The International Chamber of Commerce (ICC) has launched a radical update of its respected Business Charter for Sustainable Development. The 3rd edition of the ICC Charter has been designed to reflect a more holistic approach to sustainability, drawing on the expertise, experience and good practices of a broad range of international companies and business associations across all sectors and industries. Based around eight guidelines, the Charter sets out a strategy framework to enable companies to place sustainability at the heart of their operations – from staff recruitment through to the development of new products and services.
Sustainability as a source of competitive advantage
Speaking at the launch of the Charter on the margins of the UN Global Compact’s annual meeting, ICC Secretary General John Danilovich said: “Sustainability needs to be understood as a key business driver, rather than a luxury investment or a public relations tool. A growing body of evidence shows that developing a corporate culture of sustainability is a major source of competitive advantage in today’s economy.”
To take just one example, recent research shows that companies with high ratings for environmental, social, and governance (ESG) factors have a lower cost of debt and equity – and frequently outperform the market in the medium and long term.
Mr Danilovich added: “Our message with the launch of the Charter is that becoming a sustainability leader requires changes in all relevant business practices, but that the effort to do so is most certainly worth it – in environmental, social and economic terms alike.”
SMEs and sustainability
The new Charter has been carefully designed to provide a common and accessible starting point for companies to develop or enhance their business sustainability strategy. In doing so, ICC aims to better enable small- and medium-sized enterprises (SMEs), particularly in emerging market economies, to integrate sustainability considerations in their operations.
Commenting on the role of the Charter in engaging businesses, Professor Claus Stig Pedersen, Head of Novozymes Corporate Sustainability said: “Novozymes warmly welcomes ICC’s new Charter for Sustainable Development: It provides high-level strategic guidance for companies when integrating sustainability into their own business models and across their value and supply chains, and enables them to partner for impact”.
Martina Bianchini, Chair of ICC’s Green Economy Roadmap, who was heavily involved in the development of the Charter added: “Despite major strides forward on this agenda in recent years, SME engagement remains a challenge. Many existing tools are overly complex to fully engage small businesses. SMEs are the backbone of the global economy and there is the potential for them to be the drivers of a new sustainability revolution.”
The UN Sustainable Development Goals
This September will see the finalization of new global sustainable development goals (SDGs), under a process initiated by United Nations Secretary-General Ban Ki-moon some two years ago. It is widely anticipated that the SDGs will place a significant focus on the private sector to deliver sustainable and inclusive global growth.
Many leading companies are already taking action to put sustainability considerations at the heart of their businesses. Francisco Suárez Hernández, Corporate Affairs Officer for Coca-Cola FEMSA, said: “The role of the private sector is crucial for the progress of people and communities. Sustainable development requires full commitment from all companies so that every action generates economic, social and environmental value simultaneously within its value chain.”
The launch of the Charter represents ICC’s initial response to this process with the aim of more fully engaging the corporate sector in the implementation of the SDGs.
Mr Danilovich said: ” Delivering on the promise of the SDGs will require widespread engagement of companies large and small across the world. The launch of the Charter is the start of a concerted push by ICC to ensure that the power and reach of the private sector is fully harnessed in the context of the post-2015 development agenda.”