Safety Sustainability Understanding the Business Value

Sustainability is a widely used term in business today. To some, it means a focus on environmental responsibility. For many in the corporate world, however, its meaning has moved beyond a single-minded focus on environmental responsibilities to include a business’s social and economic impacts. For example, many in the investment community track a company’s sustainable business practices and in so doing consider its environmental, social and governance (ESG) effects, such as water use, labor practices, carbon emissions and supply-chain management material to complete company valuations (Chouinard, Ellison & Ridgeway, 2011). In the context of this article, sustainability is used to refer to an organization’s environmental and social aspects. The term is further qualified to incorporate considerations for ESG and economic impacts as well as the commonly used phrase, “people, planet and profit.” Executives are increasingly adopting sustainability as a business strategy. It is embraced by more than 50% of member companies represented by the U.S. Business Roundtable (2012), an association of CEOs from leading U.S. companies with a combined $6 trillion in annual revenues and nearly 14 million employees. According to a 2010 McKinsey & Co. study of 1,946 executives, 50% consider sustainability “very” or “extremely” important to shaping corporate strategy, building reputation and brand, and informing product development.