Making the "S" word our business
- 3 min reading
How you make an adaptive mindset a tool for better business.
This last year, the world of sustainability professionals has been buzzing with equal parts anticipation and trepidation around the tsunami of EU regulations and directives that are quickly upon us (but more on that later). Some have long grasped that the EU, with their bureaucratic finesse, and smoke and mirrors, is stealthily manhandling the private sector towards a radical shift on how to do business in Europe. While others, disappointingly, have underestimated the magnitude and force of what is happening. We expect a very ugly wake-up call for the latter group especially as the effects are beginning to seep into the C-suite level and board rooms.
The EU’s directive on corporate sustainability reporting (CSRD) is driving a wrecking ball through everyone’s door. They are demanding transparency and accountability from over 50,000 companies this and next year— so tomorrow in corporate math. Businesses are required to report on sustainability matters, detailing how their operations impact society and the environment. To translate, we’re not just talking about a facelift to business operations but a deep-rooted, systemic overhaul.
This is where the pulse quickens for those of us in the sustainability field. What we have been harping on about for decades is finally happening. It almost feels alien that the issues we’ve been spotlighting from our dimly lit basements are not just getting airtime; they’re getting primetime. But this also means our jobs are changing. We are going from advocates to architects of change.
Gone are the days of wondering ‘what is sustainability?’ and ‘why should we care?’, explaining, coaxing, educating, and nagging— our new priority and the pressing question now is ‘how?’. It is finally(!) clear that we must transform our business models, our operations, our ways of working, to adhere and contribute to the sustainable, circular, net-zero transformation.
The newly developed sustainability reporting standards (ESRS) are developed to support and drive the transformation to climate neutral, competitive, and risk-minimized business practices by 2050. At the heart of these standards is the Double Materiality Assessment (DMA), which is like a sustainability MRI scan for your business. It’s shedding brutal light on your business’ every strength and every vulnerability. And although it gives you a diagnosis, it stops short of prescribing solutions. This begs the question, particularly if you’re not a sustainability guru: how do we harness the raw truths by the DMA to boost business growth? And how do we ensure that the DMA’s analysis is actually integrated into our strategic business planning?
Enter the Triple Materiality Assessment. In this approach, which we also call Business Materiality, we superimposed our business strategy and growth plan onto our DMA. This three-dimensional analysis has birthed over 80 actionable initiatives and ideas that will contribute both to enterprise value and sustainable transformation.
Of all these 80 bubbling ideas, we’ve handpicked the 13 hero initiatives that resonate across our value chain and foster cross-functional unity internally. The excitement within Adapteo is palpable, almost electric. Here is finally something that makes sense to everyone— a language we all can speak and that resonates regardless of if one is driven by financial goals or a mission to safeguard the planet. We’ve seen first-hand that sustainability and business objectives are not mutually exclusive but are, in fact, synergistic. The pursuit of one amplifies the success of the other. And the icing on the cake, ownership is distributed across our entire company— closely connected with the right people in the right functions. For the first time in history, impact metrics are not put in siloes. And the value (business and sustainability) is driving actions.
Adapteo’s Triple Materiality Assessment is our strategic response to the ‘how’ – not just a mere exercise in compliance but a transformative strategy that has injected sustainability into our operations’ veins. Here’s a glimpse of how we’ve approached it:
- We mapped sustainability regulations against our commercial strategy to pinpoint where alignment can drive growth. This integration isn’t just for compliance— it’s our competitive edge.
- Our analysis of potential risks is thorough and unflinching. We scrutinized our business practices and their environmental impacts to ensure that our operations are as sustainable as they are successful.
- The business cases for our top initiatives are more than just numbers and projections. They are well-crafted stories, each underpinned by solid data, illustrating a journey towards profitability that does not compromise our green ethos.
- Our sales force, who’ve become as fluent in sustainability dialects as they are in the language of commerce, has evolved to become ambassadors of our sustainability vision. They’re adept at articulating the benefits of our sustainable practices, conveying to our clients that when they invest in us, they invest in a sustainable future.
This text could also have been headlined ‘How a small company with big ambitions (and a healthy portion of hubris) tried to take on the transition, the regulatory floodwaters, and its plans for growth, all at once’. Will the Triple Materiality or Business Materiality lead us to Shangri-la, the new paradigm where sustainability and business results are truly aligned? We’re betting on it. But we strongly believe so. For now, it has at the very least served as incredible rocket fuel (fossil free, needless to say) for everyone involved in the process. And that is, in itself, a triumph worth talking about. Before we sign off, consider this an open invitation to reach out to swap notes and share learnings. After all, the best journeys are those based on collaborations and where knowledge is shared.
Adapteo is the leading adaptable space partner in Northern Europe
Operations across 9 markets – Sweden, Finland, Norway, Denmark, Germany, Belgium, Lithuania, the Netherlands and Estonia. We have a large portfolio of adaptable buildings and a long experience in the construction and real estate industry.