CREATING A SUSTAINABLE ORGANISATION

According to Google Trends, the term ‘sustainability’ has steadily grown in popularity worldwide since early 2022. Chartered Manager, Eman Deabil (DipESG, PfMP, IPMO-P, SIP), explains the concept and breaks down how we can create a sustainable organisation.

In my article published in last month’s edition of Woman This Month, I spoke about sustainability in general and the rise of the Chief Sustainability Officer (CSO) role. I also gave you a glimpse at the history of the GCC as far as ESG is concerned. In this edition, we will cover high-level plans on how to create a sustainable organisation by looking at the organisation’s operating model.

Before I put things into perspective, let’s first explore the terminologies below:

Sustainability: This is a broader concept of how to ensure driving value over a long period of time by looking at different aspects.

Environmental, Social, and Governance (ESG, for short): A term that was officially coined in 2004 with the publication of the United Nations report titled “Who Cares Wins”.

ESG normally represents the three pillars that we need to set plans and KPIs to ensure sustainability. It became the terminology used for the reporting side of sustainability. The three pillars, along with a few examples, are:

1. Environmental: Factors related to how an organisation has an impact on nature such as climate, carbon emissions, biodiversity, water, electricity, waste, and paper.

2. Social: Factors related to how an organisation manages its relationships with its employees, customers, suppliers, and communities where it operates, such as training, inclusion, diversity, and equality.

3. Governance: Factors related to how an organisation is led and managed, such as board independence, transparency, diversity, and whistleblowing.

In many publications and literature, both terminologies (i.e., ESG and Sustainability) are being used interchangeably, and here they will be used interchangeably as well.

Operating model: This defines how an organisation operates to achieve its objectives and deliver value to its customers. In general, it encompasses four main components: processes, organisation, technology and information (POTI).

Processes Organisation Technology Information

The set of activities that an organisation performs to deliver intended value to its customers, and everything that supports this such as policies and procedures.

The people within the organisation, their capabilities, their roles and responsibilities, the structure.

The systems and tools that support the organisation’s operations and enable it to achieve its objectives.

Insights and reports that the organisation uses to make informed decisions and improve its performance.

Below are a few steps to start the journey of building a sustainable organisation by looking at the operating model components. Having said that, these components are interrelated and overlap.

Now let’s look at the operating model with an ESG lens:

Environmental Social Governance

• Examine your value chain and make sure your processes are streamlined (be they manual or digital) to drive long-term value, enable operational excellence, and reduce operating costs.

Processes

• Adopt a circular economy model to move from a linear value-chain to a circular value chain.

• Improve the process, cut redundancies, automate workflows, and create a paperless environment.

• Adopt strategies to reduce carbon footprint: work from home, apply car-pooling for employees, work with local suppliers.

• Reduce, reuse, recycle materials wherever possible.

• Switch to eco-friendly products.

Establish awareness of the importance and urgency of ‘sustainability’, create relevant training programs, and build capabilities around climate change.

Engage relevant stakeholders and train them on how to adopt sustainable practices and follow seamless processes.

Adhere to regulatory requirements, controls, and best practices.

Set the required policies to ensure maximum transparency, accountability, fairness, and equality.

Acquire sustainable technology products (the ones that consume less electricity and reduce carbon emissions).

Look at the technological resources being utilized and optimize them.

Look for alternative ways to minimise the carbon emitted from technology.

Explore automation opportunities for repetitive tasks (using robotics, for instance) to reduce manual interventions and paper.

Create a culture that embraces diversity and encourages equal opportunities.

Set a process to reward the excellent performers and reprimand the underperformers (ESG objectives and deliverables).

Train employees on how to use the available technological resources.

Partner with local suppliers, vendors, and consultants.

Clarify the roles, responsibilities, and accountabilities as far as the ESG is concerned, and set clear job descriptions and expectations.

Use technology with the intention to increase transparency and accountability, by sharing information and tracking decisions. Automate processes and reduce potential human error.

Use technology to offer a level of security to combat cyber risks or data breaches.

Set clear ESG objectives, collect relevant KPIs, targets, and initiatives, and assign owners to measure the performance. Communicate and report the performance indicators to stakeholders on a regular basis (on a defined frequency), and in a transparent manner. Support the information with evidence.

Examine the information reported and assess where you stand vis-à-vis where you want to go (target), providing justifications if needed or propose corrective actions if deemed required.

The above is just a brief blueprint on how to create a sustainable organisation; however, with sustainability comes innovation. The more we believe in creating long-term value, the more we become innovative in coming up with ideas that serve this purpose.