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Sustainability = The Defining Feature Of Africa’s Growth


by on 24/07/13 at 11:00 am
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African companies now recognise the importance of sustainability as a strategic imperative, although many still battle with implementing a comprehensive solution. This is the view of Antoinette Du Randt, Regional Director, DuPont Sustainable Solutions, the operations management consulting firm of the science company.

Du Randt says “after grappling with sustainability for many years, starting with how to define sustainability, there is now raised awareness about the need to continually think about keeping a business sustainable for the long term”. Du Randt ranks sustainability as a key challenge for corporations in the 21st century and she equates it to the modern assessment of business performance.

“A key element of sustainability is the creation of social value,” says Du Randt, who points out that companies are under pressure to not only deliver profits for shareholders, particularly evident in mining companies, but also to deliver higher value to government through increased taxes and royalties, as well as communities where they operate, who are looking for employment opportunities and improved facilities.

Sustainability can also become the defining feature of Africa’s growth in the decades ahead, helping the continent overcome the “growth at all costs” trap that has afflicted other countries in the past, whose economic growth has sometimes been accompanied by high social and environmental costs.

Africa has changed for the better, moving from economic stagnation to being home to seven of the ten fastest growing economies, according to The Economist. This growth has helped build a burgeoning middle class, which has spurred demand for goods and services.

But for Africa to truly realise its potential it will need to diversify its economy, encourage movement to high value manufacturing and facilitate beneficiation of its vast minerals. Putting in place robust sustainable development strategies will help the continent achieve inclusive growth without damaging the environment or harming the long term use of fresh water resources and agricultural output.

Du Randt points out that DuPont sees sustainability as part of the evolution of the business model and is a goal that companies have to pursue in collaboration with government, labour and communities. Du Randt believes that sustainability is no longer a function of corporate responsibility or compliance, but rather a key growth opportunity that differentiates a company from its competition. “For companies to thrive, the communities they operate in must thrive,”

Du Randt says as with any other business objective, sustainability needs to be driven from the top of the organisation with a clearly defined set of goals, a buy in from all employees and leadership from board and executive level.

Du Randt points out that companies need a change in mind set and view sustainability as “going beyond corporate social responsibility” to create sustainable shared value for all stakeholders as a strategic imperative.

Sustainability can deliver commercial benefits. Between 1990 and 2004, DuPont estimates that it reduced its greenhouse gas emissions by 72% and has generated $ 10 billion in revenue from products based on non depletable resources.

She also argues that stakeholders need to have realistic expectations from sustainability and that stakeholder education and inclusion is important.

Du Randt argues that the best way for companies to achieve sustainability is to invest in innovation that improves all aspects of business performance, whether its improvement in production while reducing water and energy consumption or by defining market facing goals which deliver product innovation that reduces the environmental footprint throughout the value chain while providing tangible consumer benefits

There is also emerging debate whether companies should be provided with incentives, including financial incentives, to pursue sustainable practices. Du Randt points out those financial incentives are likely to have a limited impact and the companies should pursue sustainability for their own long term interests.

Du Randt also argued that there are already incentives such as tax breaks in place and the ultimate incentive for any company is increased and sustained profitability, gained through an integrated strategy informed by shared value creation and capture.

Du Randt concludes by noting that as external pressures continue to mount, improved sustainability performance is no longer optional, shareholders and stakeholders expect companies to reduce their environmental foot print.

As companies search for opportunities on the African continent and exploit its resources, they should use innovation and a robust sustainably culture to drive improvement.

Ideate is one of South Africa's biggest business blogs, with a team of authors all of whom have had entrepreneurial experience. Ideate is read by entrepreneurs thinking BIG. Follow us on Twitter here. View more articles by Staff Reporter.

Tags: Africa, sustainability

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