Why the Hydropower Sustainability Standard is a game changer for business sustainability strategy
What if the key to hydropower’s future success wasn’t just about generating electricity, but about proving it can be done responsibly? As global expectations for sustainability rise, the Hydropower Sustainability Standard (HSS) is quietly reshaping the industry. But the question is – will companies embrace it fast enough to stay ahead of the curve? Helen Locher and João Costa take a closer look at how the certification scheme can be a catalyst for progress in business sustainability strategy for companies with hydropower investments.
Why is sustainability becoming important for global corporate strategy?
Sustainability isn’t just a choice anymore – it’s a necessity in today’s business landscape. The Hydropower Sustainability Standard (HSS) is a powerful tool that ensures hydropower projects meet globally recognised environmental, social and governance (ESG) criteria.
The HSS is designed for hydropower, but it can also be applied to dam developments and for all types of water storage and water supply schemes.
While the core benefits of HSS are well established – improved risk management, alignment with financial mechanisms, or broader stakeholder engagement approaches for example – there are additional, often overlooked advantages that further strengthen its value proposition.
Attracting and retaining top talent
The global “war on talent” in sustainability-related fields and for those with science, technology, engineering and mathematics (STEM) qualifications means that companies must find ways to differentiate themselves so they can attract and keep top professionals.
Organisations that commit to implementing and demonstrating achievement of rigorous sustainability standards, like the HSS, demonstrate their leadership and credibility, making them more attractive to skilled employees who are passionate about responsible and impactful work. In the case of a growing focus on gender and diversity targets within the workforce, businesses that demonstrate strong sustainability commitments may attract more interest from job applicants.
A strong sustainability commitment fosters a purpose-driven culture, increasing employee engagement and long-term retention.
HSA delivering a Certified User training at Total Energies.
Paris, France, 2024
Building a culture of continuous improvement
The HSS is more than an assessment tool; it is a framework for ongoing enhancement. By providing clear evidence of performance across key sustainability criteria, it supports a culture of continuous improvement within an organisation.
“The most successful hydropower projects attract a broader range of partners than just those responding to contractual opportunities.”
The insights derived from HSS assessments help companies to identify areas for targeted action, ensuring that sustainability efforts remain proactive rather than reactive. Adopting a continuous improvement mindset strengthens operational efficiency, resilience, and ultimately drives long-term sustainability performance.
A recent example of this can be seen at the Chorreritas Hydropower Project in Colombia. After undertaking an initial sustainability assessment in 2022, developers Energo-Pro followed an action plan to close gaps that were identified, resulting in the project being certified Silver under the HSS this year.
Other projects that have undertaken follow-up HSS assessments after implementing action to close gaps include Tajikistan’s Sebzor (training session pictured above), Iceland's Fljótsdalsstöð/Kárahnjúkar, and Brazil’s Jirau (dam pictured above).
Strengthening supplier and partner confidence
Sustainability-conscious companies seek suppliers and contractors who align with their values and commitments. The HSS provides assurance that hydropower projects meet global best practices, making them more attractive to high-calibre suppliers, partners, lenders and insurers.
In contrast, companies that neglect sustainability may find themselves spending extra time and resources ensuring contractor compliance – a challenge that can be avoided by identifying aligned partners from the outset.
The most successful hydropower projects attract a broader range of partners than just those responding to contractual opportunities. There is considerable demand to get the attention of potential partners, and they will be attracted to partnering with organisations that can prove their commitment and action. Examples include financiers, who in turn are increasingly ESG-focused, and a broad range of civil society and non-government organisations who can help deliver on sustainability-related initiatives.
Adopting the HSS signals and supports a strong commitment to sustainability, helping companies build more reliable, long-term relationships across their supply chain and with key business partners.
Keeping up with global sustainability reporting standards
Sustainability reporting is quickly becoming a fundamental expectation for companies worldwide, particularly those adhering to the International Financial Reporting Standards (IFRS). The latest sustainability-related financial disclosure requirements call for transparent reporting on climate-related risks, with future expansions covering biodiversity, social inclusion and other ESG factors.
An HSS assessment can provide valuable documentation that can feed into these reports, helping companies identify gaps, showcase achievements, and stay ahead of evolving disclosure rules. It’s not just about ticking boxes – strong alignment with reporting standards also builds trust with investors and stakeholders.
Conclusion: the HSS is a powerful tool for business sustainability strategy
The Hydropower Sustainability Standard offers far-reaching benefits that go beyond compliance and risk management. From attracting top talent and fostering a culture of continuous improvement to strengthening supplier and partner relationships and supporting sustainability reporting, the HSS provides a strategic advantage in today’s evolving ESG landscape.
A growing number of businesses around the world are exploring or advancing their journey with the HSS, while various national governments and financial institutions are incorporating it into their requirements. For those not currently involved in hydropower but considering it as a renewable energy option – whether through acquisition, new development, or water supply scheme expansion for example – HydroSelect offers a valuable early screening tool, applying ESG criteria aligned with the HSS. To learn more, we invite you to reach out to the team at the Hydropower Sustainability Alliance.
Embracing the HSS helps hydropower companies lead the way in sustainable energy, setting them up for long-term success in a world that demands it.
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