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Many businesses and organizations around the world claim that they are striving to achieve sustainability. But what is sustainability work all about in practice and how can businesses get to a point where they are making a real difference? In this issue, we will be discussing this with two specialists from the consulting firm Trossa, who work on such issues on a daily basis.
Based in Stockholm, Sweden, Trossa offers businesses and organizations consultancy services for sustainable development. Their customers operate in both the private and public sectors and in many different industries.
“We apply a holistic and broad perspective, and can offer in-depth specialization in many areas. For example, within sustainability strategies, sustainability reporting, chemical, climate and purchasing issues, and in a number of specific industries,” says Mia Barkland, Trossa’s CEO.
“Our common sustainability goal is to ensure that everyone can enjoy a good life, without over-utilizing resources and without negatively impacting the climate or the environment.“Mia Barkland
What, then, is Trossa’s definition of sustainability?
“In brief, it is about creating real values that work over time. Sustainable development meets humanity’s needs within the framework of what our planet can do,” replies Mia Barkland. “Our common sustainability goal is to ensure that everyone can enjoy a good life, without over-utilizing resources and without negatively impacting the climate or the environment.
“To get there, all players – companies, organizations, individuals and states – must commit themselves to working within a set of sustainable parameters, or sphere, which enables people to live their lives in a way that does not cause irreparable damage to the planet.
“Science tells us this is possible, but not if we continue to live as we are doing today. All businesses have to consider the changes that would be needed to fulfil their role within the sustainable sphere. Only in this way can they remain successful in the longer term,” Mia Barkland underlines.
Sustainability – so much more than environmental issues
Her colleague, consultant Iris Tolonen, emphasizes that sustainability stretches beyond environmental issues.
“Social issues and finances are related to the environment. The planet sets the boundaries, but innovation and economic development can deliver prosperity and success within the given framework, as long as the solutions are environmentally smart,” she says.
“There’s still a lot left to do. After integrating sustainability issues into business strategies, they must be implemented and begin to deliver results.”Iris Tolonen
At the UN summit five years ago, the world’s heads of state and government adopted the United Nation’s Agenda 2030, an action plan which sets 17 global goals for sustainable development to be achieved by 2030.
“The global goals give companies and organizations something to relate to in their own sustainability work and provide a starting point for setting their own goals and strategies. Agenda 2030 makes it easier to put your finger on what you should focus on,” says Iris Tolonen.
The two colleagues at Trossa both believe that the global goals have contributed to a new attitude within businesses, where sustainability work is not just about “behaving appropriately.” Now issues of a more existential nature are being taken on board, for example why the business exists at all and what values it creates.
The UN Goals for sustainable development
In 2015, world leaders agreed on 17 global goals and Agenda 2030 for sustainable development. Agenda 2030 constitutes a commitment to lead the world towards a sustainable and fair future by 2030, by ending poverty, combating inequality and ill-health, promoting peace, protecting the environment and urgent action on climate change. It is vital that all players participate in order to reach the goals.
“When Trossa started ten years ago, there was a lot of talk about adopting a holistic approach and integrating sustainability into business strategies and operations. Now I think this is actually happening in reality. Businesses are focusing on what this means to them specifically, which aspects or dimensions are most important and where they can make the biggest difference,” says Mia Barkland.
The importance of a clear sustainability strategy
Although some perspectives are common to everyone, such as climate change and the risks that come with them, the usual approach nowadays is to carry out a feasibility analysis to find out what specific risks the company faces or will face and how the company can contribute positively. It is important such an analysis should involve external stakeholders such as suppliers and customers, as well as employees; this, to find which sustainability issues are most important for the business and what aspects could be improved.
“Farsighted companies understand that without a clear sustainability strategy, they risk not being able to meet the demands of the outside world. They want to gain a full and correct grasp of how their operations impact the world at large and take responsibility, in a focused and fact-based way,” says Mia Barkland.
Anyone who does not do their homework risks being punished in today’s market, regardless of what industry they are in or their size. In addition to losing customers, they may find it more difficult to buy raw materials and obtain capital, and it could be more expensive to borrow money and more difficult to attract and retain good employees.
“Businesses are not only looking to minimize risks but also eager to see the opportunities. They want to participate and contribute positively, in terms of both working methods and business and customer offerings. So, more and more companies are now looking beyond their own operations and including the entire value chain both in their demands and in the search for new opportunities,” says Iris Tolonen.
Negative Carbon emission curve
Although sustainability work has improved in general, not all business have necessarily become more sustainable. From a global perspective, development is still going in the wrong direction, for example with regard to carbon dioxide emissions.
“There’s still a lot left to do. After integrating sustainability issues into business strategies, they must be implemented and begin to deliver results. So, it is important to also develop concrete action plans and follow up the work,” Iris Tolonen points out.
“In recent years, the financial sector has realized that these non-financial issues will in fact seriously impact finances in the future. Investors are interested in sustainability issues in a whole new way.”Mia Barkland
With the UN’s global goals set for 2030, a number of alliterations have been used to describe the period ahead as “the Decade of Delivery.” Admittedly, there is a risk that the corona crisis will throw a spanner in much of the positive work development that’s been implemented so far. And, generally speaking it has also led to a change of focus away from many other crucial issues. Nevertheless, over the next ten years, governments, companies and organizations around the world will really be obliged to walk the talk. There are also other drivers pushing for this.
“In recent years, the financial sector has realized that these non-financial issues will in fact seriously impact finances in the future. Investors are interested in sustainability issues in a whole new way and expect companies to clarify their approach to risks with regard to, for example, the climate, working conditions and conflict minerals. We are seeing these factors already affecting share values,“ says Mia Barkland.
“The ability to attract new employees and retain existing ones has also become a strong driving force. In all industries, the employer brand now plays a major role in motivating solid sustainability work. Purchasing departments have also become more interested and motivated. Customers make demands and raise questions with their suppliers,” adds Iris Tolonen.
Global collaboration crucial to achieve positive results
Although there are differences between countries and regions, they emphasize that the larger picture is the same worldwide and in different industries.
“There are things happening everywhere and the global rules of the game are now embodied by Agenda 2030,” Mia Barkland points out.
This also has to do with the globalized value chains. Implementing strategies and producing positive results requires global cooperation.
“To appease investors who value companies in the longer term, you must be able to show that you have on-site management systems and that you can manage risks in the value chain.”Iris Tolonen
“We are seeing a definite trend within the field of sustainability today towards working together in a more integrated way. You are part of each other’s value chains and we are all demanding things of each other. Active sustainability work is now a prerequisite for merely being considered as a player by the market. It is therefore becoming more and more common to hook arms and be more transparent even to competitors. Since everyone is on the same transition journey, it becomes easier to share good examples,” says Mia Barkland.
“In order to appease investors who value companies in the longer term, you must be able to show that you have on-site management systems and that you can manage risks in the value chain. Management and employees need to work on sustainability issues in the same way as other business-critical issues. The board should also be involved,” says Iris Tolonen.
Resource utilization a challenge for the electronics industry
If you look at the electronics industry more specifically, there is a paradox as the ongoing digitalization serves very much as an important enabler for sustainable development, while at the same time the industry is facing major challenges in terms of, for example, resource use.
“It is vital our economy becomes more circular to enable resources, once utilized, to be recycled and reused. But electronics products have a short lifespan and it is often expensive and complicated to recycle used electronics materials. Sustainability aspects must therefore be included already at the design phase. Recycling of metals, minerals and plastics can be simplified with the right design, the amount of materials used can be minimized and whenever possible, the industry’s designers should opt for environmentally-friendly options in their choice of materials,” says Mia Barkland.
“Another important issue is to do with the raw material chain. It is important to control the use of conflict minerals, as well as set requirements with the purpose of reducing their use. Moreover there are significant risks to society if production is located to countries with poor human rights records. Reducing the carbon footprint from transport is also an important issue for the industry, since raw materials, components and products are often shipped around the world before the goods end up with the consumer,” says Iris Tolonen.
“It is vital our economy becomes more circular to enable resources, once utilized, to be recycled and reused. But electronics products have a short lifespan and it is often expensive and complicated to recycle used electronics materials. Sustainability aspects must therefore be included already at the design phase.”Mia Barkland
“In a world where the population is increasing and whose middle class is growing proportionally faster, we need to become more resource-efficient and reduce the amount of garbage. Even before a product is manufactured, we need to ask how it can become more circular – and the utilization of the product before it is worn out,” concludes Mia Barkland.
The experts’ tips to businesses looking to work in a sustainable fashion
- Perform a feasibility study in dialogue with all your stakeholders and identify your important issues and requirements that are asked of you.
- Link sustainability issues to your business model.
- See opportunities as well as risks. What positives are you currently imparting and how can you drive and create new changes for the better?
- Don’t forget smaller, simpler things. It is important to live as you learn.
- Dare to set bold goals that make a real difference.
- Do not see sustainability as a contradiction to profitability. To be sustainable in the long run, a company must also generate income here and now.
Sustainable business – a survival strategy
For many years, NCAB Group has worked actively, among other things with the help of specifically Trossa, to improve the sustainability of its operations. The Group’s Sustainability Manager Anna Lothsson answers some questions about this work.
In what way is sustainable business significant for NCAB?
“Basically, sustainable business is a survival strategy put in place so that our company will still be operating in the future as well. We will pursue a long-term sustainable business that creates growth and profitability for NCAB, our customers, suppliers and investors. It also includes a responsibility to contribute to global sustainable development. Important prerequisites for all this are that we are a reliable and responsible partner and an attractive employer.”
“Basically, sustainable business is a survival strategy put in place so that our company will still be operating in the future as well.”Anna Lothsson
Sustainability Manager, NCAB Group
How would you describe NCAB’s sustainability approach?
“We work in a structured fashion to grow the business in a sustainable direction. That’s why we have based our approach on the guiding standard ISO 26000. It covers both environmental and social and ethical aspects and, in combination with stakeholder dialogues, has helped us identify which issues to focus on. We have established a strategy that identifies a number of focus areas and objectives for our sustainability work within the supply chain, as well as towards employees and customers. At the same time, sustainability is not something that we work on separately, but is integrated into our operations and processes in the same way as other priority issues.
NCAB says it is tackling sustainability from a value chain perspective, what does that mean?
”As we develop and run our business, our focus is to create value for our stakeholders and take full responsibility for it. It is important to be able to describe the value chain, define the physical flow and those activities of ours that add value to the company’s offerings and thereby value to our stakeholders, for example our customers and employees. This approach helps us identify the opportunities available to drive positive change and minimize the risks of negative impact, within and beyond our business area.
Could you describe your approach in more concrete terms?
”At the design phase, we support our customers when it comes to optimizing the PCB design for both product reliability and manufacturing. Our engineers offer design support in individual conversations with the customer, through seminars and in customer meetings, or through our website where our design guidelines are available. Optimized PCB design contributes to less scrap and reduced use of materials, water, electricity and chemicals in production. In the factories, our work on social responsibility, environment and quality contributes to the customer’s own sustainability work and minimizes risks in the supply chain.
“In collaboration with our production partners, we focus on quality, social responsibility and environmental responsibility in the supply chain. In regular on-site audits, we audit in areas such as working conditions, human rights, health and safety, materials (chemical content and conflict minerals), chemicals management, waste and recycling management, business ethics and quality. Employees in our Factory Management Team carry out these audits and follow up deviations and improvement activities to ensure that they are implemented.
“As a knowledge-based company, our success is a result of the work – as well as the commitment carried out by our employees. We offer a large scope for development for both the individual and the team and through internal training among other things. We also put a great deal of focus on leadership, team-building, ethics and equal treatment. Follow-ups and activities take place in individual conversations and through an employee survey where indexes for commitment, leadership, and collaborative ability are key figures in our business management.”
“As a knowledge-based company, our success is the result of the work – as well as the commitment – put in by our employees. We offer a lot of scope for development for both the individual and the team.”Anna Lothsson
Sustainability Manager, NCAB Group
In what way is NCAB contributing to achieving the UN’s Global Sustainable Development Goals?
“When Agenda 2030 was launched, we had already implemented a structured sustainability programme covering strategy and defined goals. However, the global goals have given us a better picture and greater understanding of the fact that we all have a responsibility to contribute to global sustainable development. These goals can help keep us on the right track as we further develop our sustainability strategy and operations to contribute to a better future for all. That’s why 2019 saw us conduct a review to define which of the goals and sub-goals incorporated under Agenda 2030 are relevant to us. We mainly contribute to nine of the goals.”
Which milestones in the sustainability work would you like to highlight in 2019?
“Apart from the analysis we mentioned, linked to Agenda 2030, we continue to implement sustainability audits in the factories on a continuous basis. In regards to our employees, we have focused on training and November 2019 saw us launch a new, digital platform for learning and development – the NCAB Academy. It is now easier for our employees to continuously develop their skills and share knowledge with colleagues around the world. Not least, the platform is an excellent tool we use with new employees to help them embrace our culture and our working methods, especially useful in connection with integrating companies the NCAB may acquire.
“We shared knowledge with our customers worldwide through 152 technology seminars and nine sustainability seminars. This work has continued during 2020 and the situation being what it is, the seminars have so far this year been held online.
“I would also like to mention that the results in the employee survey 2019 improved further from an already high level, with customer satisfaction remaining at a high level, including in matters relating to sustainability.”
“There is no doubt that the biggest issue for the future is to get a better grip of our climate impact and to take measures to reduce this impact.”Anna Lothsson
Sustainability Manager, NCAB Group
What are the biggest challenges ahead for NCAB?
”There is no doubt that the biggest issue for the future is to get a better grip of our climate impact and to take measures to reduce this impact. We know that greenhouse gas emissions we cause emanate mainly from our manufacturing and transport processes, but we need to carefully study more and establish where in our processes they arise, how large they are and what we can do to reduce them. In this context, we are looking to use the Greenhouse Gas Protocol to map the emissions in our value chain. Obtaining all the data will be a challenge, but we will strive to find whatever is measurable and take the appropriate measures.
You can read more about our sustainability work in NCAB Group’s sustainability report (PDF).
Anna´s tips for successful sustainability work
- Anchor the work with the Board of Directors.
- Appoint a manager at management group level to drive the overall sustainability work.
- Build a strategy and integrate the work as a natural part of the business.
- If possible, use methods that are already established in other areas.
- Make use of a standard to help build a structured approach.
- Set aside sufficient resources for the job.
- Be persistent and follow up the progress continuously.
- Transparency is positive, do not be afraid to point out challenges and improvement potentials.