Sustainability Culture and Reporting at Dangote: A reflection

By Ndidi Nnoli

The Nigerian Stock Exchange (NSE) hosted a forum called “Shared Goals, Shared Future” this past week, joining the increasing number of execution-oriented sustainability advocates in the business world.

A decade ago sustainability was considered peripheral by business, cited when discussing the reduction of energy consumption, recycling initiatives, tree-planting, community empowerment, saving the planet, and good causes to empower women, youth and children. In recent times, there has been a big shift with regard to mainstreaming sustainability as core to business operations, even in evaluating leadership capabilities. Forward-thinking companies are developing business strategies and corporate cultures that embody sustainability as central to business modelling, growth and risk management. New business principles like ‘circular economy’ have emerged – whereby environmental concerns and operational efficiency are aligned, measuring impact in economic, environmental, social and financial terms. Likewise, investors and financiers place a higher weighting on environmental, social and governance factors in evaluating the creditworthiness and risk of investment options. Sustainability has become more tangible and visible.

Companies are being held accountable by a range of stakeholders, alongside shareholders, with terms like ‘social license to operate’ validating the emergence of host communities as core stakeholders. Data abounds to show how the introduction of responsible business policies and sustainable business practices has resulted in better sales, improved customer loyalty and delivered more sustainable brands, products and organizations. Human Capital is also increasingly attracted, engaged and incentivized through Sustainability Indicators. Top Talent often cite businesses furthering the ‘doing well by doing good’ agenda as a reason for employee loyalty. In summary, businesses now have the opportunity (and responsibility) to contribute towards building inclusive, resilient and sustainable economies, directly as well as by extending sustainability best practices through their value chains and supply chains.

The United Nations Sustainable Development Goals clearly acknowledge the critical role of business, beyond the responsibility of governments, in promoting prosperous economies and inclusive growth. This might foster a more ideal economic model to achieve the ‘Wealth of Nations’. Perhaps it is “sustainability” that was the missing ‘capability’ to enable business adopt Adam Smith’s ‘invisible hand’? If so, sustainability thinking can now guide that ‘hand’ to better serve stakeholders and shareholders alike…

I commenced work in the sustainability space as Founder of the Growing Businesses Foundation (GBF) in 1999. Two decades ago at GBF, I was privileged to witness the catalytic positive impact made possible when business leaders take on the role of responsible global citizens. I quickly learned that when inspired leaders engage to serve stakeholders (and not just shareholders), their functional heads respond by designing creative and innovative solutions that serve the greater good for the long-term. Such thinking ensured the local and global economies thrived alongside securing the well-being of the business, people, communities and planet. Everybody was a winner. As such, from my experience, businesses were always in the strongest position to close economic inequalities and promote inclusive growth, by improving per-capita wealth in tandem with business profitability. Starting with GBF I quickly learned that the approaches that interlink social and economic prosperity for all with operational efficiency and financial profitability are the more sustainable success stories.

I joined the Dangote Group exactly two years ago. I had previously resumed at the Lagos Business School as Faculty, for the second time hoping to document and publish the 7 Sustainability Pillar Methodology which I had started to crystallize during my PhD (2004 – 2006).  The rare privilege of applying the 7Pillar Methodology at Africa’s largest business as the Group Chief, Sustainability & Governance was irresistible. I have since been privileged to drive the implementation of Sustainability across the business, commencing with NSE Premium Board listed Dangote Cement Plc (DCP) as the pioneer.

Adopting the 7Pillar Methodology requires every aspect of the business to become involved in the agenda to build a sustainable global brand. DCP proved to be perfectly primed to embrace this transformational approach to operationalizing sustainability. The ensuing sustainability journey of DCP, described in its 2018 Sustainability Report, is centered around people and systems and involves all business functions including Operations, Marketing, Finance, Risk, Community Relations, Health & Safety, Environment, Social, Procurement, Human Resources, Legal and Compliance. Sustainability Reporting at Dangote is centered around the GRI standards.

Dangote is adopting circular economy principles, designed to drive sustainable consumption and production (economic and operational sustainability) whilst ensuring the preservation of natural capital stock (environmental sustainability). This ultimately also secures the financial and operational sustainability of the business. Sustainability  already seemed like a win-win in 1999, so please imagine me 20 years later, coincidentally on the 20th floor of the Nigerian Stock Exchange, commending NSE for the adoption of Sustainability Guidelines? Needless to say, I felt honored to witness such a paradigm shift occur in my lifetime – hopefully just in time.

Elation aside, the process of defining the Dangote Sustainability Journey, which prioritizes stakeholder engagement, involved nurturing a uniquely customized culture of sustainability thinking and doing among employees, anchored at the highest levels of governance. This internal ownership of both the sustainability vision (‘thinking’) and sustainability implementation (‘doing’) is in my view highly relevant in this era of ushering in ‘Sustainability Compliance’ as anchored by the Nigerian Stock Exchange. I foresee that while the pressure of regulatory compliance will fast-track Sustainability Reporting, corporate commitment to sustainability principles and the alignment of Sustainability KPIs with local and global laws, regulations and guidelines, are critical to deliver the sustainable development NSE’s Guidelines are designed to inspire.

By convening leading stakeholders, in collaboration with the Global Reporting Initiative (GRI), the NSE has ushered in a new era wherein ‘compliance’ may now be leveraged as an ‘incentive’ or ‘consequence’ by sustainability advocates to facilitate ‘action’, beyond talk. As such, the just-concluded forum has done well to inspire reflection upon corporate progress in Sustainability Reporting, which might now be considered in the era of ‘pre-compliance’ and ‘post-compliance’.

In developing our Sustainability Report, Dangote embarked on an extensive Stakeholder Engagement exercise, which the GRI also necessitates, including a stakeholder mapping/prioritization, benchmarking against our global peers, a media review and employee survey. Our own objective was to define and operationalize an approach to Sustainability which could be owned from the highest levels of governance to the lowest level of employee within the organization. Our first act of sustainability ‘doing’ was Sustainability Week, which coincided with the United Nations General Assembly. It was almost entirely employee-led and served as a unique means to enable employees express their desire to give back to society. It was also a great opportunity for employees to interact informally across functions/levels for a good cause and inspire innovation.

Dangote Cement’s adoption of the 7Pillar Approach to Sustainability has helped mainstream the business’ commitment to evolve a holistic strategy, structures, processes, systems, human capital and internal capacity to drive the Group-wide sustainability agenda across all its operating companies in Africa. Our efforts to institutionalize sustainability and achieve GRI-Certification were also significantly enhanced by the 500 Sustainability Champions and 97 data owners we enrolled across business functions, together with leading academia to align and substantiate our sustainability best practices.

The 2018 DCP Sustainability Report reflects the Dangote Group’s voluntary commitment, preceding the NSE Guidelines, to produce a GRI (core)-compliant Sustainability Report. Our approach to sustainability, guided by the 7Pillar Methodology, has been embraced by the leadership and employees across various functions and we are geared to extend this adoption across our value chain and supply chain. As discussed last week, in alignment with SDG Goal #17, the NSE’s hand in partnership with the private sector, beyond playing its role as enforcer of the Sustainability Reporting Guidelines, brings us one step closer to ensuring we leave no-one behind.

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Ndidi Nnoli

Chief Sustainability and Governance Officer, Dangote Group. She is a social entrepreneur