The need for decisive changes to the strategic direction and organization is intensified by the Corona crisis, but at the same time offers the opportunity to reposition itself for the future and secure sustainable competitive advantages.
The integration of sustainability into corporate strategy and business processes is now essential for long-term economic success. Only if the interrelationships between corporate activities and society in the various dimensions (economic, ecological and social) are considered in an integrative manner can potential be leveraged for one's own company from the major social challenges, such as climate change or urbanization.
The transformation to a sustainable business model is significantly influenced from three directions: by companies, regulators and social interest groups. Measures to achieve a sustainable business case for manufacturing companies can therefore include product improvements, innovations for material efficiency, cost reduction through waste avoidance or shortened supply chains. Reputation and brand management should not be underestimated when it comes to topics such as recruiting and talent scouting.
Sustainability management is usually more established in large companies than in medium-sized companies. This also has to do with regulatory requirements, such as reporting on non-financial key figures as part of the CSR Directive Implementation Act (CSR-RUG). For companies active on the capital market, these measures are also reflected in analysts' assessments and ratings. Mainstream analysts and investors are paying more attention to a convincingly sustainable business model. Such a model is increasingly seen as an indicator of the quality of management and is therefore crucial for future business success.
On June 11, 2021, the German Bundestag passed the Supply Chain Act (Act on Corporate Due Diligence in Supply Chains). This means that from 2023, large companies will have to monitor and promote compliance with human rights in their supply chains. The legal anchoring of corporate due diligence obligations entails an expansion of the scope of responsibility of companies as well as increasing requirements for the integration of social compliance to respect human rights and compliance with labor law standards.
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