Integrating Sustainability Into Firm Business Strategy

What is it about?

Sustainability imperatives hold the potential to drive business strategy in a way that improves both firm and environmental long-term viability. Yet, too often, the process of making such transformations can be misperceived as being outside the bounds of acceptable risk-taking for some firms. At minimum, companies often shy away from the challenge of discovering how to make sustainability initiatives relevant to their everyday efforts to cultivate customers while gaining competitive advantages. This paper provides a framework for linking sustainability to Michael Porter's generic strategies in ways that are practical for every firm.. More importantly, it sets the stage to enable firms to move naturally from merely doing business strategically, toward doing business strategically with greater sustainability.

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Why is it important?

The vast majority of firms want to do business in sustainable ways. However the currently popular frameworks for 'doing sustainability' tend to force companies in one of two directions -- either one tends to underminine the firm's basis for gaining competitive advantage. One such strategic option drives firms in a direction that forces them to operate sustainability initiatives in parallel to their business strategy with little actual integration of the two. This can create an operational wedge that causes greater difficulty in integrating the firms business strategy with sustainability processes. Secondly, it may require a company to embark on a 'bet-the-firm' ad hoc experimental design strategy meant to create a unique sustainability-driven strategy. However, this often strains the firm's culture and structures by removing reliable operating routines, traditions, and creates intolerable risks. There is now a third way to achieving both greater firm and systemic environmental sustainability - which includes fortification of social and intangible assets. The lynch pin to this approach is built on Porter's remarkable work on ways of looking at sustainability more strategically.

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