Blog

pexels-vicky-tran-1745766
  • |

Is There Higher Ground Beyond Sustainability?

As I look back on the last 20+ years of implementing sustainability best practices, I wonder if we are at a crossroads and whether we are on the threshold of moving to higher ground. When I first learned about sustainability, I embraced the pioneering efforts of John Elkington  who developed a business model concept around the “triple bottom line” (TBL) of economic, environmental, and social performance to the bottom line. The TBL was first coined in 1994. Innovative companies that sought more than financial performance and shareholder returns began to develop “win-win-win” strategies for their businesses. Early adopters of sustainability best practices included Patagonia, Interface, Unilever, and many others. These pacesetters shared which sustainability practices worked best, what practices were under continuing development and a “work in progress”,  and what areas and projects did not meet management expectations but needed further innovation, creativity, and system solutions. The TBL became a new reporting tool that companies could measure and report collective TBL performance. This best practice has been advanced, as companies raise the sustainability bar through continuous improvement.

The first primary focus area of sustainability began to address complex environmental issues and economic performance. Key environmental areas such as energy, waste, water, land use, and air pollution provided fertile ground and low hanging fruit projects for many companies. Many organizations were on a journey to move beyond compliance and truly improve their environmental footprint and performance through pollution prevention and environmental management systems. However, some companies seemed to circumvent the true intent of sustainability to “do well while doing good.” Greenwashing became an initial  major concern which still does linger on today. Some businesses wanted the eco-friendly benefits and upside of sustainability without putting in all needed hard work and efforts to achieve these results. Even well-known companies and brands including Keurig, Ikea, Windex, Hefty, Shell, and others have stumbled and led consumers astray over the years through vague and misleading claims, insincere advertising, false product representation, hidden trade-offs, and gaslighting etc. (1)

Today, many sustainability initiatives have shifted to addressing prominent social impact issues and concerns that have been present in businesses and the marketplace for many years without any clear cut solutions. One of the tenets of positive social impact has been the rise of transparency and accountability in the eyes of customers, shareholders, and employees for a company’s actions and the communities in which they operate. Today, companies are increasingly being required to report on social impact performance. As with “greenwashing,” some companies have also been challenged with “goodwashing” regarding social impact issues. Employee well-being, safe working conditions, inequality and other social sustainability issues in the marketplace have become critically important, as well as environmental and economic performance. The driving forces for social sustainability include well-being, equality, diversity, democracy, and governance. (2) Over the years, sustainability best practices have proven their viability and worth through improvements to the bottom line performance and long term value creation and will continue to do so.

How has this sustainability performance been achieved? There has also been an evolution of sustainability best practices, protocols, standards, and certifications that are available for businesses and organizations to use and embed within their companies. These collective best practices are available for use by organizations in both the public and private sectors, regardless of size.

Some of these overall best practices and processes include:

  • ISO 9000 and 14001 certifications for manufacturing and operations including environmental management systems.
  • Design for the Environment (DfE) and Cradle to Cradle product development processes.
  • Life Cycle Analysis (LCA) for products and services
  • Leading Environmental and Energy Design (LEED) building standards
  • Energy Star ratings for appliances and mechanical systems
  • Circular Economy strategies using waste as a raw material.
  • Sustainability reporting and guidance frameworks such as the Sustainability Accounting Standards Board (SASB), the Global Reporting Initiative (GRI),and the International Sustainability Standards Board (ISSB)

Sustainability best practices and the TBL have come a long way and will continue to grow in their use and application. I have always thought, however, that the TBL of sustainability had a 4th leg. Each business or organization may understand the TBL of sustainability but can only achieve its optimum level of performance by fully understanding the identity, heritage, culture, and values of their own organization. Organizations and businesses must understand and fulfil their sense of purpose. How then can we continue to grow sustainability best practices, achieve long term goals, and meet the expectations of shareholders and stakeholders?

Today, there is a developing model for organizations and their future growth, which is one of being intentionally purpose built. Purpose built organizations seek to differentiate themselves further in the marketplace and take sustainability to a higher level of use and value. The transformational change in this model is that businesses seek organizational alignment and growth through listening to the voices of employees and customers, developing corporate behaviors around transparency and openness, building on core values including human and social capital, and making the right business decisions through technology, innovation, and system solutions. One key strategy is to begin with the end in mind. In the past some companies have looked at sustainability as an in vogue business strategy and may have thought about sustainability as only being a stopgap measure. Today, sustainability best practices are considered integral to continuous improvement.

Purpose built companies take into account all stakeholders including customers, employees, investors, suppliers, and partners of the organization or business. Focus is placed on creating shared value by creating win-win strategies through alliances and partnerships. Tenets of being purpose built include sustainability best practices as well as trustful working relationships with others in the supply chain across areas such as performance, equity, social responsibility, norms, and values. A recent survey has indicated that values including agility, collaboration, customer, diversity, execution, innovation, integrity, performance, and respect are most cited by leading companies and have the greatest impact on results. Successful strategies for purpose built companies will center around (3):

  • Making purpose built a desired strategic goal, not a media scheme or communications exercise.
  • Concentrating on how you earn money, and not on how you spend it.
  • Recognizing the core competencies of your business, not just the existing capabilities and strengths, that you can build upon for the future.
  • Establishing the leverage of being purpose built across the organization, and not letting it reside in just a single business or operational unit.
  • Affirming individual commitment and holding management and board members accountable for the progress of being a purpose built company.
  • Placing sustainability at the core of business strategy

Purpose built companies must wrestle with and answer the questions of what business I am really in and what drives the organization? Mission helps describe what business the company is in today and for the future. The purpose of a company goes beyond mission by determining the driving forces for a business. So mission describes what we do,  and purpose determines why we do it. Unilever and its Dove brand, Natura and its Body Shop brand, and Grupo Bimbo, are a few examples of purpose built companies. Bimbo is the largest baking company in the world whose purpose is “We nourish the world!” The chair and CEO of Grupo Bimbo, Daniel Servitje, recently acknowledged that purpose drives sustainability, sustainability does not drive purpose! I look forward to embracing and learning from these and other purpose built companies as they take sustainability to the next level and transform their organizations.

Sources:

—-

All the best on your sustainability and purpose built journey!

Norman Christopher