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Wake up call for businesses: sustainability progress remains slow

 
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In a wake-up call for companies, a UN Global Compact survey found a big gap between what firms say and what they do. Photograph: Getty

 

Powered by Guardian.co.ukThis article titled “Wake up call for businesses: sustainability progress remains slow” was written by Jo Confino, for theguardian.com on Thursday 5th September 2013 12.05 UTC

If you’re under the illusion that sustainability is already embedded into the corporate sector, then it’s time to wake up and smell the coffee.

A comprehensive survey of 1,712 corporate members of the United Nations Global Compact from 113 countries shows that while increasing numbers of chief executives recognise the need to change, they are not following through with concrete actions.

UN secretary-general Ban Ki-Moon gave the business community a ticking off when he wrote of the survey results: “While UN Global Compact participants are on a good track in terms of high-level commitments and goal-setting, much more needs to be done to deepen sustainability efforts in how they think and act, from boardrooms to supply chains.”

The limited progress comes despite a warning from the UNGC, the world’s largest sustainability membership organisation, that turning a blind eye to sustainability issues is a “ticking time bomb”.

Companies also don’t yet seem to fully recognise the benefits and opportunities of embracing corporate sustainability, which the UNGC says “are clear and appealing”.

GSB Report 2013When you stand back, what’s particularly worrying is that less than a quarter of UNGC’s corporate members filled in the anonymous annual online implementation questionnaire. And those members represent a tiny percentage of the 70,000 multinationals – and millions of smaller enterprises – around the world, many of whom are doing little, if anything, to shift from business as usual.

As the report states: “There is still a long way to go until companies everywhere put principles into practice. Even those committed to sustainability still have a long journey ahead to fully embed responsible practices into their strategies, operations and culture.”

That said, the UNGC reports modest progress in many areas. It’s true that companies are on a journey. They need to win high-level board buy-in before they have any hope of implementing a triple-bottom-line approach.

But the essential problem is that we just don’t have the time to allow change to happen in a slow, incremental way if we’re going to avoid what many experts see as a looming environmental and social catastrophe.

Huge difference between ‘saying’ and ‘doing’

Enough generalities; let’s turn to the enormous amount of valuable detail in the report.

The gap between what companies “say” and “do” is enormous. For example, while nearly two-thirds of respondents claim to evaluate sustainability policies and strategies at the CEO level, only around a third train managers to integrate these into their work.

Nearly nine in 10 of company boards say they discuss and act on sustainability issues, but a mere 8% link their remuneration packages to social, environmental and governance performance.

Let’s clunk down another level and probe – in more detail – just one of the issues the survey covers: supply chain management.

Just over half of the companies include sustainability expectations in supplier documents, but less than a fifth actually do anything to help those companies set and review their goals – and only 9% verify any remediation activities.

Only slightly more than one in 10 put their money where their mouth is by providing suppliers with resources for improvement projects, while less than a third even bother to review publicly available information.

Still worse, company performance on supply chain management hasn’t improved for several years.

“Even those actions that scored relatively higher (in the 30% range), such as training procurement staff on corporate responsibility and self-assessments, have remained in neutral for years,” according to the report. “Around the globe, there is a need to drastically shift supplier practices. With higher levels of engagement in supply chain sustainability, companies can create a ripple effect.”

Sustainability not penetrating core corporate culture

Other survey results show that sustainability isn’t being integrated into the core culture of companies. It’s especially worrying that only 29% of respondents claim to align their lobbying to their sustainability objectives.

 

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