Argon & Co has recently revised and updated its ESG and sustainability offering. But why is ESG important? Why now? And where should companies start? MHD asks Argon & Co’s Frans Verheij and Maxime Van Hees these and other questions.
In an age where sustainable business practices are no longer just nice-to-haves but imperatives, Argon & Co is leading the charge in integrating Environmental, Social, and Governance (ESG) considerations into all its consultancy offerings. For this global management consultancy, ESG isn’t merely a buzzword or a checkbox but a driving force.
“Humanity must work together towards the common goal of amplifying future living environment by considering sustainable practices throughout every aspect,” says Maxime Van Hees, Consultant at Argon & Co.
“It starts with a personal driving force. It’s about recognising that change is needed, especially in a business context.”
But, of course, it’s not only about personal conviction. External and internal corporate pressures make it increasingly difficult for businesses to ignore the call for sustainable operations.
Maxime highlights the “increased regulation in Europe and America, shifting consumer patterns, the financial market’s inclination towards sustainable businesses, and Climate Change affecting supply chains” as significant drivers in the push towards sustainability.
Frans Verheij – Former Partner of Argon & Co, who now occupies an emeritus Strategic Advisor position – builds on Maxime’s latter point, noting the increasing importance of regulatory compliance.
“The government is taking action on issues like carbon emissions,” he points out, indicating that the days when businesses could choose whether to be sustainable are fast receding. “Soon, businesses won’t have a choice: the government will require them to be sustainable.”
And it’s not just the regulators businesses have to be wary of. In the age of social media and global connectivity, consumers are more informed and more vocal than ever before. Companies that don’t align their operations with sustainable and ethical considerations can suffer catastrophic consequences.
“For instance, one of the most famous sport fashion brands faced backlash years ago for child labour allegations, halving its brand value overnight – a cautionary tale that we must all learn from,” Frans notes.
Yet, beyond the regulatory and consumer pressures, there is an elemental, undeniable reality that businesses must face.
“We have limited natural resources,” Frans continues, expressing his disappointment at the promotion of natural gas consumption in Australia. “Given the finite nature of such resources and the existence of sustainable alternatives, it’s time we re-evaluated our priorities.”
STATEGISING FOR SUSTAINABILITY
The vast expanse and abundant resources of Australia present both unique challenges and opportunities for businesses venturing into the realm of sustainability. Delving deeper into the intricacies of ESG integration within supply chains and operations, Maxime and Frans shed light on the journey businesses must undertake in the Australian landscape.
“The key,” Maxime begins, “is for every business to adopt a sustainability strategy and vision. The first thing is actually to commit to have one and set out the main priorities and targets. But after that, there are myriad opportunities that can be tapped into.”
Emissions and waste reduction, product development, circular economy, transport efficiency, alternative energy sources, and smart planning emerge as leading frontiers for businesses to reimagine and reinvent.
“We should think about environmentally friendly alternatives, ethical sourcing, and treating waste as a resource for new applications,” she continues.
Identifying these opportunities – let alone executing on a strategy that would make the most of them – is no easy feat. But the journey of a thousand miles begins with a single step. The trouble is many Australian companies falter even at that outset, unsure of which direction to take.
“Companies often want to become sustainable but don’t know where to start,” Maxime explains. “Moreover, even as companies venture forth on this path, many grapple with measuring their impact and reporting it, often stumbling because of a lack of resources.
Frans, echoing Maxime’s sentiments, highlights a critical aspect of this journey: leadership.
“This shift needs to start from the boardroom,” Frans says. “While Australia’s immense resources and vast landscapes might have lulled companies into a sense of complacency in the past, the time for action is now. A few pioneers, like Patagonia, are setting the pace, but many still lag.”
But while leadership must come from the top, the demand for such leadership is coming from below: “Younger generations value sustainability; statistics suggest 45 per cent would leave a company that isn’t environmentally responsible.”
So – what is to be done?
ARGON & CO: HERE TO HELP
“Sustainability isn’t a standalone proposition or discrete service Argon & Co offers,” Frans says. “It’s not compartmentalised like, say, procurement. Instead, sustainability is seamlessly integrated into every project undertaken by Argon & Co.”
Take warehouse and logistics network design, for instance, which Argon & Co consults on. Far from focusing only on cost-efficiency or swift lead times, it embeds sustainability credentials, “like a seven-star green rating for the building,” which includes innovative solutions like “installing solar panels on the roof or recycling rainwater”.
“The goal is to not only determine the fastest or cheapest way to reach a customer but also the most sustainable way,” Frans says.
Sustainability isn’t an isolated project for Argon & Co: it’s a vital layer that sits across all their business transformation offerings, projects, and solutions.
While sustainability’s core importance at Argon & Co isn’t new, the explicit emphasis on it is a relatively recent development. This shift has been evident in the past year, reflecting market dynamics and the growing demand for sustainable solutions.
Frans observes a marked evolution in the market landscape, noting, “A few years ago, you wouldn’t find many procurement officers in ANZ with titles like ‘Sustainability’ or ‘Ethical Sourcing,’ but now, many have adopted such titles.”
“Although sustainability has always been important, we’ve recently started giving it explicit attention,” Maxime adds. This manifested this year when Argon & Co developed a renewed dedicated sustainability service offering.
Argon & Co’s sustainability service offering expands its prior strategy and transformation expertise. The consultancy assesses, designs and embeds ESG strategies, sustainability assessments & benchmarks and ESG due diligence frameworks. It leverages its existing expertise to drive sustainable operational improvements in every aspect of the end-to-end value chain and leverages its understanding of ESG regulations by supporting sustainable culture and providing learning and best practice.
Argon & Co’s foray into deeper, explicit sustainability practices is not just a reactive change; it reflects the company’s proactive adaptation to the global market’s pressing needs and the larger responsibility businesses have towards the planet. Argon & Co’s responsibility is to deliver a positive impact – and not only as a response to market demand.
Behind the strategic offerings and corporate decisions of Argon & Co, there lies a genuine, deeply personal commitment to sustainable change. This commitment is mirrored in the convictions of both Maxime and Frans. Their dedication isn’t just rooted in market trends or client demands but stems from a personal sense of responsibility and a heartfelt yearning to make a positive impact.
Maxime’s motivations are both earnest and simple. “I believe we have a responsibility to act,” she says, articulating the sentiments of many in today’s world who feel the weight of ongoing environmental challenges. She is driven by a desire “to make positive contributions wherever possible and to always remain mindful of our planet.
Frans, a foundational pillar of Argon with 16 years under his belt, offers a deeper glimpse into his personal journey. His passion for sustainability is not just a recent corporate initiative but is ingrained in his lifestyle choices. “I pick up rubbish with my kids at the beach; my house runs completely on green energy – I’m that guy,” he laughs.
“If it doesn’t stem from this genuine intent – if companies don’t care in their very being – then I think this can lead to using ESG or sustainability as mere marketing tools or engaging in greenwashing.
“It will not be easy. We need to look after our planet and our communities for future generations, I don’t want to imagine a world where my grandchildren are unable to enjoy the planet and social relationships I have,” Frans concludes. “And if that is not enough; with consumer awareness increasing, resources becoming scarce, regulatory requirements increasing and sustainable business models being most cost effective, it makes good business sense to act now. Together, we have no choice but to create a path towards a more sustainable and socially responsible world.”
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