December 2012 – Business Council for Sustainable Development Hungary (BCSDH) recently launched the ‘Complex Interpretation of Corporate Sustainability’ recommendation for business leaders, a guide to assist managers in identifying good corporate sustainability practices.
The ‘Complex Interpretation of Corporate Sustainability’ recommendation was launched in Budapest on November 27. Nearly 50 CEOs signed up to the recommendation. Among the companies that signed up include Accor, Alcoa, Alstom, EDF, Denso, Electrolux, E.ON, GDF Suez, Grundfos, Holcim, ING, KPMG, Legrand, Nestlé, Sanofi, Shell, Siemens, Telenor, Unilever, and Vodafone. Together, they represent almost 20% of Hungary’s GDP.
Commenting on the recommendation, István Salgó, President BCSDH explained, “We believe that the key to the long-term success of a company is having a CEO and management team who are aware of the concept of sustainable development and are able to interpret it in a complex way in decision making. In putting forward these recommendations our aim was to identify principles that can be used as guidelines for corporate leaders in Hungary. In order for this task to be successful, they were drafted in cooperation with business executives and experts in sustainable development. Thus, we hope that they will be received widely and with an open mind.”
By signing the recommendation, company executives make a commitment to manage their companies according to a set of key principles. The recommendation is supported by Mr. János Áder, President of Hungary and the British, German, French, Swiss and Swedish Chambers of Commerce.
The principles contained in the ‘The Complex Interpretation of Corporate Sustainability’ recommendations for business leaders include a commitment to adopting a strategic approach. By signing up, company management is making a commitment to draw up business strategies that integrate long-term, value-creating economic, environmental and social considerations. Management also needs to provide the resources necessary to implement such strategies.
The recommendation also calls for the appointment of a dedicated sustainability manager responsible for overseeing the company’s sustainability performance. However, this recommendation is not simply aimed at management. Under the terms articulated in the recommendation, all members of management and staff, at every level, should be individually responsible for promoting sustainable operation of the company. Executive incentive schemes should be put in place and should include environmental and social goals as well as economic ones.
Ethical operations too form a key part of the recommendation. Each company that has signed up to the recommendation makes a commitment to operate in a manner that both respects the law and is ethical (for example, companies must endeavor to be free from corruption and provide fair employment). The behavior expected must be documented in writing and resources provided for implementation and enforcement. The policy should not simply extend to management, but to all parts of the company.
The recommendation also calls for respect for human values. By signing up, companies are making a commitment to protecting human life and safety, equality and the right to a healthy working environment. This commitment needs to be borne in mind whenever business decisions are made.
An important component of the recommendation is a commitment to the environment. The recommendation requires that the life-cycle approach, along with economic profit and environmental impact, should inform all decisions made by participating companies. Companies should be committed to environmental sustainability and should extend this responsibility to the entire supply chain (suppliers, partners and customers).
Similarly, companies should cooperate with their stakeholders and maintain open and bilateral communication with them. When stakeholders are impacted by company operations, companies should aim to create mutual satisfaction and long-term cooperation and partnerships. They need to set an example by taking advantage of their size and position. When selecting business partners, companies should consider and prioritize sustainability factors. Through professional organizations and extensive cooperation companies should endeavor to integrate into their operations the sustainability principles of regulatory processes and policies.
Finally, the recommendation calls for transparency in operations and decision-making. Signatory companies should collect reliable data and information about their activities, economic, environmental and social impact and performance on an ongoing basis. The information should be made available and companies should inform their partners of their activities in a regular and credible way.
The ‘Complex Interpretation of Corporate Sustainability’ recommendation was drafted by the Business Council for Sustainable Development in Hungary in cooperation with business leaders and sustainable development experts.
Business Council for Sustainable Development Hungary (BCSDH) is one of the World Business Council for Sustainable Development’s (WBCSD) Regional Network partner organizations.