The need to reduce environmental impact, while generating social benefits and competitive advantage, is one of the main challenges facing companies today. For this, firms need to invest assertively in changing production processes to reduce greenhouse gas (GHG) emissions and optimize the use of resources, engaging society and employees so that adaptation is consolidated for the long term with no return. This is called sustainable transformation.

Sustainable transformation aims to satisfy current needs without compromising the possibilities of future generations. To achieve it, it is important to harmonize three fundamental elements: economic growth, social inclusion, and environmental protection.

Sustainable transformation requires an analysis of the production cycle, from obtaining raw materials, proceeding to the use of the product by the consumer and its final disposal. Replacing the energy matrix or incorporating the circular economy are examples widely seen. It means innovating with reused waste, making raw material for the company’s process, or even developing the reuse of waste generated from its process in another industrial sector through good environmental management in line with partnership. 

Sustainable transformation has the potential to generate carbon credits, that is, there is the possibility of monetizing this. It has a lot of value – it is a way to get a subsidy to make the implementation of measures economically viable and also to allow a consolidated advantage in the medium and long term. 

The carbon market depends not only on the engagement of companies and investors, but also on public policies that can encourage and subsidize it.

Companies are at different levels of their sustainable transformation – some are starting to inventory their carbon emissions, while others are already at the stage of implementing these measures to mitigate emissions, or even further ahead, monitoring the results of changes on the operation. 

In order for a business to lead in sustainability, the leaders should be fully on board. Willingness to take risks, commitment to the bigger picture and big investments are necessary to meet the critical sustainability targets.

Such leaderships know how to grasp the interplay between ESG issues and their business goals, this results in a clear, defines business case and can inspire action towards sustainable transformation across the company.

Most of the leaders that prioritize sustainability have made a mistake of isolating the work of transformation in one department. That is why leading sustainable companies integrate sustainability in to the business strategy. This makes it clear how sustainability focused investments can be connected to the business risk, growth, innovation, opportunity and growth.

It is also important to mention that sustainability and social impact targets should be added into the KPIs across all sectors of the business like manufacturing, HR or procurement.

To make sustainable transformation easier to optimize, money, needed time and resources become much more clear when the company has a defined mission, values and a larger purpose for existing. These questions can help the leaders bring this questions together:

• Why does sustainability matter to our company?  
• Are our employees educated on sustainability?  
• Where do our competitors stand on sustainability?  
• What do people outside of our business think about our efforts?  
• How will we communicate our sustainability efforts?

Crucial factor is to have a clear perspective on priorities, linkages to the business operations and the willingness to require investments for the success of their sustainable transformation initiatives.
To start such sustainability initiatives, you must know your know how to the core of your business strategy:

• What are your key areas of risk and opportunity?
• What are the challenges, geographies, and stakeholders most central to your business?
• What are the areas in which your company is primed to make the greatest difference?

These sustainability priorities should be closely tied to the firm’s mission, vision and purpose. This makes the priorities and purpose align providing a clear understanding of investments across the whole business.

Understandably, with the previously mentioned factors (see above) there is a topic of strategic partnerships to create a wider network of companies with the same core values and know-how in order to meet the commitments and to bring greater sustainable impact, beyond what your firm can do alone. Because of this, many companies that are leading in sustainability turn to partnerships, and some may include:

• Do collaborations with other ecosystem players and sectors
• Creation of partnerships with key stakeholders
• Even competitive partnerships or industry-related partnerships with other companies with overlapping supply chains

Leading sustainable businesses encourage innovation, reward learning, take calculated risks, and infuse these values across the entire organization. They make investments in open innovation to develop fresh approaches to issues and incorporate sustainability into their value chain. The best sustainable businesses are supporting social entrepreneurs with innovative new solutions, encouraging farmers and suppliers to employ more regenerative agricultural practices, and much more.

At the end of the day, even the most ambitious commitments are meaningless unless they are supported by an actionable strategy. Leaders of sustainable businesses back up their lofty goals with a budget and a team ready to act, as well as quantifiable and time-bound targets and milestones and a performance tracking plan. Then, as they learn what works and what doesn't, these companies are willing to pivot and adapt.

Even the most sustainable businesses do not have all of the answers or tools. In this case, they seek collaboration with third-party specialists such as CDP, WWF, Earthworm Foundation, Verité, and others who can assist companies in designing, implementing, and tracking sustainability initiatives.