SBS Principles




	There is a lot of evidence showing that companies, which broadly follow the principles of sustainability, e.g. having a much longer business growth strategy, can significantly increase their performance. However, there is little agreement on which of these principles are fundamental and which ones play only a marginal role. During the seminars, workshops and meetings with business leaders we share the sustainability principles developed by Sustensis. Although they are only a guidance, we believe they may help companies and investors make the right decision on a transition to a more sustainable growth. Some companies may implement them as is, but the majority would almost certainly adapt them to suit their particular circumstances, such as internal capabilities and constraints. So, departures from these principles are unavoidable and it is the skill of the company’s management that will ultimately determine how sustainable the company’s growth will become. Sustensis’s contribution in implementing these principles lies, among others, in enhancing the managers skills in maintaining the overall consistency in the day-to-day operation of a sustainable organization. 10 Fundamental Principles of Symbiosa Business Sustainability (SBS): Mission & Vision: intention to grow long-term in a sustainable way Strategy plan: Minimum 5-year on going, updated continuously Business operations: reflect intended Mission and Vision Leaders: “Walk the talk” and facilitate rather than direct CEO: Promoted from within the company for min.5 years. CEO and Chairman’s functions are separate Employees remuneration: can vary with the company’s growth Long service: At least 50% of staff has worked for >5 years Participation: All employees have share options Stakeholder relationships: Based on similar core values Transparency: Disclosure far beyond current regulatory requirements. We offer free preliminary Business Sustainability Review for qualifying comapnies. Apart from these fundamental principles we propose additional sustainable growth criteria which, in our view, will enhance the company’s overall performance. They are split into three levels related to a company or an organization, its senior management and corporate governance, and finally to the management of growth in a sustainable organization. We would be grateful for sending us your feedback on these principles. A. Company Companies are accountable to shareholders (and only indirectly to the community through governmental regulations). They are not accountable to other stakeholder groups such as employees, or suppliers, but to stay competitive they must (rather than should) take account of stakeholders interest. We believe that a sustainable company can be better managed for a longer-term sustainable growth if it is in private hands rather than listed on a stock exchange. In normal circumstances, such a company would not be for sale because its key goal is a sustainable growth. Key investors are encouraged to leave their investment for a period of minimum 5 years if they want to achieve better than average return with lower than average risk. They should be directly involved in periodical reviews of company’s performance and have their own representatives on the board as Non-Executive Directors The Mission and Vision of companies intending to adopt the SBS principles should be redefined to reflect a new way of doing business The ensuing strategic and tactical objectives should also be consistent with such a redefined Mission and Vision. B. Corporate Governance and employment CEO should be the champion for a transition towards sustainable growth The remuneration of board members of listed companies should not include share options Board bonuses should be linked to a three-year averaged rolling profit. Employees remuneration can fluctuate with the actual company’s growth over a certain period (e.g. five years) to achieve a smoothing effect on the planned average growth New employeesshould be assessed for their fit to the company’s “sustainability ethos” Employees who have stayed with the company for more than two years should have additional redundancy protection rights Any external recruitment should take place only after the internal resource cannot be found. C. Management of growth in a sustainable organization The transition towards sustainable growth should not be detrimental to current operations The manner of transition to sustainability (e.g. evolutionary or a fast track) is less important than the adherence to the overall direction towards SBS principles A company should adapt to changing conditions of the market continuously and coherently, rather than redefining its strategy periodically Performance measures should reflect longer-term planning horizon Companies should make at least one independent assessment p.a. of their growth performance and of the adherence to the SBS or similar business sustainability principles. The results of such an assessment should be made public. Profit and revenue targets should be based on a five-year rolling basis Most of these principles are embedded in Sustensis’s services.