Sustainability has to be ‘business-relevant’

Göran Carstedt, popular sustainability speaker and former CEO of IKEA Europe and North America, is a climate champion. He has dedicated his career to aiding businesses in their sustainability journeys, reducing carbon emissions and improving renewable energy for organisations across various sectors. In our exclusive interview with the former Senior Advisor to President Bill Clinton, Göran reveals his step-by-step guide for businesses wanting to introduce a successful sustainability strategy.

What role did you play in President Bill Clinton’s climate change initiative, and do you believe it was successful?

“The Clinton Climate Initiative was launched in 2006 as a business-oriented approach. We wanted to create practical, measurable steps to reduce greenhouse gas emissions. The starting point was that climate change is this century’s most decisive challenge for all of us, and that’s why we need innovative business models, and we need to accelerate technological development.

“We were convening different parties to the same table, with the same mission. Collaborating with consultants and political institutions, and we worked in three main areas:

“The first? Large scale renewable energy, like concentrated solar power. The second was to avoid deforestation and work on reforestation. And the third area focused on big cities – the C40 initiative gathered the 40 biggest cities in the world.

“I was leading the big city initiative. We employed hundreds of young people, who all wanted to make a difference with very limited pay.

“The convening power of the Clinton Climate Change was amazing. When we worked on our building retrofitting project, we worked with the Empire State Building. We brought the owners, the tenants, the banks, the world class technical consultants, and the energy service companies to the same table with the same mission, to reach 44.5% percent energy savings, which is amazing.”

What are the key components of a successful sustainability strategy for businesses? 

“Well, I think the first part is that it has to be business-relevant. It’s not about philanthropy. It’s not about corporate social responsibility. It’s not about compliance. It’s not about somebody telling you what you have to do. 

“It has to be business-relevant, and it has to start where the business is today and be about the products, the services and the supply chain. 

“The second part is to engage leadership. If the leadership is not engaged, and that’s not only the CEO, but the key leaders in the company, it’s not going to happen because it has to be understood as a company-wide transformation journey.

“It’s not about creating a sustainability department, putting a green label on some product, and then you’re done. It’s about a transformation journey. 

“The third part is to work with a sustainability framework because if you’re starting from scratch, where should you start? So, we need some kind of framework that is showing us what is relevant for our business. There are many good frameworks, but you have to choose the one that is relevant for your business and that you can work with. “

“The fourth part is to engage your value chain. If you’re a retailer or if you are a brand or a manufacturer or whatever you are, you have a value chain. It’s not only about what you are doing as a company, it’s about what your suppliers are doing, what your customers are doing, what your customers’ customers are doing. You have to work with your value chain, and that’s a very important part. 

“The fifth part is that you have to measure, measure, measure. If you’re not measuring, you’re not serious. It’s just lip service. It’s just blah, blah, blah. So, you have to measure the carbon footprint, the water footprint, the land footprint. It’s so easy today – you can do it online in one day for your company. 

“The sixth part is that it has to be a continuous learning journey because the world is changing. So, we have to understand what is the latest of science, what is the latest of technology, and then we have to adapt. It has to be a learning journey and the journey of transformation. 

“So, these are some of the key components that I think are important in building a successful sustainability strategy. But again, if you take one step back, it’s about how can we build a sustainable business model, not only a business model, but a business model that is sustainable. And again, it is an ongoing journey, and it has to be led by the leadership.”

What do you think is the role of businesses in addressing global challenges such as climate change, social inequality, & environmental degradation? 

“I think businesses are part of society, and if we understand that, it’s very obvious that we have a joint responsibility for the development of society. It’s very clear that we have to respect and support the democratic systems because that’s the only way to create a sustainable development. I think businesses have a joint responsibility for the development of society. 

“Of course, there’s a lot of talk about corporate social responsibility. And I’m sometimes a little bit sceptical with that notion because if you are responsible, that means you handle something. What are you responsible for? When are you responsible? And when are you not responsible? 

“It’s about, how can we create business models that are in line with societal development? That’s, of course, crucial for any company because if you are not aligned with societal development, you’re not going to be successful. You’re not going to create shareholder value. 

“There are a lot of challenges ahead of us. The climate challenge, the social inequality challenge, the biodiversity challenge, and so on. If we don’t start to build resilience and take care of our planet, we are not going to be successful. So, businesses are part of that journey, and it’s not about philanthropy. It’s not about corporate social responsibility. It’s about being part of a sustainable development.”

This exclusive interview with Göran Carstedt was conducted by Jack Hayes. 

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