What is Corporate Sustainability?
Corporate sustainability is an evolving corporate management paradigm. While corporate sustainability recognizes that corporate growth and profitability are important, it also requires the corporation to pursue societal goals. Societal goals specifically those relating to sustainable development — environmental protection, social justice and equity, and economic development. Click here to know the 3 ways of sustainable development.
Below, we will share the concept of corporate sustainability from 4 established concepts:
1) Sustainable Development
Sustainable development is a broad concept that balances the need for economic growth with environmental protection and social equity. In Our Common Future, it is being recognized that the achievement of sustainable development could not be simply left to government regulators and policy makers only. It also recognized that industry had a significant role to play.
As a result of that, many businesses have now embraced and support the principles of sustainable development.
2) Corporate Social Responsibility
Next, CSR deals with the role of business in society. Click here to learn more about Corporate Social Responsibility (CSR).
3) Stakeholder Theory
Stakeholder is defined as “any group or individual who can affect or is affected by the achievement of the organization’s objectives.” The basic premise of stakeholder theory is that the stronger your relationships are with other external parties, the easier it will be to meet your corporate business objectives; and vice versa.
Nevertheless, strong relationships with stakeholders are those based on trust, respect, and cooperation.
4) Corporate Accountability Theory
Accountability is the legal or ethical responsibility to provide an account of the actions for which one is held responsible. The contribution of corporate accountability theory to corporate sustainability is to help define the nature of the relationship between corporate managers and the society. This theory also sets out the justification why companies should report on their triple bottom lines, not just financial performance.
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