Sustainability and Business Change

Ah sustainability.

The watchword of business across the globe, plastered across everything from boxes of tea and packets of salmon, to organisational goals statements and marketing materials. But really, the contexts in which this all-too-often used word is placed seems to vary greatly, covering a range of meaning from ecological safeguarding, to fair trading and ethical practices, through to simply meaning that a business will ensure that it survives in the long term.

However, we only have to look at the political discourse in today’s polarising and highly charged media environments to recognise that there is clearly a disconnect between the individuals’ view of what is sustainable and the overarching organisational corporate or governmental view of what is sustainable. In recognising this, we are presented with a challenge from a change perspective.

How do we enact sustainability, when really we don’t actually have a firm grip on what it means!

Triple bottom line theory, or TBL for short highlights these views somewhat, putting across that organisations no longer can simply acknowledge only the fiscal factors pertaining to their survival, but the wider societal and environmental impact practices as well.

This existential ‘triple threat’, is obviously a massive problem to attempt to get a handle on, and is something that many organisations don’t know where to begin. In some ways the ‘fear factor’ alone of what will happen when the implications of calculating the societal or environmental factors are considered weigh large, causing a strategic and operational paralysis that results in these vital changes not taking place at either the scale or speed that is required.

A good example of this is the brave move by Puma to calculate environmental impact as part of its operating model (though it is worth noting they still have not included this in their annual profit-loss statements). Calculating the impact in 2015 as a whopping 145 million Euros per year. As a point of comparison, Puma’s 2018 net earnings were 187 million. Fear factor indeed.

Yet it’s easy to focus on the negative aspects rather than the implicit positives of getting things right. Organisational resilience is at its highest point when all variables are being considered.

Likewise the benefits of having a fully engaged and committed workforce is well understood. Disengagement costs alone potentially cost tens of thousands per disengaged employee, saving these costs in return for an investment in a truly open, meaningful program of work that benefits both employees and the business seems like a good trade to make.

As Ken Blanchard in his book on servant leadership says, look after your people, and they will look after your customers, which will look after your bottom line.

But let’s link in now to the change element. Clearly there’s a big piece to be considered here! Arguably this could be the biggest and most important change that organisations will need to make in this century to avoid the obvious repercussions stemming from social inequality & environmental destruction, but also technological disruptions, new business models and rising geopolitical uncertainty. In order to become truly resilient this needs a new way of viewing things, that requires looking beyond the box of the organisation and into the wider world in which that organisation sits.

So what do businesses need to look at to examine this in more depth?

The BSR (Business & Social Responsibility), a not-for-profit organisation, have an integrated framework that encompasses three main areas. The purpose of this article is not to cover their framework in depth, but at a glance, they are:

ACT – Creation of resilient business strategies, governance and management approaches that ensure the achievement of business goals.

ENABLE – Catalyze systemic progress by building mutually beneficial relationships and collaboration with stakeholders and partners across the entire value chain.

INFLUENCE – Promote policy frameworks that strengthen the relationship between commercial success and the achievement of a just and sustainable world.

These are useful pointers certainly, but this author’s view is that there is actually a wider issue at hand here. That of the inherent capability of the organisation to actually change, ie: their change readiness. This need exists not at a project level or simply a ‘piece’ of the business but a total sea change across all operating areas. The mind boggles at the cost, time and complexity that this change would require!

By this standard, organisations clearly aren’t ‘change ready’ in the majority of instances.

However, to make the impossible difficult, and the difficult manageable, we can break this down using the experiences we already have at our fingertips of what it takes to embed change across an organisation.

Underpinning this are the same change components which are utilised in effective change programs across the globe; people-focused culture shifts, proactive and meaningful communication and dialogue with key stakeholders, the establishment of effective learnings on how things should and could be done, and appropriately deployed technological mechanisms all ensure effective change management takes place not just at a project level but as a program and organisationally aligned initiative.

By looking at things in this way we can begin to gather an inkling of the step changes which can, and indeed must, take place over the coming years. Even small steps, when taken together can make big leaps forward! This is what good change management is about!