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5 Drivers for sustainability leadership and enhanced competitiveness

Wednesday, July 4, 2018

Integration, capacity building, collaboration, transparency and regulation are the 5 main drivers for sustainability leadership, in turn leading to competitiveness.

By Stefan Crets, Executive Director, CSR Europe

Recently I attended a seminar on sustainability organised by Business Europe, the federation of 34 national business associations in Europe. It was a well-attended event and a great opportunity to explore a business agenda on sustainability as seen by the federation. The programme indicated a clear link between sustainability and competitiveness, and the topics chosen were much in line with the November 2017 Business Europe paper “A business agenda on sustainability”.

At CSR Europe we put emphasis on the link between sustainability and competitiveness. Our core belief is that sustainability is becoming an even more important driver for competitiveness than before. This belief is part of the core DNA of our organisation and our members as expressed in our vision and mission. In Europe we have the technology, the innovation power, the skills and expertise, the values and the creativity to leverage this and become a leaders in global growth and prosperity.

The dialogue at Business Europe gave me a deeper insight on the 5 drivers that establish this leadership.

  1. The integration driver. The integration of sustainability challenges and opportunities in company strategies goes well beyond cost efficiency and risk mitigation. Above all, it is about R&D towards new products and services, manufacturing approaches, and relations with customers and stakeholders. Large companies like Henkel and Norsk Hydro explained their approach, but the most compelling case was made by Ingrid Lietaer from the Belgian SME “European Spinning Group”, where she explained how their focus on quality and sustainability helped them to secure public procurement contracts in a very competitive market.
  2. The capacity building driver. Companies cannot act in isolation – strengthening the competitive advantage depends on the quality and sustainability of their eco-systems. All stages of the business value chain need to take this into consideration and build capacity to tackle sustainability challenges and to find innovative solutions. More interaction and collaboration is required for leading companies to be able to deliver on their sustainability promise.
  3. The collaboration driver. This is directly linked to the ‘capacity building driver’. Impact can be achieved by working together within the value chain or with competitors. However, this may not always be easy and due to free-rider and timing issues. European and local policymakers must understand this and focus on creating practical frameworks that stimulate and reward such collaborative efforts. At CSR Europe, we are involved in many practical collaboration initiatives, like in the automotive industry (Drive Sustainability), the rubber sector, the aluminium sector and the cobalt sector.
  4. The transparency driver. Transparency enhances leadership.  It stimulates internal change and improvement, and helps to secure a level playing field. Reporting is a means to an end, a way to engage stakeholders and build trust. Another interesting initiative is the ‘Tax Transparency to responsible Tax Behaviour’ project.
  5. The regulation driver.  Regulation needs to be precise, smart, impact-driven and based on a balanced consideration. Regulation - without bureaucratic burden - is not the least important for assuring the level playing field.

Europe can be a leading , inclusive and sustainable economy that provides prosperity to its citizens and future generations. Sustainability can be the key differentiator in the globalised economy, where other regions like China are catching up on this agenda too. We need to engage all 5 drivers to keep up the pace and lead the way.

More articles by Stefan Crets