Sustainability…

…is a business approach

Sustainability is a business approach that seeks to build long-run competitiveness without compromising short-term profitability and cash flows. Like any business strategy, it focuses on managing risk, building brand and reputation, enhancing market access and driving competitiveness through efficiency and innovation.

…is not business-as-usual

Sustainability differs from business-as-usual in the extent to which it is informed by an appreciation of the radical transition presently underway in the global economy and the natural and social systems it depends on. We define sustainability as ‘an approach to creating value that sustains or enhances the systems on which that value depends’.

…is measured by impact and agility

Selecting performance indicators for sustainability requires an analysis of the risks and opportunities of moving towards and into transition, as well as an assessment of the impact of the business on society. In addition to reflecting on its net value contribution, sustainability should provide an indication of the organisation’s capacity to operate in times of significant change. Sustainability competence (or agility) is increasingly being explored by analysts and investors as a material investment criterion.

…is different to Corporate Social Responsibility (CSR)

While some regard CSR as synonymous with sustainability, we see a distinction. CSR is largely concerned with managing the impact of the business strategy on society and the environment, while sustainability is largely about shifting the business strategy to ensure long run competitiveness.  This distinction is evident in performance measurement which for CSR focuses primarily on societal impact, usually framed in terms of the ‘triple bottom line’ (social, environmental, economic issues). CSR can, however, make a valuable contribution to sustainability strategy if appropriately used as a consumer-facing or brand strategy.

…should not be confused with Corporate Social Investment (CSI)

CSI is one of many tools used in Corporate Social Responsibility.  It generally describes the percentage of post-tax profit that a company donates to social causes. It is typically measured as a percent of net profit after tax and less commonly as social return on investment (SROI).