Essential, Elusive Leadership

18 Jul 2011 – Mark Lee

This past Friday, July 15th in Washington, DC, my colleagues Jeff Erikson, Michael Sadowski and I hosted a breakfast roundtable on leadership, trust and value. With guests from Areva, Chevron, the Environmental Defense Fund, Johnson Controls, the International Finance Corporation, Molycorp, the Nature Conservancy and WWF, we explored the intersection and interdependence of these topics as well as their influence on the sustainability agenda.

Towards 2012

Numerous big events pend for the year ahead – the 2012 Summer Olympics in London and the 57th US presidential election to name two – but we are focused on three anniversaries: Rio+20, the 25th Anniversary of the Brundtland Report and (indulgently? ☺) SustainAbility’s own 25th Anniversary. We feel it is time to ask: When policy-makers and leaders from the private sector and civil society gather in Rio next June, what assessment will they make of sustainable development progress achieved the last 20-25 years? …And we don’t expect an encouraging answer: In the words of one guest Friday, sustainability progress has been too fractured to allow scaling of solutions, meaning our best (but isolated) efforts have left us ‘playing to lose’.

Government deficit

With debt ceiling talks (and fears) currently dominating US political discourse, those of us assembled in DC had a ready example of the potential damage inaction can cause when leaders can’t or won’t agree due to dogma or lack of courage. The July 9th-15th issue of The Economist sums the debt crisis well in a piece entitled Shame on them, in which they accuse especially Republicans of ‘A gamble where you bet your country’s good name’.

Our own discussion suggested a view that government – especially national governments – are similarly gambling through inaction on a host of sustainability issues, from climate change, to biodiversity, to the oceans, to fresh water. In sum, government is perceived to have failed to create the conditions (clear policy; pricing mechanisms; a level playing field; or leadership by example in terms of stewardship of resources and investment) necessary to help position all actors to play to win.

Government is not the (only) problem

As results of a recent Sustainability Survey we conducted with GlobeScan suggest, there is insufficient leadership everywhere. While sustainability experts worldwide judge national government leadership efforts to advance the sustainability agenda most harshly – only 6% deem them effective – corporations and multilateral organizations each garnered less than one quarter or respondents’ approval, and NGO’s meet approbation of just less than half. Only social entrepreneurs topped a 50% favorable score for the effectiveness of their work to advance the sustainable development agenda – perhaps because they are perceived as doing most to challenge existing business models and to create new and better ones?

My own read of the survey and the external environment? No one is doing enough, fast enough, in the face of the scale of challenges we face. For just one example of how things may be spiraling away from us, see this warning that our oceans may be tipping towards ‘irreversible, potentially catastrophic change’ much faster than anticipated.

Got hope?

Asked what’s working, breakfast participants offered the following:

• The Walmart Effect: While others wait for regulatory certainty, Walmart continues to advance its own sustainability efforts at a torrid pace. How do others, with less market clout, follow? And why don’t more large corporations do similar? As our group was asking this question Friday, The New York Times was reporting that Costco and Beef Products Inc. had become ‘tired of waiting for regulators to act’ and so were ‘proceeding with their own plans to protect customers’ by expanding E. coli testing. Our attendees also cited FedEx CEO Fred Smith’s bullishly outspoken position on electric vehicles. Are we on the verge of a multiplication of individual efforts such that the scaling lacked in past might emerge?

• The making of some sustainability issues pre-competitive: Can this be made to work for global issues like climate change or biodiversity that affect every industry, especially where reputational risks are not so directly tied to particular companies or an industry, as, for example, child labor was to footwear, apparel and sporting goods in the 1990s?

• Campaign pressure: One of our corporate attendees cited the powerful impact on company thinking of well-organized proxy resolutions and supporting campaigns, implicitly questioning whether civil society is employing this tactic enough today. Does a group like 350.org stand out so much at present because so few organizations are generating like energy? Will other civil society organizations campaign more in coming years?

• Regulation: While examples were few, there was a general feeling that smart regulation underwrites good business decisions regarding sustainability. This part of the discussion made me think of the climate approaches explored in Mark Hertsgaard’s Hot: Living Through the Next Fifty Years on Earth, which details the policy and investment approaches places like King County (the Seattle area), Chicago and The Netherlands are implementing to mitigate climate change as much possible, but, crucially, to thrive by being leaders in adaptation no matter what happens.

• Education: Finally, the group pointed to shifts in education e.g. the emergence of so many excellent, combination sustainability-MBA programs at places such as the Center for Responsible Business in the Haas School for Business at Berkeley and the Erb Institute For Global Sustainable Enterprise at the University of Michigan, plus all the signatories to the Principles for Responsible Management Education, which are preparing new generations of leaders to take sustainability into account from the beginning of their careers, not only as legacy issues at the end.

What’s next

We are embarking on a search for the right kind of leadership for the decades ahead – leadership capable of building the trust among all parties to the sustainability agenda that confident action requires, and possessing the vision and ability required to describe and demonstrate how moving boldly on sustainability will create rather than destroy value for individuals, organizations and society as a whole. While not mentioned in today’s blog, this search will encompass citizens and consumers, who are too often silent on sustainability, or, if vocal, still allow governments and corporations easy passage by failing to bring sustainability demands to bear in the voting booth or at the checkout.

As part of this search, SustainAbility will convene a series of conversations like the one we just had in DC. We will report on some of them in this blog, and we will roll everything we learn into a suite of efforts we are undertaking to build momentum towards Rio+20.

To learn more about our 2012 plans, our thinking on leadership, trust and value, and how you might become involved in or sponsor these activities, please contact me on lee@sustainability.com, and/or pop a comment here on the website next to this post.