According to a recent survey by Accenture, sustainability has emerged as the “new digital” for businesses—an essential investment that can drive innovation, unlock efficiencies, and create a competitive advantage. The question seems to be, “Is sustainability the new digital Accenture?”
Sustainability has gone from a fringe issue to a top priority for businesses worldwide. With climate change threats mounting, stakeholders ranging from customers to regulators are pressuring companies to reduce their environmental footprints and operate responsibly. Pressure due to massive awareness has been created.
At the same time, the COVID-19 pandemic has underscored the interconnectedness of our world and the importance of building more equitable and resilient systems. More companies realize that sustainability is an ethical imperative and a business opportunity.
What does “Sustainability is the New Digital” mean? This catchphrase captures how sustainability is becoming integral to business success in the 21st century, much like digital transformation.
The three key ways sustainability is changing business:
- Driving Innovation: Sustainability challenges companies to find innovative solutions, from developing electric vehicles to designing packaging with recycled plastics. Many of the most groundbreaking innovations today unlock business value while reducing environmental impacts.
- Uncovering Efficiencies: Sustainability initiatives like installing renewable energy or reducing waste force businesses to critically examine their operations. This often reveals inefficiencies that, when addressed, cut costs substantially. Energy efficiency investments alone could save industries over $700 billion globally.
- Creating Value: Consumers, employees, and investors are increasingly factoring sustainability into purchasing and investment decisions. Companies that get ahead of the curve can attract top talent, customer loyalty, and investment capital, building competitive resilience.
The five ways leading companies are embedding sustainability intrinsically into their business strategy and operations are:
- Setting Ambitious Goals: Leaders are setting ambitious, science-based targets to reach net-zero emissions, 100% renewable energy, zero waste, and sustainable sourcing. This creates a north star to guide investments and innovation.
- Investing in Green Tech: Companies are heavily investing in emerging technologies that drive sustainability, from renewable energy storage to carbon removal solutions. Microsoft has committed $1 billion to carbon reduction technologies.
- Greening Supply Chains: Leading firms work closely with suppliers to reduce emissions across their supply chain. Walmart aims to get suppliers to cut a billion tons of GHG emissions by 2030.
- Making It Central to Governance: Sustainability is becoming part of companies’ governance models through dedicated teams, executive-level sustainability positions, and tying incentives to green goals.
- Embedding Into All Functions: Sustainability can no longer be a peripheral function. Companies are embedding it into everything from products to facilities to procurement.
However, for businesses, if it does not show any profit, it becomes a decorative click-read on their website or in their wonderfully crafted business report. So, what are the compelling reasons for most companies to start with sustainability?
- Reduced Costs: Efficient energy, water, and resource use cut operating costs.
- Increased Sales: 48% of consumers buy from brands based on a sustainability reputation.
- Attracting Talent: 92% of millennials would work for a sustainable company over a non-sustainable one.
- Driving Innovation: Constraints spur creative problem-solving, revealing new opportunities.
- Building Resilience: Mitigating environmental risks and impacts creates more durable operations.
- Enhancing Reputation: Sustainable brands outperform the stock market by up to 25%.
- Future-Proofing: Transitioning to green business models provides a competitive edge moving forward.
In my opinion, sustainability is no longer a side armor or a “nice-to-have” décor. It is becoming as essential to competitiveness as digital transformation was in the past decade.
The next frontier will be figuring out how to embed sustainability into the core of business strategy and culture. It requires a fundamental shift but promises to unlock innovation and share value creation to define the economy of the future.
Sustainability is not just an option anymore but is quickly transitioning to a business imperative.