Between war, geopolitical crises, economic volatility and civil unrest, throughout history, the business community has always grappled with instability.
So in some ways, this year’s COP29 global climate conference in Azerbaijan is not set on an unusual global stage.
What is unusual, however, is that never before have these headwinds been so intertwined, interconnected, and interdependent, in such a global and tech-enabled economy.
The entire world is also facing its greatest challenge of all time: climate change is an existential threat to humanity and also the biggest threat to the global economy. There are inescapable and growing natural, legal, social and financial risks at play.
All of this means significantly increasing complexity for business leaders across supply chains, regulation, pricing, and fast-evolving social pressures.
CEOs and business leaders are navigating uncharted waters, while also facing more distractions than ever before… and it’s happening as consumer and investor demand swells for greater responsibility across social, diversity, equity, and inclusion.
It’s no surprise that many leaders are struggling to steer the ship, as they juggle an increasing number of responsibilities and competing priorities.
In fact, a staggering 87 percent of CEOs globally feel that geopolitical instability is hampering progress towards achieving the UN’s 2030 Agenda for Sustainable Development, in which all member states of the UN adopted 17 Sustainable Development Goals,
We are just over halfway to 2030 but we’re certainly not halfway done.
The majority of CEOs (93 percent) are dealing with ten or more global challenges affecting their business. At the same time, 98 percent of global CEOs believe it is their role to make their businesses more sustainable, according to the latest CEO Study by United Nations Global Compact and Accenture.
In Australia, businesses are grappling with increasing regulation and new compliance measures, with non-financial disclosures rolling out from January 2025, and expectations around nature positive on the horizon.
In such an environment, it might be tempting to focus on short-term survival and minimum compliance, and to take a ‘head in the sand’ approach to transformational sustainability until absolutely necessary.
However, we are already well beyond that ‘absolutely necessary’ point, today. At the UN Global Compact, our message is that there should never be a trade off between short-term goals and long-term sustainability. Business has to be for the long term.
And that head-in-the-sand approach could spell imminent disaster for any business choosing to ignore this global groundswell of demand for sustainable business practices.
Because it’s not just technological advancement, AI, and business practice redundancy that could wipe out laggard businesses over the next decade.
A refusal to develop sustainable business practices could also contribute to wiping out a business faster than the smartphone near-killed Polaroids.
By any measure, these are turbulent global seas we are traversing. So how exactly can business leaders chart a safe and sustainable course?
Building resilience through sustainability
Amid all the turmoil and uncertainty, forward-thinking CEOs are building critical longer-term resilience through holistic sustainability measures that are simultaneously preventative and opportunistic.
For instance, when we talk about environmental sustainability, we’re not just talking about reducing or offsetting carbon emissions. We also have to consider nature and biodiversity — the impact a business has on the natural world, how we plan to report on this in the future, and how we eliminate harm and transform businesses to become a force for good.
Considering this now could help in avoiding a sudden scramble in the future, when it becomes mandated into law. But more importantly, it could also be an effective means to tap into the growing demand for sustainable business practices right now and ensure a habitable planet in the long term.
Likewise, social sustainability and broader governance issues are multi-faceted: covering human rights, amplifying First Nations voices, modern slavery, anti-bribery and corruption, greenwashing, quotas, and much more.
CEOs who build social sustainability into the core of their business practices in 2024 will have a head start on any regulatory shifts, which are already happening globally, while also tapping into an increasingly ethical global consumer.
They are also insuring against a growing ‘trial by (news and social) media’ phenomenon, whereby the public acts en masse to punish companies behaving badly right where it hurts them — brand reputation and their hip pockets.
However, this only works when businesses focus on their material harms, for example, while carbon emissions must be abated, large tech companies should prioritise reducing misinformation as their primary concern.
These CEOs see sustainability initiatives as a measure to help weather the storms; to ensure survival in the long term by focusing on their communities, their environment and their impact. But they also see these initiatives as a potentially lucrative competitive advantage.
Businesses that invest in positive change perform better. Research by League of Scholars has revealed that UNGCNA member companies, those who have committed to embedding sustainable practices into strategy and operations, experience a 5% annual premium (4.93%) in returns compared to non-members.
In Australia, this could even look like turning our weaknesses into our strengths.
For instance, we have long been criticised for being economically uncomplex due to being largely reliant on what we dig out of the ground.
But if we reimagined our future with sustainability in mind, we might create a much more complex, durable, and resilient economy, harnessing other natural assets such as the wind and the sun.
We might still dig things up, because the renewable revolution requires critical minerals that Australia has in abundance. But we’d do so in a way that preserves nature and brings benefits to local communities.
By leaning into and centring the voices of First Nations people, we could unlock enormous innovation potential in areas such as medicine, engineering, food security, and more.
By bringing Pacific Nations voices to the table (as per Australia’s bid to host COP31 alongside the Pacific Islands), we would diversify our knowledge base in a way that cannot be achieved on our own.
And we would preempt the financial devastation of remaining reliant on fossil fuel income.
The global economy is moving towards sustainability, and Australian businesses and governments alike have an opportunity to be world leaders.
Changing the narrative
In the face of so many headwinds, sustainability can feel like an inconvenient compliance exercise, and not the rich, potentially lucrative, long-term solution to a series of imminently looming risks, or a way to holistically work towards the UN Sustainable Development Goals.
But when executives are reminded of the mission, the movement, and the change they’re making together, that attitude changes; the spark comes back.
With the upcoming UNiting Business LIVE Australia: Sustainability in Action event, Australian boards, government and businesses have an opportunity to come together to drive a new vision for a more complex and sustainable Australia, and to remain influential in the global economy.
That’s where the inspiration, the creativity, and the drive is going to come from.
The UN Secretary-General has said we’re facing a “moment of truth”. He urged governments, businesses and individuals to do more; go further; to position themselves on the right side of history.
We hope you were listening. CEOs and leaders may be facing more distractions than ever, but that’s because the stakes have never been higher.
In a sea of tough decisions, this one should be easy: To lose sight of the bigger picture and the broader goals for sustainable development would be a disaster — not only for the planet and its people but for your business and your bottom line. Short-termism, protectionism and burying your head in the sand might feel easy. But the repercussions that follow certainly won’t be.