‘Sustainability’ has become a bit of a buzzword. But unlike so many other buzzwords that come and go, sustainability is here to stay.
Climate change is happening before our eyes. Extreme events such as storms, flash flooding and fires are just some examples of global warming that we’ve seen in recent years. And according to NASA, there’s a 95% probability that human activity is causing the planet to get warmer.
Equally, poor quality employment remains a major issue for global labour markets despite progress in reducing unemployment. A 2019 report by the International Labour Organization found that millions of people worldwide are forced to accept inadequate working conditions.
Considering the impact of globalisation
Globalisation hasn’t exactly helped the fight for sustainability. International trade and travel combined with increased consumption and mass production have undoubtedly contributed to the problem. Thanks to a business environment that prioritises rapid production and turnover of products for maximum profits, we’re set to produce 27 billion tonnes of solid waste by 2050.
This increase in trade, migration and investment across borders also has a direct impact on workers in both developed and developing countries. And in recent years, large global corporations exploiting cheap labour from countries with less focus on workers’ rights have come under increased scrutiny.
Fortunately, things are changing. Consumers are demanding greater transparency, and organisations are recognising the need to act on sustainability and meet corporate responsibility expectations. Once somewhat obscure positions, roles such as ‘director of sustainability’ are now being filled by almost every Fortune 500 company, and many global businesses are implementing specific sustainability strategies.
These strategies are designed to foster company longevity. An environmentally aware business considers far more than just profits — it considers how it operates in the ecological, social and economic environment.
Committing to change
Operating a sustainable business is undoubtedly more challenging for global companies with interests in multiple jurisdictions. But these international organisations also have the biggest impact; they need to do their bit.
Sustainability starts with a commitment to do better (largely by addressing material issues and improving transparency). Every individual can take steps to live a more sustainable life. But when it comes to enhancing business sustainability, a few key stakeholders are in the best position to action change: board members, business owners, organisational leaders, and HR teams.
Setting up a sustainability committee can help to create accountability and promote a culture of sustainability. Many companies are also encouraging green commuting or ‘going digital’ by using technology such as computers and smartphones to minimise paper waste. However, one of the best ways businesses can reduce their carbon footprint is to offer remote work options (ideal for global teams). The 3.9 million employees working from home before the pandemic were equivalent to taking 600,000 off the road for a year. Imagine what that stat looks like now…
When it comes to supply chains, global companies are also taking positive steps. Many household names are encouraging collaboration across their supply chains to increase resource productivity, optimise material usage and reduce waste. FMCG (fast-moving consumer goods) brands are focusing on water stewardship and setting targets on water replenishment. Manufacturers have made strides in energy efficiency and pollution reduction. And fast-fashion brands are targeting specific issues like dyeing and plastic use, as well as addressing local labour conditions with suppliers from emerging markets.
Not only can these sustainability initiatives help to meet consumer expectations and increase efficiency, but they can also add brand value and give companies a competitive advantage.
Falling through the gaps
To address sustainability appropriately, there are two gaps that companies need to be aware of. Firstly, there’s a big difference between knowing and doing. Despite 90% of executives believing sustainability is important, only 60% of companies have a sustainability strategy. Businesses often talk about being sustainable but fall short when it comes to implementation — perhaps because CEOs and corporate boards are not as engaged as they should be. However, good intentions are no longer enough.
Then there’s the issue of competitive advantage versus compliance. Many companies push through material sustainability initiatives because they see it as an area of competitive advantage. But they, first and foremost, need to address compliance, including regulations on pollution, waste management and labour laws.
The global businesses that stand out when it comes to sustainability are those that address both gaps and ‘walk the walk’ — not just ‘talk the talk’.
A PEO can ensure compliance and sustainability remain at the forefront of your global expansion journey. Get in touch to find out more about our international employment services.