Creating Sustainable Value

Just as the creation of shareholder value requires performance on multiple dimensions, the global challenges associated with sustainable development are also multifaceted, involving economic, social, and environmental concerns. Indeed, these challenges have implications for virtually every aspect of a firm’s strategy and business model. Yet, most managers frame sustainable development not as a multidimensional opportunity, but rather as a one-dimensional nuisance, involving regulations, added cost, and liability. This approach leaves firms ill-equipped to deal with the issue in a strategic manner. – Stuart L. Hart and Mark B. Milstein

As the world heats up! Literally! So does the buzz around ESG investments, Tripple Bottom Line, Sustainability, Sustainable Value Creation, Circular Economy, and bunch of other key metrics.

Though these should not have been a fad or cyclical in nature but turns out, they are. Each year, companies look determined to adapt sustainable business practices, and the determination falls out like the new year’s resolution. Though we are left with some more sustainable companies, but clearly with each passing day, month and year, the world needs more sustainable companies, value creators, excelling the triple bottom line and championing circular economy like never before.

A sustainable enterprise, therefore, is one that contributes to sustainable development by delivering simultaneously economic, social, and environmental benefits—the so-called triple bottom line. For some managers, it is a moral mandate; for others, a legal requirement. For still others, sustainability is perceived as a cost of doing business—a necessary evil to maintain legitimacy and right to operate.

A few firms have begun to frame sustainability as a business opportunity, offering avenues for lowering cost and risk, or even growing revenues and market share through innovation. We at Volition attempt to broaden the sustainability drivers and dwell deeper into them.