Strategic Sustainability: Overcoming Challenges and Building a Resilient Future

With Richard Eadie, Head of Sustainability and Corporate Strategy at Severn Trent

Since the concept was first popularised by the United Nations during the 1980s, sustainability has evolved from a corporate buzzword to an essential guiding principle for businesses worldwide. Initially often a superficial concept used for marketing purposes, today it represents a fundamental shift in the way companies approach their operations. Across the modern business landscape, sustainability and Environmental Social Governance (ESG) has a profound impact on every facet of a company’s development and operations, from strategic decision making and risk management to brand reputation, stakeholder relationships, and long-term financial performance.

For many organisations, however, sustainability concerns also pose significant challenges. From the rise of trendy B-Corps to increasing consumer demands for eco-friendly products and services, companies are under mounting pressure to align their operations with sustainable practices while maintaining profitability and competitiveness. Additionally, navigating complex regulatory frameworks, ensuring supply chain sustainability, and effectively measuring and reporting performance are ongoing hurdles that require dedicated resources and expertise. 

Following on from our previous interview, we spoke with Head of Sustainability and Corporate Strategy at Severn Trent Richard Eadie about the growing strategic importance of sustainability and ESG, the challenges posed by KPIs and metrics, and why honing a unique sustainability identity should be top of the corporate agenda for all organisations.

Evolving perspectives: a holistic approach to corporate sustainability

Today, sustainability efforts in the business world go far beyond carbon accounting. Instead, organisations like Severn Trent take a multi-faceted approach which incorporates other elements of ESG such as investment into the communities it serves and supporting the acute affordability crisis. That means the business holds itself accountable not only through environmental targets such as helping to plant 1.3 million trees by 2030, but also by initiatives such as a 10-year societal commitment to help 100k people across Wales and the Midlands out of poverty. In addition, Severn Trent’s transparent annual sustainability reporting allows customers and stakeholders to track the organisation’s efforts. 

Richard describes how this exemplary approach to sustainability and ESG originated: “Four years ago, we created our sustainability framework, which lets everyone know what we stand for as a company. It’s based around three pillars: creating a thriving environment, helping people to thrive, and being a company people can trust. Within each pillar, there are four sub mandates. For example, our environment pillar addresses climate change, water scarcity, nature and waste. So, we really think about our impact through several different lenses.” 

Sustainability as a strategic imperative

The lack of a firm definition of ‘sustainability’ often means that companies struggle to set targets, accurately measure their progress, or understand where their resources will have the greatest impact. Added to this, a recent survey revealed that 45% of executives believe there to be ‘no clear business case’ for prioritising ESG amidst other pressing organisational concerns. Experts say this points to a lack of understanding about how taking an ambitious approach to sustainability can save operating costs, improve resilience and boost innovation – all things that can improve profitability. Richard notes, “In a landscape of growing regulations and mounting societal expectations and scrutiny, companies that fail to act on their sustainability ambitions face the very real risk of their business models becoming obsolete or inadequate. Sustainability and commerciality aren’t separate considerations – they’re inextricably linked. Becoming a sustainable business means you’ll still be around in 20 or 30 years’ time, delivering for customers and stakeholders.”

Part of delivering an impressive ESG and sustainability strategy is determining what that looks like for an individual business, as one organisation’s journey may greatly differ from another. Key to this is crafting a sustainability identity that resonates with an organisation’s employees and customer base. Richard explains, “Your sustainability vision needs to look and feel authentic, as this is the only way you’ll gain buy in from the wider organisation and the public. Some members of your team might see sustainability as using recycled paper, or turning monitors off. Others may consider the wider impact of transport, packaging, and supply chain sourcing. None of these things are wrong, but it’s about unifying those facets under one vision everyone can rally behind.” 

What gets measured, gets done  

Measuring sustainability efforts provides a tangible way to track progress, identify areas for improvement, and demonstrate accountability. Nevertheless, knowing what to measure – and how – can be a challenge. A broad range of metrics, data availability and quality issues are just some of the hurdles businesses may face. Though ESG reporting is mandatory in the UK for organisations with 500 or more employees or with an annual turnover greater than £500 million  –  set to be further formalised through the Sustainability Disclosure Requirements (SDRs) – smaller organisations are currently under no such obligation. 

Richard notes, “Sometimes, accurately measuring where we’re succeeding and where we’re falling short can be difficult. I’m someone who likes metrics and KPIs, because as they say, what gets measured, gets done. So, we spend a great deal of time considering how we embed all our initiatives into point value scorecards and monthly performance reports. All our progress is then published through annual reports, which really drill down into our tangible achievements and identify areas for improvement. This helps us stay focused and accountable.”

Even for experts like Richard, the key to delivering on sustainability and ESG is staying curious, keeping an open mind, and always being willing to learn from others. He explains, “It can be too easy to look at where you’ve succeeded and give yourself a pat on the back. You really need to look externally to judge your efforts. That means being curious, and talking to other organisations – not just within your industry or sector – but looking more broadly for the very best in sustainability and benchmarking your organisation against that. We know there’s more to do, and our ambition remains to deliver sustainable outcomes for years to come and to have a positive impact on our planet and society.” 

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