Waste management
Sustainability management: turning strategy into operational change
Give sustainability work clear ownership, an evidence-based business case and useful metrics so teams can translate strategy into everyday decisions.
Sustainability strategy becomes useful when it changes procurement, production and operational decisions. Give the work a clear owner, an evidence base and a route into normal business planning. This article sets out practical ways to connect management support with day-to-day action.
"Thinking about the present from the perspective of the future" - this is how Prof. Dr. René Schmidpeter outlines the challenges which companies will have to face during this decade. As Professor of Sustainable Management at the IU International University in Erfurt, he clearly considers sustainability to be a key issue for strategic management. Increasingly, more and more companies see it as their duty to prioritise sustainability, whether as a result of customer expectations, their own efforts or new regulations.
However, this prioritisation is not always easy. Too often, measures which started with strong motivation fail to materialise. Process adjustments are met with resistance from within the company. As much as the topic of sustainability represents an opportunity, it is also often associated with a paradigm shift that deeply affects the corporate culture and substance and thus proves to be a hurdle.
How do European companies succeed in tackling this challenge? How can stakeholders, from management to employees, be convinced of the relevance of the issue? And what are the advantages of investing in sustainability now?
Give sustainability a clear role in your organisation
Start by mapping who makes decisions about materials, suppliers and investment in your organisation. Sustainability work needs access to those decisions, not just a reporting role. Identify the teams whose actions can influence the outcomes you want to improve.
For a historical example of disclosure analysis, explore the Resourcify Sustainability Index 2022. Its findings describe the study period rather than current company performance.
Match the scope of the programme to the people and time available. Define responsibilities across procurement, operations, finance and leadership so that evidence gathering and operational changes do not fall on one sustainability role alone.
Build a shared vocabulary for the measures you use. Teams should understand the difference between reuse, recycling, other recovery and disposal, and between measured results and estimates. Written definitions make cross-site comparisons more useful.
The current state of sustainability is also not dissimilar to the early phase of digitalisation. Change is inevitable - but strategic thinking still too often lacks the conviction that sustainability as a success factor for the future is a core area of entrepreneurial action.
Just a Trendy Topic? Sustainability and Leadership
There is no doubt that sustainability is a current buzzword in the European and international economy. However, the hurdles that companies face should not be underestimated. After all, sustainability is by definition an overarching discipline. "Sustainability can be found in all areas of our company," reports Stefan Kauß, sustainability manager at the Bitburger Brewery Group, citing raw material purchasing, resource consumption and employee training, among other things. "And we must not lose sight of the fact that we also have to think and act economically in all of this."
Professor Schmidpeter precisely points out this supposed contradiction between sustainability and profitability. "Sustainability does not mean less, but rather more profit and success," he stated in an interview with the PR company Cision. However, on the contrary: "Sustainability is the polar star that sets the direction in which profits can be made at all in the future." Sustainable management must be the new mindset for companies as a means of getting rid of its contradictory connotation. This applies above all to companies involved in the stock exchange, for example DAX companies.
A credible proposal includes implementation effort as well as expected benefits. Assign a budget, record dependencies and agree how progress will be reviewed. Where data is incomplete, use a small pilot to test the assumptions before asking the business to scale the change.
This latter challenge works in tandem with the area of finance which is a major concern. Ingo Speich, Head of Sustainability & Corporate Governance at the Deka Group, explains with regard to the financial sector: "We are currently seeing a sensitisation of customers in the market with regard to sustainability issues. So what strategies can sustainability managers and other stakeholders use to convince company management of the importance of the issue?”
Convince Management, Motivate Employees: 4 Strategies for More Sustainability in Companies
Sustainability managers often fight on two fronts at the same time: on the one hand, they have to convince management to provide them with sufficient resources and decision-making power on a continuing basis. On the other hand, they have to motivate employees in all areas to implement measures consistently. With these 4 strategies, the balancing act can be achieved.
1. Demonstrate Advantages of Sustainability
Sustainability becomes more tangible for both management and staff when investments in this area are reflected in tangible benefits. These can include:
- Positioning as an industry leader with customers, stakeholders and competitors
- Securing future viability through crisis prevention and long-term competitive advantages
- Increased returns through process optimisation and responsible use of resources
- Attractiveness as an employer
- Preventive, not just reactive, compliance with legal requirements
Successfully communicating these and other benefits can be achieved with the help of non-financial KPIs, among other things.
2. Measure Successes - and Celebrate Them
Choose metrics that serve a specific decision or applicable reporting requirement. Define the source, calculation, owner and review period for each one. A few reliable measures that teams act on are more useful than a dashboard full of numbers without a clear purpose.
3. Define Responsibilities
Establishing the role of sustainability manager is not enough: employees from all areas must be involved in sustainability processes so that long-term change is possible. A crucial part of this onboarding is the concrete definition of tasks and responsibilities. Only when everyone involved is fully aware of the contribution they can and must make to corporate sustainability will success be possible at all management levels.
4. Communicate Commitment - Internally and Externally
To further strengthen the strategic role of sustainability, companies must communicate it consistently. Communication around sustainability issues is not a one-way street - honest feedback from customers and employees can reveal gaps in the process and contribute to optimisation. Another key factor, however, is to demonstrate commitment with the help of concrete goals and their achievement, in reporting as well as in internal communication.
Prioritise Sustainability Now and Ensure Long-Term Entrepreneurial Success
"Investors have long since recognised that the risk-adjusted returns of sustainable companies are higher than those of others", is how Prof. Dr Schmidpeter sums it up. The management of companies of all sizes, from large corporations to SMEs, is thus under pressure to act. The faster measures can be taken to ensure sustainability in the long term, the greater the potential competitive advantages.
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