4 actions to align sustainability goals with digital transformation

If organisations change the way they operationalise sustainability, they can significantly increase business value.

What’s needed is to align sustainability goals with digital transformation efforts. Here are four actions to achieve that.

1. Reimagine the business model

Advanced technologies can not only make business more efficient and profitable but also smarter and more agile, adjusting to consumer needs and changing market conditions, and transforming business models to “do more and better with less”.

Organisations must reimagine their whole business model and value chains by integrating digital and sustainability into everything they do in order to design, construct, and scale operations, services, and products that are more intelligent, efficient, sustainable, and resilient. Circular practices and sustainable product design, for instance, not only lessen the environmental impact of a product but also increase cost and resource efficiency, strengthening enterprises’ ability to withstand supply chain disruptions.

Integrating sustainability with digital strategy involves more than upgrading technology, though. It requires an agile business model that can pivot as regulations and market conditions change, especially in light of growing climate concerns. Companies that embrace circular economies demonstrate that sustainability and profitability can coexist. The key is for accounting and finance professionals to take an active role in this integration, considering how business models may adapt to achieve truly sustainable growth rather than addressing sustainability from a “we have to report” perspective.

2. Identify software to invest in

Delivering on the promise of sustainable digital transformation will require CFOs to collaborate closely with other executives to identify the technologies that will help the company achieve its sustainability goals.

Technologies like advanced analytics and AI applications enable tracking and reporting of sustainability metrics more accurately and transparently, which is essential for upholding investor confidence and complying with legal requirements. Some tools can also help identify and manage sustainable investment opportunities, aligning financial strategies with long-term sustainability goals. The implementation of effective technology has made sustainability reporting, capital allocation, risk management, performance management, regulatory compliance, and sustainability storytelling much more manageable and measurable.

3. Measure impact

It is crucial that finance leaders apply the value-creation mindset. They need to help create long-term value and build sustainability into core company strategy, support integrating sustainability with digital strategy, and report on how the organisation has generated value. This is where the opportunities and competitive advantage will be found.

Finance’s role in measurement and management of an organisation’s intangible ESG value, which facilitates decision-making and eventually propels long-term success and profitability, will be a crucial component of measuring and communicating impact.

4. Lead the shift to systems thinking

Finance leaders must shift from a cost and compliance focus to resilience and systemic risks and from siloed to systems thinking that considers the interconnectedness of technology, sustainability, and organisational strategy. To successfully make this shift, finance will be required to expand its knowledge of integrated thinking, data analysis and digital skills, sustainability expertise, and change management. Improving these skills will help finance move from assessing only financial performance to assessing broader economic and societal performance to better understand their organisation’s environment and community impacts.

Adapted from: “4 actions to align sustainability goals with digital transformation”, by Jakub Bejnarowicz, regional director for Europe at AICPA & CIMA, together as the Association of International Certified Professional Accountants, published on FM magazine on 11 October 2024.