How to balance sustainability and corporate growth? Hints for "new growth" learned from leading companies

Initiatives related to sustainability, including the SDGs, have now become a social responsibility that companies must fulfill. However, while many companies understand its importance, they often face various contradictions and difficulties when integrating it into their corporate growth strategies. Therefore, Dentsu Inc. launched a webinar series under the theme "Sustainability for New Growth."

Titled " What is Corporate Growth in a Sustainable Society? ", this session featured presentations by Mr. Takatoshi Kitajima from the Brand Strategy Department of Meiji Yasuda Life Insurance Company and Ms. Yoshimi Hirako from the Corporate Communications Department of Sumitomo Forestry Co., Ltd., both of whom are implementing advanced sustainability initiatives. They introduced their respective companies' approaches. Furthermore, members of Dentsu Inc.'s Sustainability Consulting Office discussed the challenges faced by many companies.Here's a look at the webinar, which offered many insights for considering sustainability and corporate growth.

How Sustainability Drives Corporate Growth

In his opening remarks for the webinar, Keiichi Higuchi, Executive Officer at Dentsu Inc., highlighted the current trend of numerous client companies seeking advice on sustainability. He emphasized the potential for sustainability to drive corporate growth.

Higuchi: In recent years, business value chains have become increasingly complex for many companies, and touchpoints with internal and external stakeholders have diversified. Consequently, we often hear concerns that even when companies want to pursue sustainability, coordinating with various departments and stakeholders is difficult, and consensus-building often stalls.However, we believe that making sustainability the central axis can actually clarify decision-making within such complex situations and enable the organization and restructuring of internal and external relationships. This, in turn, could become the catalyst for new corporate growth.

In the webinar, we explained corporate sustainability—which can easily become theoretical or idealistic—using concrete, leading-edge case studies. Furthermore, we introduced solutions that will be useful for companies considering implementation.

Realizing Corporate Purpose: Health Promotion and Regional Revitalization as Sustainability Initiatives

In the corporate case study session, Mr. Kitajima from Meiji Yasuda Life Insurance and Ms. Rie Takeshima from Dentsu Inc. took the stage. Titled "Initiatives Addressing Social Issues like Health Promotion and Regional Revitalization, Including J.League Partnerships," they discussed case examples, their relationship to business activities, and future prospects.

Meiji Yasuda Life Insurance promotes projects extending healthy life expectancy and fostering regional revitalization through sports, guided by its brand message: "Health for people, vitality for communities." One such initiative is its partnership with the J.League, launched in 2014. Starting as the J.League's title partner, the company now has 105 branches nationwide serving as club sponsors for all 60 J.League clubs and JFL clubs.Beyond simply watching and cheering at matches, the company engages in initiatives that contribute to health promotion and regional revitalization, such as organizing walking events where participants walk alongside players and team staff, and holding soccer clinics for children.

Furthermore, using these projects as a starting point, we are also working on corporate transformation, such as integrating community contribution activities into our business operations and establishing bases that contribute to regional health initiatives.

Kitajima: Going forward, we aim to strengthen our framework for solving regional challenges. Previously, we standardized our approach into common packages, delivered in a similar style across all branches. However, since actual challenges vary by region, we believe it's crucial to enhance our ability to address individual issues. We will continue our efforts to deepen relationships with club teams and local governments, striving to become a core element within these communities.

We now live in an era where both companies and individuals are increasingly questioned about their purpose and existence. Our company values both economic and social value, aiming for management that creates a virtuous cycle between them.

Following Mr. Kitajima's remarks, Mr. Takeshima shared his perspective on the company's initiatives.

Takishima: While sustainability often focuses on the environment, health promotion and regional revitalization are also significant and immediate challenges for Japan. Your approach aligns well with the life insurance business. Furthermore, using sustainability as a catalyst to drive various business transformations, and collaborating not only with companies but also with sports organizations, local governments, and customers who share the same vision—this truly represents the ideal approach for our times.

Company-wide Initiatives and Effective Communication Significantly Boost Brand Image

Next, for the second corporate case study session, Mr. Hirako from Sumitomo Forestry and Mr. Soichi Ono from Dentsu Inc. took the stage. Titled "Leveraging Sustainability for Corporate Growth! ~The Importance of Communication Strategy~," they introduced the high affinity between Sumitomo Forestry's business and sustainability, as well as key points for effectively communicating with stakeholders.

The company announced its "Long-Term Vision for Decarbonization" in 2022. Shifting from being a housing manufacturer with strengths in wood construction to becoming a global partner in the decarbonization shift, it is transforming its entire business toward decarbonization solutions.

Hirako: Sumitomo Forestry operates a wood-centered circular business model called " WOOD CYCLE. " It begins with growing trees, then harvests them. The harvested wood is utilized not only for various products but also as fuel for biomass power generation.After harvesting, we replant, creating a circular business model. Promoting this cycle itself connects to decarbonization, a pressing global challenge today, making the business itself uniquely sustainable.

Ono: Sustainability integrated into the business itself likely aligns well with employee motivation, doesn't it?

Furthermore, establishing a clear long-term vision centered on decarbonization has reportedly had a positive effect on the company's growth.

Hirako: Since announcing our long-term vision, we've ensured all corporate communications are tied to it. Communicating our value proposition to society alongside concrete facts has yielded positive results.

In fact, Sumitomo Forestry saw a significant improvement in its corporate image after communicating messages about its decarbonization contributions through advertising and other channels.

Linking Sustainability to Corporate Growth

The latter half of the webinar featured a panel discussion titled "What are the hints for making sustainability a new foundation for growth?" moderated by Yasutoshi Sumida, Head of Dentsu Inc.'s Sustainability Consulting Office, with panelists Mineko Hotta, Jun Kanie, and Ayu Sasaki, all members of the same office.

The Sustainability Consulting Office, newly established in January 2023, supports companies in creating sustainable business models. The discussion also touched on specific solutions provided by Dentsu Inc. related to the theme.

First, the panel addressed the common challenge faced by many companies: "the ambiguity between non-financial activities and business themes." Mr. Kanie, the developer of the "Non-Financial Value Survey" solution, then introduced this approach for deriving the contribution value of non-financial activities to business.

Kanie: The "Non-Financial Value Survey" is a service that uses Dentsu Group's proprietary data and analytical methods to identify the strengths and weaknesses of non-financial activities and discover promising future activity themes. A major feature is that it reveals how non-financial activities impact corporate image and resonate with stakeholders. It also provides insights into whether a company has strengths compared to competitors and hints on what next steps to take.

Next, we discussed the theme: "When a sustainability perspective becomes necessary for new business development or business shifts, how should we approach it?" There was unanimous agreement that sustainability is an indispensable perspective when considering a company's medium-to-long-term direction. Furthermore, as a tool useful for developing sustainable new businesses, Mr. Sasaki introduced "Sustainable Growth Drivers."

Sasaki: When developing this tool, we aimed to transform sustainability—which can sometimes appear as a constraint—into growth potential. Thus, "Sustainable Growth Drivers" compiles 25 perspectives that convert various unaddressed challenges facing Japan by 2030 into business growth opportunities. We hope this will spark new ideas.

Its unique feature is its design as a card game-style workshop tool. By making the process enjoyable, it can help smooth communication and increase the number of people involved.

Next, addressing the theme of "difficulty achieving cross-departmental consensus on advancing business actions." The challenge of aligning perspectives not only across departments but also among many internal and external stakeholders is a common concern for many companies tackling sustainability. The tool proposing a solution is the "Sustainable Roadmap." It communicates sustainability challenges across the entire supply chain in a way that is easy to understand and logically presented to many people.

Hotta: The " Sustainable Roadmap" was developed as a support tool for shaping sustainability, informed by trends and consumer needs. It consolidates regulations like sustainability-related laws, along with trends in technology, materials, and processes. Furthermore, shifts in consumer thinking, behavior, and values form the core axis of the roadmap.It is designed to be useful when building consensus on sustainability-related business initiatives, enabling logical explanations such as, 'Given that regulations will evolve this way and technology will reach this stage by then, we should launch this product now.'

Finally, Mr. Sumida concluded the panel discussion by stating that he hopes to leverage the opinions and solutions introduced thus far to work with companies toward realizing sustainability.

Sumida: Rather than having definitive answers ourselves, we want to explore those answers together. We sincerely hope we can collaborate.

Some companies may perceive sustainability initiatives as potentially requiring more time and cost than before, or as a hindrance or constraint to growth. However, it's clear that sustainability significantly expands the potential for corporate growth, offering new growth ideas, enhancing employee awareness, and building stronger relationships with stakeholders.Why not consider charting a path forward, like the two pioneering companies, leveraging your company's strengths to take the first step toward becoming a sustainable enterprise?