5 Ways to Reframe Sustainability Strategies for CEOs
Sustainability language is often the Achilles heel of passionate sustainability advocates. We need to be smarter about borrowing C-suite (as in CEO, CFO, Chief-anything) language to adeptly reframe the “so-what” of our sustainability strategies and visions. We need to connect with senior executives’ language, context, and priorities. We need to build commitment when addressing tough, long-term business issues with sustainability-related strategies, often without ever using the S-word.
So, what are the future issues and trends that CEOs are worried about; and how can we apply sustainability strategies to these areas? There are several dilemmas causing consternation in the executive circles these days, as described in the three recent articles and reports below:
1. McKinsey/CECP study: “Shaping the Future”.This study by McKinsey & Company for the Committee Encouraging Corporate Philanthropy (CECP), published in June 2010, explores how corporations can position themselves to maximize their profitability and societal impact over the next ten years. The 39 CEOs interviewed identify five converging game-changing trends that companies must address if they are to create sustainable value.
2. IBM CEO study: “Capitalizing on Complexity”. For its fourth biennial global survey of Chief Executive Officers (CEOs) priorities, IBM interviewed 1,541 CEOs, general managers, and senior public sector leaders who represent differently sized organizations in 60 countries and 33 industries. The findings from this largest-ever survey of CEOs were published in IBM’s May 2010 “Capitalizing on Complexity” report. It declares that the overarching CEO challenge in the next five years is the “rapid escalation of complexity” in a world that is substantially more volatile, uncertain, and complex. The drivers of that complexity shown in the slide are starting to look familiar.
3. HBR article: “Sustainability Imperative”. This article by David Lubin and Daniel Esty in the May 2010 issue of the Harvard Business Review was mentioned in my June 11 blog. It identifies six drivers of the sustainability imperative / megatrend (shown in the slide). The six issues are business issues. Sustainability-oriented strategies conveniently happen to address them. This article connects the dots between business and sustainability interests. Perfect.
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These three studies collectively reinforce five big threats / drivers / game-changing trends in the next five to ten years. CEOs view them as business threats, not sustainability threats. It behooves smart champions of sustainability to reframe sustainability strategies as helpful, enabling, and empowering solutions for each challenge.
- Increasing scarcity of natural resources
Encourage radical resource productivity that drives four times, ten times, even 100 times improvements in the use of available resources; dematerialize products and packaging; reengineer products and processes to optimize the use of scarce materials; use cradle-to-cradle and closed-loop production approaches to minimize waste; promote a service economy by leasing rather than selling products; develop service revenue streams to compliment product income streams; source materials from countries with low geopolitical risks. - A new era of government intervention
Voluntarily get so far ahead of anticipated regulations that they become irrelevant; earn a seat at the table with regulators by being a model corporate citizen whose environmental and social best- practices can help shape the regulatory landscape; anticipate a price on carbon and reduce the company’s carbon footprints; exploit eco-efficiencies to work toward water/waste carbon/and energy neutrality. - Shifting centers of economic activity
Innovate ways to do well in under-served economies; experiment with operations in India and China; create service jobs that are less likely to be out-sourced; collaborate with new stakeholders; capitalize on the wired world to invent new revenue streams and master engagement in diverse cultures. - Global interconnectivity and supply chains
Improve resiliency and reduce the company footprint by more local buying and selling; reduce transportation needs for employees, customers, and suppliers; help suppliers “green” your supply chains; develop new business models that synergize global and local strategies. - Talent shortages and mismatches
Become the most responsible company in your industry in order to attract, retain, and get the most creativity / productivity from top talent; engage and empower employees and customers to co-create new products, services, and supply chain logistics.
Are these sustainability-related strategies? Yes. Should we call them that when suggesting them to CEOs? Maybe not. Executives might think you are trying to convince them that sustainability is a nobler goal than contending with gnarly business issues like complexity, resource scarcity, and talent shortages. It’s sometimes better to back off and reframe sustainability strategies as enablers of executives’ priorities, rather than as another nagging goal to worry about.
CEOs are already recognizing that sustainability strategies are vitally relevant to their companies’ futures. A recent UN Global Compact-Accenture survey found 93% of corporate CEOs say that sustainability will be critical to the future success of their companies. The survey found that CEOs believe that, within a decade, a tipping point could be reached that fully meshes sustainability with core business capabilities, processes and systems, as well as throughout global supply chains and subsidiaries.
Reframing sustainability strategies as business strategies makes them immediately appealing to harried CEOs. By using these means, CEOs will get a better company with increased profits. As a co-benefit, we’ll get a better world.
Bob
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The slides will be available to subscribers in the next release of the Master Slide Set.
