Recently, most of us experienced the effects of climate change and its top of mind across the business world in each sector. There is a need for urgent action, and organisations of every type are being challenged on their role and their impact on the world around them.
Sustainability conversations are increasingly becoming a business imperative for companies, with many recognising the need to meet rising environmental and societal expectations to improve their reputations, attract and retain top talent, and generate new business opportunities.
Our latest global report, ‘A road well- travelled’ shows that family businesses, in particular, may have a "first-mover advantage" on the path to sustainability, as their commitment to creating value for all stakeholders has been deeply embedded in their values and business models across multiple generations.
The families we work with in New Zealand share a similar ethos and are focused on stakeholder capitalism. The principle of shared value is at its core and how best to serve society as a whole – not only their owners and shareholders.
Our research also shows that family businesses have embarked on their sustainability journey to achieve one or more of the three interconnected goals for maintaining the sustainability of family businesses while also contributing to a more sustainable world, as illustrated below:
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Family business leaders highlight three interconnected goals
Family businesses want to create the world we want for every generation. The main purpose is strategically developing a business model that answers the question: What will we do today to develop a better tomorrow? It’s the responsibility of the family business leaders to establish practices, processes and structures for synchronising their business and sustainability strategies to connect the past and the present with the future.
There may be concerns regarding the short-term economic feasibility and costs of sustainability, but family businesses are taking the first steps towards making sustainability central to what they consider "business as usual". This may involve retrofitting their operations and investing in IT resources and infrastructure for measuring, controlling, and managing their environmental and social impact efforts.
Similarly, it is becoming a competitive advantage for companies, with many recognising its importance in attracting and retaining top-performing employees and winning new work from customers who prioritise ethical and sustainable practices.
In summary, for family businesses, the drive for sustainability is already a road well-travelled. And the potential benefits of being a sustainable business have been clear for a long time. Ultimately, family businesses that prioritise sustainability may create a healthier and more resilient world for future generations and position themselves for long-term success in a new, low-carbon world.
Doing what’s right for generations to come
The sustainability journey is not an easy or a quick one. It takes time and the right people to support, explain and promote the initiatives and potential changes, as well as the support of the owning family, the board and the leadership team.
For many, the starting point has been to engage family members from every generation – as well as independent board members – to map out the practical steps that can be taken to weave sustainability throughout the business strategy and to do so in a way that will have a meaningful and lasting impact
