. Their research in energy efficiency is aimed at creating products that will help reduce energy consumption. For instance, their specialised lightweight steel is already creating value in the automotive industry as it helps vehicles to reduce fuel consumption. Their electrical steels are also enabling significant improvements in energy efficiency in the power generation sector and in electric cars.

Wiles Greenworld, a UK office supplier, offers a complete business solution by focussing on reducing their own and customers’ costs and environmental footprints. This is carried out according to the company’s sustainability strategy which involves a major emphasis on resource, waste and energy management. In fact, the company is doing it so well that they were chosen by BSI (The British Standards Institute) as a case study out of 327,000 companies to demonstrate how they have met the stringent requirements of the internationally recognised standard for environmental management – ISO 14001: 2015.

EY’s global, multi-disciplinary team combine their core experience in assurance, tax, transactions and advisory with climate change and sustainability skills. EY has recently been recognized for its sustainability services within a global brands survey by the independent analyst firm Verdantix. 

Nick Blyth said this report shows that we have reached a critical time for organisations and their ability to thrive in the future. “There is no doubt that some businesses are further on in their journey to sustainability than others. The innovations being spearheaded by such businesses are inspiring and show what can be achieved when a long-term horizon is used. Many more need to follow suit…”

In our upcoming webinar, Hitting your Sustainability and Low Carbon targets - Getting Greener in 2017, our panel of experts will get to the bottom of the key drivers, challenges and aspirations for corporations looking to smash Sustainability and Low Carbon targets. They will answer key questions including;

  • The cost of getting greener

  • Making sense of sustainability targets

  • Metrics and data - embracing digitisation

  • Quantifying the green credential opportunity

You will hear case studies of small, medium and large enterprise business (like yours) which are making real progress and gain an understanding of what sustainable green policies could like. Join this session to learn how to move your energy management strategy into the 21st century! This webinar is part of our 'Energy Management Predictions 2017’' In Focus track on Engerati. Follow this link for more insights!

Further reading

IEMA-“Beyond The Perfect Storm: The Corporate Sustainability Challenge”.

 

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