SustainAbility

Leadership Requires Systems Change

info@sustainability.com (Sustainability) — Wed, 22 May 2013 09:45:33 +0100

Companies like Whole Foods have developed successful business models to meet particular environmental and social needs but it is not necessarily as straight forward for mainstream brands.

“Innovation is most powerful when it’s activated by collaboration between unlikely partners, coupled with investment dollars, marketing know-how and determination. Now is the time for big, bold solutions. Incremental change won’t get us where we need to go fast enough or at a scale that makes a difference.” — Mark Parker, CEO, NIKE, Inc. at the LAUNCH 2020 Summit

I recently finished Conscious Capitalism by John Mackey and Raj Sisodia, and came away with new perspectives on, and examples of, strong private sector leadership on environmental and social issues. The authors’ examples from Whole Foods – generous employee benefits, transparency and equity of salaries, etc. – are impressive and might be enough to soothe customers displeased by Whole Foods’ CEO Mackey’s candid views on topics such as health care, climate change and unions.

Like others before them (see my blog on Creating Shared Value), the authors attempt to differentiate their concept with others such as sustainability, citizenship and CSR. Yet Mackey and Sisodia essentially offer the same thesis: companies that consider and manage a broad array of stakeholder interests (beyond meeting the needs of shareholders alone) will perform better financially over the long run. This viewpoint is now more or less commonplace amongst large, global companies, a development we should celebrate.

The most pressing problem then is no longer that leading companies don’t understand or accept the issues before us. The problem is that even the most ambitious among them face major hurdles in realizing their commitments and driving the change society and the planet require, hurdles that point over and over again to the need for a fundamental rethink of the rules of the game (or system).

We welcome and need more companies like Whole Foods that have developed successful business models designed from the start to meet particular environmental and social needs. But it’s incredibly difficult for “mainstream” companies – Costco, Amazon, Nordstrom and others included as examples by the authors – to find the same equilibrium amongst competing stakeholder interests without addressing the fundamental flaws in the current system. For example, natural resources are not fully priced, labor is not fairly valued in many supply chains, unhealthy food is cheaper than its alternative, etc. Mackey and Sisodia are right that free markets are incredible forces for good. They would be even more so if government policy, investment norms and industry codes of conduct fully addressed the externalities that exist.

This particularly struck me during an interview with an investor for our Rate the Raters research, who acknowledged that obesity was imposing enormous costs on society, and yet he would not see it as a material issue for a food company until some sort of public policy instrument made it more profitable to sell more oatmeal and orange juice than chips and soda. We heard similar sentiments around other issues and sectors, for example electric utilities and climate change.

Of course, incumbents have it in their best interest to maintain the current rules of the game, and we see this in effect each time the EPA considers new regulation or Congress considers the farm bill. Yet, as we seek to identify and foster sustainability leadership amongst corporations, we must press aspiring companies to go beyond their own organizational boundaries and commitments and engage in challenging conversations about changing the system.

Encouragingly, companies are joining together with other organizations in an attempt to change the rules of the game and find the levers for change in the system. We see this in the good work of Ceres, which is leveraging its BICEP network of companies to push the US government to tackle climate change, as well is in efforts such as the Roadmap to Zero Toxics group and the Aspen Institute’s Corporate Values Strategy Group, which is working to reverse the increasing short-term focus of our financial markets. We need much more of this type of collaboration to drive the change we seek. After all, Ceres’ climate coalition currently has around 30 companies involved – one can imagine the change that would occur if 3,000 companies were behind this.

Our just-released 2013 Sustainability Leaders survey suggests that sustainability experts recognize that leadership requires engaging at the systems level, as most companies cited as leaders (slide 13) are doing just that in certain areas. For example Google in pushing for renewable energy tariffs, Nike is partnering to deliver game-changing sustainable materials and Novo Nordisk is working with a variety of partners to prevent and manage diabetes.

As I watch efforts like these from the vantage points of an outsider and advisor to some of these companies, I recognize how incredibly messy and difficult it can be to engage with the “system.” Collaborating with competitors, suppliers, regulators, other consultancies, etc. requires new modes of thinking and working, and it takes time. Yet, we must recognize and encourage such collaboration, as per Mark Parker incremental solutions won’t get us where we need to go fast enough or at the scale required.

Why Iteration alongside Innovation Leads to Sustainable Systems Changes

info@sustainability.com (Sustainability) — Thu, 09 May 2013 09:02:00 +0100

I was at the Fortune Brainstorm Green conference last week. This annual event, where Fortune magazine “gathers the smartest people [they] know in sustainability,” is a cauldron of ideas and actions focused on finding “Sustainable Solutions,” this year’s conference theme. There is no shortage here of big ideas.

Hannah Jones, Nike’s Vice President of Sustainable Business and Innovation, speaking on a panel titled “Pushing the Boundaries of Green,” summed up neatly what many of us in the room were thinking when she said, “If we aren’t working towards system change, we might as well go home.” Unfortunately, she didn’t reveal to us the magic formula for changing the system.

When we think and talk about system change, we often default to thinking only about dramatic and abrupt changes to the status quo, driven by a visionary individual. However, system change, like systems themselves, is a mosaic of many actions by many individuals, companies, governments, NGO’s and others. And like a mosaic, the sum of these actions, and their proximity to each other, create the picture of system change. When viewed in isolation, any single piece in a mosaic may appear inconsequential. But each is nonetheless essential for the full picture to be realized.

A couple of years ago at this conference, one speaker noted that “transformation occurs incrementally.” Indeed, when we look back on the history of human achievement, we can see that transformation is a result of many small improvements that build upon each other, punctuated occasionally by step changes in technology, beliefs or behavior.

The iPhone is often held up as a device that has transformed the way we live, but as was noted yesterday by Tony Fadell, the “father of the iPod” and currently CEO of Nest, it took seven years to get from the debut of the iPod to the debut of the iPhone. In between were many incremental improvements by Apple and by others. The iPod itself was an iteration of other portable digital music storage devices.

Since I joined SustainAbility 11 years ago, I have seen — and been a part of creating — many corporate sustainability strategies. Those that have been most effective at driving change have a big idea — a transformative change — at their core. But they also drive and celebrate incremental improvement, not as a substitute for transformation, but as an essential element of it. Recently SustainAbility and GlobeScan released its annual Sustainability Leaders Survey. Unilever once again came out on top, followed by Patagonia, Interface, Walmart and GE. Each company combines a compelling vision and robust strategy with strong performance and evidence of integration — big ideas plus incremental improvements.

Over dinner on the first night of the Fortune Brainstorm Green conference, one of my tablemates made the statement that “distributed power generation will transform Africa,” bringing some degree of prosperity to millions that currently are just surviving. A big idea, but right now, just an idea. Turning it into reality will require the commitment of governments, NGO’s, companies and individuals, and many iterations of a solution.

We should all be working for system change. For some, that means thinking big thoughts about how the world can be transformed. For others, it means working on the next iteration that is a bit better than the last. Indeed, both are essential elements of the mosaic that makes up system change.

This article originally appeared as part of SustainAbility’s Changing Tack column on GreenBiz.com.

Why Unilever, Patagonia and Puma Lead the Pack, say Sustainability Leaders

info@sustainability.com (Sustainability) — Tue, 07 May 2013 09:10:00 +0100

Companies continue to rank low among global institutions when it comes to sustainability leadership, though a few companies — mostly the usual suspects — continue to rise above the others, according to an annual survey being released this week.

If that sounds like damning with faint praise, it is. According to the 2013 Sustainability Leaders survey, produced jointly by GlobeScan and SustainAbility, the private sector outperforms only the world’s national governments when it comes to effectively addressing sustainability challenges. That is to say, their second to last.

Still, a handful of companies — and one in particular — are highly regarded. Unilever continued its reign as the top-ranked company and actually increased its score, according to the survey, which is based on the responses of 1,170 “qualified sustainability experts” polled earlier this year. Companies are named on a top-of-mind basis — that is, they are asked to name leadership companies but aren’t given a list from which to choose.

Another top-tier companies was Patagonia, which “catapulted to the No. 2 position on back of strong gains in last year,” according to the study. Interface and Walmart round out the top four, with 10 additional companies clustered roughly with similar rankings (in descending order): GE, Marks & Spence, Puma, Nike, Coca-Cola, Natura, IBM, Google, Nestlé and Novo Nordisk. Puma was notable for being the only one not to have appeared on the previous rankings, done in 2012.

In addition to naming names, respondents were asked to include a few words about their rationale for the companies they picked. “Commitment to sustainable values” was the primary reason a company was cited as a leader, consistent with previous surveys. Transparency and communication, integration into core business model and environmental, waste, and water management rose in importance in 2013.

“The really big thing is that Unilever has just rocketed farther than anyone else, so there’s a lot less diversity in the rankings,” said SustainAbility research director Chris Guenther, in assessing this year’s results. “In the past, what we’ve seen is that companies go up to the top of the list when they make a big splash, and stay up there for a couple of years, then inevitably taper off and fall down the list when someone else captures imagination anew.”

That hasn’t been the case with Unilever. “There’s nothing terribly new about its Sustainable Living Plan, almost three years into it,” he said. One reason for Unilever’s top spot may be that “no one else has come along with anything better,” Guenther surmised.

There is broad consistency in leadership opinions across the world. The primary distinction is relative opinions of corporate and NGO leadership. Corporate leaders rank higher than NGOs in Europe and Oceania, but far lower in North America, Latin America/ Caribbean and Africa/Middle East.

Over half of experts are unable to name a sustainability leader from the developing world. Brazil’s Natura and India’s Tata were the only companies that garnered more than 1 percent of mentions from experts in Europe and North America.

So, if companies aren’t seen as leaders, who is?

Leaders in the scientific community, NGO leaders, leaders of multinational organizations — but, most of all, “social entrepreneurs,” who are now perceived as the sector advancing the sustainability agenda most.

That seemed curious. “I think people reflexively think that’s a good institutional form, even though people can’t point to specific social entrepreneurs that are making a difference,” Guenther explained. “I think what they respond to is the label.”

Note to big companies: Embrace the mantle of social entrepreneurship and you just might win some hearts and minds.

This article originally appeared on GreenBiz website.

A Personal Journey Towards Rethinking Poverty Alleviation

info@sustainability.com (Sustainability) — Fri, 03 May 2013 09:30:39 +0100

Gulu, Uganda - Copyright (c) Livia Martini

My junior year of college I spent a year living between Northern Uganda and Rwanda. Like most twenty-something liberal arts school students who graduate from an international studies program, I was convinced I would change the world and that living abroad would show me how. I returned to the United States disheartened; ashamed at myself for being naïve enough to think I had the answers, and convinced that poverty was unsolvable. Three years and many life turns later, I’ve begun to rethink the issue of poverty alleviation.

Poverty is heartbreaking, numbing, maddening and nonsensical all at once, but poverty is not powerlessness and it is not the failure of an individual.
Poverty is the result of a failed system; a system that assigns worth based on purchasing power; a system that makes quality of life, health, and education equivalent to a person’s income; a system that replicates socio-economic situations for various generations. To address poverty, we need to change the system and stop accepting such paramount inequalities as an unfortunate side effect of capitalism.

No sector is better equipped to lead this change than the business sector. Businesses, unlike NGOs and governments, have the capacity to price and design products according to various socio-economic realities. What would our world look like if everyone could afford high-quality food, decent clothing, and the Internet? Not to mention, medicine and education? Think of the immeasurable divides we could bridge just by making certain products more accessible. And while this might sound like charity, it’s not; there is a business incentive and financial reward for companies willing to take this extra step. As economic uncertainty continues, consumerism is dwindling. Markets that were profitable are now saturating, and the financial securities companies enjoyed are now facets of the past. Pricing and developing products on a tiered system could incorporate close to 3 billion new consumers and give companies a leg-up in markets that were once thought impossible to reach.

Addressing poverty also mitigates certain risks in a company’s supply chain. It is an unfortunate reality that most supply chain catastrophes (Foxconn, factory fires and child labor to name a few) include impoverished populations. People should not be dependent on unsafe inhumane labor conditions for food and water. Removing this vulnerability will empower workers to demand basic human rights in their workplace and protect companies from possible supply chain embarrassments.

In addition to the business benefits of equitable and inclusive business models, trends suggest that poverty alleviation and economic equality are on their way to becoming prominent social demands. With the Millennium Development Goals set to expire in 2015, NGOs and organizations alike are calling for a refocus on the issue of inequality; the Chinese government announced plans to raise the minimum wage to 40% of average urban salaries by 2015; Unilever partnered with Oxfam to track its impact on poverty; poverty, once associated with certain regions of the world is now a concern for developed and developing countries alike. It is not farfetched to assume that society will soon turn to the business sector for answers and action.

What we cannot do is make the business sector our “savior.” By demanding too much from businesses we risk creating an equally unsustainable system; one that relieves governments of their responsibilities to their people, creates cultures of dependency, and assigns tasks that businesses are not equipped to deliver. What we can do is ask businesses to address poverty within their core capabilities and consider the impacts of the system they’ve helped create. Doing so will move us one step closer to a just, efficient, equitable and sustainable world.

3 Things To Do Before Next Earth Day

info@sustainability.com (Sustainability) — Mon, 22 Apr 2013 11:00:00 +0100

Earthrise

For me, and I daresay for many working in the sustainability space, Earth Day has become an opportunity to reflect on the progress we’ve made over the past year, and to think about where we need to focus our efforts going forward.

This year I find myself gravitating toward three actions:

Rethink the language of sustainability. I have always found the Brundtland definition of sustainable development – to meet the needs of the present generation without compromising the ability of future generations to meet their own needs – to be elegant in its simplicity. It has served us well for many years, but does it convey the sense of urgency we badly need to instil if we are to overcome the challenges we now face? Take one example: greenhouse gas emissions. At current rates, how many more Earth Days will pass before we have spewed enough CO2 into the atmosphere to virtually guarantee that we exceed the all-important 2°C temperature rise that 159 countries have agreed we must not breach? Fewer than twenty. This is no longer about future generations; it’s about us. And it is incumbent upon everyone working in the sustainability space to make the world see this.
Change the dialogue with investors. As long as CEOs have a duty to put shareholder interests above all else, and as long as those same shareholders think it’s ok to behave more like speculators than investors, there is a very real limit to the leadership we can expect to see from the business community. We need to shift our economic system away from short-termism, which in turn demands that we change the dialogue with investors. Over the past year the rise of the B Corporation, the emergence of the so-called Shareholder Spring, and the launch of initiatives such as Breakthrough Capitalism have given me hope that we can do this.
Help business leaders join the dots between what’s good for society in the long term, and what’s essential for their companies today. Take greenhouse gases again: most CEOs understand that reducing CO2 emissions is a ‘good thing to do’ in some abstract sense, but many still haven’t grasped how swift action could immediately help their business. The price of fossil fuels is likely to fluctuate ever more widely and unpredictably in the next few years as a result of many factors, from constrained supply and geopolitical tensions to reactive (and regionally inconsistent) changes in legislation. Question: Which CEOs can say with hand on heart that their operations would be immune to a rapid doubling in the cost of oil, gas or coal? Answer: Only those who have eliminated the need for such fuels. Irrespective of the moral case, insulating a business from unforeseen fluctuations in the price of a commodity is just good sense.

These three actions are of course deeply interconnected, and all are grounded in communication. That gives me cause for optimism: the notion that we in the sustainability space can catalyse real progress just by changing what we talk about, how we talk about it, and who we talk to is, I believe, incredibly uplifting. So let’s start today, and perhaps the next time Earth Day rolls around we will have something to truly celebrate.

Why Cities Will Lead

info@sustainability.com (Sustainability) — Mon, 08 Apr 2013 16:44:50 +0100

Image: OiMax (Flickr)

We are reminded constantly that humanity faces unprecedented challenges: climate change, resource constraints, economic volatility, over and under nutrition, widening inequality, and political conflicts that are increasingly aggravated by these issues. Yet, even as awareness of the causes and potential solutions to these challenges has never been higher, overall progress remains frustratingly slow or non- existent. Understandably, many of us have looked to national and international leaders, multinational companies, universities and other large scale institutions to provide leadership but, while their efforts have been earnest and sometimes substantial, they have so far failed to make very much difference.

It is not hard to see why this is the case. We know that to achieve global environmental, social and economic sustainability, ie to begin to permanently address or adapt to the fundamental challenges of this century, will require novel approaches to and combinations of technology, public policy and financing, and major shifts in both individual and organisational behaviour, all playing out on a global scale. But, the larger the system, the harder it is to consciously bring this about. No matter how well we understand the problems and their likely solutions, we are simply overwhelmed with too much complexity, too little feedback and not enough shared vision and trust to enable big changes to take hold.

This is one reason why we now see, and will continue to see, so much leadership and innovation emerging at smaller scales: from activists and entrepreneurs, from schools, hospitals and community organisations and, crucially, from the cities and towns they are a part of. At the city level, the challenges play out in more specific ways, solutions are more rapidly tested and refined, and communities are better able to unite to support and adopt new ways of doing things. And what takes hold in one city often becomes a model for what is possible in others.

In early 2012, SustainAbility published Citystates, in which we argued not only that cities represent smaller systems within which to enact change but that, by their nature, they offer the best means for us to rapidly develop, test and replicate sustainability solutions around the world. We also explored the role and opportunity for businesses, which are increasingly expected to drive meaningful progress on sustainability, to create shared value in the context of cities.

At its core, Citystates posits the following seven characteristics that underpin the positive role that cities both large and small might play in advancing sustainability more widely:

Connected

Cities offer the possibility of both physical and social connections that drive stronger communities, greater trust and more effective collaboration. ‘Connected’ now also refers to the way in which many cities are pushing the boundaries by digitally networking people and urban systems, leveraging enormous amounts of data culled from smart meters and smart sensors, in everything from stop lights to power grids, to drive new levels of efficiency, collaboration and economic development. The rise of the ‘sharing economy’, best exemplified by car and bike share services cropping up in cities around the world, is just one potent example of the power of bringing community and technology together. As we further harness the value of such physical, digital and social connections, there is potential to enable dramatically more sustainable systems and lifestyles.

Decisive

It is widely agreed that there is an overall lack of political will when it comes to addressing sustainable development. But that’s not the headline in many cities around the world. One reason is that many mayors have direct control or influence over key sustainability levers including waste, water, transit, land use, buildings, economic development and more. Furthermore, because many challenges are more immediate and tangible in an urban context, there is greater pressure on and expectation of mayors to act. It is no wonder then that the most ambitious pragmatic efforts to address climate change, energy consumption and resource depletion are emerging from cities, rather than at the national or global level. By leveraging a global network of ‘decisive cities’, we may yet have the chance to circumvent some of the structural roadblocks to action on these and a host of other issues.

Adaptive

Adaptiveness – or its now popular cousin, resiliency – will be essential to navigating a future defined by growing environmental, social and economic risks. There is something instructive then in how cities inherently grow and adapt organically over time. Certainly their evolution is the product of so many intentional actions as well, and though their adaptiveness may be inherent, there is not always enough of it to ensure prosperity or indeed survival. But, in general, cities possess energy and momentum that lie somewhere beyond our direct control and that has enabled some of them to persist for millennia. By harnessing this capacity for adaptive innovation, we can drive sustainability beyond what deliberate, co-ordinated action alone can accomplish.

Collaborative and competitive

There is an intriguing and quite productive tension in cities’ tendency to both compete and collaborate with one another. On the competitive side, cities are engaged in an escalating global war for the talent, tourists and private investment needed to drive prosperity. This is a potent driver of the public innovation and investment that shapes the essential character and productivity of any given city. At the same time, a growing number of cities, both large and small, are finding the cause and capability to collaborate, scaling up and spreading innovation, often across regional and national boundaries. More and more frequently this is in the service of sustainability. United Cities and Local Government (UCLG), C40, Metropolis, Local Governments for Sustainability (ICLEI), Cities Alliance and WeGo (World e-Governments Organization of Cities and Local Governments) are but a few examples that underscore the trend. This essential, dynamic tension between collaboration and competition has the potential to catalyse and rapidly spread sustainable innovation around the world.

Visceral

Cities invite and inspire more rapid, effective responses to sustainability challenges, in part because their challenges are, or have the potential to be, so much more vivid. Air and water pollution, social dislocation, congestion and other urban challenges are acute and undeniable to the populations affected by them. And when the challenges are more visible, citizens, businesses and policy makers begin confronting the same reality, and dramatically different and more effective responses are made possible. Furthermore, once a given solution has been demonstrated, and stakeholders see and experience it directly, there is vastly greater potential for it to be adopted and replicated. By understanding and enhancing cities’ intrinsic advantage of natural feedback loops, we can seed the possibility for far more sustainable policy, strategy and behaviour.

Personal

The power of identity as driven by the collision and expression of varied personal and shared values and, just as important, a sense of place is key to cities’ potential. As seen recently in Cairo’s Tahrir Square or New York’s Zucotti Park, the city can be a touchstone for the power struggles that define our age, and which may determine the long term potential for sustainability. Meanwhile, the rise of mostly young, educated, digitally and culturally aware, and economically influential citizen- consumers is changing the political and economic landscape in many cities, and rapidly pushing sustainability up the agenda. There is tremendous potential if businesses, policy makers and civil society organisations cannot only engage citizen-consumers’ core values, but also push them to take action on those values.

Experimental

Cities often possess innate advantages for the cycle of experimentation, failure and redesign that leads to true innovation. This may include research and development ecosystems, low barriers to entry, ready markets for radically new products and services, and the ability to rapidly test and improve on new ideas in the context of real life. They also allow for more participatory innovation, where a wider array of stakeholders can help to shape the environment around any given solution, to ensure its sustainability and successful adoption. Building on and leveraging these advantages will drive more rapid prototyping and replication of sustainability solutions across cities.

With these seven characteristics clearly articulated, it can be concluded that cities are a powerful new frontier for the collaboration needed between civil society, business and government to drive sustainability forward. Cities themselves will play a critical role in setting the conditions, while businesses that adequately invest, and are sensitive to the unique opportunities and constraints that cities offer, have the chance to generate enormous social and economic returns for decades to come. There are signs that this phase change is already well underway in many cities, yet we’ve only just begun to understand its broader potential. It is now our collective opportunity to realise it.

This article originally appeared in Issue 32 – Spring 2013 of Green Alliance’s Inside Track magazine.

Big Idea, Meet Moment

info@sustainability.com (Sustainability) — Tue, 12 Mar 2013 09:09:47 +0000

In a blog posted in the fall of 2012 entitled, What’s the Big Idea, Chris Guenther and I explored the degree to which vision (a Big Idea) enables sustainability performance and leadership and vice versa. We concluded that it does to a very substantial degree, and that the current era is one suffering for lack of the kind of rhetoric that, when backed by appropriate strategy and operational excellence, paints a picture of the change required and provides inspiration that it can be realized.

In the same article we shared the vision-performance-engagement framework SustainAbility uses to assess corporate leadership, by benchmarking 11 attributes, of which the Big Idea is but one.

Metrics versus meme

Also in that benchmark are metrics and goals. These are essential, and I don’t mean to underplay them, but a spate of recent conversations and some recent media stories have me wondering how focused we should be on the mechanics of target setting and measurement versus understanding the timing of shifts or potential shifts in any movement or change effort — and how to predict, address and capitalize on them.

Fallow patch?

A wave of events in late 2012 and early 2013 suggests many of the major efforts the corporate sustainability field heralds as solutions are not delivering adequate results. For example:

Horrendous factory fires in Bangladesh and Pakistan underscore that labor standards still are not nearly as enshrined as necessary — or as auditing systems like SA8000 have promised.

Food retailers across Europe are scrambling to find out if what they are selling customers is beef or horse meat, with Ikea meatballs being only the latest product pulled as I write.

In North America, the mirror reflection of the bovine-equine confusion in Europe raises similar questions about food system oversight, with news on a report from Oceana stating that wholly one-third of fish samples tested in 21 states were not the fish that labels or menus told consumers they were buying.

And maybe it doesn’t matter when we can’t even be sure which fish we are eating, but the Marine Stewardship Council has been the subject of an NPR investigative journalism series Under the Label, which seriously questions whether multiple major fisheries certified as sustainable by MSC — from British Columbia salmon whose numbers are uncomfortably low, to Nova Scotia swordfish where the blue shark bycatch dwarfs the number of swordfish caught — are anything of the sort; similar questions surround some other prominent certification and labeling systems.

Labor rights and food provenance are not the whole of corporate sustainability, but they are relatively mature areas, and it is disheartening to see their foundations flawed to this degree, notwithstanding a couple decades of substantial effort to improve. And if there was time and room to cover other topics, examination shows challenges across the sustainable development spectrum — for example, in the policy space as evidenced by the near complete lack of progress made by national governments at Rio+20.

Fertile ground?

At the same time as I find myself questioning the rate at which sustainability mile markers are being passed (sometimes in reverse!), some amazing shifts are occurring in society generally and specifically endemic to sustainable development:

The gay rights movement in the U.S. is in a transcendent moment. That the same-sex marriage debate will soon end with strong majorities favoring it and wondering how it was ever in question is, I think, a demographic certainty. This was reflected in the recent brouhaha around the Boy Scouts’ decision-making on gay membership — while the Boy Scouts deferred their decision until later this year, it was telling that President Barack Obama did not even seem to feel the need to answer media questions about his views on the subject, addressing a question he recently would have found vexing and risky by saying more or less, “If you have been listening to me, you know I believe all Americans deserve equal rights and equal access to everything. Next question.”

Momentum is building from the other side of the aisle also, with dozens of prominent Republicans signing an amicus brief in support of gay marriage that will be filed in the Proposition 8 case going before the Supreme Court.

Immigration reform is posed for a tectonic shift also, with this article describing how the transition in attitudes that California has been through over the last decade and a half is what the U.S. might anticipate nationally near-term. (Hint: We will worry more about attracting and retaining immigrants than keeping them out.)

In spite of debt ceiling and sequestration dysfunction suggesting U.S.-elected representatives may be completely witless, there is exciting movement in terms of climate policy. Again new ground is being broken out West, with California’s cap and trade program coming online in November of last year and instantly becoming the second-largest such program worldwide.

Meanwhile, in the Northeast, the longer established Regional Greenhouse Gas Initiative is ratcheting up standards, cutting emissions allowed under the scheme by nearly half.

And there is clearly new energy in civil society in terms of demanding more action on climate, as evidenced especially by the number and scale of Keystone Pipeline protests. Without it being certain whether the president will approve or block this particular piece of energy infrastructure, I do think we have entered a whole new realm with regard to the level of public concern about global warming, and that expectations for evidence of how government and industry will help create and deliver a low-carbon economy will do nothing but accelerate.

What these societal and sustainability shifts have in common is that they now sound just normal — outlying curiosities whose future hopes were slim until recently now moving forward inexorably.

Big Idea, meet Moment

While the thread is elusive, there seems a connection (or needs to be one) between the Big Idea, metrics and goals, corporate sustainability leadership overall and larger societal change. We must continue to work as individuals and individual entities to help bring change about via the practical and hands-on steps implied by the vision-performance-engagement framework and like approaches, certainly. But we have to pay attention to the larger context.

Does corporate strategy understand and intersect with the public mood? Is policy moving to support or counter the initiative? Are there indicators of any kind of groundswell foretelling the kind of acceleration on an issue needed to push it fully into consumer and/or public consciousness? And can corporate effort help shape and build sustainability groundswells, while also harnessing their momentum to uplift new, more just and durable business models?

I could be wrong about this. But there’s little new downside risk — we’d maintain the status quo and be no worse off than now. And perhaps 2013 offers a window in which societal foment and sustainability couple to deliver new and exceptional results. Can we seed and seize that moment?

This article originally appeared as part of SustainAbility’s Changing Tack column on GreenBiz.com.

The Future of Transparency: Trust B Trumps Trust A

info@sustainability.com (Sustainability) — Mon, 11 Feb 2013 15:05:39 +0000

On a recent in-flight experience, the airline’s CEO started off the safety video by saying in smoothly scripted terms that his company wants to make every passenger’s experience enjoyable and safe. Really? We had just stood in the jetway as “excess” carry on baggage was rerouted to be checked, after having waited at the gate as “an excess” of passengers were asked to forgo their seats in return for a voucher due to overbooking. These are admittedly First World problems, but they’re not enjoyable. Does the CEO know that his words are more likely to trigger irony than trust?

It reminded me of what happens in the sustainability reporting field all too often. These are efforts to account for a vision, rather than be it.

In the mid-1990’s the concept of producing a sustainability report began to take hold, and it has grown steadily ever since. That is, if we believe “grown” means “more companies have been producing reports.” We have certainly done that.

The impetus behind reporting was the belief that to shift business along the sustainability continuum, an increase in trust among stakeholders was necessary. Further, an increase in transparency was required to foster this trust. Has trust of companies grown? Not really. There is plenty of data indicating that companies today are among the least trusted among a wide array of stakeholders.

Yet the need for companies to improve their sustainability impacts has only increased since the dawn of reporting, as several very real concerns about our collective prospects can be tied to lack of action or poor decisions by business (see climate change, economic meltdown, etc.). So the need for trust has only increased. Does that mean there is a need for even more reporting? Or is reporting — for all its internal management systems and external communications benefits — simply not generating the necessary trust to advance the cause?

Maybe it’s doing the trick for Trust A when what we really need is Trust B.

Bear with me.

Trust A happens when a company communicates that it’s going to do something, and it then does it. We can think of it as accounting-related trust. Being accountable, accounting for what happened, and accounting for what might happen going forward.

Trust B is trust like sustainability reporting has never seen it before. It’s about genuine benefit for all concerned that brings about a deeper, almost faith-based trust. It’s about being trustworthy not because a company consistently tells the truth, but because the truth is actually good and on track to be even better.

The challenge with Trust B is that not many companies are ready to come right out and say, “We need to make significant, fundamental changes to how we do business, but we don’t really know how it’s going to go. But trust us, we’re working on it.”

There are some who are inching towards Trust B (and communicating elements of it, in their reports and otherwise). Whether through the B-Corp movement, or big ideas at major companies like Unilever, Puma, or business model rethinks at manufacturers like Novelis or Interface, there are very encouraging signs that the corporate sector is shifting to a shared (versus shareholder) value model.

The beginnings of a Great Transformation, as some are calling it, are taking shape and reporting will likely provide the record, to a degree.

Reporting might (repeat: might) have helped to bring this about in its early days, but it doesn’t seem likely that it will accelerate the shift towards a sustainable, generative economy.

How then to achieve this deeper level of trust among stakeholders, this Trust B that really gets to the heart of the matter? Certainly it will be crucial to continue providing transparent, meaningful information. However it will most likely involve making systemic, structural changes to the business that indicate the company isn’t just accountable, but it offers a net benefit for all stakeholders. When the truth about that tale is told, it will inevitably generate trust.

If the airline had been completely upfront at the time of booking, ensuring everyone who bought a ticket had a seat, if they had a fare structure that discouraged people from bringing an unwieldy amount of luggage onto the plane, if the flight crew were demonstrating at every turn that enjoyment and safety were their main objectives, the CEO wouldn’t need to bother trying to convince us.

It’s the ultimate story-telling adage: Show, don’t tell. Rephrased for the corporate transparency crowd seeking to increase trust: Be, don’t account.On the road to sustainability, Trust B definitely trumps Trust A.

This article originally appeared as part of SustainAbility’s Changing Tack column on GreenBiz.com.

How to Make Progress on Collaboration for Sustainability

info@sustainability.com (Sustainability) — Fri, 25 Jan 2013 14:00:00 +0000

Collaboration for sustainability: Nike is working with its competitors to develop a systems change programme to eliminate hazardous chemicals from supply chains.

As the Guardian’s Jo Confino wrote at the close of the Rio+20 Conference in June 2012, “the most often used phrases in the many meetings I attended [were] the need to create ‘coalitions of the willing’ and a recognition that ‘all issues are inter-connected’ and cannot be viewed in silos.”

Collaboration is widely acknowledged as vital if we are to address global challenges at the scale and speed we need, but the current rhetoric often fails to acknowledge how hard it is to get meaningful initiatives off the ground. Building and maintaining relationships with any partner is difficult, let alone a competitor who fights for your market share. The line between collaboration and collusion is not always bright, and concerns over privacy and intellectual property rights can challenge even the most committed collaborators.

If we are to guide companies towards greater success, we need to better understand the barriers and roadblocks that prevent collaboration from starting or scaling, and the transferable lessons learned from efforts that get it just right.

SustainAbility and GlobeScan recently surveyed nearly 800 sustainability professionals globally, from business, government, NGO and academia, to understand the future prospects and potential pitfalls of collaborating for a sustainable future. Three key themes emerged.

1. Don’t give up on government

Survey respondents may be pessimistic about national governments’ willingness and ability to make substantive progress on sustainability issues, but their overwhelming belief is that networked collaborations have the best chance of success when governments are involved.

The Global Food Safety Partnership, an initiative of the World Bank, is a collaboration that is driven by the increasing globalisation of food supply, where any food safety issue can quickly become a shared problem. Companies have an acute interest in improving safety standards – both because of public health concerns and lost opportunities in global production – but only with the convening power of national governments and multilateral institutions such as the World Bank can they manifest that interest into actual initiatives.

2. Keep it focused and make it systemic

Our survey respondents believe that the most effective collaborations will be those that focus on a single issue, rather than a broad set of topics.

We have seen success to date in two areas when a single issue has been targeted. The first is in NGO-company partnerships (eg Coca-Cola-WWF on water stewardship; Marks & Spencer-Oxfam on clothes recycling), which are usually targeted towards the specific needs of the business concerned. The second is in the area of eco-labels and certifications (eg Fairtrade, Forest Stewardship Council), where multiple stakeholders come together but where their level of engagement has remained largely transactional.

Survey respondents see these types of collaboration as the most likely to increase over the next five years. But although they may win the day, they are unlikely to win the decade ahead: the greatest potential for change lies in initiatives that are both focused in nature and systemic in scope.

Starbucks cup recycling is one such example. For an issue that requires both behaviour change and a change in recycling infrastructure, the company’s starting point was to convene all the players in the system. Government officials, suppliers, manufacturers, retail and beverage businesses, recyclers, competitors, conservation groups and academics were brought together to develop an approach that worked for Starbucks as well as the food service sector as a whole. The work that Nike is doing with its competitors to develop a systems change programme to eliminate hazardous chemicals from supply chains is another good example.

3. Know when to collaborate

Public policy advocacy and consumer engagement on sustainability topics are seen as having the most upside when addressed through collaboration. However, those surveyed recognise that collaboration is not always the answer, indicating that competition is the best approach when it comes to companies developing a more sustainable business model and/or products and services. Sustainability professionals, it seems, still have some faith in the power of the market to drive change and spur sustainable innovation.

The careful balance between collaboration and competition is personified in the Sustainable Apparel Coalition, an industry-wide alliance of apparel, footwear brands, retailers, suppliers and NGOs. The coalition is working to develop an index that measures the environmental performance of apparel products. With a shared measuring tape, each company can tailor its sustainable products to fit their own business model. As one brand in the coalition said at Sustainable Brands in London recently, “we need [a] common language before we can be competitive”.

4. The challenge ahead

The idea that traditional adversaries can realise greater benefit by upholding common environmental and social standards, rather than by competing on them, seems to have come of age. If our 800 sustainability professionals are to be believed, company-led collaborations may really start to move the dial if they focus on a single systemic problem, actively engage the public sector, and seek to learn from and build on what has worked before.

To download the full results of the GlobeScan/SustainAbility survey see here.

This article was coauthored with SustainAbility Associate, Michael Reading, and originally appeared on the Guardian Sustainable Business website.

The Urgent Need to ‘Future Proof’ the World’s Cities: Implications for the Private Sector?

info@sustainability.com (Sustainability) — Wed, 23 Jan 2013 10:48:00 +0000

People worldwide are starting to connect the dots. Hurricane Sandy costing New York over 60 billion dollars with one of the largest insurance pay-outs in history. 85% of Dhaka submerged by recent flooding. 44 million people – many located in our cities – pushed into food poverty by food price spikes in 2010. And the costs of congestion bringing many urban centres to grid lock. In summary – cities worldwide need to take steps now to ‘future proof’ themselves if they are to avoid irreversible and costly damage to their environmental, social, and economic futures.

We already live in an urban world. But more than 75% of people will live in cities by 2050, or over 6.1 billion people. 95% of this urban expansion will happen in fast growing developing countries. In a new report – Future Proofing Cities – recently launched by Atkins in partnership with the UK Department for International Development and University College London, we show in further detail why cities need to take urgent steps to future proof themselves.

The report essentially makes three points. First, cities need to take proactive steps now to future proof themselves due to a perfect storm of risks from climate hazards such as flooding to risks to water, food, and energy systems, as well as from growing carbon emissions and damage to vital ecosystems.

Based on an integrated assessment of 129 cities across 20 countries we show that cities can be divided into five urban types based on the most significant environmental risks they face. This analysis shows that the most common group of cities are cities such as Bangkok, Delhi, and Jakarta which face risks across multiple fronts, underscoring the need for action now.

Second, that cities can act to future proof themselves, and that acting can generate economic and social benefits as well as environmental ones. The report outlines over 100 polices for future proofing from integrated urban planning to sustainable transport, management water and waste, and new sources of energy.

The good news is that, at the level of the city, many policies can respond to multiple environmental risks. For example, buildings – and indeed whole neighbourhoods – can be designed to reduce carbon emissions and energy use, and to be resilient to climate hazards such as temperature extremes. Many options for future proofing can also generate wider benefits. Recent work Atkins has been undertaking in Madurai (India) has showed the wider economic and social benefits of a low carbon trajectory due to opportunities for green jobs, improved health outcomes, and enhanced efficiency of energy use.

Third, that responding to these complex challenges requires an integrated, multi-disciplinary, multi-skilled approach. We can’t continue to think about long term environmental challenges in silos. For example, looking at climate change mitigation in complete isolation from climate change adaptation doesn’t make sense in cities given the range of solutions which can respond to both challenges.

So we need to break out of our silos and create integrated solutions and packages of measures for future proofing. This will require pooling skills across professions from engineers, planners, and architects to sustainability experts, economists, climate scientists, transport specialists, ecologists. This won’t be easy, but by working together this can support the creation of cities of the future which are more environmentally, socially, and economically prosperous.

The role for municipal authorities, national and regional government, engineering and design companies, and development agencies in responding to this agenda is perhaps obvious. But what about the private sector?

Owners and managers of assets in cities – from transport providers and water companies to banks – need to ensure they are paying adequate attention to the risks to their investments and operations. The private sector is also part of the solution: companies can create the innovations required to help cities respond to long term risks such as water and food scarcity. In doing so, this can not only help the global community deal with the challenges we face, but it can also help to improve the bottom-line.

For a full copy of the Future Proofing Cities report go to FutureProofingCities.com

Nick Godfrey is Principal Economist in Atkins futures team and lead author of Future Proofing Cities. Nick’s colleague Elspeth Finch will be appearing on a panel with SustainAbility’s Geoff Kendall at the Net Impact event, Retrofitting the Sustainable City. Click here for more information.

SustainAbility Becomes a Certified B Corporation

info@sustainability.com (Sustainability) — Thu, 02 May 2013 10:03:46 +0100

We are proud to announce that SustainAbility has become only the third Certified B Corporation in the UK.

We became a B Corp because our vision is a just and sustainable world for present and future generations, and our shareholders are as concerned about social and environmental impact as they are about financial returns. B Corp status is a truer reflection of our nature as an organisation than a for profit limited company.

Click here to view our ful B Corp profile.

About B Corp

B Corp certification is to sustainable business what Fair Trade certification is to coffee or USDA Organic certification is to milk.

B Corps are certified by the nonprofit B Lab to:

meet rigorous standards of social and environmental performance;
legally expand their corporate responsibilities to include consideration of stakeholder interests; and
build collective voice through the power of the unifying B Corporation brand.

As of January 2013, there is a growing community of more than 600 Certified B Corps from 20 countries and over 60 industries working together toward one unifying goal: to redefine success in business.

To find out more about B Corp click here.

About B Lab

B Lab is a nonprofit organization dedicated to using the power of business to solve social and environmental problems. B Lab drives systemic change through three interrelated initiatives:

building a community of Certified B Corporations to make it easier for all of us to tell the difference between “good companies” and just good marketing;
accelerating the growth of the impact investing asset class through use of B Lab’s GIIRS impact rating system by institutional investors; and
promoting supportive public policies, including creation of a new corporate form and tax, procurement, and investment incentives for sustainable business.

To find out more about B Lab click here.

Mark Lee and Chris Guenther to Speak at Sustainable Brands'13

info@sustainability.com (Sustainability) — Wed, 01 May 2013 13:45:00 +0100

Join us as at Paradise Point in San Diego, CA, June 3-6 where sustainability, brand and innovation professionals come together from around the world to be inspired, engaged and equipped to succeed by building the better brands of tomorrow, while building a network of likeminded colleagues who can help.

Our Executive Director, Mark Lee will open the event on June 4th, 2013.

Our Research Director, Chris Guenther will sit on a panel Meet the Aspirationals: Innovating for Complex Consumers with BBMG and GlobeScan to discuss sustainable consumption and the latest Regeneration Roadmap survey at 3:30pm on June 5th, 2013.

Receive 20% off registration when you use this code: NWsaSB13

For more information and to register, click here.

Unilever Remains on Top of Poll of Corporate Sustainability Leaders

info@sustainability.com (Sustainability) — Mon, 29 Apr 2013 09:00:00 +0100

London, 29 April 2013 – Unilever has once again retained its top ranking in the latest sustainability leaders survey. Patagonia continues to rise in the eyes of sustainability experts and Puma has entered the ‘top 10’ for the first time.

The Sustainability Leaders is the latest GlobseScan / SustainAbility opinion survey and asks over 1,000 experts which sectors of society and which companies are most effectively advancing the sustainability agenda.

While leadership examples are called out what is also consistent in the opinion of experts is that these examples are not nearly enough. Only national governments – whose paltry leadership on sustainability was recognized by all stakeholder respondents, including experts in government – rank lower than corporate leaders in advancing the sustainability agenda. This is an all too familiar theme in the global workshops and research GlobeScan and SustainAbility have conducted for The Regeneration Roadmap.

The GlobeScan / SustainAbility Surveys are in field around six times each year, and provide a regularly updated expert perspective on a range of timely topics.

Download the full 2013 Sustainability Leaders Survey.

SustainAbility at Sustainable Brands Rio 2013

info@sustainability.com (Sustainability) — Fri, 26 Apr 2013 10:01:22 +0100

Join us in Rio on May 8-9 for the first Sustainable Brands event in South America.

SB Rio will feature inspiring lectures by business leaders and entrepreneurs, as well as thematic sessions where topics such as network innovation, corporate culture change, communication, and entrepreneurship will be covered in detail.

SustainAbility is a partner of this event and on May 8 will co-host with GlobeScan a workshop called Meet the Aspirationals, highlighting the latest consumer survey results from the Regeneration Roadmap project.

For more information and to register your place click here.

Consumers Rank Ingredient Transparency Among Most Important Issues For Brands

info@sustainability.com (Sustainability) — Thu, 25 Apr 2013 14:11:01 +0100

Study finds large majority of consumers say “ingredient transparency” among top purchase drivers for food, beauty and household products, yet only 57% regularly check the list of ingredients before purchasing.

A study by BBMG, GlobeScan and SustainAbility finds that nearly 9 in 10 consumers globally (86%) say “ingredient transparency is extremely important or very important” for companies to address as part of their products, services, or operations, including 88% of consumers in emerging markets and 84% of consumers in developed markets. However, only 57% regularly “check the list of ingredients before purchasing” products, highlighting the gap between interest and action in sustainable consumption.

According to the report – Re:Thinking Consumption: Consumers and the Future of Sustainability – ingredient transparency is also a “very important” or “important” factor in purchase decisions across key categories, such as food and beverage (82%), beauty and personal care (82%), and household products (82%). The study draws from an online survey of 6,224 consumers across Brazil, China, India, Germany, the United Kingdom and the United States.

“Many consumers globally believe they have the right to know what products are made of and they want companies to ensure their products are safe and effective,” said Eric Whan, Sustainability Director at GlobeScan. “However, there’s a gap between interest and action when it comes to actually reading the list of ingredients on product packaging.”

“The overwhelming majority of consumers identifies ingredient transparency as an important consideration in making purchase decisions for food, beauty and household products,” said Raphael Bemporad, co-founder of brand innovation consultancy BBMG. “Across multiple markets and product categories, consumers are expressing interest in what goes in, on and around their bodies.”

Click here to read the full press release.

Newsletter > Join us at Convergence Paris...

info@sustainability.com (Sustainability) — Fri, 12 Apr 2013 08:11:07 +0100

This month’s newsletter features Convergence Paris, an event hosted by GreenBiz Group. SustainAbility Executive Director Rob Cameron and Development Director Geoff Kendall will each chair a panel session during this event. Click here to view.

Also see other past updates here

Sign up on our website to have future updates delivered directly to your inbox – either by joining the members area or just by giving us your email address at the bottom of our homepage.

Geoff Kendall to Chair a Panel at GreenBiz Group's Convergence Paris Event

info@sustainability.com (Sustainability) — Wed, 10 Apr 2013 12:18:01 +0100

SustainAbility Development Director Geoff Kendall will chair a panel session at this year’s Convergence Paris event hosted by GreenBiz Group. The event is scheduled to take place from June 26, 2013 – June 27, 2013 at the Microsoft Conference Centre in Paris.

Convergence Paris is part of the VERGE event series, which brings together business leaders and key influencers to explore opportunities at the intersection of the energy, information, buildings, and transportation sectors. Through keynote interviews, moderated panels, talks and interactive discussions, Convergence Paris will explore 7 key themes:

M2M / Internet of Things: Wireless communications and embedded intelligence connect billions of devices to monitor and manage energy use.
Smarter Supply Chains: Data-sharing and new technologies to create competitive global supply chains.
Future Cities: Innovative financing, technology enablers, public-private partnerships, platforms for sustainability strategies.
Next-Gen Buildings: Automation systems, embedded sensors, advanced lighting, demand response, data transparency.
Data: How big data, advanced computing power, and analytics create actionable insight.
New Energy Systems: Cloud-based IT processes, corporate energy management for facilities and data centers, integrating renewables & distributed generation.
Intelligent Transportation: Connected vehicles, fleet management and logistics, sustainable mobility.

To register for the event click here.

About VERGE

VERGE conferences have traveled the globe with events in Shanghai, London, Sao Paulo, Washington DC, and San Francisco, all simulcast to a global audience via a highly-interactive virtual environment. Prior VERGE conferences have featured thought leaders from a wide variety of sectors, including SustainAbility founder John Elkington, Tony Hsieh, Steve Case, Jon Wellinghoff, Amory Lovins, Tim O’Reilly, Bill McDonough, Carl Bass, and many more.

For more information visit the VERGE microsite.

About GreenBiz Group

GreenBiz Group is the world’s first and only mainstream media company focused exclusively on sustainability and the competitive edge it brings to businesses. Its focus is on providing resources that help the rapidly growing market of green- minded professionals and institutions succeed and prosper.

For more information visit the GreenBiz website.

Newsletter > Your Turn to Rate the Raters, Is this the Moment for the Big Idea and more...

info@sustainability.com (Sustainability) — Wed, 03 Apr 2013 14:03:32 +0100

This month’s newsletter features the latest from Rate the Raters on sustainability ratings and a blog highlighting that public pressure is shifting toward taking action on a range of sustainability issues. Click here to view.

Also see other past updates here

Sign up on our website to have future updates delivered directly to your inbox – either by joining the members area or just by giving us your email address at the bottom of our homepage.

Mark Lee to Speak at 5th Annual ARCS Research Conference Forum

info@sustainability.com (Sustainability) — Thu, 28 Mar 2013 11:07:30 +0000

SustainAbility Executive Director Mark Lee will be speaking at the opening Forum of the 5th annual Alliance for Research on Corporate Sustainability (ARCS) Research Conference in Berkeley.

The ARCS is hosting the one-day Forum as part of its annual academic conference with the intention of bridging the communities of practitioners, researchers, and educators focused on the area of corporate sustainability. This year’s objective is to spark a useful discussion on business models for sustainability. The morning session will kick-off with an overview of the current status of sustainable business practice and then leave the balance of the day to consider the merits of emerging examples in the areas of market-based approaches, customer engagement, and motivating change toward sustainability in companies. The debate will be lively as researchers and practitioners come together to share and compare their science-based findings and real-world experience.

To find out more about the forum click here.

To register for the event click here.

About the 5th Annual ARCS Research Conference

The Fifth Annual ARCS Research Conference, hosted by the Haas Center for Responsible Business and the Berkeley-Haas School of Business, will be held Mon. April 29 – Wed. May 1, 2013. The Call for Papers sought submissions of unpublished working papers focused on business and sustainability issues (both social and environmental) from all disciplines and methodologies.

Find out more

About the Alliance for Research on Corporate Sustainability (ARCS)

The Alliance for Research on Corporate Sustainability (ARCS) is a partnership among academic institutions created to provide data and networking opportunities to facilitate research on corporate sustainability. As environmental issues have grown in complexity and scope, there is growing recognition that to gain ground on our most pressing environmental issues will require the proactive engagement and leadership of the business sector. ARCS helps develop greater understanding of the opportunities and limits of policies and strategies to create sustainable businesses by facilitating rigorous academic research.

ARCS was launched in January 2009, by a consortium of institutions at leading universities: Dartmouth College, Duke University, Harvard University, University of Michigan, University of Virginia, and University of Western Ontario.

Visit website

SustainAbility's Sister Company Volans Publishes Breakthrough Report: How Business Leaders Can Create Market Revolutions

info@sustainability.com (Sustainability) — Thu, 07 Mar 2013 09:00:00 +0000

SustainAbility’s sister company Volans today launches a new market intelligence report calling on business leaders to help drive ‘breakthrough’ innovation, as part of a coming revolution in global markets.

Our current resource crunch coupled with ongoing population growth means that life will become increasingly turbulent – “Extreme is the new normal,” as New Scientist has put it. We must do things differently. But government leadership has been conspicuous by its absence, as illustrated by the failure of last year’s Rio+20 summit. Against such a backdrop, business has an increasingly crucial role to play in creating a world fit for the 9 billion people predicted for 2050.

Volans’ latest report entitled Breakthrough: Business Leaders, Market Revolutions outlines the context in which business operates today and suggests three possible scenarios for the future:

Breakdown – where business misunderstands the complexity of global challenges and resists change;

Change-As-Usual – where earnest efforts are made, but the overall outcome is little more than a set of patches on the existing, dysfunctional system;

Breakthrough – where business dares to create ambitious ventures with innovators, entrepreneurs, intrapreneurs, investors and policy makers, helping drive disruptive change into markets and political systems.

The Volans team interviewed 120 leaders (ranging from the CEOs of some of the world’s largest companies through to innovators determined to disrupt just such companies), representing multiple sectors and geographies. Their focus: the emerging challenges in such areas as energy security, water security, food security and climate security. The Breakthrough report summarizes these findings and spotlights how some business leaders are taking the reins, arguing the business case for “market revolutions” in such heartland areas as accounting, valuation and economics.

Find out more by downloading the full Volans press release below or download the report on the Breakthrough Capitalism website.

About Volans

Founded in 2008 by SustainAbility founder John Elkington, Volans is a consultancy and think-tank driving market-based solutions to the future’s greatest challenges. We broker new conversations, relationships and partnerships across sectors, geographies and time horizons. In the process, we help key players to develop their strategies and business models. We stretch thinking, ambitions and targets with our Breakthrough, zero-impact and entrepreneurship agendas. In terms of our ultimate impact, we aim to develop the ‘Future Quotient’ (FQ) of individuals, teams, organization and economies.

Website: www.volans.com

About Volans’ ‘Breakthrough Capitalism’ Program

In 2012 Volans hosted an event for some 250 people in London, on Breakthrough Capitalism which explored the three scenarios outlined above. The Forum hit a nerve, and Breakthrough Capitalism evolved into a program for people to engage with the idea of businesses creating system-level change, which could inspire action.

Website: www.breakthroughcapitalism.com

The 2013 Sustainability Leaders

info@sustainability.com (Sustainability) — Sun, 28 Apr 2013 14:57:52 +0100

“If we achieve our sustainability targets and no one else follows, we will have failed.” – Paul Polman – CEO, Unilever

Another year has passed and the results of the latest GlobeScan / SustainAbility opinion survey on leadership look startlingly similar: Unilever on top. That’s not the whole story of course – Patagonia continues its impressive rise in the eyes of our sustainability experts, Puma has entered the “top ten” for the first time ever, and our global expert pool proves that leadership is often best recognized when it’s familiar, with respondents most likely to cite leaders headquartered in the regions they are based in. Even Unilever as #1 rises above the status quo, bucking the trend of leadership companies “coming back to Earth” as time passes between the launch of ambitious commitments or initiatives. In fact, Unilever has only continued to rocket past its peers since it first launched the Sustainable Living Plan in 2010.

And therein lies the rub of “leadership as usual,” broadly exemplified in The 2013 Sustainability Leaders survey: it’s not nearly enough. Only national governments – whose paltry leadership on sustainability was recognized by all stakeholder respondents, including experts in government – rank lower than corporate leaders in advancing the sustainability agenda. This is an all too familiar theme in the global workshops and research GlobeScan and SustainAbility have conducted for The Regeneration Roadmap.

So in celebrating Unilever and other business leaders’ ambition, achievement and engagement (alongside its fellow changemakers in social enterprise, science and the NGO space), let’s remember the quote (above) from Unilever CEO Paul Polman: leaders are only as successful as those who are inspired to follow in their path.

The Raters Response

info@sustainability.com (Sustainability) — Wed, 27 Mar 2013 10:20:23 +0000

It’s Your Turn to Rate the Raters

In this final piece of Rate the Raters Phase 5, we publish the responses from a number of sustainability raters to a questionnaire we posed to them. We do this to promote greater transparency and to provide users – companies, investors and others – a better understanding of how these ratings work. SustainAbility has not edited or evaluated the content of these documents. Instead, we want our readers to use this information, and the methodology we developed in Phase 3, to form their own opinions. We want to hear from readers on the good practices that should be disseminated and opportunities for further improvement.

Since initiating our Rate the Raters work in 2010, we have learned a great deal about ratings, and have seen a number of improvements. For example, just last week CDP and RobecoSAM announced a collaboration in which the Dow Jones Sustainability Indices will ask the same climate change questions asked by the CDP. This streamlining addresses a common company complaint (i.e. duplicative questions) and is something we’ve advocated for in our work.

Yet, new ratings continue to pop up, for example over the last several months we have seen the launch of Oxfam’s Behind the Brands Scorecard, the Access to Nutrition Index and The Civic 50. Without judging the objectives and approaches of these and other ratings, it’s important that their founders consider the sort of questions we have posed in our survey, and consider how their ratings are advancing the corporate sustainability agenda, rather than adding additional burden and complexity to it. For these ratings and others not included on our website, we will request responses to our questionnaire.

We encourage our readers to review these responses through the lens of our methodology (which is also available for download below) and engage ratings organizations. Tell them where they are doing good work, and advocate for change. SustainAbility will remain active in the ratings agenda, as we believe they are critical tools in improving corporate sustainability performance. We will continue to press for greater transparency and quality, for example in advising the Global Initiative for Sustainability Ratings, and we will engage the raters with which we have developed constructive relationships over the last several years.

As always, we welcome your perspectives and ideas on how to advance the ratings agenda, Michael Sadowski – sadowski@sustainability.com.

Collaborating for a Sustainable Future

info@sustainability.com (Sustainability) — Wed, 12 Dec 2012 14:33:43 +0000

As Jo Confino, chair of Guardian Sustainable Business, wrote at the close of the Rio +20 Conference in June 2012, “the most often used phrases in the many meetings I attended [were] the need to create ‘coalitions of the willing’ and a recognition that ‘all issues are inter-connected’ and cannot be viewed in silos”. In effect, proponents of more and better collaboration (e.g. between businesses, businesses and governments, businesses and NGOs, and multi-actor partnerships between all three) were not only big winners Post-Rio, but collaboration continues to be viewed as one of the few models that could catalyze solutions to the sustainable development challenges that we face at the speed and scale that we need.

To better understand the renewed hope, future prospects and potential pitfalls of Collaborating for a Sustainable Future, SustainAbility and GlobeScan surveyed 800 global experts in 74 countries representing business, government, NGO and academic perspectives. We asked respondents for clues to a blueprint for the most effective forms of collaboration, how business should (and in reality, would) approach governments to address sustainability issues, and the most valued attributes of a collaboration partner. Collaborating for a Sustainable Future represents the beginning of our exploration into these questions and more, becoming an important focus area for us in the new year. We look forward to hearing your thoughts and insight.

To read about the survey findings, please watch this video or download the survey results below.

The Investor View

info@sustainability.com (Sustainability) — Wed, 05 Dec 2012 15:48:57 +0000

Taking the pulse of mainstream investors on sustainability

We have extensive experience in managing portfolios with social, environmental, and religious considerations, and are committed to an integrated approach to Environmental, Social and Government issues (ESG) as part of our overall investment management process.

If you follow the responsible investment field, you are no doubt familiar with statements like this from a large, global asset manager that is a signatory to the UN Principles for Responsible Investment. These statements likely give you hope – that over 1,000 investors managing over $30 trillion in assets have endorsed PRI is real progress. Yet, you should also have serious questions, as these commitments are not yet sufficiently translating into action by investors.

In this piece of our Rate the Raters research, we set out to better understand the perspectives of mainstream analysts and portfolio managers on ESG issues and ratings. Through a survey and one-on-one interviews, we sought the views of investors who don’t specifically focus on socially responsible investment, believing that if we are to make progress on the issues we care about – climate change, poverty, health, etc. – we must work harder to engage this group, which by one recent estimate represents 89% of the assets in the US.

To learn what the investors think, please watch this video or download the survey results below.

The Company Perspective

info@sustainability.com (Sustainability) — Fri, 19 Oct 2012 18:16:15 +0100

Throughout the first four phases of Rate the Raters, we heard perspectives from a number of companies on sustainability ratings, and included some of these in our reports. We certainly heard a lot about the things ratings should do better (greater transparency, more feedback, etc.). Yet, we completed phase four lacking a systematic view on how ratings are being used by, and creating value for, companies. We thus set out in phase five to better understand how companies are using and getting value from ratings, and interviewed nearly 30 companies in the process.

We spoke with individuals responsible for managing the ratings process within these companies and asked them the following questions:

Which ratings, rankings and indices do you prioritize and why?
How has your approach to managing ratings evolved over last five years?
How do you use ratings in your work?
How do you get value from ratings?
What and how do you communicate about ratings to your non-sustainability
colleagues?
How could ratings create more value for your work?

We present the highlights of our conversations in this paper.

Polling the Experts 2012

info@sustainability.com (Sustainability) — Tue, 11 Sep 2012 09:00:00 +0100

In May of 2010, we launched a multi-phase research program entitled Rate the Raters, which aimed to shed light on the universe of corporate sustainability ratings and to influence and improve their quality and transparency.

In the fourth phase of Rate the Raters we put forth our vision for ratings in the future, which called for competition on analysis rather than data collection, greater focus on material issues and impacts, and improved transparency.

A year on we believe there remain a number of important, unanswered questions, for example around how ratings are being used by sustainability professionals and investors, and we embarked on a new fifth phase to explore these issues.

The first of four deliverables from Rate the Raters, Phase V is a GlobeScan / SustainAbility survey of how sustainability experts view and use corporate sustainability ratings. Similar to a survey that we conducted in 2010, we polled 850 people from over 70 countries, across multiple sectors, who have worked on sustainability matters for at least three years (in fact, over 60% of these respondents have 10 or more years of sustainability experience).

Watch the video for the full survey results, and please join the debate by commenting below or sharing your views on Twitter (#RatetheRaters).

Water for Business Version 3

info@sustainability.com (Sustainability) — Wed, 22 Aug 2012 13:25:38 +0100

In 2009, WBCSD and IUCN released Water for Business – the first online guide specifically designed to help businesses manage water more sustainably by providing them with an overview of water tools and initiatives which they can use or engage with.

The third edition is now out and was developed in collaboration with SustainAbility and IUCN. The guide recognizes that one initiative alone will not satisfy the needs of every business, local community or stakeholder group. It outlines the benefits of the different tools available and illustrates how a combination of complementary tools can best meet wide ranging needs.

Water risks are increasingly capturing the attention of large institutional investors, and stakeholder concerns and expectations of corporate water management practices are high. Among others, business will have to address the following challenging questions:

Where are the internal and supply chain “hot spots” that may be vulnerable to business interruption, or a significant increase in cost?
What are the water needs and vulnerabilities of the local communities in which they operate?
What are the regulatory/political climates across key geographies?
How can they work collaboratively with local stakeholders to develop and execute strategies, which ensure water availability over the long term?
What level of performance constitutes leading practice in water management?

The global business community increasingly recognizes and has begun to address these water challenges. Despite the growing awareness, however, a lot of work remains ahead of us.

Overcoming the looming water crises will require more effective guidance to scale up collaborative solutions across watersheds including strengthened local governance.

Purpose and scope of the guide

The purpose is to help businesses and key stakeholders identify water tools and initiatives that will best meet their specific needs, and ensure the sustainability of our water resources. More specifically, it aims to:

Provide an overview of water initiatives, so that readers understand “who is doing what”;
Develop a common language for business on water and sustainability;
Facilitate business engagement in relevant initiatives and uptake of tools accelerating action;
Enable the identification of risks and opportunities, gaps and complementarities;
Help water tool developers increase their impact through consensus building and joint action.

Structure

This report is organized into four main sections:

Key messages: conclusions and lessons learned from updating the Water for Business guide.
Understanding water management: summaries of the five stages of water management, and the key functions within a corporation where information about water management is becoming more relevant. For each stage and function, it recommends various tools that can be used to enhance sustainable water management practices.
Initiative factsheets: overviews of specific water initiatives, enabling businesses to compare and contrast them as effectively as possible, and to find out where to go for more information. The scope of this report is by no means exhaustive.
Glossary: key terms and definitions in the area of water management.

Key Issues

We rely on water to grow our food, produce our goods, and generate our energy. “Business has a leading role to play in the management of natural resources, especially in the use of freshwater resources, for which there exists no substitute,” says James Dalton, Coordinator, Global Initiatives, IUCN Global Water Programme. “The Water for Business guide can support businesses to find their way in tools aimed at managing water in a more equitable and effective manner, in the interest of companies’ performance, balanced with growing population demands and healthy ecosystems.”

Businesses need to have frameworks within which they can measure, manage and assess their impacts, especially those moving into emerging markets. “This is an essential guide for business, especially when you consider that 80 percent of the global population now lives in areas where the threat to water security is high,” says Joppe Cramwinckel, Director, World Business Council for Sustainable Development Water. “That, coupled with the spread of industrial and agricultural activity, is putting additional stress on local aquifers.”

Water is becoming an increasingly precious resource for businesses across sectors and around the world. “Managing water effectively—both within and beyond the facility fence line—is essential to ensuring that both businesses and communities prosper long into the future,” says Jeff Erikson, Senior VP at SustainAbility. “Water for Business can help business leaders sort through the myriad of tools and resources available, and select the ones that are most useful for their individual situation.”

Download the full report below or visit the dedicated section on WBCSD website.

Climate Change Policy Options: Beyond Kyoto

info@sustainability.com (Sustainability) — Wed, 09 May 2012 09:08:05 +0100

At the end of this year the first commitment of the Kyoto Protocol will expire having failed to get carbon emissions down to a safe level. The main success appeared to be that the international policy process managed to stay on track despite the near breakdown of negotiations at COP15 in Copenhagen. As we move into the post-Kyoto period we still have a climate change challenge that looms larger than ever and the governments of the world still have no clear plan to address it. So what next?

To better understand what it will take to make real progress on getting carbon reductions down to a safe level SustainAbility and GlobeScan surveyed more than 800 sustainability experts and practitioners located in more than 70 countries, asking for their views on climate-change policy. We asked respondents to rank the effectiveness of various mechanisms to address climate change, those that garnered most support – economic instruments, regulatory approaches and technology development – are those that will change the cost of emitting greenhouse gas emissions and, consequently, change the economics of energy.

Download the PDF for full results and insights.

The 2012 Sustainability Leaders

info@sustainability.com (Sustainability) — Wed, 28 Mar 2012 12:45:00 +0100

It is probably no surprise that perceptions of sustainability leadership have declined or stalled for nearly all institutional actors – including corporations, governments, NGOs and social entrepreneurs – in the last 12 months. Social protests around the world indicate disillusionment with rising inequality, unemployment and continued unsustainable short-term thinking and reflect the growing distrust in leaders of all stripes.

The 2012 Sustainability Leaders: A GlobeScan / SustainAbility Survey polled a total of 825 experts in January and February 2012 to better understand which companies and sectors of society, if any, are making any progress in advancing the sustainability agenda.

Watch the video below for our survey findings and for expert analysis from Jeff Erikson, Senior Vice President of SustainAbility or download the PDF below for the full results and insights.

Citystates

info@sustainability.com (Sustainability) — Tue, 13 Mar 2012 12:00:09 +0000

Cities are where we build our most ambitious and symbolic structures, where we come together to share experiences and exchange capital, goods and ideas, and where we go in search of a better life. They will also be ground zero for the collision of economic, environmental and social imperatives that define sustainability.

Cities therefore provide a compelling frame through which to understand and drive sustainability. As models of characteristics such as connectivity, adaptability, decisiveness and experimentation they provide numerous lessons, especially to business, on how to advance the sustainability agenda both within and beyond the city.

Sponsored by Ford Motor Company and produced in partnership with GreenBiz, Citystates puts forward seven characteristics that enable us to explore the current and potential nexus between cities and sustainability and understand what risks and opportunities cities might hold for global companies who intersect with, provide for and depend on them in many ways.

Download the full report, watch the video briefing or join the debate on Twitter @SustAbility #citystates.

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