A New Framework for Sustainability

All In: The Future of Business Leadership

David Grayson, Chris Coulter & Mark Lee

224 pages, Routledge, 2018

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Understanding these attributes will help social innovators, social entrepreneurs, and campaigners to work more effectively with businesses for the common good. —David Grayson, Chris Coulter, Mark Lee

We know it instinctively, feel it intuitively, and see it empirically. The world is going through unprecedented change at extraordinary speed thanks to revolutions affecting markets, technology, demographics, development, and values. Any one such revolution would have major implications. Taken together, mutually reinforcing and interacting with other macro forces like biodiversity, the disruption they cause presents both escalating risks and amazing opportunities.

All In: The Future of Business Leadership looks at these risks and the scale and pace of change that economies, the environment, and society are experiencing through the lens of sustainability leadership, particularly the private sector’s contribution to ameliorating the challenges facing the world today. By “sustainability,” we mean how over nine billion people will live reasonably well within the constraints of one planet by the mid-twenty-first century. All In does not aim at some indefinite future, but at how we address these problems from now through to 2030. The Paris Agreement and the United Nations Sustainable Development Goals (SDGs) both came into being in 2015, giving humanity fifteen years to make good on their intentions. We have already used nearly 20 percent of that time.

Going all in makes a business more resilient to future shocks because it has a better grasp of the changing external environment. It makes a business better able to attract, retain, and get the best out of employees, business partners, and suppliers. It makes the business more attractive to patient, long-term investors. It provides the business more opportunity to shape the future thanks to better influence and access to governments and civil society. It creates more hunger for better platforms to innovate successfully. In short, going all in is not a guarantee that a business will continue into the indefinite future but it creates the optimum conditions for doing so.

Five Attributes of Leadership

There are five key interlinking attributes for business to go all in: a framework for leadership. It starts with having a purpose—a clear, defining idea of what a business stands for, which is inspiring, authentic, and which explains how a business creates value for itself and for society. It involves having a comprehensive plan covering all aspects of a business and its value chain. It is about having a sustainable culture which is about being innovative, engaging, transparent, and accountable. To achieve scale, it requires collaboration with a whole range of other businesses. The fifth and final attribute is advocacy: being prepared to speak out and to speak up for social justice and sustainable development.

Whereas in the past you might have been able to be a leader if you could demonstrate excellence in just one or two of these attributes, the crucial distinction today is that businesses now need to possess all five of those attributes. Let’s explore them in a bit more detail:

Purpose is the foundational element. One of the great case studies we’ve come across in the research is Natura, the Brazilian cosmetic company. At their founding nearly fifty years ago, they had a purpose called Bem Estar Bem (which translates to the harmonious relationship with oneself, with others, and with the whole) that at its core is about taking care of life in all its forms. It has been the guiding light for Natura ever since and has driven their remarkable achievements in sustainability from sustainable sourcing, to protecting and advocating for the rainforests, to their social impact work in their employee system, as well as acquiring companies like The Body Shop to extend and drive their purpose in a more global context.

If purpose is your North Star, plan is your map. We aren’t talking about a sketch but a detailed step-by-step, metrics-laden, transparent, stakeholder-engaged change of business model kind of plan. We believe such plans first began to emerge with GE’s Ecomagination in 2004 and Walmart’s Sustainability 360 Plan in 2005. Marks & Spencer released their first Plan A in 2007. We read the launch of each of these plans not just as the baking of a strategy but as a signal of intent to everyone with whom the company is meant to engage. Building on these early leaders, businesses like Nestlé, with Creating Shared Value, emerging in 2009, followed by Unilever’s launch of The Sustainable Living Plan in 2010, which it has continued to push forward.

The third attribute is culture. We all know culture eats strategy for breakfast. It is the way we do things around here. It is, we think, the pivot in terms of our five attributes, because you need a purpose to give you direction, and you need a plan for how to achieve it. The culture is whether you really make it come alive. It also then enables you to have a mindset of collaboration and to be a powerful and authentic advocate. Culture, of course, has to be led from the top, from the board and the senior management team. But as well as coming from the top, it also needs to function from the bottom up. It must engage employees. Patagonia was one of a number of companies that we talked to, who made extensive efforts from its very earliest days to train their employees in the ethics and values of the organization so that people feel empowered and engaged. The result has been a whole pipeline of innovations, including Patagonia Provisions, a whole new market segment which they’re currently developing. It creates the basis of being able to collaborate and advocate.

Collaboration is the fourth attribute in the All In framework. How do businesses go beyond their four walls to project and actually drive the change that is needed? Kathleen McLaughlin, the CSO of Walmart, said all future sustainability problems require collaboration. It is not an option; it is a requirement. So, if we’re serious about sustainability, we must develop these collaborative muscles.

The final attribute is advocacy. Advocacy at this point is probably the least mature of the set. The Economist and the Harvard Business Review both published articles in 2017 about the emergence of the CEO as Chief Activist Officer. The reality is this is still really new and uncertain territory for most companies. So, what is it and what isn’t it? Advocacy isn’t lobbying. Lobbying is usually in the direct self-interest of the institution, whereas advocacy must be in society’s interest. It doesn’t mean that self-interest isn’t present in the equation. It is essential that self-interest is present, or there is no way the advocacy will endure. But advocacy has to address systems change—the norms, the rules, and the laws that support sustainable development. While a pioneering space, we’ve got leaders like Interface showing us the way. Their Climate Take-Back Program demands that they reinvent their business. They are not doing it quietly, and they’re not doing it alone. They’re engaging their partners, their suppliers, and the public to deliver it with them.

2030 Leadership Horizon

The UN’s SDGs run until 2030. The Paris Agreement requires that huge progress on the climate needs to be effected by that date if we are to avoid catastrophic global warming. The 8.5 billion people expected to be living on earth at that time are in need of corporate leadership to help government and civil society create the fair and sustainable economy necessary to ensure equal opportunity to individuals and institutions worldwide.

The scale and systemic nature of the sustainability challenges presented by the global forces of change make individual approaches to problem solving obsolete. To address them, we have to go from the tyranny of the “or’” to the genius of the “and,” drawing on the best business can offer in terms of both competition and collaboration.

Such collaboration will work best when business operates not apart from society but as an integral part of it. Business in 2030 will thrive when it is trusted; if an enabling environment for sustainable business success emerges, it will, in part, be based on advocacy for policies that favor sustainability, like carbon pricing and extended producer responsibility. Such advocacy will be most effective if undertaken collectively—by groups of businesses in and across sectors, and by companies in partnership with civil society and policymakers themselves.