![]() Date: 2024-08-16 Page is: DBtxt003.php txt00008059 | |||||||||
Event | |||||||||
Burgess COMMENTARY | |||||||||
Value: A New Definition for Business? A common standard for measuring the social value of businesses is years away. The need to find new and scalable sources of competitive advantage by creating non-traditional value is growing within the business community. A common standard is required—and quick. Watch this session Traditionally, business value has been based on direct economic factors such as profit and growth. However, in recent years, some companies have challenged this notion, evolving their core strategy to address other issues, such as caring for the planet or looking after people and society. These leaders have identified new and scalable sources of competitive advantage that are driving innovation and generating measurable profit in their own right, while also helping to tackle some of the most important sustainability challenges facing communities around the world. However, is it really possible to measure the social value your business is creating? Can “sustainable valuation” be embedded into core business strategy and investment analysis? These were just some of the questions posed and debated by a panel during Accenture’s Sustainability 24 event. The session, moderated by Harry Morrison, director –sustainability services, UK and Ireland, Accenture Strategy, posited that there is a fairly narrow understanding of value and that needs to change. Alan Kreisberg, senior vice-president of sustainable development at Lafarge, said his company had already started the process of redefining value. “For us, it’s about creating value not just financially for our shareholders, but also for our suppliers, customers and local communities,” he said. Lafarge begins by trying to understand what is important to its various stakeholders and then assessing its performance against those issues. “It’s about getting good information to make good business decisions that take into account the view of all stakeholders,” he said. Sabina Nealon, Unilever’s finance director for sustainability, agreed with the approach adopted by Lafarge. “We assess value in non-financial metrics with the same rigor as financial metrics. And we embed that thinking into all decision-making, whether investment, capex or innovation,” she said. For Peter Bakker, president and CEO of the World Business Council for Sustainable Development, the need to move beyond the current system of reporting is obvious. “Radical transparency from businesses is becoming the norm and is increasingly demanded. So, the only way forward is to redefine value in terms of social and natural capital returns—looking at both negatives and positives,” he said. But how do you do that without common metrics or standards for companies to adhere to? “It would certainly be easier if there is a standard so that it offers investors comparability,” said Nealon. For Kreisberg, there’s a need for a common benchmark for best performance to be created. “Creating a benchmark is more important to us than monetizing value,” he said. It’s an issue that Bakker is keen to sort out. “The big brands like Unilever will increasingly be asked by consumers: what is your true impact, how many of these problems are of your doing?” Bakker added. He believed that if business leaders gave their full support, we could have such standards in ten years. Session illustration Value: A New Definition for Business? Session Speakers
Harry Morrison ... Harry MorrisonDirector, Sustainability ServicesAccenture
|