Understanding and applying sustainability in your organization- The leader role

An introduction to sustainability

Sustainability is a very wide subject that needs leaders to align their strategies around it. They need to understand how the natural and social system works and how their companies interact with them. Then they will need a framework to implement a strategic sustainable development that will guide their successful future.

The United Nations Brundtland Commission in 1987 defined  sustainable development as “meeting the needs of the present without compromising the ability of future generations to meet their own social, economic and environmental needs worldwide.” Therefore sustainability is a about present and future needs, the commitment to leave a better world to the future generations.

But, why has it taken so much time to implement sustainability strategies and actions for businesses and governments?

The answer is the impact’s delay of our actions. For years there has been a sensation that nothing was happening and that we could continue doing as before. This sensation changes if we see from a bird eye’s perspective the last 50 years…

So how does the future look like? According to The Natural Step we are in a funnel and the possibilities to change this trend are getting smaller (less natural resources, greater impacts on current environment and social conditions...)

We know there a lot of reasons why sustainability matters. The question is how the business leader has to focus and implement a global sustainability strategy.

Benefits

There are very important business benefits as Bob Willard stresses of applying a sustainability strategy in your organization:

1. Easier hiring & retention of top talent

2. Increased employee productivity

3. Reduced manufacturing and commercial expenses

4. Increased revenues and market share

5. Reduced risk, easier financing

So, what you need to incorporate sustainability strategically in your organization? You need a robust and tested framework.

Steps of the Framework for Strategic Sustainable Development, FSDD.

1^st) Understand how your company impacts the environment, society and economy in the whole System. It is not only about climate change, sustainability embrace a lot of concepts. Everything is connected! No more reductionism! you need Systems Thinking"

2^nd Embrace the sustainability principles that make the System work and that are currently violated by our society as constraints in your company’s growth.

3^rd Align your strategy with the sustainability vision. In this point leadership and ecological coaching plays an important role to involve all the company resources in this effort and setting up the strategic goals.

4^th Design and implement actions that allows the organization to step by step by selecting those actions that are financially viable, guide the company to achieve its vision and build competitive advantages against the competitors.

5^th Monitor the progress of the strategic goals and actions designed by the company’s dashboard or any other strategy implementation tool or environmental management system as ISO 14001.

One final and most important step: lead your company’s journey to be part of the solution. It does not matter how big the impact is, is the example and corporate citizenship you set up. You will realise how powerful this message can be within your organization and how your employees embrace it bringing new solutions and ways to reduce your impacts and satisfy your customers.

Opportunities and challenges

Out of there, there are opportunities and challenges you have to face:

-          Stakeholders pressure (more information about GHG emissions and sustainability commitment)

-          Upcoming National and International regulation

-          Competitive advantages from innovative products/services

-          Earth resources limitation and continuous increase in scarce resources prices your company depend on.

-          Young professional's expectations about what company they want to work for

All of them are opportunities for leaders to include sustainability principles to their agendas and be the pioneers in their sectors applying the strategic sustainable development.

Wal-Mart, Ikea, Lafarge or Interface are examples of big corporations that have put sustainability in their agendas and that are gaining the customers trust and market share to continue creating new ways to operate in a System with limited resources where everything is connected. You have the chance to start a new journey that will make you better as a business meanwhile a good neighbour.

Sustainability key factors:

Do not forget, some of the key factors for applying sustainability successfully!

-          It is a progressive effort. You do not have to be carbon neutral in one day! Sustainability is about doing the business we do by applying sustainable actions that improve our services, keep us on green numbers and constantly guide us to our sustainability vision.

-          It is not a question of implement some independent actions, it is required a complete understanding of the company’s function within the environment, society and economy. This understanding will help us to draw the whole picture and design the most efficient way to achieve it (GHG inventory, energy efficiency, green building, …)

-          It must be included in the company’s vision

-          It offers important benefits and also requires efforts, investments and organization involvement

Easy Framework for Strategic Sustainable Development for businesses

How many times have we read an article about Sustainability, green actions or renewable energy?  Perhaps several times!
But, are all these programs, projects, concepts or actions solving the big issue?
The truth is that Sustainability is a complex issue which includes more and more concepts and opinions everyday that add more complexity to the subject. Climate Change, Ozone hole, GHG management, CER’s, REC’s, Environmental Management Systems, Corporate Social Responsibility, Kyoto Protocol, Global Report Initiative, are just some of these concepts.
The Natural Step, a non profit organization founded in the early 80's has developed a new approach to Strategic sustainability that has impressed me because its clear analysis of the situation and the common sense and consensus it applies to solve the big problem we are facing.

What we are seeing today is a battle played by different actors that try to fix some issues with a lack of perspective and understanding of the global problem. We are lost in the details and we are not capable to achieve a common understanding of the circumstances that are destroying the System (Ecological and Social) and therefore we don't share a common goal of how to solve it. We are drilling holes instead of looking at sustainability from a bird eye’s perspective.

So when did this start?

There is scientific consensus about this unsustainable society started with the Industrialization era. High polluting manufacturing processes, products based on hazardous materials and metals difficult to recycle, and also multiple human actions that systematically undermined the ecological and social conditions are the main causes that industrialization has brought.

Who can solve it? The typical answer is everybody, governments, businesses and society as a whole. However the main role has to be played by businesses: Of the world’s 100 largest entities today, well over half are not nation-states but corporations. But of course business will be more active if customers can force them to act NOW!

So what do companies have to start doing?

Understanding the issue from a global perspective: The Sustainability Challenge. Organizations must understand how the system works and the interrelation of all its components (everything is connected: i.e CFCs were seen as a good idea and then after years we realized their impact in the ozone layer). They also have to think in their activities considering the whole supply chain; from their suppliers to their customers. A car company can think that by substituting some heavy materials from it’s cars for a new lighter material could help to reduce gas consumption and therefore GHG emissions, but it should also consider the impact of that material in the Earth’s crust once the car finishes its life, because the material could not be biodegradable or foreign to Nature, polluting the soils and adding chemicals that could end up in the vegetables we eat. It should also consider the impact of the processes needed to produce it and also the waste that they generate when customers stop using them.

The Framework for Strategic Sustainable Development, FSSD from The Natural Step, offers a goof methodology for business to comprehend their responsibility in achieving sustainability through five key steps.

1) The System: First thing is trying to understand the system (society within the Biosphere) and the causes that are destroying it. Because knowing what is causing our destruction will allow us to stop it in the long run. Here there is a lot to understand and scientist help us to achieve consensus explaining how the System works (solar energy entering, photosynthesis, The Conservation Law, 2^nd Law of Thermodynamics,…)

2) Success: Shared Sustainability Principles that The Natural Step summarize in 4. In a sustainable society, nature is not subject to systematically increasing:

a.      ...concentrations of substances extracted from the Earth’s crust

b.      … concentrations of substances produced by society

c.       … degradation by physical means

Additionally, in that society …

d.      … people are not subject to conditions that systematically undermine their capacity to meet their needs.

So it is clear that just focusing in these four conditions businesses can do a lot for a Sustainable Society.  Does it not sound easier than other specific approaches and not lost in the details as some articles about energy efficiency, GHG management, green practices, … All of then are good but only if they are result of a global vision that takes into account all the interdependences of the system and it is flexible enough to change actions in case they are not driving us to a successful scenario. It is simple, as the chess game. We know the basic principles (rules) and know how to play to reach the final goal.

3) Strategy: Knowing the sustainability principles is a good starting point but businesses need to put them as constraints in their company’s vision. To be strategic we need to know where we want to go: a sustainable world. Companies need to think about how to achieve their vision with these new sustainability constraints. For that purpose they can use a methodology for solving complex systems: Backcasting from principles. Yes, instead of analyzing what they are doing in the present and plan the actions to achieve their vision (forecasting); they have to imagine that they have already achieved their vision (their activities are sustainable in a Sustainable World) and back to the present to plan the first steps that will guide them in the right direction. The big issue the companies have faced is that the System is constantly changing and new issues, technologies, interdependencies appear so they do not know the entire way to achieve sustainability or even worse there are no solutions today to achieve the sustainability vision. It is like playing soccer or chess you know the principles (rules) that will allow you win and in the game you have to apply them progressively.

4) Actions:  To implement the strategies the businesses have to design different actions and programs. One way is to analyze their present activities, procedures, products and services and figure out the ways they are contributing to violate the 4 sustainability principles. For example, Panrico, a Spanish bread company, has recently launched a new individual package for their donuts, it is made of plastic and its goal is keeping the donuts fresh for at least one week. The big issue is that before they were distributed to restaurants in big carton boxes and now these individual plastic packages are violating the sustainable principle 2, increasing concentrations of substances produced by society (plastic takes to Nature 100 years to decompose). These actions need to be prioritized according to the creation of flexible platforms for achieving the Sustainability vision or ensuring good return on investment.

5) Tools: There an extensive number of environmental and management tools that can be used to help organizations implement, monitor and improve their sustainable strategies. From the environmental tools ISO14001, to Life Cycle Assessment, Cradle to Cradle, Factor X to classic strategy management tools as dashboards or the Balance Score Card. The key is to understand the organization´s business and the benefits from each tool they can get.

This is only a summary of my understanding about how to guide organizations in their journey to strategic sustainable development and the FSSD from The Natural Step.

I would like to finish with some quotes from leaders who have faced the challenge of sustainability as an opportunity and responsibility with the world and who have inspired me to continue studying ways to help companies to be part of the solution.

Business cannot succeed in a World that fails”. Bertrand Collomb, Chairman and former CEO, Lafarge, SA

For Wal-Mart to be successful and continue to grow, we must operate in a world that is healthy and successful… we believe that these initiatives and many more to come will make us a more competitive and innovative company, and one that is more relevant to our customers. Lee Scott, CEO, Wal-Mart Stores Inc.

Now, however we have reached a level of maturity in the organization where the sustainability work can be truly integrated in our everyday business agenda and strategies. Sustainability is no longer an activity on its own but it is totally integrated in everything we do. I am convinced that this will make a big difference in the years to come.” IKEA’s global CEO Anders Dahlvig  

Hola a todos, Hi everyone!

Welcome to my blog or my online home! whatever you want.

This blog is my starting point and I hope the beginning of an exciting and great experience. I guess I will publish my thoughts and opinions about the subjects that interest me more as sustainability, renewable energies and politics (just from the citizen point of view).

I will also add some presentations and other multimedia content to the blog so you could have more information in different formats.

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