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Four myths clarified: sustainability within companies


From nice-to-to-have to must-have – the topic of sustainability is now unavoidable for companies. They are all facing the same challenges: they must successfully integrate sustainable approaches into their business processes and pave the way for new sustainable technologies. Not an easy task – around which there are still many ambiguities. Our fact check reveals the four biggest myths about corporate sustainability.

01

Sustainability only means environmental friendliness

Not quite! It is true that preservation of the environment and combatting climate change are central aspects of sustainable action. Yet there is much more to it than that alone, which is where the term "Environmental Social Governance (ESG)" comes in. This is the entirety of corporate social responsibility that goes far beyond environmentally conscious action. Sustainable corporate governance requires companies to integrate into their strategy not only their impact on the environment, but also social, human rights and economic aspects. This also means that a company should not focus on maximising short-term profit, but on long-term and sustainable value creation.

Concrete examples of sustainable action in the field of social affairs include efforts to create fair working conditions, mandatory respect for universal human rights or investments in the health and safety of employees. In the area of governance, for example, companies commit themselves to ethical corporate governance, the prevention of corruption and the installation of independent supervisory bodies.

02

Sustainability is too expensive

False! Although the attitude that ethically correct trading and investment leads to a reduction in profits does still persist. In recent years, however, this assumption has frequently been debunked : companies whose management teams confront social and ecological challenges do not perform worse on average, but just as well or even better than those that ignore the topic.

A relevant study was provided by the business consultancy Deloitte with its "European CFO Survey" from 2020. Their consultants surveyed around 1,000 Chief Financial Officers (CFOs) in 18 countries regarding their attitudes towards sustainable finance. The result? A large majority of 87 per cent of CFOs have seen their ESG performance impact positively on the cost of capital. In detail, twelve percent of CFOs believed that the impact of ESG was high; a good third thought the influence was moderate, about as many spoke of a small influence and 13 percent of no influence at all.

The bottom line is clear: good and transparent ESG reporting can boost a company's bottom line and attract new investors. But customers are also increasingly focusing on corporate sustainability. Those who cannot meet the corresponding requirements, for example in the context of a tender, will no longer be considered as a partner.

Illustration on which three people can be seen. They are surrounded by a bus and a truck, above their heads float a light bulb, a leaf and a curve.

03

Sustainability is a nice-to-have

False! Sustainability and ESG are no longer fair-weather issues for companies that only serve marketing purposes. On the contrary, sustainability now plays a central role in both business strategies and customer decisions. Because the basic attitude of entrepreneurs, employees and customers is increasingly changing. They see a coherent ESG strategy as an integral part of a healthy corporate culture and therefore even presuppose it. Clear and open ESG reporting is therefore even a competitive advantage – and increases a company’s value.

The topic of sustainability and ESG has already become a very special business driver at MAN Truck & Bus,: under the motto of "Simplifying customer business through leading sustainable solutions", the company is repositioning itself via its "NewMAN" transformation strategy and is primarily investing in innovative zero-emission technologies.

04

It’s already too late to get involved in climate protection and sustainability

Not necessarily. Scientists from the Intergovernmental Panel on Climate Change (IPCC) recently published a report in August 2021 on the fundamentals of climate change. This report outlined five forecasts for the future and played out very different scenarios: from very low to very high emissions. The result? If emissions remain as they are, the global 1.5-degree limit in the Paris Agreement could be exceeded by the early 2030s. If, on the other hand, humanity quickly manages to reduce emissions very drastically, there would still be the possibility of preventing a major climate catastrophe. The key message imparted by around 230 scientists from more than 60 countries is that we  currently have the very last chance to act to achieve the Paris climate goals. Albeit the Intergovernmental Council on Climate Change stressed that this is not a decision between the 1.5-degree target and a lack of any climate protection. They indicate that every tenth of a degree that is prevented reduces the risk of extreme climatic events. This means that companies like MAN Truck & Bus are now fully committed to pushing ahead with sustainable products and strategies by all possible means – and thus actively making their contribution to meeting the requirements of the Paris Agreement.

Text   Matea Prgomet
Photos   Michał Bednarski

#Sustainability#Company#CorporateResponsibility

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