Executive Summary

Businesses ventures are global citizens; as such, they have a responsibility to the world, as the extended version of stakeholders, not just the shareholders’ value and profit maximisation. In achieving this global responsibility as a corporate citizen, entities have an obligation to social and environmental sustainability strategies. This report adopts an analysis of the Abu Dhabi Distribution Company (ADDC). The report indicates that although adopting social and environmental sustainability strategies, the organisation has room and opportunities for improvement. This is recommended through a sustainable business model to enhance sustainability and internal stakeholders‘ participation in the long-run period.

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Introduction

This report develops a critical evaluation of organisational market sustainability. To allow for practical examination of sustainability issues in business, the report establishes a case study on the Abu Dhabi Distribution Company (ADDC). This is the Abu Dhabi Emirate government-mandated distributor for water and electricity. The entity is a leading player in the market. The report is structured as a response to the different questions, and thus it is segmented into four distinct parts as illustrated below.

Question 1: Social and Environmental Sustainability Challenges

In executing an organisational function at the global scale, Lozano and Huisingh (2011) stated that organisations are increasingly adopting and using the triple-bottom-line model. This is a model that seeks to create and strike a balance between the three conflicts objectives nd goals on profits, environment and society. However, often than not, entities face challenges in prioritising and realising their social and environmental goals. On the one hand, organisational face social sustainability goals. A leading problem is high unemployment rates. This is primarily a challenge facing global entities in the developing markets. A high unemployment rate means that a significant proportion of the worldwide labour base, although with skills and expertise, is unemployed. It falls as a social responsibility of the global organisations to offer employment to these population categories. Unfortunately, the organisations have a shareholder’s responsibility. Thus, they cannot provide employment to all in the market. Therefore, the entity, although seeking to offer social equity, is limited by the high rates of unemployment and inequalities in society.

On the other hand, a second challenge is on environmental responsibility and sustainability. This is mainly due to the connected nature of ecological sustainability. As Baumgartner and Ebner (2010) noted, it requires a collective responsibility for sustainability realisation. For instance, it is the combined industry and national markets responsibilities to create an effective circular economic system. This is through the creation of systems such as disposal and re-manufacturing centres. Also, it requires a systematic perception and culture change to abide by and adopt such strategies. Thus, although the entities create their systems individually, they have no capability, and minimal success opportunities and chances for success are limited. It implies that the individual responsibilities and efforts have to be supplemented by the market and contextual factors to stimulate market success.

Question 2: ADDC Company Sustainability Evaluation

The Abu Dhabi Distribution Company (ADDC) is a leading interface connector for the Emirate water and electricity supply. In executing its mandate, the venture has applied a sustainable business model. This is a model guided by the consideration of social and environmental sustainability goals. First, in terms of its social responsibility and sustainability, the ADDC has established the Aquatec Biomonitoring System. This is a real-time monitoring system that helps the entity assesses its distributed water quality before the water gets to the end consumer point (Gulf Construction, 2020). Through this approach, the entity has developed and illustrated a commitment to not only deliver water to the customers but also to ensure the quality of the supplied water as a source of enhancing the social well-being through promoting good health among the Emirate residents.

Additionally, when dealing with its employees, the entity has adopted an employee-centric model. This is a model that allows for an extensive employee support system, both formal and informal. The understanding is guided by the fact that it is supporting its workforce, derived from the society, it by extension support to the well-being of the Emirate society at large.

In terms of its environmental sustainability, it has resolved to the adoption and use of alternative renewable sources of energy. For instance, through its green initiative, it held the Heroes of UAE campaign where besides sensitisation it distributed over 40,000 environment-friendly light bulbs as a demonstration of the need to regulate and reduce energy uses (ADDC, 2020). Despite its strengths, a critical evaluation of the ADDC social and environmental responsibilities demonstrates that the organisation could improve on its commitment. For instance, its support for social activities that are not directly linked to its water and electricity distribution functions has been minimal. This has been limited to supporting education. There are alternative and additional areas that the venture could support the society to enhance improved social living standards.

Question 3: Social and Environmental Sustainability

Benn, Edwards and Williams (2014) noted that organisations serve not only as corporates and vehicles for profits generation but also as global corporate citizens. As corporate citizens, organisations have a responsibility to meet the existing social and environmental sustainability regulations. As such, the entities have set KPIs that define the leave to which they are good corporate citizens. Environmentally, sustainability KPIs were singled out as mainly focusing on the reduction in pollution as well as in the use of natural resources that are not renewable. Thus, among the core KPIs in environmental sustainability was the reduction in greenhouse gases emissions. These are the emissions that cause carbon pollution, and as such global warming among other related consequences (Linnenluecke and Griffiths, 2010). Secondly, there is KPI on the reduction in the consumption of natural resources. This is through a focus and a strategy increasing process and production efficiency in eliminating production inefficiencies in resources utilisation.

Additionally, it includes the use of renewable resources. This consists of a reduction in the sue of non-renewable energies and instead of the adoption and use of renewable energy sources. Finally, under environmental sustainability, KPIs is the reduction in waste. This is both within the distribution chain and at the end of the distribution chain. As such, this includes the assimilation of strategies such as a circular economy model that creates resources feedback loop once the initial utility value is utilised.

Socially, the KPIs include a responsibility to the internal and the external stakeholders. Internally, the KPIs include the extent to which an entity provided a socially conducive working environment for the employees. This includes safe working context as well as remuneration for the employees (Dangelico and Pujari, 2010). Externally, the organisational KPIs are the rest for human rights and freedoms. The corporate functions and products should be developed in a manner that respects the existing human rights. Additionally, entities are mandated with the responsibility to participate and support social programs and activities.

Question 4: Proposed Sustainability Business Model

As illustrated, the ADDC Company, through having sustainable business practices, has areas for improvement. This is a strategic goal achievable through the application and adoption of a sustainable business model. The organisation should adopt a circular economic and distribution model. This is a model that would allow for the participation and the inclusion of the stakeholders in the sustainable process. On is mandate, the ADDC Company distributes water and electricity to the Emirate citizens. However, once the water has been distributed, it is the responsibility of the citizens to control water usage. There are no clear water recollection and recycling systems (Benn, Edwards and Williams, 2014). Environmentally, a sustainable framework would be the establishment of a recycling model. The organisation should establish a platform for recycling water from the homes. As such, this would ensure that once used, water is not wasted but instead recycled and purified for re-use or other non-drinking domestic uses. Additionally, the organisation should establish a flat organisational structure. One of the core pillars is to promote a suitable and safe working environment. This would be achieved by adopting a lean hierarchy and management structure. This is a shift that would eliminate the exiting power distance perception, where decisions on sustainability are often a reserve for executive management. Instead, the proposed framework changes would allow for increased employee engagement. With a flat organisational stricture, t would mean that the employees are included in the decision-making process. This is a tool that would benefit the venture by allowing for diversity (Lozano and Huisingh, 2011). An extensive employee base is synonymous with the inclusion of diversity in the decision-making process. The variety and direct incorporation of employees would enable the venture to realise and prioritise its activities on social and environmental activities and projects that have the best and highest value on society.

Summary and Conclusion

In summary, the report has developed an examination of business sustainability. In particular, the report focused on the ADDC Company and the elements of social and environmental sustainability. First, the report examines the challenges in sustainability. It denotes that social inequality and high unemployment rates are leading social sustainability challenges. His is in addition to a lack of market cooperation as the leading environmental sustainability challenge. When analysing the ADDC company, the report demonstrates that the entity has a high sustainability index, both socially and environmental. This is through a comparison of its operations and sustainability activities against the KPI dimensions for social and ecological sustainability. Finally, the report develops recommendation on business model shift that would enable the venture realise its strategies sustainability goals. This is recommended by adopting a circular economic model with a flat organisational structure. This would allow for increased engagement and participation by the employees in the sustainability-related decision-making process. Through allowing for high employee diversity, there is the probability of expanding the scope and implications of the adopted social and environmental sustainability projects and activities.

References

ADDC, 2020 Strategy Book, Author. [Online] Available at < https://www.addc.ae/content/Publications/ADDC%20Strategy%20Book%20FINAL%20ENG.pdfl> [Accessed: 22nd March 2020]

Baumgartner, R.J. and Ebner, D., 2010. Corporate sustainability strategies: sustainability profiles and maturity levels. Sustainable Development, 18(2), pp.76-89.

Benn, S., Edwards, M. and Williams, T., 2014. Organisational change for corporate sustainability. Routledge.

Dangelico, R.M. and Pujari, D., 2010. Mainstreaming green product innovation: Why and how companies integrate environmental sustainability. Journal of business ethics, 95(3), pp.471-486.

Gulf Construction, 2020, ADDC reinforces commitment to sustainability, Author. [Online] Available at < https://www.gulfconstructionworldwide.com/stories/source/?url=CONS_362822.html > [Accessed: 22nd March 2020]

Linnenluecke, M.K. and Griffiths, A., 2010. Corporate sustainability and organisational culture. Journal of world business, 45(4), pp.357-366.

Lozano, R. and Huisingh, D., 2011. Inter-linking issues and dimensions in sustainability reporting. Journal of cleaner production, 19(2-3), pp.99-107

Business Sustainability: Social and Environmental Sustainability

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