Why sustainability should be the business strategy – reflections on PwC’s latest CEO Survey
As a CR and Sustainability consultancy we were interested to read PwC’s 21st CEO Survey 2018 which reveals that despite having optimism in the global economy, CEOs’ anxiety is rising on a far broader range of business, social and economic threats.
According to the Survey, CEOs are ‘extremely concerned’ about geopolitical uncertainty (40%), cyber threats (40%), terrorism (41%), availability of key skills (38%) and populism (35%). These threats outpace familiar concerns about business growth prospects such as exchange rate volatility (29%) and changing consumer behaviour.
The rise of these concerns demonstrates that we are living in an increasingly fractured world and is precisely why sustainability is best placed to help businesses meet these challenges of a fractured world.
It would appear that this level of concern by CEOs is being driven by broader societal and geopolitical change, as opposed to being rooted in leaders’ own business markets. This suggests that CEOs’ long-term confidence in revenue growth is facing threats that the business world simply hasn’t had enough significant or direct experience of addressing. It is interesting to read in the report for example that CEOs are now divided over whether future economic growth will benefit the many or the few, and that they see the world moving towards new, multifaceted metrics to measure prosperity. It is worth highlighting the parallel with sustainability which drives companies to take account of the full cost involved in doing business – by using different metrics to measure the social and environmental performance of the corporation over a period of time, alongside the financial metrics, to measure the success and value of the company.
Simply put, sustainability is that strategic business approach which creates long-term value by taking into consideration how a given organisation operates in the ecological, social and economic environment. It is built on the assumption that developing such strategies fosters company longevity. It also encourages companies to consider and take action on a far broader range of issues – that will affect company value over time. In short, it requires and develops a different mind-set among leaders which enables them to prepare for and handle a broader range of threats and to see the opportunities.
It is therefore vital for companies to ensure that that the strategy of the company and its sustainability approach are closely aligned. Or even better, that they are one in the same.
And now, more than ever, is the time for the CEO to drive this. After all, what CEO wouldn’t want their business to be in it for the long-term?
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