Labels don't guarantee sustainability

SME entrepreneurs who invest in sustainability like to see their investment pay off. Not only financially but also in terms of marketing and communication. A CSR certificate seems like a great start - "look how sustainable my company is," the proud recipient can boast.

We shouldn't blame the entrepreneur for adopting this approach. More worrying is that this approach to the market inhibits the fundamental steps towards making a company sustainable. After all, how does a CSR certification contribute to a company's real-world and sustainable operations?

Sustainability and certificates

Sustainability is about creating a resilient society and companies that can become more self-sufficient. A resilient business, akin to any resilient system, is flexible. It can evolve with the times, adapt quickly to change, and anticipate the future.

Certificates do not measure that adaptability and are always forced on a narrow segment of the many aspects of sustainability. Thus, entrepreneurs adopt a distorted picture of sustainability and how they can enhance their own.

Sustainability as a strategy

Sustainability is mainly expressed in a company's strategy and has had positive impacts over the years. Contrary to popular belief, it doesn't start with things like energy, waste, biodiversity, and ethical conduct - all of which are measured by a certificate but are ultimately the outcomes of sustainable practices.

A certificate can help communicate results to the outside world, but if they are not based on a broader strategic vision and actions within the company, it says and does very little.

Because certificates only measure physical aspects, a misguided emphasis is placed on them, while the factors not taken into account receive no attention. What we see is that it is precisely these factors that can cause unexpected environmental damage, social problems, or instability within the company.

Because the certificate does not measure them, the entrepreneur is unaware of this. Ironically, even a company that meets the criteria of the most common sustainability labels can negatively impact society - and pay astronomical costs to certifiers while doing so!

That's also where profit comes into play. Companies that integrate sustainability into their long-term strategy are more robust in the marketplace, with more motivated employees and innovativeness and less absenteeism. These are not the typical things that sustainability certificates are about, but a simple matter for a company's survival.

Leaders

A CSR certificate is not meaningless; the CSR Performance Ladder can generate positive examples and give insight into how a company is doing.

However, it is not a good idea to put sustainable enterprises in a box and tick off what you do or do not comply with, hoping to gain a certificate. Taking an integrated approach to sustainability will make a difference.

SMEs who dare to take this step and become leaders in their industry in sustainable business will reap the long-term benefits.

Roel Vos is co-founder of Sustainable Group Netherlands, and Tom Bosschaert is director of Except Integrated Sustainability. Together they work on a decisive increase in the sustainability of SMEs.