Corporate sustainability: changing from the inside is the next trend

This article was originally published on LinkedIn here

No one can deny that corporate sustainability and its structured sibling CSR are taking more and more space in our information age. Most companies now publish a sustainability report and a sustainability page on their websites, with announced goals and success stories.

The specialized media, conferences and green marketing businesses are rocketing, and if you are ready to buy your place on the stage, you will get seen and heard.

For the most advanced, the stamp of compliance has recently evolved into an activism tag, as for the top multinational companies involved in the COP21 and some of those based in the US who later opposed the American president’s decision to leave Paris Agreement.

When it comes to sustainability matters, are companies really changing, has green washing become an archaic behavior, or is it still essentially about investing in communication and brand image? What is going on inside companies, are they transforming deeply and investing for the long term?

Picture David Drexler  [businessmen]  2007 Flickr CC-BY
Who can tell if companies are (really) (deeply) changing?

We (Early Strategies & New Angles) just published a research report called ‘Managers Speak Out on Sustainability – How CSR is Changing Business’ giving the inside story from middle management on how sustainability policy and activity have reached a tipping point in the last 5 years.

We worked with middle and senior managers, as they are the ones having positions and power (hopefully) to perform change in their organizations. They know best how their companies are doing, how healthy and sustainable they really are; they are vision-mission-strategy ambassadors, and at the same time get their hands dirty in daily operations and decisions.

We asked them, via 36 questions including 25 open-ended ones, to describe us how they make decisions, consider responsibility and ethics, if leadership is evolving and how, what noticeable impacts have CSR and sustainability programs, and how positive change can be scaled.

The sustainability business case gets clearer and wealthier

75% of our respondents think the business case for sustainability is clearer than 5 years ago (this was our question 12).

Respondents were 130 middle and senior managers from 107 organizations of over 2000 employees, in 25 countries; we confirmed each individual identity and position. Half of them had sustainability or CSR responsibilities – full or part time – and the other half didn’t have.

We asked (Q13) participants to choose the dominant business case driver among 10 propositions, and the brand image still comes first, but only for ¼ of respondents. 75% mentioned other dominant drivers, competitive advantage coming just next with preference from 18% of the respondents. It is a sign that sustainability benefits are seen more engrained than before, and the business case is becoming more granular.

We also asked participants (Q16) how non-financial value creation gets its way in management decisions. A big third – 38% – said they always consider non-financial value creation to be an important factor in their management decisions, and additional 46% said they often do.

Beyond these statements, the topic was extensively commented, giving us a very rich feedback on what non-financial value creation means in a real world – I’ll share more insights on the 6 categories we identified in another post.

The business case is recognized more widely and many companies are including sustainability issues in their core strategies. At the same time, short-termism is also pointed, holding back progress. Short-term pressure is often mentioned all along the study, for example when pointing barriers to change (Q28): 48% mangers see the pressure for short-term results, versus long-term thinking, as a major corporate hindrance.

Middle managers willing to change their organizations

Q14 was about producing a real shift toward sustainability: answers show a discrepancy between what is needed according to the participants vs. according to their companies, and what is underway. For them, transforming the vision should be the priority: it comes first from our 12 proposals. But they see it coming 5th in their company’s plans, and 9th in the list of actions underway and already producing visible results. Differences in the rankings are a goldmine for grasping what is considered as successful, what is awaited from middle management, as opposed to what the companies are prioritizing in their plans.

We also asked the impact of CSR on participants’ job (Q30): 83% of managers report that CSR has changed their jobs in the last 5 years. Participants not in a CSR job give examples of transformation from different view points: decision making and sense giving, along with a better understanding of the issues at stake, and of course many practical examples, such as zero policy paper.

Asked where the impetus of change should come from (Q33), 60% managers answer it should come from everywhere – and not just from a specialist team or from the executive management.

Corporate awareness: burden or bonanza?

In link with this statement that everyone should be involved, managers point needs for improving awareness:

  • To get the companies transformed, the need for more training comes second need after budget in general (but who does not need money?) far before incentives, experts, and other ‘tools’ proposed
  • Involving employees comes high as a source of success stories – 28% of the examples quoted by the participants (Q34)

Awareness and involvement are definitely priorities. A CSR director I talked to recently had this nice sentence: “Having employees understand sustainability issues and willing to give a hand is really what we need now. We know how to communicate externally, but we have a long way to go to convince internally and transform the business”.

This is why we started this research: in order to give executives a tool to reflect, but also to grow awareness, push learning & thinking and support the implementation of change.

There is more information on the dedicated website www.is-csr-changing-business.com.

 

Is Unilever’s Sustainable Living Plan turning out to be just CSR in disguise?

Business writers have been having a hay-day covering the “big” story of this past week – the failed Kraft Heinz bid for Unilever. No question that in pure money terms this is indeed big news. If these two giants had managed to merge, we would have witnessed the biggest ever takeover by a foreign company of a UK company and a clear victory for a “certain way” of doing business.

However, the back-story is certainly more interesting, a little more complex and with consequences that could be far reaching. Just days after this very public collapse, pressure on Unilever’s CEO, Paul Polman, has seen UL commit to a far reaching review to show shareholders the very value spotted by its rival. Graeme Pitkethly, the UL CFO, said Kraft’s offer had highlighted the importance of achieving a balance between long-term sustainable value, which it had prioritized, and short-term delivery. UL’s investors may not support the slash-and-burn tactics that define Kraft-Heinz and more specifically the killer combination of Warren Buffet and Jorge Paulo Lehmann, but neither do they appear to be as seduced by the long-term strategies espoused by Polman and his team.

In an age when state protectionism (as the front cover of the January 2017 Economist states – “In Retreat – Global Companies in an era of protectionism”) combined with national deregulation threatens both social safety nets and the (small) environmental gains made over recent years the signals from Unilever are of real concern. Will the 2016 beauty queen of the Dow Jones Sustainability Index soon fall down the ranks, pulling others down with her and confirming the more cynical that Corporate Social Responsibility really is a glossy form of Business as Usual? Will business commitments to the UN Sustainable Development Goals continue to provide attractive graphics for annual sustainability reports leaving the non-business partners the heavy responsibility and practical task of ensuring a thriving future for our planet?

This bid is clearly a challenge to the progressive and enlightened. It is more important than ever that business leaders such as Paul Polman and Danone’s Emmanuel Faber maintain their vision of business as a force for good and the plethora of strategies and actions this implies. It is also more important than ever that investors recognise that that true value of business is reflected as much in value created for social networks and ecosystem services as the direct share value they tend to focus on.

In launching the New AnglesEarly Strategies international survey earlier this month, “Is CSR Changing Business”, we will try to ascertain, from the insider perspective of middle-management, the extent to which the CSR intent and efforts made over recent years have made an impact on business behaviours. We expect this to inform business strategies of the future in line with our common conviction that business can and must be a force for good.

(this post was originaly published in LinkedIn here)

Research “Is CSR Changing Business?” – latest news

We published our Press Release through CSRWire service see here: http://www.csrwire.com/press_releases/39698-Is-CSR-Changing-Business-; and we continue to reach our personal contacts and pass the news to networks. Participation in our research is growing well. I cannot disclose findings yet, but below is some information on our progress.

Who are our respondents so far?

The research has already attracted participants from a wide range of companies. To mention some of their organizations: Allianz, Alstom, Arriva Group, Arup, at&t, Axa, Axway, Barilla, Bombardier, China Ting Group, Commerzbank AG, Conduent, Dentsu Aegis, Diageo, Genpact, HSBC, La-Z-Boy, Lagardère, Lowe’s, Merial, Mosanto, O2, Omya, Oxy, Pepsico, Philips Lightning, PwC, Royal Canin, Saint Gobain, Sealed Air Corporation, Smithfield, UTC Aerospace Systems and Vale. Participants respond in their names, not as representatives of their organizations – but this list witnesses the relevance of our questions.

A little less than half of the participants so far (48%) spend less than 25% of their working time on CSR issues: this will definitely inform our goal of understanding how CSR permeates organizations – as a reminder, the questionnaire is open to non-experts, and we look forward to receiving answers from sustainability non-specialists in particular.

Why do respondents fill the survey?

Responses will help find how to foster sustainability within business. The questionnaire is also a good way to nurture thinking, as you can see from the participants’ comments mentioned below. Last but not least, they will receive a personal copy of the research report free of charge in May, and they look forward to it.

Will we find if corporate social responsibility is now mainstream and non-financial value creation part of most decisions? Or will we find there is still a lot to do and be able to gather some good practices? What I am sure is that many (maybe most) senior and middle managers have sustainability in mind, but it is a big mountain to climb: they would appreciate insights on how to incorporate its challenges in their strategies and everyday business lives – so that BAU becomes SBAU.

Interested? If you are into the topic of sustainability or CSR, whatever your degree of expertise is, and if you are a senior or middle manager in an organization of more than 2000 employees, come join and fill the survey http://bit.ly/CSRvsBusiness ! It takes 25 minutes to complete, and has 4 main sections: Decision-making Path and Processes, Human Rights & Ethics, Leadership of CSR, and CSR Impacts. It is open until March 19th.

Some respondents’ comments

As you may see from some of the nice comments received from participants after they responded, it seems we are on the right track to help companies’ progress in the sustainability area:

I was pleased to respond. Unfortunately I missed to respond the previous research and regretted it. I found the questions insightful and I hope this kind of research can help move things forward. (VP HR MEA)

I enjoyed the survey (Head of Sustainability Leadership)

Thank you for the survey invite. Happy to help you! (Global CSR Senior Manager)

Thanks for the invitation to participate – I just did. I found the questionnaire interesting and look forward to the results. (VP Corporate Responsibility)

Thanks for the note and completed the CSR survey. Interesting area of work… (GM EMEA)

Thanks for including me in this survey. Glad to contribute. (Head of Sustainability)

Interested? come join and fill the survey and/or share the news with your contacts http://bit.ly/CSRvsBusiness – thank you !

(this post was originally published on LinkedIn here)

Do digital adopters endorse sustainable development?

These last years I worked mainly on digital transformation issues: researching how change happens, what resistance hinders progress, strategy pitfalls to avoid. I published on how middle management copes with this trend, I did consulting, coaching and speeches about it. I am now reverting to another leading-edge area in organizational change: corporate social responsibility (CSR) and sustainability.

I just launched with partners at New Angles a new research entitled “Is CSR Changing Business?”.

Is this a split from what I was doing before? Not really, rather a return to my roots. I am an organizational change practitioner who takes a chance to work on her passions: digital transformation and sustainability. I do consider these issues related: to me, they are both about reinventing organizations.

Faith in a better organization

Those interested in digital transformation and those interested in corporate sustainability have something in common: they think organizations can be improved, and can be changed into something better.

In an ideal world, digital transformation allows collaboration, which fosters collective intelligence, which in turn makes the organization agile and innovative. In an ideal world, CSR & sustainability allow organizations to care about people and the environment, to focus on creating value other than just financial and to make the future more livable.

Transparency and ethics are intertwined concepts: digital transformation increases transparency, which is good for ethics, and vice versa. Both domains are also testing new business models: circular economy, collaborative economy. Last but not least, for both domains, thinking is holistic and global, not linear or hierarchical.

A continuous challenge

Those interested in digital transformation and those interested in corporate sustainability have something else in common: they are conscious of the hazards of a difficult economy. Their organizations may decide to protect short-term profit, and expose themselves to downstream depleting effects: loss of agility, and negative impacts on sustainability. “Consolidate achievements” is a watchword for both communities.

Another mantra is “rejuvenate motivation”, as efforts have already been heavy, and we are not yet in sight of the journey’s end. Digital transformation brings uncertainty in the future of some professions, and technology evolves at light speed. Transformation toward sustainability may question business basics. Because discoveries are made, innovation is needed and new markets must be invested in, we must constantly reinvent ourselves.

Is there a synergy between both domains?

Many organizations reached a milestone on sustainability, as they enabled reporting and complied with regulations. They wonder, “What’s next?” If they decide for pushing beyond legal requirements, how can they generate enough creativity and innovation, other than through relying on collaboration?

One of the questions of the survey “Is CSR Changing Business?” pertains to digital maturity, and I hope to find what kind of correlation, if any, exists between digital adoption stage and CSR maturity. Another work I am doing is to look for structured communities inside multinational corporations – communities of practice (CoP) on sustainability – and research how they are using digital tools and enterprise social network to ameliorate their actions toward sustainability.

I would happily read your comments – whether you are from the digital transformation community, or from the CSR and sustainability family, or having interest in both worlds like me -, do digital adopters endorse sustainable development?

 

(this post was originally published in LinkedIn here)