Dozens of questions were submitted during the post-keynote Q&A session. Unfortunately, there wasn’t enough time to answer them all so we will be responding to your remaining questions via a series of blog posts.
Here, Greg Balestrero highlights 5 critical changes that organizations and individuals need to consider for 2014 (in particular, those yet to embrace sustainability) and what you can do to support this change.
1. What I understand is (that) status quo is not enough. How can we make the executives aware of the shift they must make? – Jeanne T., Canada
First, make yourself more knowledgeable of the issues facing your industry and company. Look into the industry associations conducting research in this area, and coalitions among competitors regarding specific issues. Be sure to investigate the activities that are being undertaken within the company to identify and embrace these critical issues. Together, this will make you smarter and more informed about the future.
The next level up is the executive sponsor for any project to determine if there are teams working on this issue and how you personally can get involved. If you find that the company is not working the issues, then it is worthwhile to bring to the attention of executives their competitors in this arena that are embracing sustainability. If your company wants to remain competitive, it will have to stay ahead of your competition. If you see an opportunity for your company to participate in a coalition, or for you personally to be engaged in a fruitful manner, then make your move and ask to participate.
2. How can we convince investors that success must be about sustainability and social good, not just the bottom line? – Mike F., Canada
The task is easier than you might think. Rebecca True (a contributing author for Organizational Survival) conducted research to determine whether companies that transform their strategies to embrace sustainability remain profitable and are still considered good “risks” for investment.
The results of the research indicate that these companies are, in fact, a worthy risk and will generate an excellent return on investment. The Dow Jones Sustainability Index (DJSI), for example, contains companies from nearly every sector of the economy, and they clearly perform well. In fact, since 2003, the DJSI has outperformed the regular Dow Jones indices.
In addition, there is a venture capital movement called Impact Investing which provides venture capital to companies that have as their product and service mission to provide a positive impact to the environment, social communities or global prosperity. And let’s not forget that public opinion research over the last 4 years has shown a dramatic increase in buying decisions made on the basis of social and environmental impact, and product cost and quality. The time is right to show organizational leaders that nearly every sector in the world has seen a shift to competitors distinguishing themselves as good corporate citizens, addressing social and environmental problems.
3. How broad of scope do you see sustainability reaching? Usually we speak to “resources” but what about organizational (re) structuring, partnering, etc.? – Mark T., United States
Being a sustainable company, as we have defined it, is really about changing to adapt to the new conditions under which a company operates. It isn’t a passing trend.
Highly competitive companies have always found a way to deal with changing conditions, such as the quality movement in the early 1980s. The conditions that require a company to provide safe, high-quality products and services to customers, when and in the manner they promise them, is still the norm. This has always meant that successful companies had to know the conditions and challenges under which they worked, and act quickly to mitigate those risks. Nothing will change here…only the conditions and risks will be different.
More than ever, company performance will be held to a new and transparent standard. Companies will be held accountable to every place in their supply and value chains, so they will need higher levels of rigor, policing, and communications. Ongoing operations and new activities alike will be challenged to deliver expected performance in a new world of declining resources, higher visibility and accountability, shifting markets, and an expectation to have a positive contribution to social communities worldwide. Will this mean new organizational structures, skill sets, and measures and metrics? I believe it will.
4. Despite knowledge of the importance of sustainability, some companies still prioritize cost by continuing to deal with companies who do not support/exercise sustainability efforts. How much time do we foresee before companies make it a vital decision criteria to only deal with corporations that have sustainability efforts in place over those that do not support such practice? – Rafael P., Philippines
My gut (and the facts!) tells me that the tipping point is here. The focus on sustainable supply chains has grown dramatically from small companies like Patagonia to huge companies like the massive aggregator Walmart. The pressure is on to ensure that suppliers produce products and supplies with lower carbon footprints, with clear attention to social responsibility, and in a rigorously transparent manner. The public is now demanding this change in many industries. When the public demands it, then the company will have to act or lose ground and market share.
5. As Millennials begin to take on corporate leadership positions and become a greater percentage of employees in the workplace, do you feel that this sustainability approach will be no longer an “approach” but a major leadership standpoint? – Samantha B., United States
I agree completely that sustainability will become integrated into companies in the future, much the same as quality has become “table stakes” today to stay in business. The facts surrounding sustainability will not go away; they will only become clearer and more pronounced as we move toward the middle of this century. Leaders who stick to the facts will act and change. If the Millennial Generation brings a cultural shift as well, then the change will be accelerated. I can only keep saying, look further into the future, stick to the facts, and act now, rather than after a government regulation forces you into compliance. It makes good business sense.
Watch a snippet of Greg and Nathalie’s IPM Day keynote: