Everywhere you look brands large and small are touting their environmental sustainability programs. Time after time, those organizations that strategically and holistically manage sustainability programs are reaping the benefits. But, it’s no accident that some companies succeed and others find themselves being branded as a “greenwasher.” In order to ensure that you’re leading your organization down the right path, let’s review five key elements of a successful sustainability program.
1. Leadership Starts at the Top
A change as significant as this requires a fully engaged and committed C suite. Every aspect of the organization will be effected and without the leadership, understanding, and dedication of the CEO, CFO, and others, senior management and the rest of the company will view the sustainability program as not core to the business and, thus, not worth much of their time.
A CEO, for example, who believes that sustainability is key to the long-term success of the organization, can help drive change and innovation that form the foundation for long-term growth. An oft-cited example is Ray Anderson at InterfaceFlor. A pioneer and visionary in corporate sustainability, Mr. Anderson has created a powerful brand position for his company while demonstrating quarter after quarter the profitable impact of setting and achieving sustainability goals.
2. Clear and Measurable Goals
Leaders must establish why the organization should strive for sustainability. Once the strategic reasons are identified, use them to set clear and measurable goals. And as the goals are achieved, new goals should be set to constantly drive the organization forward.
As with every other vital program, when communicating to the employees, supply chain, and stakeholders, program initiatives are more likely to stay on track if everyone understands where the company intends to go with the program, why it matters, and the consequences of success or failure.
There is no “right” way to be sustainable; opportunities exist across all aspects of business: business process, product development, distribution, manufacturing, etc. With so many aspects of the organization involved, it is vital to engage all employees and stakeholders. By encouraging participation at every level, more opportunities will be identified along with suggestions for improvements.
In order to adequately measure energy use, water consumption, green house gas emissions and other important impacts companies should conduct Life Cycle Assessments (LCAs). A well-executed LCA will quantify specific impacts and areas within a product’s life cycle where improvements can be made. For example, when Wal-Mart was working to reduce its transportation footprint, the company, having determined that most of the weight in laundry detergent was from water, told its suppliers that it would only stock concentrated formula detergent. The concomitant reduction in weight helped reduce shipping costs and environmental impact.
3. Tie Compensation to Success
Think about what would happen if a business unit failed to meet profitability, or growth metrics. Sustainability needs to be treated in the same manner as profitability–in fact, the two are often linked. Consider implementing incentives for meeting sustainability goals within compensation packages alongside those for growth and profit. If achieving the organization’s sustainability initiative is important, it should be reflected in compensation.
Recognizing employee sustainability contributions via compensation is a clear way to reward and drive success and improve results for the company. Organizations that have successfully executed sustainability goals often gain additional benefits. Besides increased profitability, many companies have found that a focus on sustainability attracts new young talent and increases employee loyalty, productivity and job satisfaction. This is not to say that if you spend a little money on a sustainability program, all employees will be loyal, but rather that organizations that value and build sustainability over time attract employees that also value those commitments
4. Embrace Sustainability for the Long Term
One of the most important facets that a corporate leader should understand about sustainability is that it is not a fad nor one-time program. Sustainability is a path, not a quick fix or gimmick. Sustainability requires a shift in perspective and action.
Organizations that use marketing and PR departments to paint unauthentic programs as green will ultimately fail to craft a lasting sustainable brand and could find themselves pilloried by the media and consumers. At the core of a successful program are transparency, honesty, and trust; all of which companies must build in an ongoing effort, not a marketing campaign. Greenwashing will only lead to brand equity erosion.
5. Communicate Success and Failures
The hallmark of a successful sustainability program is communication. Communicating where the organization is meeting its goals, where it’s falling short, and how it plans to bridge the gap with a program of consistent and transparent disclosures will go a long way towards building trust and confidence with employees, consumers, and investors.
Develop a reporting method that works for your company. WalMart holds global sustainability milestone meetings that are broadcast worldwide. Patagonia’s Footprint Chronicles work very well too. Patagonia built an interactive website to detail successes and failures and encourage consumer feedback. These programs have helped these companies build brand equity and respect among consumers not for achieving perfection but for their efforts to improve manufacturing, distribution, and other activities that have environmental and social impacts.
Once you’ve changed the paradigm of your organization and sustainability is integrated into every level, process, and function, the rewards will be well worth the effort. A committed leader will find sustainability has improved the organization’s financial performance, engendered more loyal employees and customers, and is helping the company outperform its peers. Building a more sustainable organization is good for the planet and the bottom line.
Paul Raybin is Chief Sustainability Officer and Chief Marketing Officer of AirDye Solutions.