Kevin Brady explores corporate sustainability in 2016: Is it up to the scope of the challenges facing society?

TSSS celebrated its 40th event on Wednesday November 25th. Attendee’s gathered at the offices of Loyalty One to participate in “Kevin Brady’s “Sustainability Status Report” and the trends for 2016” discussion around the past, present and future of the sustainability movement. The question on everyone’s mind… how are the vitals of the sustainability marketplace performing? As a leader in the CSR field, Kevin Brady led the evening by sharing his experiences and recent research on the North American sustainability marketplace. Equal attention was given to the underlying symptoms and causes of the continuing battle for a sustainable future.

Kevin Brady at TSSS 2015 - Rapacious Capitalism

Kevin Brady shares the results of his Sustainability Status Report at TSSS.

It’s about perspective – change your worldview

Kevin began his talk by referencing Ken Webster of the Ellen MacArthur Foundation and his observation that:

“It’s not that we have an entirely new problem… but how we approach the problem might benefit from some adjustment.”

In one large brushstroke the change in thinking that needs to happen is captured. We are reminded that a macroscopic approach to sustainability is the way to succeed and that this will require a shift away from the predominant linear worldview and new approach to sustainability and CSR.  In reminding us, Kevin speaks more to the underlying causes of environmental issues, both cultural and economic.

The Bad

Population growth continues to put an unsustainable strain on natural resources and ecosystems. Digitization could be used to usher in an era of lower consumption, greater transparency and smart cities that run on data, yet the resulting streams of information that are generated today are largely used as a tool to drive consumerism. Urbanization is increasing; 66% of the population expected to be live in cities by 2050, and this will largely serve to reinforce the nature disconnect experienced by city-dwellers. Global wealth inequality is growing at an incredible rate, and there seems to be no end to the examples and faces of rapacious capitalism.

Group Brainstorming at TSSS

Group Brainstorming at TSSS

So…Is it contagious?

Referencing a recent New Yorker article by Malcom Gladwell on the growing number of school shootings in the US, Kevin speculated on the linkage between “riot theory” and the growth of a rapacious strain of capitalism.  In his article Gladwell quoted Stanford sociologist Mark Granovetter who, using riots as an example, described the paradox of “situations where outcomes do not seem intuitively consistent with the underlying individual preferences.”   Each rioter may prefer a chaos-free state of equilibrium, yet all it takes is one person who throws the first stone that ignites the riot. From that moment, it becomes simpler for others to jump on the wagon.

With regards to rapacious capitalism – as individuals fuelled by greed and substandard morals take advantage of the economic system it becomes easier for others to engage in similar acts.  As evidence Kevin used the recent Volkswagen emissions fraud scandal and other examples of greed and ethical lapses that appear on the news almost daily.  These type of lapses are growing in number and they are spreading to institutions such as universities and even charities.

The State of Sustainability

Kevin then switched to providing insights gained from a recent research project on the state of the North American sustainability marketplace. Using input from industry, NGO’s and government thought leaders as well as a review of research reports and surveys, the research looked at the key drivers, trends as well as the degree to which sustainability is integrated into decision-making. The research highlighted three common drivers: climate change, the availability of resources and the collective impact of both on organisations, their products, and supply chains.

[blockquote]What we’re seeing in response to the supply chain challenges and the uncertainty around risks and opportunities around access to resources is a real drive for certification schemes to look at and improve material supply chains” (quote for study participant)[/blockquote]The Aluminum Stewardship Initiative (ASI) was noted as an example of how companies are responding to these trends. ASI has brought together primary producers, convertors, automobile companies, producers of consumer goods and a range of other stakeholders to develop a performance standard acceptable to all. The current standard covers governance practices as well as environmental and social performance along the aluminium life cycle.

Trending in the sustainability marketplace

| Transparency | Technology |Shared Value |

“Transparency…It’s getting molecular.” Increasingly, companies are interested in tracking and tracing all aspects of a products lifecycle. Companies want to share their product’s stories and consumers and business partners increasingly want to know the details.  Companies are also looking for opportunities to create shared value with business partners, communities and other stakeholders. This means more partnering on solutions rather than the most powerful partner dictating performance.

| Social Capital | Financial Management & Engagement| Innovation |

Workforce expectations and Social Capital is also trending. Employees asking for their company’s stance on important issues and business are making efforts to build up their social capital and reputations so that they can attract the best employees and partners. The research also indicated that considerably more effort is needed to engage the financial managers in companies and in government. Of all the trends, the breaking down of silos to engage the financial and accounting branches of business (see past TSSS event summary) has been identified as the greatest possible game changer. This remains true whether you are speaking of the private or public sector since this is the partnership that will lead us to understand the true cost of pollution, of resources and of ecosystem services. In turn, this understanding will drive innovation.


Group Brainstorming Session at TSSS

The Final verdict…

It’s not mature enough. Kevin identified several reasons for the halting spread of sustainability values in business:

  • There is still a weak understanding in many companies as to what sustainability encompasses.
  • There is a lack of understanding, and recognition, of the scale and scope of the challenges society is facing
  • There is a dearth of necessary incentives – carbon pricing, market reward, regulations – that would otherwise even the playing field.
  • There are no clearly defined, and widely agreed to, metrics that allow the evaluation of outcomes. The question of whether we are making a meaningful difference on large scale issues (for example, with regards to biodiversity and habitat loss) is not commonly understood.

Nevertheless, we do have the tools necessary to create more sustainable organizations. There is a suite of tools to manage all aspects of a product’s lifecycle from production and distribution, marketing and communication, to product design and development. Similarly there is a wide range of strategic planning tools as well as tools to integrate sustainability into operations, supply chains and infrastructure. What we need to do is increase their interoperability by integrating these tools and to incorporate sustainability into financial management tools to achieve long-lasting impact on business.

[blockquote]Government and business alike will need to find new models of growth that are in both environmental and economic balance.[/blockquote]For Kevin, it all comes down to consciousness and consumption. Quoting Paul Polman of Unilever he noted the 21th century lifestyle has become all about “having more” instead of ‘living more.” It’s a value that arises from a linear worldview which in turn enables and reflects the dominant model of the throughput economy. Alternatively, we can choose to shift and expand our understanding of an economy, so it reflects the broader definition of the careful management of available resources and contributes to sustainable development. A circular economy more accurately depicts this definition and therefore deserves more attention as businesses get ready to face an increasingly uncertain future.

Kevin Brady ConsultingTo connect with Kevin Brady please visit his website at Sustainable Enterprise Consulting.