Sustainable development strategy - Competitive Advantage for Businesses

Sustainable development strategy has an important influence, not only demonstrating social responsibility but also being a decisive factor in the success and sustainability of a business.

What is sustainable business development?

Building a sustainable development strategy and practicing well according to that strategy will help businesses create long-term value, control risks, flexibly adapt, increase efficiency and save resources, and at the same time while enhancing brand image and customer sympathy. This helps businesses increase their competitive advantage in the market, positively contributing to the community and social environment.

How is sustainable business development understood?

Sustainable development is understood as development that meets the needs of the present generation without harming the ability of future generations to meet those needs on the basis of a close and harmonious combination between economic growth, solving social problems and protecting the environment.

In that general concept, for businesses, sustainable corporate development is a rule and strategy that businesses set and implement to ensure a balance between economic benefits and social and environmental issues. school. Businesses must build operating processes and management strategies to ensure that resources and employee benefits are not damaged...

Thus, sustainable business development is evaluated on three aspects, including: clean and efficient production process; Products are environmentally friendly and fully implement social responsibility.

Sustainable development strategy: Three aspects of economic, social prosperity and environment of the sustainable development triangle.

Benefits of sustainable development strategy for businesses

A sustainable development strategy will help businesses build a solid basis to create long-term value. It also helps businesses recognize and manage risks better, build flexible and sustainable business models and effective management systems to cope with changes in operations and development.

With a sustainable development strategy, businesses can optimize resource use and reduce waste. By adopting measures to save energy, natural resources and materials, businesses will improve production efficiency, minimize environmental impact and save costs. This also contributes to increasing competitive advantage in the market and brings both immediate and long-term economic benefits. Furthermore, compliance with sustainable standards and regulations will help businesses increase goodwill from customers, employees and the community, thereby helping to increase sales and expand potential markets.

ESG strategy

ESG strategy also helps businesses become more flexible to adapt well to rapid market changes, such as consumer trends. By investing in research and development and continuous innovation, businesses can create value and stay competitive in a constantly changing business environment.

Principles of sustainable development

In principle, sustainable development in general, and sustainable development for businesses in particular, is the process of simultaneously operating three aspects of development: sustainable economic growth, prosperous, equitable, and stable society. stability, cultural diversity, a clean environment, and sustainable resources.

From this general principle, there are three aspects that businesses need to pay special attention to when aiming for sustainable development:

Pollution Prevention: Businesses proactively prevent pollution by focusing on reducing or eliminating wastes before they are created rather than treating wastes after they are created. This strategy is implemented through continuous improvement to reduce waste as well as reduce energy consumption;
Product life cycle management: Focus on minimizing pollution throughout the product life cycle, not just during the manufacturing process.
Clean technology: Focus on developing and using green and environmentally friendly technologies.
Thus, when aiming for sustainable development, businesses first need to save input resources (raw materials, energy) and minimize all types of waste. To do that, businesses need to synchronize production, distribution, treatment, and recycling of products in the direction of minimizing the consumption of resources and minimizing negative impacts on the environment. Considering all stages related to the product life cycle should be prioritized from the beginning, while focusing on applying clean production technology to minimize impacts on the environment.

Vinamilk's sustainable development strategy Solar power helps businesses produce cleanly and practice sustainable development

Building a sustainable development strategy for businesses

ESG (abbreviated from a set of three criteria: Environmental, Social and Governance) is a basic set that helps businesses plan and develop sustainable development strategies and implement them effectively. ESG will guide businesses on how to manage risks as seizing development opportunities in 3 aspects:

Environment: energy sources, resources, waste during business operations.
Social: diversity, equity, safety, security, business and community relations.
Governance: management process, remuneration mechanism and diversity in the Board of Directors to make effective decisions.
5 steps to help businesses build effective ESG strategies and practices

Depending on the industry, scale and goals, each business has a plan to build an appropriate strategy and implementation speed for ESG. The 5-step process below is the basis to help businesses build more effective ESG plans and practices.

Determine vision, goals and current status: First, businesses need to define a clear vision and sustainability goals, such as identifying important environmental and social issues for their industry, specific goals to address them (reducing emissions, increasing the use of renewable energy, ensuring a fair supply chain...). Businesses also need to look back and consider their current financial status, human resources, position... and research the level of impact when applying ESG sustainable development rules to their business.
Establishing strategy: Based on the 3 pillars of environment - society - governance of ESG, businesses come up with ideas and establish appropriate strategies. Businesses need to establish strategies according to indicators and measurement criteria to track progress and assess impact, such as measuring energy consumption, carbon emissions, recycling levels... From there, come up with solutions. Plan to use resources intelligently and efficiently, reducing waste and maximizing value. Advanced technology and manufacturing processes can help reduce waste, water and energy consumption. In addition, businesses should also have supply chain plans and cooperate with partners to help increase performance and reduce environmental impact. Sustainable partnerships will help businesses practice sustainable development more effectively, and can create new business opportunities and enhance the brand image of the business.

Building a transformation roadmap helps make the implementation process more convenient, and is also an important basis for personnel to adapt and coordinate implementation quickly and effectively.

Deploying sustainable development: Before implementing, businesses should inventory the factors that need to be changed and relevant personnel to ensure progress and success rate. In the process of implementing sustainable development solutions according to the set roadmap, businesses should encourage and continuously communicate internally so that employees clearly understand and are motivated for true sustainable development.
Evaluation, reporting and optimization: To ensure the effectiveness of the sustainable development strategy, businesses need to periodically monitor and evaluate. This helps identify strengths and weaknesses, improve efficiency and optimize innovation. Assessment tools and methods can include tracking progress towards established sustainability goals, environmental assessments, regulatory compliance checks, customer surveys... Finally, businesses need to report ESG information to relevant organizations as well as the community, clearly demonstrating its sustainable development efforts to customers, partners as well as shareholders.
Importantly, a business cannot develop sustainably in isolation but must have close connections throughout the supply chain. Therefore, many experts believe that each business needs to act more strongly and cooperate to develop sustainably together and join hands with the community to realize sustainable development.

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Viet Australia Auditing Company is an independent auditing organization licensed and established in 2007 in the Socialist Republic of Vietnam.