These are turbulent times. The news cycle is too fast. Climate change is wreaking havoc with fires, floods, and droughts. Rising inequality and political unrest have brought polarization and violence. Technology is disruptive and markets are volatile. How do you lead through such acceleration and uncertainty?
Chris Coulter, CEO of insights and strategy consultancy Globescan, has an idea of how to give your company a "fighting chance." It is laid out in a book he recently co-authored with David Grayson and Mark Lee, called "All In: the Future of Business Leadership."
"The metrics show that the average tenure on any index for a company is much shorter than it was 50 years ago and much shorter than it was 100 years ago," says Coulter, "and CEO tenures are also shrinking. The world is going through all kinds of change; so much is happening. If a company is truly committed to being around for the next 100 years then it has to think differently and act differently. To do that strategically, sustainability becomes the ideal framework."
Sustainability is a relatively new approach to business that encompasses environmental, social and economic governance for the long term, and emphasizes value creation for all a company's stakeholders.
"The 'All In' part of the book's title means that because of all kinds of challenges and opportunities, it becomes irresistible to not take a half-hearted approach to sustainability but to dive in with both feet - because this is how you can future-fit your business," says Coulter. "When you're sort of a little bit in, you don't catalyze your employees well enough, you don't get the attraction of talent, you don't become more influential in regulatory circles or the ideal partner of choice; you also don't get any sort of halo related to market share of customers - because you're just status quo and you're not purposeful."
The book uses information from extensive company surveys over more than 20 years to draw conclusions about how best to lead for the long term health of an organization. The authors came up with 5 attributes of highly successful companies:
1. Purpose
Your company's purpose is its orientation, its north star. It is how you define what your business does and its societal impact. Coulter says: "you know that's no small thing, to do that really effectively. It takes time to be strategic, and then to make the purpose catalytic, people have to understand its power over decision-making. There are some things you won't do, and some things you'll do differently; that foundational orientation is really critical."
2. Plan
Your company's plan is the 5-10 year strategy that will give meat to the company's purpose. Following the sustainability framework, the company should set ambitious goals, including science-based targets* on the environmental side where possible, put in place risk management tools, and introduce metrics that help the company keep building toward its targets and creating value for stakeholders.
3. Culture
A company's culture is harder to define and depends quite a bit on human elements: what values did the founders and leaders bring to the company, how do people knit together, what is the human context, and so on. Coulter and his co-authors weren't expecting this aspect to come through so strongly in their surveys, nor its relative importance. "You could have all these things, a good purpose, and a good plan, but without the culture the operating system doesn't allow the purpose to drive some of the most important elements that we all know: innovation, transparency, engagement. And all those things are connected. The culture allows those aspects to really come to fruition for the organization.," says Coulter.
4. Collaboration
While purpose, plan and culture are foundational aspects of a successful company, collaboration and advocacy are means to bringing leadership to the next level. Collaboration means partnering with different types of organizations, such as governments or nonprofits, suppliers, customers or even competitors, to effect change. Today there are large-scale collaborative projects that help solve societal problems such as deforestation or human trafficking, while bringing bottom-line benefits to the collaborators. Collaboration can also accelerate change in companies as they begin sharing best practices.
5. Advocacy
More CEOs are speaking out on societal issues, associating their brands with values such as tolerance, diversity and inclusion, and environmental and human rights issues. "Advocacy has to align with the purpose, with the plan and what you're trying to achieve, so that it's strategic, not just the latest thing you think is important," says Coulter. "It really has to be in line with the systemic change taking place around sustainable development."
The implication is that we will be governing our planet, in the future, in ways that ensure that humans thrive in an ecologically balanced environment.
But looking into that future from here isn't easy. "A lot of the recent scientific reports are disturbing," says Coulter. "We're going in absolutely the wrong directions to have a stable, secure, let alone thriving society and planet. That is the context and that's why we thought the core of this conversation is really about leadership, and how do we help stoke and manifest and define what good leadership looks like going forward."
He is hopeful that a growing wave of sustainability leadership can guide us safely forward. "Historically, we went from a 'do no harm' era 20 years ago, to an era of strategic integration of sustainability about 10 years ago, and then now I think we're in a purpose-driven era. Our hope is to move into a regenerative era in the next 5 or 6 years."
What exactly does that look like? "There's a lot of uncharted territory that needs to be thought through," admits Coulter. But that makes this time all the more exciting. Sustainability, after all, is a journey.
* According to sciencebasedtargets.org, "Targets adopted by companies to reduce greenhouse gas (GHG) emissions are considered "science-based" if they are in line with the level of decarbonization required to keep global temperature increase below 2 degrees Celsius compared to pre- industrial temperatures, as described in the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC AR5)."
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