BSR at 25: Redefining Sustainable Business to Meet the Moment (Parts 1 & 2)

By Aron Cramer, President and CEO, BSR

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Part 1

This year marks BSR’s 25th anniversary. While such milestones often prompt a look back (and we are doing a bit of that), this juncture in history is a time to stay firmly focused on the future.

We are living in a time of extraordinary change. Virtually every dimension of business is changing. As I have been reflecting on what these changes mean for the future of all companies, I have zeroed in on three big changes that are flowing together: One of the changes is positive, one is neither inherently good nor bad, and one is problematic.

The first change is that we now have a clear roadmap for sustainable business. The arrival of the Sustainable Development Goals (SDGs) and the Paris Agreement have defined a powerful global agenda for the next decade and beyond. Combined with other significant efforts like the UN Guiding Principles on Business and Human Rights and the Women’s Empowerment Principles, we have universally agreed reference points on the core elements of the sustainability agenda. The question today is not where to go, but how to get there.

Second, every business is experiencing disruptions that are presenting existential questions about the future: What business are we in? Who are our customers and competitors? How do we deliver value? How do we secure the natural resources we need? How do we communicate effectively in an era of hyper-transparency? These questions about the future arise even as competitive pressures in the present are unrelenting.

Third, we are experiencing a time of great political uncertainty. The twin shocks of the Brexit and Trump votes in the U.K. and United States last year are still playing out. Whatever happens, there are some clear lessons for business. First, public policy frameworks supportive of sustainability cannot be assumed, especially when governments have a hard time demonstrating the value of open societies and the global economy amid public anxiety over change. The political earthquakes of 2016 also remind us that the sustainability agenda should focus more on basic economic fairness and demonstrate how attention to climate can deliver innovation, competitiveness, and prosperity that reaches throughout society.

As we look ahead from our 25th year, it is good to see clarity about sustainability objectives, even if the business and political environments are far less certain. I am optimistic: We have a golden opportunity to reorient business around the sustainability agenda—an opportunity to use new technologies, new business models, and new ways of delivering value to achieve the vision of the SDGs and the Paris Agreement. Business can use its voice to demonstrate values-based leadership at a time when many of our elected officials have turned away from open societies, collaboration, and a principles-based approach to governing.

At a time of massive change, the question all of us face is simple: Will we meet this moment?

Part 2

Redefining Sustainable Business to Meet the Moment

In 2017, the year of BSR’s 25th anniversary, I have been reflecting on the confluence of three crucial trends that are redefining business: clarity about the goals for sustainable business, widespread disruption in business, and political volatility[1]. In this context, sustainability provides a North Star that can be essential in creating resilient, innovative, forward-looking businesses.

To make this happen, it is time to redefine sustainable business with a new agenda, a new approach, and a new voice.

A New Agenda

Calling for a new agenda may seem odd when the world has embraced the Sustainable Development Goals (SDGs) as the path forward. In fact, there is no inconsistency, because to meet the objectives of the SDGs and the Paris Agreement, we must apply them in a new set of circumstances. In other words, the sustainability agenda has to change because the economic, business, and political situation is changing.

What does this mean in practice?

First, basic economic fairness should get more attention on the sustainability agenda. Our era’s widespread political volatility and lack of trust in business is the direct result of feelings of economic vulnerability among wide swaths of the population in the mature economies of the United States, Europe, and Japan. Business needs to provide an answer, which can come from more attention to quality jobs in an era of automation, and taking on chronic concerns about executive pay. Without that, support for business and global trade will wither even further.

Second, it is also time to address head on new questions raised by new technologies. Our lives today are shaped by algorithms and more and more information stored in the cloud, which means that every company—not just the tech sector—should have policies on privacy and the fair application of big data.

Finally, action on climate needs to focus not only on staying well below 2°C of warming, but also in addressing the social and economic climate impacts we are experiencing today. Meeting the climate challenge means reductions in emissions, yes. But it also means fully embracing resilience strategies; understanding the intersection of climate and women’s empowerment[2]; and unleashing new products, business models, and technologies that not only shift the world toward a low-carbon economy, but also create new jobs, new businesses, and lasting solutions to poverty reduction.

There are more ways the sustainability agenda can and should change, but these three areas deserve attention as we look ahead. If we don’t get jobs, the social impact of technology, and climate resilience right, the rest won’t matter.

A New Approach

Let’s face it, some elements of the sustainability playbook have grown stale. It’s time for companies to take a fresh look at how they report, engage with stakeholders, and manage supply chains. It has been inspiring to see many such efforts emerge, and at BSR we are excited about driving new thinking and new ways of working on those and other topics.

Chief Sustainability Officers have a golden opportunity to reimagine how to approach sustainability management. Many people like to say that the CSO’s goal should be to work herself out of a job. I disagree. Companies will continue to need a leader who understands the evolving intersection of business and society. And given the massive changes in culture, technology, and economics—coupled with the disruptions affecting every business—the CSO role is invaluable.

In 2025, the CSO will need to be an innovator, a futurist, a connector, and a revenue generator. Yes, the CSO will continue to look after stakeholder relations, rankings, and sustainability reports, but let’s recommit to the notion that those responsibilities are the means to an end, not the end in itself.

Achieving the ambitions expressed in the 2025 sustainability goals adopted by many companies requires strong leadership from within and beyond the sustainability function. The next 10 years, then, will need to see a strengthening of both the inside and the outside game of the sustainability function. We are already seeing signs that this is happening.

A New Voice

Our turbulent times also show how important it is for companies to act on the foundation of their values and principles. At a time when so many are advocating for walls between peoples, and questioning global trade and the free movement of people, it is essential that companies use their voice to reinforce the importance of the principles underlying their commitment to sustainability.

Companies that are taking decisive action on climate do so because they believe in climate science. Businesses that are applying the Guiding Principles on Business and Human Rights do so because they believe that all people, regardless of gender, race, nationality, or other characteristics deserve equal treatment and equal opportunity. Companies that are committing to the SDGs do so because they believe that poverty is both an economic and a moral challenge for us all. These principles—which are fundamental to social cohesion and stability—create a rules-based environment, which is central to business. They also enable global trade to function smoothly.

In the past year, we have also seen multiple examples of companies using their voice to support for immigrants and refugees, basic science, and, in some cases, transparency. This is promising. There is a lot of evidence that employees want to see the leaders of their companies express their values on these issues. And in a world in which the core values of open societies and fair, respectful treatment of people is under attack in locations across the globe, it is increasingly important.

Business has unique assets to bring to crucial public debates. Business also continues to face a trust deficit that can be addressed through statesmanship at a time when that is often in short supply in the public sector. Furthermore, business has a keen appreciation that big global goals are achieved through partnership, and during polarizing times, reinforcing the importance of collaboration is something that can resonate far beyond company walls.

Building a Better Future

The very concept of sustainability is based on a foundational belief that we are here to build a better future. In our era of immense change, that belief provides a sense of direction that will serve us well. And by embracing a new agenda, a new approach, and a new voice, sustainability will not only deliver a brighter future, it will give business a path forward in our fast-changing present.

We will discuss the concept of redefining sustainability more at the BSR Conference 2017— for registration information and join our mailing list to be the first to receive Conference news and updates visit- http://bsr17.org

 

Article by Aron Cramer, President and CEO, BSR (www.bsr.org). Aron is recognized globally as a preeminent authority on sustainable business. In addition to leading BSR, which has grown substantially throughout his tenure as President and CEO, Aron advises senior executives at BSR’s more than 250 member companies and other global businesses on the full spectrum of social and environmental issues.

Aron joined BSR in 1995 as the founding director of its Business and Human Rights Program, and later opened BSR’s Paris office in 2002, where he worked until becoming President and CEO in 2004. Aron serves on advisory boards to CEOs at Barrick Gold, Marks & Spencer, SAP, and Unilever North America, and he facilitates the AXA CEO advisory panel. He is also a director of the Natural Capital Coalition and We Mean Business as well as a member of the World Economic Forum’s Global Agenda Council on the Future of Consumption.

Aron speaks frequently at leading business forums, and is widely quoted in top-tier media such as the Financial Times, Le Figaro (France), The New York Times, and The Wall Street Journal. He is co-author of the book Sustainable Excellence: The Future of Business in a Fast-Changing World, which spotlights innovative sustainability strategies that drive business success.

Prior to joining BSR, Aron practiced law in San Francisco, and worked as a journalist at ABC News in New York. He holds a B.A. from Tufts University and a J.D. from the University of California, Berkeley.

Article Notes:
[1] https://www.bsr.org/en/our-insights/blog-view/bsr-at-25-meeting-the-moment
[2] https://www.bsr.org/en/our-insights/blog-view/women-climate-change-disproportionately-affected-powerful-agents-of-change

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