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What is Corporate Sustainability?

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  • Written By: H. Bliss
  • Edited By: W. Everett
  • Last Modified Date: 14 November 2016
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Corporate sustainability is a theory of conducting business that takes a holistic perspective on the business world to create long-term growth for the company in a way that benefits the environment in which the company operates. In general, corporate sustainability means a commitment to operating under principles that result in good corporate citizenship. Things that might influence a company's perceived corporate sustainability include environmental, social, and economic issues. For corporations, sustainable actions might include giving employees health insurance, giving money to causes, or buying from suppliers that use sustainable practices as well.

Essentially, corporate citizenship is a measure of a company's reputation as part of society, and depends largely on whether an organization operates with good corporate sustainability. Parts of corporate sustainability can include adopting business strategies that provide long-term rather than short-term profits for a company. A truly sustainable corporate business strategy would include considerations of environmental and social impacts of business so the company can ensure that the strategy is sustainable for society and the world, as well as for the business.

Efforts to achieve corporate sustainability involve environmental efforts and efforts to conduct business in a socially positive way. A company working to improve environmental sustainability might invest efforts in environmentally safe technology or conduct cleanup efforts to correct a negative environmental impact caused by the organization. The energy company BP faces a problem with its reputation for environmental sustainability as the company navigates the cleanup of the Deepwater Horizon oil spill in 2010.

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Social sustainability might include advanced package labeling to inform the consumer, or the use of socially conscious production processes, like fair-trade buying. Purchasing supplies from companies that use sustainable practices helps promote good corporate practices throughout the industry and the world. Diversity in hiring can also contribute to a reputation for good corporate sustainability. Other ways to promote good social sustainability include donating to charitable organizations or funding improvements within nearby communities.

Corporate sustainability is rated by a number of organizations, and some give awards to companies with high achievements in sustainability. These ratings are used by investors when deciding on a company to invest in. Types of investors who use sustainability ratings include stock market investors and venture capitalists. Company attributes that contribute to a positive sustainability rating include records transparency and open disclosure of sustainability efforts, movements toward sustainable progress in the future, and evidence of past sustainable results.

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