Every few years, organizations have the opportunity to pause, reflect, and chart a new course. Strategic planning provides this opportunity.
Strategic planning best practices include assessing your organization’s current state, aligning with a vision for the future, establishing key performance indicators to measure your success, and mapping milestones to guide your shares.
The past two and a half years have brought to light new challenges to consider during the strategic planning process related to talent acquisition and retention, supply chain stability, business continuity , diversity and inclusion and cybersecurity.
There is a new framework that serves as a common thread between the factors listed above, encompassing corporate environmental management, social impact and adherence to governance best practices. It is called ESG.
ESG stands for “Environmental”, “Social” and “Governance”. The three terms are the pillars of corporate sustainability: a broader, forward-looking perspective for assessing risks and opportunities for operational improvement within a business.
Business factors that fall under each of the three categories include:
- E : energy consumption, emissions, waste and recycling, use of natural resources, land use and impact on biodiversity
- S: workforce engagement, community relations, diversity and inclusion, worker health and safety, customer relations and product quality and safety
- g: shareholder engagement, board and management policies, business continuity planning, succession planning and data protection
The framework asks you to think critically about what the next 10, 20 or 30 years might look like in your industry.
- Will your existing supply chain partners be there then?
- Will your raw materials be available? Will their cost be lower, stable or higher?
- Is your business prepared for increased volume and veracity of cyberattacks?
- How would you be affected if a carbon emissions tax were introduced?
- As Millennials and Generation Z become the largest segment of purchasing power in the country, how will consumer preferences evolve?
By considering these types of questions, you have the opportunity to make short-term improvements within your business while preparing for the future, giving you an edge over your competition.
Here are some practical examples of how ESG can translate into short- and long-term business outcomes that promote the sustainability of your business (and also benefit the planet).
- STOCK: Integrate employee surveys or listening sessions for feedback using a tool like office atmosphere
- SHORT TERM RESULT: Understand the desires and issues of your employees related to work
- LONG-TERM RESULT: Improve talent retention, increase the number of referrals and strengthen the value proposition of your employees
- STOCK: Evaluate the quality of your energy program using ENERGY STAR standards free resources
- SHORT-TERM RESULT: Establish a baseline to develop an effective energy management program that improves your building’s efficiency
- LONG-TERM RESULT: Save on energy costs
- STOCK: Set up customer feedback surveys using a tool like Have a return
- SHORT-TERM RESULT: Uncover product quality issues before they arise and validate your ideal customer persona
- LONG-TERM RESULT: Improve customer retention and improve your marketing ROI