- September 27, 2019
- Posted by: fedefiore
- Category: Blog
I have just finished reading an article on “The Guardian” about “Why Industry is going for the Green on the quiet” and feel a sort of relief. I’ve been preaching for years to entrepreneurs and businesspeople “let reporting your sustainability practices be your last concern”. Finally I find partial confirmation of my strongly felt conviction in research.
It seems that there is a consistent number of business around the world that are engaged in finding more sustainable ways of running their processes, especially through innovation and technological changes, but they are keeping their advancements secret. Where we part company with the researchers quoted in the article is on the reasons why it happens and why it should be a good sign. Let me explain.
As I made clear in my short video Eco-Sustainability does NOT exist: hints to avoid the trapthe main reason (for for-profit organizations) to pursue sustainability should be the desire to do good business. Therefore, the main focus should be for the Company to identify any waste of energy, matter, time, intelligence… any kind of input and transform it into an opportunity for savings or the generation of new sources of income. Among the opportunities there should be special consideration for those arising from environmental and social needs in the context. At this point, ROI from money and time invested in the Sustainability effort shall be excellent and the Company could, if it so wishes, spread the word and report to its stakeholders about its processes. But reporting must be a “Byproduct” of embedding Sustainability in the Organization’s processes. With this approach, sustainability makes the Organization’s management excellent, using at best the available resources, preserving the Company’s assets and managing uncertainty effectively, maximizing opportunities and minimizing or completing offsetting threats.
Advantages in reputation and customer’s choice by boasting about a Company’s sustainability are volatile and risky, as research quoted in the article demonstrates. Mistakes in communication by many CSR or “early” Sustainability consultants have spoiled the market: boasting that “consumers will pay a premium price for more sustainable products” (which is largely not true) has scared away many consumers “a priori” from products labeled as “Sustainable”, fearing that they would be more expensive that less “green” alternatives. Early attempts to levy premium prices on products by greenwashing them with (self styled) “sustainable” packaging or design have added to the scare. If producers believe the fairy tale of “premium prices” and go for more costs in order to push forward their sustainability agenda they will fail, and will continue to spoil the markets. Too early and clumsy attempts to make more sustainable products have also generated a feeling that quality is traded for “sustainability”, leaving a long lasting impression that unsustainable products are cheaper and better. Finally, people scarcely believe Sustainability narratives from Companies and in too many cases rightly so: too much untruthful marketing spin under the Sustainability label in recent years.
However, there is a sound way to Sustainability and that is what I and Exsulting’s partners have ben working upon, until we developed the Embedded Sustainability Index® and its support processes to businesses along the Sustainability journey. This way has to do with the essence of Sustainability itself and goes very well in accordance to the paradigm of “quiet Sustainability” (apologies: I dislike the term “Green” profoundly). Embedded Sustainability is about believing that managing Sustainability objectives in the processes of an Organization is the best way to manage uncertainty – both strategically and operationally – considering the whole context of the Organization.
The article quotes wine companies, going organic without telling anyone for the sole purpose of protecting, and increasing, the fertility of their soils. Excellent business practice, regardless of its Sustainability implications. I am personally involved in a prestigious French wine producer, first class Cru Classées and a 40+ million € company, producing organic since its foundation more than a century ago, with no certification whatsoever. They do it just because it makes the best wines with the less cost of management, less cost in pesticides and synthetic fertilizers, less plant illnesses and parasites and more fertility of the soils. Others of my knowledge are managing their Sustainability effort by continuous improvement of their processes with the aim of reducing energy consumption, matter, waste treatment just because they have realized that waste treatment does cost, materials do cost, energy does cost and all of them generate externalities that are undesirable, especially in today’s context.
But there is even more in a strategic Sustainability effort: what I have described above could be a sort of “micromanagement” that could be partially achieved by Lean manufacturing, or a Kaizen approach. Instead, a global Sustainability strategy, that is embedded in every process, shifts the focus on the continuous search for opportunities in the challenges posed by waste, pollution, energy consumption, resource scarcity, social issues, climate change and the evolution of the people’s culture and mindset. Entrepreneurs who approach Sustainability in this way – which is how we support them through the ESIndex® – do first and foremost know that by embedding Sustainability throughout their processes and stakeholder relationships they are maximizing their innovation and research outputs, at the benefit of their Organization’s performance. Secondly, without too much expectation, they ALSO tap into the shifting culture by sharing their Sustainability objectives with their public, engaging their external stakeholders in the effort.
Mind me: they do not only “report” on what they have done: they engage their stakeholders in their Materiality analysts, in the setting of their objectives, they have profound dialogue and mutual understanding with other protagonists of their context so as to understand better their challenges and opportunities. Communication with the context’s stakeholders helps set the course to the best satisfaction of the Needs of both the Organization and those who are influenced by its activity, which is very different from “we are trying to lure more customers by boasting about how sustainable we are”. Is is a matter of leadership, profound ethical convictions and awareness that in today’s world only Organizations that put Sustainability at the core of their Vision will survive the upheaval that our societies are going to deal with in the years (not even decades, guys) ahead.
At this point, not to make it too long for you reader, I will join again the authors of the cited article in saying that it is nonetheless a pity that Companies that are implementing SOME Sustainability practices with success do not make the leap into Embedded, Strategic Sustainability by being more open to their stakeholders and share their excellences with them, taking them onboard on the journey and becoming leaders to be inspired by. While also learning where they need to improve and achieve even better performances.
Want to check how you are faring on the Embedded Sustainability journey? Here’s a straight opportunity to take the Test of the Embedded Sustainability Index® for FREE