Five key imperatives of CXOs to achieve business outcomes sustainably

In 2023, rapid response is the new baseline! Uncertainty is expected and complexity is compounding. As threats materialize on multiple fronts, organizations must reduce the time from insight to action. At the same time, companies are striving to achieve aggressive sustainability targets that require collaboration across aisles and ecosystems. As per a 2022 study done by the IBM Institute for Business Value, global CEOs named sustainability as the top challenge their organizations are expected to face over the next two to three years—rising from sixth place in 2021.

With the world already facing myriad challenges due to climate change, coupled with those brought about by the global pandemic, it is time for businesses/organizations across the world to step up and embrace sustainability. Sustainability has now come to be seen as a catalyst that defines new business models, as well as becoming core to the organization’s values. However, achieving sustainability while driving profitability is not easy.

Here are five key priorities that will help CXOs achieve their business goals sustainably in 2023.

• Digital transformation can play a significant role in driving sustainability by enabling organizations to operate more efficiently and sustainably. Organizations can achieve it by adopting digital technologies that can help automate processes, optimize resource utilization, and reduce waste, thereby minimizing the impact on the environment.

Adoption of digital and emerging technologies will also arm organizations with adequate data, enabling them to take better decisions, identify gaps and areas of inefficiency and track progress. Digital transformation also includes the adoption of green energy practices, especially decentralized energy generation through solar rooftop projects and microgrids. These measures will not just ensure that the businesses are self-reliant, but also reduces dependence on traditional energy sources.

• Innovation and collaboration are key parameters towards achieving sustainability. The development of new and innovative solutions to address the rising sustainability challenges, such as improving operational efficiency while conserving resources and reducing greenhouse gases, is the need of the hour. However, for this, collaboration is important.

Collaboration, that is multi-disciplinary and multi-sectoral, is crucial to promote sustainable practices and driving change at a systemic level. Innovation and collaboration can also help foster new business models, driving the development of new technologies and creating ample growth opportunities.

• Responsible supply chain management and embracing a circular economy will ensure that suppliers operate ethically and sustainably. This will also help minimize waste, and conserve resources, which will overall reduce the risks associated with environmental degradation, besides creating new business opportunities and jobs.

Responsible supply chain management also includes the use of digital tools to get better insights into supply chains and the environmental impact of products and services. All this calls for continuous engagement with suppliers and business partners in co-creation for improved sustainability solutions and ways of working.

• Engagement with employees, and hiring or retaining those with domain expertise can significantly contribute to an organization’s sustainability efforts, help build a more sustainable culture and drive progress. When employees are taken into confidence and informed about the organization’s vision and mission, they are more likely to take ownership of the sustainability initiatives and drive change.

Employee engagement programmes, including training and awareness drives, will go a long way in building a sustainability culture within the organization. Hiring and retaining those with domain expertise in sustainability can help drive the various initiatives forward and ensure that they are abreast of the best practices, latest technologies, and research.

Together with employee engagement, this will create an environment conducive to fostering innovation and creativity, and better decision-making.

• Organizational reporting and compliance are important components of an up-to-date and comprehensive sustainability strategy. This plays an important role as it not just supports organizations to operate sustainably and responsibly, but also goes a long way in safeguarding reputation and increasing brand value.

Companies that follow this are perceived as being responsible, trustworthy, transparent, and accountable by all stakeholders. Organizational reporting is just proof of the companies’ performance in the adoption of sustainable measures and initiatives. However, this also helps companies with evidence-based decision-making, identify areas for improvement and drive continuous progress towards sustainability goals. Organizations that fail in regulatory compliance stand to face not just penal, but also legal actions.

The five key priorities only demonstrate that working towards sustainability is tied to the success of businesses. They not just help organizations meet the demands of stakeholders, and increase operational efficiency, but also overall enhances their reputation. It is only by embracing sustainability, organizations can create long-term value for themselves and stay ahead of their competition.

-- Chittaranjan Meher, Country Leader, IBM Sustainability Software Business Unit, Technology Sales, India & South Asia.