Sustainable Brands’ proprietary tool was launched in Asia at the 2022 edition of the Sustainable Brands Asia-Pacific conference.
Asia is at the frontline when it comes to sustainability. The region is home to several of the world’s largest economies, its fastest-growing consumer markets and large global brands. It is also a region seeing some of the worst impacts from climate change — including record flooding, stronger tropical storms and deadly heat waves.
There are social challenges, as well — as injustice and inequality remain pressing issues in many Asian countries. Quite simply stated, the decisions made by corporate leaders here will help determine the future of the planet.
“Business is intertwined with the communities you operate in, and the environment. That whole ecosystem, you cannot separate from that,” said Michele Kythe Lim, President of the Institute of Corporate Directors Malaysia. She made these comments during a panel at the recent Sustainable Brands Asia-Pacific 2022 conference, where it was announced that Sustainable Brands™’ Brand Transformation Roadmap (BTR) was being launched in Asia.
While the BTR is new to Asia, it has been used by companies in the United States for several years. The tool got its start back in 2017 when Sustainable Brands noticed that several of its Corporate Members were facing challenges becoming sustainable. The result was the BTR — which has helped a growing number of companies orient and navigate the challenging journey and advance towards embodying their purpose.
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“About 100 assessments have been taken by 100 different brands, at the enterprise and brand level, across different industries — manufacturing, healthcare, retail, business to business, and more,” Daniel Krohn, International & Brand Transformation Consultant at Sustainable Brands, said at the conference. SAP, Procter & Gamble and Iron Mountain are just a few of the global players that have used the BTR to guide their transformation.
At its core, the BTR enables companies to plot their entire sustainability journey, and regularly assess their maturity in five critical practice areas — purpose, brand influence, operations and supply chain, products and services, and governance. It starts with the creation of a framework and self-assessment; and it’s often a multi-year journey.
Krohn spoke about how the Roadmap is constantly being improved from experience, evolving to better meet the needs of its users — ideally to include Asian brands soon, as well. The BTR is entering Asia at a time when companies and brands are reassessing sustainability. Measuring and reporting against ESG metrics has grown in the region; but too many companies were still treating sustainability as a ‘nice to have’ — not as a core business concern. What needs to change, Lim argued, is corporate governance.
“Corporate governance needs to shift from being compliance-oriented to being more forward-looking, innovative and smarter around sustainability. Think about your company’s compensation structure — is it all financial metrics? If so, that’s not good,” Lim said.
One of the challenges that Yoo-Kyung Park, Head of APAC Responsible Investment & Governance at APG Asset Management, has observed across the region is a leadership gap.
“In many companies in Asia, the controlling shareholders shy away as they don’t want to be seen as too active, so they don’t talk about sustainability; and then CEOs don’t talk about it, and then the board members shy away as well,” she said. “Business owners need to say something.”
Kulvech Janvatanavit, CEO of the Thai Institute of Directors Association, argued there is also a need to recognize that leadership has a different meaning in the age of sustainability.
“Today, leadership is not about top-down, ordering people what to do; but it’s a kind of energy to get people together, believe in something, and make it happen,” he said.
One thing Park would like to see? Less ‘good-sounding words’ in corporate statements and reports.
“When analyzing companies or corporate sustainability reports, what we are trying to find is consistency,” she said. “It is all beautiful words, or it is practical solutions? Consistency and action matter, rather than commitments.”
This can be daunting. Sustainability means completely rethinking how a company does business, including embracing challenges and being open and transparent about failures, past and present. It requires transformation, which, to many corporate leaders, can sound terrifying. That is why the BTR was developed, to provide a guide, with measurable metrics, and milestones, to ease a brand’s journey towards sustainability.
“Changing systems is challenging,” said Valutus founder Daniel Aronson. “If you use BTR and other tools, you can get there much faster and much more effectively.”
There really isn’t a choice, Janvatanavit added. The planet doesn’t have time for any more business as usual.
“Our generation is the first to see the impact of climate change and unsustainable business – and we’re the last one who can save the world,” said Janvatanavit. “We can’t leave it to the younger generation, there is no hope for them if we don't do anything.”
In the coming months, Sustainable Brands teams in Malaysia, South Korea, Japan and Thailand will work with brands, and hold workshops and other events, aimed at localizing the BTR and making it relevant for companies in the Asia-Pacific region. In Thailand, four leading national brands will participate, and the initial feedback has been highly positive — but also shows the need for localizing the tool.
“There are several issues that maybe common in developed countries but not yet familiar in Thailand, such as the concept of ‘net positive.’ In short, it’s a bit too advanced,” said Sirikul Nui Laukaikul, Country Director for Sustainable Brands Thailand.
The hope is that, with time, the Brand Transformation Roadmap will evolve and enable more Asian enterprises to shift their governance models and business plans to ones that enable a more sustainable, equitable and healthier planet and society.