Responsibility has shifted from reporting to the core of our business strategy, and it will make our way of burdening nature more sustainable, writes Kaisa Hietala, a columnist at HS Vision.
In 1985 marked the beginning of the golden age of corporate responsibility reporting. That’s when the international chemical industry’s Responsible Care program was born.
The volunteer program became familiar with its fine logo, with two palms protecting the atoms connected together. The program was introduced by industry players, and soon the logo was featured in reports from several companies.
With the help of Responsible Care, companies in the chemical industry created uniform indicators and operating models for the industry. They promoted environmentally friendly and safe operations in addition to existing legislation.
in the 1990’s listed companies, especially in heavy industry, hired environmental experts to set goals and measure and analyze the company’s environmental impact. The number of pages in the environmental reports swelled to the level of the annual reports, and the best were awarded at ceremonies.
The companies laid a strong foundation for knowing the environmental impact of their own operations, but a large expense item arose for these companies, for which the CFOs asked for a refund.
21st century in the first half, responsibility expanded from reports to brands. Consumers have noticed that various certifications, such as the Swan Label, are becoming more common in product marketing. Companies promised to compete with their particular product as the “most responsible choice”.
The competition for the greenest brand saw excesses but also very successful campaigns. Many remember how brand colors changed from stable blue to more modern greenery and corporate slogans became themes that valued nature and the environment.
Companies wanted to tell their customers and stakeholders that in addition to making a profit, they also pay attention to responsibility.
It seemed that one after another, the companies wanted to take part in the work for a better world. Good. However, the added value of a responsible brand was difficult to measure in euros, even though investments in responsibility only increased in the 2010s.
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New players ingeniously combine business and responsibility while creating growth, jobs and a better world.
Next a development in the evolution of corporate responsibility brought to the table of management teams various technology and product development ideas on how to make the company’s products less environmentally friendly.
Companies justified investment in production and product development by cost savings or increased sales. Gradually, value began to be found to take into account the interests of the environment instead of the previous expense item.
New technologies made it possible to bring digitalization to help as some companies went on to sell a service instead of a product. Here, too, one of the back ideas was to reduce waste of resources and improve efficiency.
Responsibility began to shift from reporting and brand support functions to the everyday life of companies’ product development and production management.
At the moment the journey of responsibility continues to drive growth as nature forces us to change. Significant new growth drivers emerging around responsibility, such as energy transit, the bioeconomy and the circular economy, are creating growth opportunities for companies.
There are industries that are facing the creation of completely new sources of growth, with old products even becoming unnecessary in the future – a good example being the replacement of plastic packaging with cardboard.
At the same time, these growth drivers are forcing new players to gain a foothold in traditional markets. They bring with them new products, solutions or services such as heat pumps or urban fillers. These actors ingeniously combine business and responsibility while creating growth, jobs and a better world.
Surpluses or failures will not be avoided in the future either, but today responsibility is moving to the core of a business strategy where shareholders and companies see it as an income and not just an expense item.
Direction is right. Pioneer companies, such as the Finnish startups Betolar and Tracegrow, are boldly paving the way. They reshape the market, define new value for natural resources, reduce the waste of virgin materials and reduce CO2 emissions. They create a profitable business that at the same time makes the way we load or use nature more sustainable. Profitable business, on the other hand, attracts investors to become acquainted with solving the world’s major challenges.
This positive spiral is generating more investment in science, the business world and our society. Money is turning in a more sustainable direction and accelerating the thinking that profitable business and responsibility will fit well into the same sentence in the future.
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