Sustainability – what’s real?

There are a belwildering array of sustainability ratings – but what do we believe? How do we know they are measuring and evaluating the right things?

In their Rate the Raters documents, SustainAbility identified over 50 sustainability rating agencies. SustainAbility will offer insights into how credible each rating system is, but I suspect that many imponderables will remain.  For example, in part two of the study, the Dow Jones Sustainability Index was ranked highest in credibility by the study’s participants. But in his article titled, When Pigs Fly, RP Siegal noted with incredulity that Haliburton is now listed in the Dow Jones Sustainability Index.

Here are two reasons that determining a company’s sustainability will remain problematic:

• the bureaucratisation and commercialisation of quality processes
• determining sustainability

 The bureaucratisation and commercialisation of quality processes

In the galaxy of organisation endeavour, sustainability reporting can be regarded as a quality measure. For example, while the ISO 9000 series deals with operational quality matters, the ISO 14000 series deals with environmental management. While ISO 14,000 may not be classified as sustainability reporting, it serves the same purpose, in that it provides third party assurance of a quality measure.

I like Tom Peters perspective on quality. He quotes Richard Buetow, a Motorola executive.

With ISO 9000 you can still have terrible processes and products. You can certify a manufacturer that makes life jackets from concrete, as long as those jackets are made according to the documented procedures and the company provides next of kin with instructions on how to complain about defects. That’s absurd.

Where quality processes are formalised, they can divert resources from the product or service itself. Any product or service will justify a finite amount of resource input, so ideally, any quality process will add value equal to or greater than its cost. Too often, compliance-driven quality processes militate against quality as they divert resources away from product or service delivery. This is a big issue in service delivery sectors such as education and health. When teachers spend more time on quality assurance processes, they spend less time on preparation for delivery. It may be that, unless there is a compelling reason to get third party assurance, that resource is best invested in enacting sustainability aspirations, rather than measuring them.

 

I’m not arguing against quality processes – but I am stressing that they have to add value. Sustainability reporting processes will add value to the economic bottom line where there are game-changing benefits. For example:

• a supplier demonstrating conformance with a client’s ESG (environmental, social, governance) standards to ensure continuance of business
• securing a listing in a sustainability index
• remediating reputation losses.

But unless there are clear benefits from quality process third party assurance, why bother?

BP’s gulf oil spill illustrates this issue. Along with Shell, BP scored consistently highly in GRI (Global Reporting Initative) reports, and I believe the company’s leaders had, and have, genuine sustainability aspirations. BP invested a lot in rebranding as “beyond petroleum.” But the gulf oil spill incident has undone a lot of the energy BP had invested in sustainability initiatives. What the GRI couldn’t assess, were complex embedded processes, such as the quality of engagement between BP and its suppliers, and the impact of budgets and deadlines on safety and operations.

Commercialisation

No doubt ratings agencies are also well motivated, but budget pressures will typically create pressure to grow the business and perhaps make processes than they need be. SustainAbility’s Rating the Raters cites commercial pressures as an impediment to more transparent report, partly because the raters are paid by those being rated.

Determining sustainability

Part two of this blog will explore what sustainability means in different industries, and from whose perspective.

Sustainability, engagement and the end of empires, part 2

We are nearing the end of the age of empires (see part one of this post). As the old world is crumbling under its own dysfunction, the new shoots of a new civilisation are discernible. This is the context for the shift to sustainability.

Civilisation by engagement and community building

With the old world essentially a spent force, impotent to deal with the complex issues we now face, the required course correction is a radical reorganisation of human communities and patterns of civilisation. In addition to develop the new institutions to support a new world order, we face the far more profound challenge – that of disrupting ancient and ingrained assumptions and patterns of behaviour, and supplanting them with new ones. This is no simple task.

Current sustainability discourse calls for change, but it is frequently posited as incremental change (albeit challenging enough itself). The environmental and social challenges facing us are enormous. We will struggle to reverse, or slow down some of the alarming trends, such as climate change, species extinction and resource depletion. But In some ways, the task of supplanting old patterns of behaviour, anchored and expressed in age-old human behaviours, is even more challenging. But the good news is, when we can achieve this, new patterns of human interaction will make it much easier to build sustainable communities.

The changes we are facing require the displacing of these old patterns of human behaviour with often diametrically opposed new patterns. For example, most human communities have used slavery as an economic resource. The practice persists today in locations where the prevailing cultural norms of subcultures view humans as objects for exploitation. This practice is unsustainable where human dignity is a dominant value and poverty is banished.

At present, we are in a twilight zone, where many are working hard to implement sustainability interventions, but are doing so on the foundations of the old order. Many corporates struggle with schizophrenic personalities – the old “profit maximisation at any cost” personality, and the emergent “sustainability” personality. BP’s gulf oil spill personifies this. I have no doubt, the companies’ leaders are genuinely aspirational, but the hyper-competitive marketplace invokes “profit maximisation” behaviours. We are attempting to build a new world on shaky foundations.

Green shoots – community building

There are encouraging developments. Take community building for example. I am hopeful that we have reached the nadir of dislocated urban and suburban communities and we are beginning to connect more with our neighbours. In the following Ted talk, Rachel Botsman talks about the growth of “collaborative consumption” – a phenomena driven partly by new peer-to-peer technologies.

And in my corner of the world, the city of Christchurch recently experienced two devastating earthquakes. Amidst the tragedies, it was heart-warming to see neighbours looking after neighbours. Two “armies” were mobilised – the student army, and the “farmy” army, the former, tertiary students, and the latter, Canterbury farmers. These armies cleared away the tonnes of liquefaction that covered streets and suburbs.

More green shoots – the global community

A hundred years ago most of our exposure was to homogenous others – those that were much like us. It was very easy to be embedded in and “us and them” world, when most other nationalities are strangers. Now we mix a lot more, we are broadening our empathy far beyond the homogenous cliques of the past. We are more likely to respond to the plight we see our fellow humans suffering. And science has taught us to that biologically, we are all much the same.

The attitudinal foundations

In the previous post, I outlined the underlying assumptions that supported the empire building ethos – “growth is good” – “extracting value” and “us and them”. Our new world requires an entirely different assumption: unity of action. Rachel Botsman advocated a shift from competition to collaboration.

 

We also have to overturn some deep-seated beliefs about human nature. For example, we can live peaceably together, and we can transcend self-interest.

Is it arrogant to think that we are living in the midst of epochal change? Could it be that we are indeed part of a transformation of human consciousness? I believe so, and in my next post, I will assemble some supporting evidence. What do you think?