This post was originally published on Green Biz
Source: Green Biz
The general business, sustainability, and DEI landscapes are increasingly tense, and in times like these, it’s not uncommon to instinctually choose from three basic responses: fight, flight, or play dead.
Some sustainability leaders and their companies will fight. They see climate change and DEI as core to their values, existential risks, or sources of value worth addressing. Others will take flight, sometimes because they never really understood the value of sustainability. As a result, CSOs and their teams have lost their jobs and commitments have been rescinded. While most of us will agree this is a shortsighted mistake, it’s not hard to understand why business leaders are afraid.
And then there’s the most common response: playing dead, which amounts to continuing the work but going quiet, especially externally, to avoid attracting undue attention and risk offending stakeholders or facing a backlash. This approach can make a lot of sense given the shifting ground, and predictability—the most valuable asset in the business world—is scarce.
All of these responses are rational. The question becomes which path to choose? Below are three steps for making the business case of sustainability and moving beyond basic instinct.
Find the tangible value
Leaders feel pressure every day to deliver outcomes. They must stand in front of their investors quarterly and reveal progress and setbacks related to profit, loss, revenue, cost control, market share and brand strength. A small, but growing number of leaders may include carbon emissions, water usage, and the odd social metric. However, profitability indicators reign supreme. So how do we help CEOs and boards navigate this moment in the context of their priority outcomes?
Instead of focusing on our commonly called upon force multipliers – regulation, supply chain engagement, reporting and policy advocacy – we need to return to fundamentals and recognize that sustainability programs deliver tangible value and our job as practitioners is to find and support that value creation. Our research has found companies that apply environmental sustainability concepts save millions of dollars in production costs and reach sales targets that support low emission energy, lower water use, and more circular approaches. Companies have boosted sales by featuring resource traceability that assured consumers that workers in the product’s supply chain were treated fairly.
We need our version of the “it’s the economy, stupid,” which is the business case. This means advancing the CSO as a strategic business partner who harnesses sustainability as a source of competitive advantage, brand differentiation and operational efficiency.
This isn’t about surrendering principles or becoming captive to corporate inertia. Rather, it means deeply engaging with the machinery and relationships that drive organizational decision-making. This approach doesn’t limit others; sometimes the short term business case is not there, and it’s still time to fight.
Identify competitive differentiation
To get the calculus right requires identifying strategic intersections where sustainability initiatives simultaneously advance business objectives and societal outcomes — positioning sustainability as a source of competitive differentiation and value creation. It means managing tensions and understanding the archetypes of sustainability value creation.
We need not view the business case as sacrificing true commitments to environmental and social impact. To the contrary, for years major architects of the ESG and sustainability movement have tried to get companies to spend “real money” on environment and social outcomes. Linking sustainability more directly to the profit engine will better persuade leaders to direct more capex and opex to sustainability than regulation and reporting can. As our “How to Set Sustainability Strategy in 2025” report discusses, companies have become crafty at managing regulatory and reporting workarounds.
Mix art and science
Of course, managing competing interests and tensions is not easy, and every day seems more of a tightrope act. But we have more going for us than we might think. While many have lamented the rise of reporting requirements, these have actually given us much better data upon which to base our decisions and make our case. Creative business leaders can use this data to see which programs are driving value and which aren’t
Sustainability has too long been like the famous saying about advertising where we know that half of it drives value – we just don’t know which half. Data-driven business cases solve this challenge. Discussions about sustainability-advantaged hurdle rates for investments — given their high rate of success compared to other riskier alternatives — are far more common than they once were. Marginal abatement cost curves are making a comeback in the presentations of sustainability teams. There will always be an art to creating the business case, but data provides a much more scientific foundation upon which to build.
The tension resulting from integration efforts makes the sustainability profession challenging. It’s relatively simple to critique from the sidelines, questioning why executives don’t prioritize long-term thinking. It’s far more challenging to earn a seat at the decision-making table, navigate complex trade-offs, occasionally accept suboptimal outcomes, and persistently work to advance sustainability as a driver of commercial success and societal progress. But that is, as they say, the job.
The post Fight or flight? The most powerful response is making the business case for sustainability appeared first on Trellis.
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