Elevating corporate sustainability to create impact

In the ever-changing business landscape, adaptability is key. The term ‘sustainable’ has evolved beyond carbon emissions and fuel sources, expanding its scope to redefine corporate development.

Over the last decade, substantial economic shifts have reshaped business paradigms, pushing companies to create value beyond mere profitability.

Today’s critical need is crafting strategies that not only mitigate negative impacts but actively contribute positively to society and the environment.

Creating value is now a business imperative

A sustainable business strategy goes beyond immediate gains, striving to create enduring value for the business, stakeholders, and society.

Synthesising the four P’s – people, planet, profit, and policy – and harmonising economic growth, social inclusion and environmental protection, is crucial for success.

According to a McKinsey study, companies which outperform their competitors in ESG, are more than twice as likely to grow revenues by more than 10 per cent. Additionally, according to a study, 77 per cent of companies see an increase in customer loyalty with their sustainability initiatives.

Moreover, 64 per cent of respondents surveyed have adopted a formal ESG strategy, indicating a growing trend towards sustainability integration in business practices. Good ESG practices are based on setting targets that are anchored in the core practices of a company.

Varied studies indicate that a sustainability agenda should be a priority for CEOs and boards, with more than 60 per cent of survey respondents of the view that they should spend more time on ESG-related issues, according to PwC Middle East.

Strategies should not only address current needs but also safeguard and augment future requirements. Reflecting on and embedding sustainability into core business objectives is a challenge every leader must confront.

Effectively incorporating sustainability requires taking note of customer needs and building a reputation as responsible corporate citizens fostering positive change.

Strategic foresight must evolve and adapt

A successful strategy hinges on asking the right questions. This also requires the analysis of a company’s strengths and weaknesses. To ensure profitability, businesses should create a clear outline of their vision and also lay out transparent policy guidelines.

The most effective strategies are aligned with the core business objectives and lean towards enhancing the social and environmental impact.

Each company must chart its course towards corporate sustainability by listening internally and externally. An outside-in approach warrants that businesses are in tune with the demands of the stakeholders and allows the management to introspect and define the company’s culture – what it stands for and how to measure success.

The second approach is to develop the right mix of metrics to gauge sustainability efforts. Goals must be reflected through actions. Businesses need to think long-term so that their efforts are in the right direction and the correct procedures are in place.

An organisation’s purpose forms another part of the strategy. Implementing sustainability practices can be challenging. Businesses need to consider involving stakeholders, employees and communities. It is a lot easier to develop thorough tactics incorporating stakeholder feedback which is a realistic way of improving policies and processes.

Embracing circular economy practices is essential for any organisation. This extends beyond internal operations to eco-friendly supply chain practices, focusing on the triple bottom line approach (environmental, social and economic performance) to consider community and stakeholder impact.

UAE free zones – a catalyst for sustainability?

The UAE provides a very conducive environment for sustainable practices, with robust support from the government and collaborations between public and private sectors.

Free zones have been pivotal in UAE’s economic growth and are uniquely positioned to drive business innovation and investment. Companies operating in these zones can gain a competitive advantage by integrating sustainability from the ground up.

In this pursuit, free zones emerge as catalysts for positive change and achieve a competitive advantage.

We have a dedicated division called IFZA Cares which supports communities, protects the environment, and fosters a culture of ethical and sustainable business practices.

The company also actively seeks partnerships, and amplifies its efforts towards promoting sustainability, setting a precedent for positive change.

Corporate sustainability as a critical component of core business processes is here to stay. It is not a fleeting trend; but a continuous commitment to change.

Organisations which foster a culture of sustainability stand as a beacon for others looking to make a meaningful impact on the world while ensuring long-term success.

The writer is the head of ESG at IFZA.