Sustainability is becoming an integral part of many company’s philosophies. Just like a firm’s management practices, it is influencing the business value.
There has been a movement towards establishment of sustainability activities for large, medium and small enterprises.
In a recent study more than 89 percent of CEO’s confirmed that sustainability is fundamental to success of any business and there is clear evidence based on the amount of efforts that top management put towards sustainable strategies: such as developing sustainable products and services, creating sustainability departments and publishing sustainability reports, involving their stakeholders as part of the business ecosystem etc.
But what is sustainability? There are many versions. I will, however restrict myself to the definition provided by my friend Dr Michael Hopkins CEO at MHCi who defines it as that situation where activities undertaken by the business ensure that all the stakeholders are treated responsibly or ethically. This incorporates companies’ relationships to the natural environment, social causes, and the corporate governance are dealt with in a proactive way.
This means that companies must invest in decisions that impact people positively, benefit the environment and guarantees the sustainability of the project itself through profit creation.
The benefits of looking at your business from the three lenses of people, planet and profit are such as increased brand value, achievement of social licence to operate, cost cutting, increase in revenue as well as risk management.
A leading sustainable brand is one that generates demand- suits customers’ needs at the moment, influences buying behaviour by reducing risks, and develops a strong relationship with customers to its uniqueness, hence influencing their recurring purchases- a key factor to securing profits for the business.
A sustainability programme that is consistent with a brand positioning will create more value for its brands. Corporates have sought to increase competitive positioning by linking sustainability and corporate strategy.
Recently Brand Africa announced the top 100 brands in Africa in their 7th Annual Brand Africa 100: African’s best Brand.
In 2019, Where Nike, MTN (South Africa), Dangote (Dangote (Nigeria) Safaricom (Kenya), were the highest listed brands on sub-Saharan Africa’s leading bourses, the JSE, Nigeria Stock Exchange and Nairobi Securities Exchange respectively.
Looking into this top four brands, there is a common denominator, despite making a name for themselves in the top 100 brands, these companies have also embraced sustainability in their business strategy.
The writer is CEO, Kenya Climate Innovation Centre.