Meet around 400 financial officers: CFOs and Finance Directors, all working for companies with more than 1.000 employees or in finance offices with over 100 employees. They are a select group of ambitious senior managers who want to be inspired, discover new developments in the profession, learn from inspiring arguments and network with colleagues. They are highly educated individuals with 10-30 years of work experience. Also a number of bankers, consultants and journalists will be present.
Theme: Value Driven Corporate Sustainability
The theme of Corporate Sustainability has found an important place inside the boardrooms of many Dutch corporations. In ‘duurzame top 100’, the sustainability index of the Dutch newspaper Trouw, there are a large number of executives from Dutch multinationals listed. According to the Dow Jones Sustainability indexes Review 2010, Holland is leading the way internationally in five of the nineteen business sectors.The realization had clearly grown that true value creation comes from taking into account what the interests are of all stakeholders. The old and tried shareholder's model, with the emphasis on financial results and the interests of the shareholders as its trademark, has been up for discussion for a while now. Value Driven Corporate Sustainability can turn out to be an important parameter for success.
More than just Green
Although the ‘green factor’ is often emphasized, corporate sustainability is so much more than just developing a ‘green strategy’. It entails developing a strategy that encompasses all dimensions of a company, including socially and economically. All developments, including on a technological, economical, ecological, political or social terrain, that contribute to a healthy planet with prosperous people in a well functioning ecosystem are categorized as sustainable.
Sustainable Strategy
There are companies that have already shown that sustainability adds value to a profitable business case. They have sustainability firmly embedded into their strategy in order to cover key grounds in new markets in a fast paced world.
The companies that have sustainability high on the agenda make choices by taking into account what impact they have on environments. For them, it’s not just about Profit, but also about People, Planet and Prosperity. Sustainable management means thinking of the needs of not only the current generation, but also future ones.
That way of thinking is not yet part of everyday life. A vast majority of businesses perceive sustainability mainly as a cost. Measures for sustainability are predominantly taken with the aim to cut costs and maintain risk management, or simply because the law forces them.
Transparancy
Nobody opposes sustainability. The theme lends itself well to giving corporation’s images a great positive boost. The threat exists that sustainability becomes a bunch of fancy words that don’t get a foothold in the practise of every day.
Because of this, companies can quickly lose credibility. Transparency about targets and results is extremely important. Stakeholders should be able to see with their own eyes what sustainability means for the company’s results so they can judge for themselves.
Chief Value Officer
Corporate sustainability requires a new way of reporting and checking. Apart from looking at hard results, a way must be found to look at softer factors, such as the satisfaction of employees, contributions to society and corporate images. At this moment all major accountants companies are working together internationally in setting up a framework for sustainable reporting (Global Reporting Initiate). Also, assurance is important and there should be focus on future control on sustainability reports.
Possibly in the future there might even be not only a CEO and CFO, but also a Chief Value Officer, who doesn’t only look at the financial results, but also safeguards the value creation for all stakeholders within a company. In finding a new balance, from shareholders to stakeholder’s values, we need a new business model. Questions that a CFO has to deal with are for example: how do we incorporate new and different value systems in the process of reporting, or how do you calculate a good ROI for sustainability?
Organizing Sustainability
How do you manage to create an environment where everyone knows what is expected of a sustainable company? Following a sustainable strategy calls for cooperation from all levels within a company and outside it. To operate sustainably, a corporation has to oversee its whole value chain. This is about concrete plans to create value for all stakeholders within an organization.
Sustainable HR
The HR-department will be expected to deal with employees in a durable way to make sure they reach their pension age in good health. This is possible with permanent schooling, career planning and possibilities for flexible working hours. The reward system will have to be adjusted to sustainable goals and will have to stop stimulating certain unwanted behaviour. The general image of the company is important in attracting the right talented people, and we must also think about stimulating diversity and developing knowledge.
Sustainable IT
IT can become more effective by using energy efficient systems such as cloud computing. Apart from that, IT is an important tool in making companies more efficient. With the help of analytics it is possible to deal with energy more efficiently, optimalizing processes and calculating a future footprint of a product.
Sustainable Governance
The great amount of attention for sustainability has lead to national and international regulations in the areas of carbon emissions, carbon trading systems and taxes on non-durable products and processes. Within this there is an important role assigned to lawyers, accountants, environmental and innovation experts and business consultants. Lawyers play a key role in advising on (inter-) national environmental laws and regulations and stimulating a healthy governance and transparency within companies.
Sustainable Capital
Banks will have to take sustainability into account when making financing decisions. Also, in their asset management, a critical look shall have to be taken at their investments. How do they deal with this in their investment decisions and do they have enough insight into these issues? Internally, they view themselves to be facing a challenge to find a sustainable business model in which the trust of the client is won back and another financial crisis is avoided.
Sustainable Innovation
Innovation is inextricably tied to corporate sustainability. Only companies that can quickly respond to change will remain in existence. Innovation means: innovative products, processes and innovative organizations. Knowledge that is not in-house will have to be found elsewhere, such as with second parties or advisors.
Leadership as a prerequisite
We cannot create a sustainable society without sustainable leadership. Only people with a clear vision, courage energy and endurance can move the masses.
To ensure that sustainability seeps through to every fiber of a corporations being, strong leadership is required. Rules and regulations are relatively easy to change, the biggest challenge lies within the organization. This requires leadership, a clear vision and strategy within a greatly transparent company. This vision is becoming more and more prevalent in the boardrooms of our companies.
Present your company at the CFO Day
Would you like to be a partner of CFO Day? E-mail Ezri Blaauw.
Are you a CFO and would you like to give a presentation at the CFO Day? E-mail Michael van Asperen