Sustainability management should matter to corporates in Nigeria

Olufemi Adedamola Oyedele, MPhil. Construction Management, managing director/CEO, Fame Oyster & Co. Nigeria, is an expert in real estate investment, a registered estate surveyor and valuer, and an experienced construction project manager. He can be reached on +2348137564200 (text only) or femoyede@gmail.com.

Sustainability and sustainable development became popular after the 1987 Report of the World Commission on Environment and Development (WCOED), also known as Brundtland Report in “Our Common Future” which muted the idea of sustainable development and defined it as “development which meets the needs of the present generation without compromising the ability of future generations to meet their own needs”. This laudable definition reckons correctly that our environment does not belong to only us.

As business organisations, governments, groups and individuals, the management of the natural setting of our environment (eco-system) should, therefore, be our aim in our various development schemes. The fundamental principles of sustainable development are: that our actions must take into account their effects on the environment, economy and society, and that what we do today should not compromise the well-being of our future generations.

Worldwide, corporate organisations now see sustainability practices as ethical and profitable ways of doing business. International private organisations see sustainable development as a corporate sustainable development responsibility (CSDR) rather than as a corporate social responsibility (CSR). Corporate sustainability management is where business meets sustainable practices. Sustainability in business is about health, safety and environment measures of businesses. It also involves business continuity. It is the activity of managing a corporation’s impact on the three key bottom-lines – profit, people and planet, so that all the three can co-exist and flourish well into the future. Corporate sustainability is the strategy whereby a business delivers its goods and services in a manner that is both environmentally and socially sustainable, while supporting its economic growth. There are two types of sustainability practices – internal (within) and external (without).

Sustainability is a business approach to creating long-term value by taking into consideration how a given organisation operates in the ecological, social and economic environment. Sustainability is built on the assumption that developing such strategies fosters company longevity according to Knut Haanaes in, “Why all businesses should embrace sustainability?” published in 2016 and available at https://www.imd.org/research-knowledge/articles/why-all-businesses-should-embrace-sustainability/. Sustainability can also be described as a business continuity strategy. O2 Telecommunications did a survey of senior executives from 500 of the UK’s largest companies; the report suggests that, despite remaining on the global political agenda, sustainability is losing out to the demand for short term profits in the boardroom. When asked about what their organisations were likely to do after the 2009 recession, just 26 percent said they will work towards lowering their carbon footprints, while 36 percent said they will focus on profit and survival. Thirty-two percent said tidying up slack operations and 30 percent are thinking mainly of expansion and returning to business as usual.

Many business organisations globally, believe business means profit-making and see sustainability practices as additional expenses. It reveals a more solemn, yet not inconsistent, report than emerged from a similar survey of 722 global chief executives conducted by the United Nations in June 2010. This found that 80 percent of chief executives believe sustainability should be delayed and it will be “fully integrated across their global business” in 10 to 15 years’ time. The latest survey also conveys a willingness to increase spending on sustainability, with almost half of respondents planning to spend 20-50 percent more in the coming decade. 62 percent also said they expected to spend up to 40 percent or more on research and development. But many executives also said they had difficulty making a solid business case for sustainability to their board. This is partly an issue of skills and knowledge. A third said they lack expertise for measuring sustainability practices performance and 34 percent cited a lack of uniform industry, government and customer benchmarks. However, 34 percent also said that a lack of board level sponsorship was the main barrier to sustainability practice.

In Nigeria, as in almost all African countries, business sustainability practices are still unpopular as most businesses are more concerned with profit than satisfying the people and the planet. Businesses strive to meet shareholders’ expectations which differs from observing measures to save the environment and its people. Despite this, the number of organisations showing interest in sustainability in Nigeria’s business environment had actually increased in the last decade. Most organisations, especially the big ones now have officers and offices responsible for sustainability. The fact that environmental and social sustainability practices have no immediate direct link to profit is a bane. Most CEOs are not ready to invest in the future that they will not be credited for. Most organisations do not see sustainability requirements as part of their criteria in choosing suppliers and distributors.  About 90 percent of organisations in Nigeria, especially the small to medium organisations, do not have sustainability practices in place.

Most of the foreign organisations follow their parents-offices’ tradition of sustainable development in Nigeria. Others practise sustainability because they are afraid of the implication of ‘informed’ customers’ negative reaction to their non-sustainability practices. Organisations like Marriott Hotels Group, Transcorp Hilton, Radisson Hotels, Sheraton Hotels, etc, in the hospitality sector have their sustainability mission statements visibly stated either in their offices, premises and souvenirs. In the communication sector are organisations like MTN, Airtel, Globacom, etc. Nestle, UBA, First Bank, TotalEnergy, Union Bank, Standard Chartered Bank, Shell, Chevron, OANDO, etc, all have their sustainability mission statements.

There are three clear goals for Unilever’s vision for sustainability: Improving health and well-being for more than 1 billion; Enhancing Livelihood for Millions; and Decoupling growth from our environment footprints. Businesses which fail to state and propagate their sustainability mission statements are now seen as archaic and ‘worthless’. Sustainability statement is not a choice but a corporate requirement.

There is more work to be done to ensure sustainability practices in the African business environment because they involve additional costs and or change management. Non-government organisations (NGOs) in environmental advocacy, like Friends of the Environment (FOE), Nigerian Conservation Foundation (NCF), World Wildlife Foundation (WWF), United Nations Environmental Programme (UNEP) and Federal Ministry of Environment, as well as states ministries of environment should increase the awareness of sustainability and sustainability management among corporate organisations in Nigeria. Ethical NGOs, like Transparency International (TI) and Mo Ibrahim Foundation, should also look for a role to play in African businesses’ sustainability practices management. Most organisations will not imbibe the culture of sustainability as an ethical practice until the government makes it compulsory as a statutory requirement, like International Standard Organisation’s assessments. State governments can help corporate organisations cultivate sustainability practices as a culture by setting standards and establishing task forces to enforce these standards as organisations’ responsibility to people and the environment. Sustainability practices are modern ways of ensuring business continuity into the future and not a show-off or additional corporate burden.