Issues such as climate change and global warming, human rights, and health and sanitation for all have garnered significant attention in recent years, in part, due to the United Nations’ adoption of the Sustainable Development Goals (SDGs). Leading businesses realize that it is no longer enough to maximize profits and cater only to shareholders; it is also critical to integrate the well-being of the planet and its people into their business models. Such a transformation to managing the “triple bottom line” of people, planet and profit requires looking at business and its operations through a new lens.
In this context, “sustainability” – the practice of integrating environmental and societal concerns into business models – is emerging as a unifying principle to guide firm behavior. No longer is it considered sufficient or sustainable to devote an arm of the company to philanthropic giving. Rather, sustainable business practice entails making the ethical and strategic concerns of all stakeholders central to all aspects of the firm. This requires a continuous process of engagement with multiple stakeholders who influence or are influenced by the company, including customers, employees, investors, regulators, and activists.
Leading conceptual and empirical research shows that – when implemented correctly – sustainability initiatives can have positive social and environmental effects as well as contribute to a company’s competitive advantage, drive innovation within and across industries, reduce exposure to risk, and positively impact various measures of financial performance. In other words, it is possible to “do well by doing good.” Equally, caring for the wellbeing of the planet and its people while conducting business is, in our view, simply the right thing to do. While this kind of thinking is powerful and would benefit both business and society, achieving this symbiotic relationship between business, society, and the environment requires a strategic understanding of when, why, and how sustainability initiatives create value for all stakeholders.
To this end, the most effective business leaders of the 21st century need to grasp the breadth and depth of current challenges and opportunities in sustainability. This includes a much more nuanced understanding of the conditions under which sustainability initiatives yield positive business and social returns. Some of the largest and most successful companies around the world are working to embed sustainability in all aspects of their organization, from operations to marketing to the supply chain and beyond. In 2008, 90% of Fortune 500 companies had some formal commitment to corporate social responsibility initiatives. As of 2014, Fortune 500 companies collectively spent more than $15 billion annually on corporate social responsibility initiatives.
Yet, despite increasing investments in sustainability and corporate responsibility initiatives, the potential impact of this investment remains under-realized by the majority of companies because sustainability is not embedded throughout the entire organization. In many cases, this occurs not because of a lack of interest in promoting sustainability, but because of a lack of understanding about how to take on this unfamiliar task.
Vision & Strategy
We created the Center for Sustainable Business (CSB) at the University of Pittsburgh to help address this critical need. The mission of the CSB is to maximize the value of investments in sustainable business strategies for all stakeholders. We accomplish this by leveraging the unique expertise and capabilities of an active research and teaching community together with the applied knowledge and industry experience of some of the world’s most influential companies.
The Center, housed at the Joseph M. Katz Graduate School of Business and the College of Business Administration, consists of three broad programmatic areas: thought leadership, research, and education. In all three of these areas, we utilize our position as a leading academic institution to engage companies in the adoption of more sustainable business practices. We help companies and other stakeholders (individuals, government entities, non-profits, foundations, etc.) capitalize on short-, medium-, and long-term investments in the human resources, intellectual know-how, and physical and social infrastructure needed to realize a more sustainable future for our local and global communities.
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