Business is playing a central role in causing many of the societal problems we are facing globally. As I will argue in this contribution, we will also need business to help solving the societal challenges. We need business because it has the know-how, the resources, and the reach to effectively address the challenges. I will show, what business needs to do to be successful. It will not be an easy task. There remains a lot to do for a new generation of leaders from business and from society who are prepared to approach this task collaboratively in a new and different way. You can also view this post in this TEDx talk.

Introduction

As a researcher and teacher in business sustainability, I became more and more concerned about the escalating problems our humanity is facing. We were living far beyond the planet’s means.[i] And governments were incapable to effectively deal with these problems. I was relieved and hopeful to see business get into the game and make sustainability increasingly their business. Why? Because they have the know-how, the resources, and the global reach needed to address these problems. But it has been troubling to see that there was a big disconnect between the approach to business sustainability taken and the scale of the problems we are facing. Something was badly out of sync.

As a response to these concerns, we developed a model of “True Business Sustainability” [ii] to adequately address the sustainability challenges of our times. In doing this, two fundamental problems became clear to us. Existing models of business sustainability, in theory and in practice, don’t address the problems our societies are facing, but the economic benefits for business in addressing societal issues. This so-called “business case” of sustainability is primarily good for business, but not for the world. The second problem we found, was that business sustainability is focused on minimizing the negative impacts of business activities, not on creating a positive impact in relevant areas for society and the planet. What is needed, however, is aiming to increase the societal goods, not only to decrease the bads done by business itself. In other words, reducing carbon emissions is good but capturing carbon from the air is much better and in reality, it is essential.

Watch a video about True Business Sustainability

The model of “true business sustainability” helps us to move business from net zero, where the negative impacts of business are driven towards zero, to positive impact, where business contributes to solving societal challenges. In this contribution I will put the model of true business sustainability into practice. My focus will be on five big questions and answers.

1. Societal Challenges as Opportunities

My first question: How can business make a positive contribution to society? And my answer is: by looking at societal challenges as opportunities. In support of this insight, let me cite Management Guru Peter Drucker who remarked a long time ago:[iii]

Positive contributions to societal challenges can be found in all areas of the economy. And they offer great opportunities. In the food sector, they lie in the development of healthy diets and lifestyles in highly developed countries and the creation of affordable food and access to clean water in developing countries. They lie in areas like developing a sustainable energy supply without having to accept irresponsible climate risks and in creative approaches to using construction waste to produce new construction materials.

2. Putting purpose into strategy

My second question is: Why are so many companies today committed to a wider societal purpose that goes beyond a purely economic purpose? My answer is: They do it because their stakeholders are demanding it.

Employees are expecting it from their employers. The social commitment of their employer is of great concern to the employees, often a matter close to their hearts. And on the market for talent, it needs a clear and convincing purpose to attract the highly sensitized millennials, which make up 35% of the market.[iv]  Consumers prefer companies that take a position on issues like sustainability, transparency, and human rights. And the millennials are leading again.[v] Investors have been rushing into social and sustainable investments because they want to combine social impact with economic goals. And financial institutions are happily offering products to support this trend.

A purpose is aimed at a positive societal goal, not at increasing profit. It defines the company’s reason to be and are not in contradiction to economic goals. They are rather their precondition. They secure support from society and guide the company’s development in the longer term.[vi] But a true purpose is certainly more than a lofty declaration on paper. It needs to be backed by credible action. It must reflect in the company’s products, its investments, and its incentive systems. Actions speak louder than words![vii]

A good example is outdoor clothing company Patagonia with its bold purpose “to be in business to save our home planet.” [viii] How do they act on it? Among other things they use 100% organic cotton. And while globally 15% of used clothing is recycled, 87% of their raw materials are made with recycled inputs. They also offer repair services and recycle products that are beyond repair.

3. Integrating sustainability into regular business

My third question is: What should companies do to create maximum impact? My answer is they should integrate sustainability into regular business.

Sustainability efforts of companies are mostly handled by specialized units for sustainability, social responsibility, or communication. Their function is often reduced to shielding the corporate core from disruptive influences. This is extremely limiting.

It should be easy to see that the necessary “clout” for mastering sustainability challenges can only be achieved if sustainability is integrated into regular business, so that all the strengths and competencies of the company are brought to bear on the issues. Only then we can succeed in creating an offensive dynamic that points the way forward instead of a defensive dynamic that neither gives pleasure nor corresponds to entrepreneurial thinking.

What needs to be integrated? Sustainability needs to be integrated into company processes, so that it will be taken care of automatically in the company’s decisions and actions. Product innovations need to focus on products with a net positive impact, not simply on making existing products a bit better. And it will need fully committed leaders, who can win the hearts and minds of the people, internally and externally.

4. Simultaneous orientation on several time horizons

My fourth question is: How do companies go about innovating their business? My answer is they must orient their business on several time horizons.[ix] In times of far-reaching and dynamic structural changes, companies will have to build the business of tomorrow and the day after tomorrow in parallel to keeping-up today’s business as long as necessary.

Sustainability problems are dynamically evolving. Take the automotive industry which started out in a first phase with modest sustainability demands driven by the quest to make cars better. Issues were increasing fuel efficiency, reducing unhealthy exhaust, and recycling cars. In a second phase, the discussion centered around the more fundamental question “How long will oil reserves last?” Its focus was on the core of the car, its internal combustion engine. The race for alternative drive technologies and fuels has seen hybrid cars and electric cars come out as winners. And in a future third phase, driven by traffic jams, congested cities, and individualized demand,  we will see transform car companies into networked mobility providers offering rent, leasing, car sharing and ride sharing, in short: mobility-on-demand. In each phase the business models are dramatically different and need dynamically changing companies.

5. Collaborations

My fifths question is: Is it a good thing we see more and more collaborations between business and government? My last answer is that collaborations are necessary.[x]

Overcoming the societal problems of our time is beyond the reach of even large companies. Challenges such as the phasing out of plastic waste or the switch to renewable energies are simply too big and too complex. These challenges require collaborations across supply chains and sectors as well as the integration of private, public, and civil society actors.

We have seen many collaborative platforms being created in recent years. Platforms for sustainable forest management or fisheries, for palm oil, cocoa, or fashion. They demonstrate that global problems require collective solutions that bring all relevant stakeholder groups together at one table.

We will also need creative solutions to shape political change. Companies still view government relations mostly as a way to resist regulation or fight for preferential treatment. But some companies approach regulators openly and transparently to help them improve the collective rules and solve larger problems. Establishing circular economy models for products and packaging for example, need active support from companies. And it needs business also to support policies that accelerate investments in areas that improve the living conditions for everyone. Think of health care and education. This will not only make the world a better place, but it will also allow business to flourish in a healthy and stable environment.

Closing

In closing, let me summarize the five areas discussed in this contribution to move business from net zero to positive impact:

1. Societal challenges as opportunities
2. Putting purpose into strategy
3. Integrating sustainability into regular business
4. Simultaneous orientation on several time horizons
5. Collaborations

My message has been, that we need business to help solving societal challenges. I have shown how business can do it. Clearly, there is lots to do for a new generation of leaders from business and from society.  For them, my five answers developed above should help to get off to a good start.

This contribution is based on the author’s TEDx HSG talk delivered on December 4, 2021, at University

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[i] Nobel Prize Laureates and other experts (2021): Our planet, our future. An urgent call for action. The National Academies of Sciences, Engineering, and Medicine. Statement: April 29, 2021.  https://www.nationalacademies.org/news/2021/04/nobel-prize-laureates-and-other-experts-issue-urgent-call-for-action-after-our-planet-our-future-summit (accessed Dec 8, 2021); Union of Concerned Scientists (1992): 1992 World Scientists’ Warning to Humanity. Published Jul 16, 1992 (Updated Oct 29, 2002) https://www.ucsusa.org/resources/1992-world-scientists-warning-humanity (accessed: Dec. 8, 2021); World Scientists’ Warning to Humanity (2017): A Second Notice. BioScience, Volume 67, Issue 12, pages 1026–1028; https://academic.oup.com/bioscience/article/67/12/1026/4605229 (accessed: Dec. 8, 2021).

[ii] Thomas Dyllick & Katrin Muff (2016): Clarifying the Meaning of Sustainable Business: Introducing a Typology from Business-as-usual to True Sustainability. In: Organization & Environment, Vol. 29, No. 2, 156-174. (2016 Organization & Environment Best Paper Award)

[iii] Cited in: Cooperrider, D. (2008). Social Innovation. BizEd, July/August, 32-38.

[iv] Dhingra, N.; Samo, A., Schaninger, B.; Schrimper, M. (2021): Help your employees find purpose – or watch them leave, McKinsey Quarterly, September, 93-100. Gast, A.; Illanes, P.; Probst, N.; Schaninger, B.; Simpson, B. (2020): Purpose: Shifting from why to how, McKinsey Quarterly, April.

[v] Edelmann (2018): Two thirds of consumers worldwide now buy on beliefs. October 2, 2018. https://www.edelman.com/news-awards/two-thirds-consumers-worldwide-now-buy-beliefs (accessed:  October 12, 2021)

[vi] Fink, Larry (2019):  Profit & Purpose. Larry Fink’s 2019 letter to CEOs, https://www.blackrock.com/americas-offshore/en/2019-larry-fink-ceo-letter (Accessed: 12.15.2020). Fink, Larry (2018): A Sense of Purpose. Larry Fink’s 2018 letter to CEOs, https://www.blackrock.com/corporate/investor-relations/2018-larry-fink-ceo-letter

(accessed: December 15.2020). Dyllick, T. & Muff, K. (2021): Anforderungen an eine echte Purpose – Orientierung von Unternehmen, in: Controlling, Vol. 33., Special Issue «Purpose und Controlling», Spring, 31-35. Grayson D./Coulter C./Lee M. (2018): All in. The future of business leadership, 1^st ed., Milton Park.

Polman, P. & Winston, A. (2021). Net Positive. How courageous companies thrive by giving more than they take. Harvard Business Review Press, Boston, pp. 74.

[vii] Samuelson, Judy (2021): The Six New Rules of Business: Creating Real Value in a Changing World. Berret-Koehler, Oakland.

[viii] Beer, Jeff (2018): Exclusive: “Patagonia is in business to save our home planet.” In an exclusive interview, founder Yvon Chouinard talks about how the new mission will reshape how the company does business. Fast Company, December 13.  https://www.fastcompany.com/90280950/exclusive-patagonia-is-in-business-to-save-our-home-planet (Accessed: Dec. 8, 2021)

[ix] Business & Sustainable Development Commission, Better Business Better World, January 2017 https://sustainabledevelopment.un.org/content/documents/2399BetterBusinessBetterWorld.pdf (accessed: December 10, 2021)

The pursuit of personal growth and learning plays a central role in my life.  However from time to time I question whether it is worth it.  After all, growth requires change and deep change is hard. Sometimes I ask myself whether I am up to it.  Maybe I am too old, too busy or just too lazy to do the hard work.  Perhaps I’ve grown enough.  After all I have a good life.  Wonderful friends and family surround me and I love my work, which I consider to be meaningful. So why do I need to change?  The answer for me is that I believe to grow is to live. I share this belief with my blogging partner, Katrin Muff who demonstrates her thirst for growth in how she lives every day.

Last month Katrin described the external conditions that tend to stimulate her and push her to try something new.  The previous month, I discussed an incident that led to my own painful growth.  While reflecting on what stimulates our growth inspires me, I believe that we also need to stay aware of the barriers that can stymie us.

In his book Thinking Fast and Slow, psychologist and professor Daniel Kahneman describes “a puzzling limitation of our mind: our excessive confidence in what we believe we know and our apparent inability to acknowledge the full extent of our ignorance and uncertainty of the world we live in.”[1] I suspect that most of us consider ourselves to be logical thinkers. Yet, since we are human, we are all subject to thinking biases that can inhibit our ability to learn and access new experiences apart from our own status quo.  Consider the following:

Confirmation Bias

Magicians, who practice sleight of hand, or misdirection as they call it, count on our seeing what we expect rather than what is taking place in front of our eyes. And usually we do not let them down. We are all susceptible to seeing what we expect. Confirmation bias, or the tendency to seek out, notice, interpret and remember information to protect our prior beliefs and expectations is widespread.

False Consensus and Naïve Realism

The “false consensus effect” refers to our tendency to overestimate the degree to which others agree with us. And the “naïve realism bias” is a tendency to believe that we see reality as it is and that others who disagree with us do not. When suffering from this bias, we view anyone who disagrees with us as irrational, uninformed or overly subjective.[2]  The presumption that everyone sees the world the way that we do can stifle our growth and isolate us from diverse thinking.  However even more dangerous is the belief that those whose views of the world differ from our own are wrong. In truth, our views are merely our theories, hidden or not, of how things work. And theories aren’t the same as truth.

I know that I am susceptible to these mind tricks that can prevent me from change.  Yet if I truly value ongoing growth and personal change, I must be vigilant to falling prey to these biases.  While I do not have any clear answers to how to fight them, I do know that my first step in neutralizing the biases is to acknowledge that I am susceptible, as are all of us.   As I interact with others, I can adopt the discipline of taking mental time-outs to reflect on how I am feeling and what I am thinking.  I can entertain the possibility that the biases might be at work.  This level of self-awareness should give me a fighting chance at foiling my own mind tricks.  And yes this level of vigilance is hard work.  Yet I hope that I will never grow too old, too self-satisfied, too arrogant or too lazy to do the work that growth requires.

[1] Daniel Kahneman, Thinking Fast and Slow, New York: Farrar, Straus and Giroux; 1 edition, October 2011.

[2] List of Cognitive Biases, Wikipedia, 2018.

The impact of the change of being in our ability to change

When have you last tried something different? I had to think for a while until I recalled such a moment. For me, trying new foods is the easiest way of trying something different. Travelling to new places and discovering new cultures and places and people is my preferred way of trying something different. Trying a new sport requires courage for me to try and I love the feeling of excitement when I have overcome my resistance. Trying a new behavior is by far the hardest way of trying something new, by a long shot. It is also by far the most exciting way to challenge myself.

Image source: https://aminoapps.com/c/books/page/blog/weekly-challenge-try-something-new/7viP_u3dXvQ7BJXVkbzVaBMkqe12Dz

What about you?

I was very touched by what Kathy Miller shared in her last blog and when she shared how this simple advice by a friend “try something different!” changed her approach to looking at change. And I have observed myself in the past month to see how often I might be willing to try something. What I noticed as I observed myself was that there were conditions that favored my ability to try a new behavior. And this led me to consider the impact of the state of being in our ability to change.

Some external conditions favor a state of excitement, of thrill, or of fear or anxiety. These carry the same underlying high energetic vibration and they generate states of being which lead to states of mind that then allow or prevent our ability to try something different. For me, such a high energetic vibration is really good when I want to try a new sport. And it hinders me when I try to adapt myself to a situation trying a new emotional attitude.

Image source: https://www.humansynergistics.com/blog/constructive-culture-blog/details/constructive-culture/2017/07/18/organizational-courage-part-1-of-2-what-it-is

 

On the other hand, my travels to Cuba has exposed me to a country that resonates entirely differently. Its relaxed attitude, laid back music, warm temperatures and kind people grounded me in a very easy and relaxed energetic state. The calmness that comes from appreciation, satisfaction, joy and gratitude expresses itself in a much calmer low energic vibration. Such a vibration has served me well to try new ways of approaching relationship and served as a condition that allowed me to react with more kindness, openness and patience than I had known as my natural patterns. Quite obviously the state of being served as an enabler for change. I must say, however, that this relaxed state of being did not serve me when trying to motivate me to join a local public fitness class. I felt way too relaxed for such a try during vacation.

Image source: https://eocinstitute.org/meditation/meditation-and-emotions-the-power-of-silence-during-times-of-change/

 

In conclusion, there is not a preferable state of being, each such state simply either promotes or prevents an attempt to try something different and hence to change. High energic vibrations serve to push us beyond our boundaries which is useful in some situation. Low energetic vibrations, on the other hand, will pull us more inward to our source freeing other potentials that are useful in attempts of something different.

Image source: https://www.physicsclassroom.com/class/waves/Lesson-2/Energy-Transport-and-the-Amplitude-of-a-Wave

 

May I invite you to observe yourself for a week or two and to share what you notice about enabling or disabling conditions to try something different? I would love to hear from you!

Blog by Kathy Miller Perkins, www.millerconsultants.com

Our personal stories are powerful. When talking about myself with others, I might recount a particularly exciting experience such as the time I served as a foreign exchange student in Thailand when I had never been away from home before and had never flown on an airplane. Or I might describe my life with my family and my three dogs, who never fail to amuse me.   As I tell these stories, I am sharing who I am – both how I see myself and how I want others to see me. Likewise, when I want to get to know someone, I usually start by asking them to tell me about themselves. I might ask about where they live, their families, their professions, their interests among other things. And I am not merely collecting facts. Instead I am listening to their stories because the tales they tell communicate their character.

So too the stories that we tell within our organizations and to the public about our companies communicate identity.  And Identity is the foundation upon which the organization’s culture rests.  In my work as an organizational psychologist, I am often asked to work with the clients to assess their organizational culture.  While I have a variety of method for carrying out this task, I find that listening to the stories they tell is among the best.   And all companies have their own stories or myths which reveal how they view themselves. And, in turn, their perceptions of themselves influence how they show up in the world.

Not too long ago, I worked with a large organization in New York. To get a feel for their culture, I asked them to tell me stories about themselves when they were at their best.  They became quite animated as they spoke of how they rallied during the terrorist attacks of 9/11 and during the aftermath of Hurricane Sandy. As I asked them questions about these stories they filled in details about their smooth working relationships under these extreme circumstances.  And they noted that their interactions aren’t nearly as smooth in their day-to-day work world.  We could all agree that this organization had a hero culture that worked well for them under crisis but not so well in more stable times.

Next, I asked them to tell some stories about incidents when they, as an organization, were at their worst. One of the stories I heard was about a cross-departmental project where people in one group hid information from those in another, presumably to maintain a more powerful position, or because they thought the other group would slow down their progress.  This part of the exercise wasn’t nearly so much fun as the first.  Yet the stories were colorful and revealed clearly some of the cracks in their day-to-day culture that made them vulnerable as an organization.

By analyzing how they acted at their best and at their worst they began to identify the conditions that brought out the good and the bad behaviors. They began to seek new ways of viewing themselves and their work.  They sought to switch from “we are at our best only when in crisis,” to “we can create conditions in our day-to-day world that will bring out the best in all of us.”  They were changing their story.

About this time, a new leader entered the organization. He brought the employees together in a “Town Hall” and told his own stories. He began by telling anecdotes about his  life and his work, followed by his vision for the organization. He claimed that he considered his work to be a calling – not just a job. And he challenged the employees to reconsider how they viewed their own work. He told them that “values count,” and described how his values influence his life every day. He ended by making the following commitment:

“I will give my time, energy and commitment to helping us become a world-class organization. I honestly believe that we can become a best in class standard against which other similar organizations can measure themselves.”

I cannot relay the conclusion of this story because my assignment ended shortly after the Town Hall.  However, when I left, I felt certain that this company could change.  To do so required them to tell a new story about who they are and who they want to be.  And I took away some powerful lessons: Just as we must change our own narratives when we seek to change ourselves, organizations can begin to change their cultures by creating their own new stories.

Exploring communication in times of uncertainty

It has been two months now, since I was told that my time at BSL is up and that my contribution to the school was no longer desired by the majority shareholder of the group to which the school belongs.

It has been a strange time, with good and bad moments. On one hand it, it has been painful and stressful. A journey that took me from shock that immobilized me, to agitation and concern for what might now happen with the school and the many people there I care so much about – my colleagues, the students, the faculty. On the other hand, it has also been wonderfully liberating. The glimpse at a new phase in my life for which I feel so ready. Possibly so because I had thought of leaving BSL before but have never dared to. I thought I would harm BSL too much by leaving. Now that the owner decided on a new strategic direction, discontinuing what I have invested in and developed – I am suddenly free!

How do you communicate in such a time authentically yet without creating confusion? This is my challenge right now and this is my first attempt at it. I sense that this ability to communicate in uncertain or changing times might be a useful skill for not just me. There are two areas of thoughts I would like to share: a) insights gained and b) emerging questions:

A) These are the insights where I have gained clarity in:

• I would like to find a way to live more authentically what I “preach”. If I want to suggest changes to make the world a better place, this starts with me. For me, now, this means to slow down and to stop racing from project to project, becoming more careful and mindful in selecting and prioritizing, and connecting to a deeper sensing of how I can truly make the difference I seek.
• I would like to review my research questions and my teaching and to adapt them based on what I have learned these past years. This includes our experience of self-organization at BSL and the challenge of finding new, better organizational and governance structures to operate in today’s world. Also, I want to revisit my (PhD) question about the connection of the inner and outer world and how transformation occurs at a personal, organizational and societal level. How do we change?
• I would like to operate in a new structure, rather than seeking a next employment. I want to serve my purpose, to be of service, to add value with my reflections and research, to create tools and methods, courses and programs, more powerfully than before. And I will do that creatively, together with others and in a structure that suits this purpose.

B) These are emerging questions I would like to explore further:

• What does the BSL incident mean for my work in helping organizations to transform so that longer-term “sustainability” concerns weigh more than a short-term profit focus. What is there to be learned for such change processes? How can this apparent organizational setback instruct my inquiry about the transformation of business?
• How do I interact with those who looked at the transformation of BSL as an important sign of hope in the landscape of business education, who had chosen it as their place of study, or who had dedicated dear time and energy to support our emergence as a promising prototype for a new type of business education? What can I offer, now?
• What are my personal lessons from this change? What has prevented me from finding a more constructive solution? What are my shadows, blind spots and shortcomings? What does this mean in my life as I have just turned 7 x 7 (or 49), and what is the deeper message for my journey?

Each of these questions will deserve a separate blog and shall serve as a further attempt to authentically share in times of uncertainty. I am attentive to the interconnection among these and I am curious what I will be learning in my exploration. I am grateful for those who accompany me in this journey. It reminds me of what Bob Quinn calls “Building the bridge as we walk on it”.

Katrin

The 21st Session of the Conference of the Parties (COP21) will kick off next week – companies, investors and policymakers gather to urge world governments to produce a strong climate agreement coming out of Paris.

Read more about it in the November newsletter of Ceres, a non-profit organization advocating for sustainability leadership.