Sustainability as strategy

An interview with a thought leader in sustainable economics.

Federico Donato, a manager at Credit Suisse, President of the European Chamber of Commerce Singapore, and board member of various institutions, shared valuable insights with Segmento on the evolving role of sustainability in the corporate world.

Federico Donato, author of a book on economic sustainability, Il Business della Sostenibilità, challenges the conventional notion that sustainability represents an unsustainable cost for companies. Donato emphasizes that sustainability is no longer an ideological or philosophical concept but a strategic necessity for businesses. He argues that embracing sustainability—including Environmental, Social, and Governance (ESG) principles and Sustainable Development Goals (SDGs)—is crucial for maintaining a competitive edge.

Federico Donato (left) presenting his book Il Business della Sostenibilità, with Hon. Pier Ferdinando Casini, Italian Politician and Lower House representative

Contrary to the view that sustainability and profitability are incompatible values, Donato asserts that they are inextricably linked. He proposes that addressing environmental and social concerns is not only an ethical choice but also an economically sound one. In his view, the cost of inaction is significantly higher than the cost of embracing innovative action.

I believe that a paradigm shift is now essential,” explains Donato. He adds:

The shift should be from considering sustainability as a cost, which has been largely, and is largely still the understanding of many businesses, especially the small and medium enterprises, to seeing it as an opportunity.

Sustainability is certainly costly. It requires an investment of time and money, so we need to employ proper strategies and think very carefully about how our companies can become more sustainable. Seldom in our history have we witnessed a situation in which the whole of society—government, corporate, non-profits, the community at large, and religious entities—has started to push in one direction, Making the economy more sustainable is becoming a civilizational drive. This is true in developed and developing countries because the latter often have the most to lose.

Federico Donato

Take, for example, the Maldives. Why should the Maldives invest in making the country more resilient towards rising sea levels? It is because the seashore and its beaches are the most important commodity for the tourism-dependent islands. So, if the Maldives, which is a developing country, doesn’t believe in rising sea levels and doesn’t believe that making investments in sustainability will support them, then they will probably be doomed. Similarly, Singapore and the Netherlands are subjected to very high risks related to rising sea levels.

Therefore, all these countries are investing fortunes into making themselves more resilient with respect to rising sea levels. When asked about the role of the private sector in achieving the United Nations’ Sustainable Development Goals (SDGs) and specific actions companies should take to contribute to those goals, Donato highlighted that each company should focus on a select few goals first.

Sustainability in action

I think companies should start by deciding on which sustainable goals to invest in. I think companies should be pragmatic, identify three or four priorities, and invest in a targeted way to make a difference where they are most exposed.

But really, I donʼt want to be prescriptive, and I am not in a position to define who should do what. I’m just trying to create awareness around the fact that all of us can contribute, especially if we are dedicated and driven to make a change. It is more effective to have a very narrow scope of action to prioritize so that change is not a hollow gesture but something that can actually be achieved.