Following a trend of other major European investment houses, global financial services company UBS, based in Zurich Switzerland, has published a guide for companies to successfully "focus on both financial and social return generation as core objectives of operation." The 49-page report acknowledges that there is growing pressure on businesses to take into account the societal and environmental impact of the business while also maintaining high levels of financial success. According to UBS, the added focus on sustainability can provide a legitimate competitive advantage ranging from better job applicants to unlocking new pools of investors which feel sustainability is important. UBS makes several suggestions for companies on how to incorporate sustainability and view it as an opportunity rather than the risk, include:
- Definitions of Business Sustainability Are Evolving: UBS believes the traditional approach to corporate social responsibility were designed principle to protect commercial returns. Rather than this focus, companies should adopt the "business with impact approach" which "regard[s] social and environmental factors as opportunities to deliver commercial returns while proactively generating positive outcomes for society." In other words, rather than seek to maximize only financial returns, UBS redefines the purpose of the corporation by highlighting that some companies are seeking to maximize both social/environmental concerns and financial returns.
- Businesses Are Under Pressure to Make Money and Benefit Society, But There Are Road Blocks: UBS notes that the pressure to generate short-term profits can be anathema to the "business with impact" strategies. In addition to pressure to deliver on the short-term, "mismatched incentive structures across shareholders" - i.e. varied interests and goals - can result in cutting corners in a way which does not maximize social and environmental returns over the long run.
- Business Can Build Sustainability Programs That Make Financial Sense and Benefit Society: UBS urges firms to work together to build sustainability business strategies and share ideas. Further, UBS urges businesses to resist short-termism by drawing on the learnings of clients and other resources in a way which allows them to maximize positive society outcomes.