Dr. Tima Bansal, NBS's Executive Director, shares her observations about business sustainability.
Bringing Your Whole Self to Work
Over the impeccably prepared sushi lunch, I said to my Australian colleague: “You called it ‘shark tank’ and you say you care about making the world better?"
I spent much of my February in Australia, giving talks and speaking to local academics and managers about sustainability. One conversation over lunch with an academic colleague was particularly poignant. It went something like this:
Him: I am setting up accelerators around the world, focusing primarily on Asia. We provide expertise and access to our networks; the local organization manages the day-to-day operations.
Me: Do you or the host organization screen for the social impacts of the initiatives? For example, would the host support an initiative that develops a new gun or a nuclear weapon?
Him: No, we don’t screen the initiatives, but I’m sure that wouldn’t happen.
Me: How can you be sure?
Him: Well, I can’t be. But, even if they did, our net impact would be positive. We encourage entrepreneurs to create wealth through good ideas. For example, we introduced Shark Tank to India, in which entrepreneurs compete against other entrepreneurs for the best ideas.
Me: Seriously?? You called it ‘shark tank’ and you say you care about making the world better? Doesn’t ‘shark’ undermine the notion of a better world? So, you’re basically teaching entrepreneurs to make money at any cost.
Baffled by my reaction, this colleague started to describe the social good he was doing in his spare time by bringing medical devices to Indians. I suggested to him that he could combine his hobbies with his occupation. He could, for example, screen the initiatives that the accelerators accepted by their net social impact.
I admit that I am not sure I made headway. It was clear that this colleague saw social responsibility as something he practiced in his spare time. I am dismayed by the frequency of this type of conversation: good people who disconnect their personal beliefs and values in their day job.
Such disconnects have been well documented in research in psychology and the behavioral sciences. Milgram’s famous obedience experiments
in the 1960s documented people administering heavy shocks to other people because they were simply asked to do so. In the 1970s, Zimbardo documented
people acting sadistically when asked to play the role of prison guards with people who were playing the role of prisoners. Darley and Latné
called the failure of 38 witnesses to stop the prolonged murder of Kitty Genovese in 1964 the bystander effect. More recent work
by Sachdeva, Iliev and Medin, called moral licensing, found that people justified morally questionable actions at one point in time by performing good work at a different point in time.
I know these individual studies have come under fire, but there is wide and robust support for the general pattern of findings: good people behave badly in some social contexts.
I argue that there may be another explanation that is not based in psychology, but in economic ideology.
In 1970, Milton Friedman wrote about the ‘social responsibilities of business’
in the New York Times Magazine
. His argument was that managers need to work in the best interests of shareholders, and practice their social responsibilities at home. Corporate social responsibility, in Friedman’s words
, seeks “to make as much money as possible while conforming to the basic rules of the society.”
I wonder if this thinking has become so dogmatic that many managers assume that wearing two hats is simply ‘the right thing to do.' Managers justify doing bad things in their professional life, because responsibility is something suitable to one’s personal life. Business is about business, at any cost as long as it is legal. Thinking about social responsibility distracts managers from making money and achieving corporate goals.
Thankfully, not everyone embraces Friedman’s dogma. I taught in an executive program for Maple Leaf Foods
last week. A senior vice president said that she “brings her whole self to the office.” She does not wear two hats. Rather than adapting her personal beliefs to the company, she helped transform the company to her own beliefs. Maple Leaf Foods now aspires to be the most ‘sustainable protein company’ on earth.
She said that she is a better leader because she wears only one hat. Not all the conversations at the executive table were easy, as many of her peers always asked for ‘the bottom line.’ But, she chooses her timing wisely and argues persuasively. She convinced the entire executive team of the business opportunities by aligning personal values with professional values. I have now taught four cohorts of Maple Leaf Foods managers and am struck by the number of people who took the job or have continued to work there because they are excited about the company’s ambition.
Most sustainability professionals are able to make connections between their personal and professional lives. They blend their preoccupations with their occupation. I sincerely believe that to advance sustainability in business, we need people to bring their whole self to work.
In the next editorial from my desk, I will speak more to this disconnect, especially within business schools. In the interim, I welcome your thoughts about this separation of personal and professional values. Please feel free to email me directly (email@example.com
) or tweet more publicly (@TimaBansal).
Why Am I So Often Asked: What Is Business Sustainability?
I am often asked, “what do you mean by business sustainability?” I hear this question from almost everyone, including business leaders, students, and even my academic colleagues who study sustainability.
I find it puzzling that this concept continues to create confusion. Terms like ‘leadership’ or ‘innovation’ do not seem to create such angst, even though the term ‘sustainability’ is grounded in a commonly accepted definition and these other concepts are not. Sustainable development is development that “meets the needs of present generations without compromising the needs of future generations” (WCED, 1987
This definition emphasizes that business must consider the following in their operations: social equity, short and long term thinking, and trade-offs between using resources now or later. These implications are often overlooked, ignored, or misunderstood.
Why the term ‘sustainability’ is confusing…
I think part of the problem people have is that the word ‘sustainability’ is commonly used in other business contexts, including to describe sustainable competitive advantage and sustained growth. I gave a talk recently to an audience at an Australian business school. When I asked audience members to define sustainable development, six people responded, each with different definitions. Only one person spoke to the prosperity of future generations. Several people described business sustainability in terms of sustained organizational profits and success —which can actually be at odds with sustainable development.
The other part of the problem with the word ‘sustainability’ is that that the definition— “meet[ing] the needs of present generations without compromising the needs of future generations.” — seems unclear and its guidance to companies seems vague and unspecific. What does it mean for a company to assure the prosperity of future generations? Business sustainability seems more like inspiration than aspiration.
…but other concepts aren’t equivalent
People often find it easier to translate business sustainability to corporate social responsibility
(CSR), shared value
, the triple bottom line
, or just managing environmental impacts. For example, when Shell Oil describes what sustainability means to them, they confuse it with responsibility and the triple bottom line: “Sustainability at Shell means providing energy in a responsible manner, respecting people, their safety and the environment.”
These other concepts differ from sustainability in important ways.CSR
speaks to the corporation’s ethical responsibilities, whereas business sustainability speaks to sustaining systems over the long run. However, what is ethical for one person is not necessarily ethical for another. Some executives feel their firm is acting ethically by abiding with laws; others feel their firm must often go beyond the law’s requirements. For some managers, being responsible requires offering the minimum wage; to others, it means offering the higher living wage.
Furthermore, CSR does not speak to equity across generations
. When Nike announced its woven FlyKnit
, it claimed to be responsible for creating fewer wasteful offcuts. I agree
that the action is responsible, but I am not sure it is necessarily sustainable if Nike intends to sell more sneakers, which consumes more resources in the long run.
argues that companies can generate value for the firm and society simultaneously. Like CSR, it too ignores the importance of time. Creating shared value often takes a long time, but many businesses are unable to see very far into the future.
Sustainability is also distinct from the triple bottom line
, which simply requires businesses to consider three ‘bottom lines’ – social, environmental, and financial performance. However, just considering the three bottom lines, does not offer guidance on how to manage those bottom lines or make difficult trade offs. How should Nike choose between selling more sneakers (more profits) or fewer sneakers (smaller environmental footprint). How should Shell Oil decide between providing more energy to people to help them live a better life (and generating profits) and drilling in the sensitive Arctic ecosystem?
Making “sustainability” meaningful for business
“Meeting the needs of present generations without compromising the needs of future generations.” While sustainability’s definition can seem ambiguous, I believe that it can offer corporate guidance and a vision of a prosperous future.
It is important to recognize that this definition applies to the entire economy, not to specific organizations. A single organization cannot secure the prosperity of future generations; every single firm consumes resources and generates waste. But collectively, organizations can ensure their wastes become the feedstock for other industrial processes – what is often called the circular economy. So, in terms of specific practices, this means that organizations should seek to source from renewable sources and find organizations that can productively use their wastes.
Organizations must consider how their operations fit within the larger industrial ecosystem. If executives see their organization as part of a larger system, then they can see that they must collaborate to create a sustainable system.
Moving from a short-term business logic to a long-term systems logic
I admit that business sustainability is not a simple, straight forward concept. It requires systems thinking, which will be the topic of future musings from my desk. I also acknowledge that it will be some time before we move from short-term business logic to a long-term systems logic. However, I am reassured that executives and academics alike are increasingly more open to this perspective.
I look forward to the day when I will no longer be asked: “So, what do you really mean by business sustainability?”
Continuing the conversation
I would appreciate hearing your reaction to the ongoing question of ‘what is business sustainability’. Please feel free to message me (@TimaBansal
) or the NBS community (@NBSnet
) privately or publicly.
Why Write a Column From My Desk?
This column is the first among the many that I hope to write ‘from my desk’. If you’re a regular reader and subscriber, you might be asking why I’ve decided to create this platform through which to discuss my views.
When I founded NBS, 13 years ago, the gap between management research and practice was large. I saw much opportunity to advance sustainability by bridging that gap. Executives could undertake more evidence-based practice and researchers could tackle more managerially-relevant issues. By sharing knowledge and collaborating, researchers and managers would see the world through different eyes, which would stimulate ideas for long-term prosperity for business and for society.
NBS has made significant progress in this bridging work. We have published 14 systematic reviews
of research on managerially relevant topics, translated numerous articles, hosted conversations, and held several events.
Most of the knowledge that we mobilized was drawn from academic journals, but the academic machine is slow. A research idea can take four to seven years to publish. At a time of such unprecedented change —planetary, technological, and social— published research can lose its relevancy.
NBS needs to move ideas between research and practice faster. Researchers and managers have many deep insights, but lack the forum to share those ideas quickly. As well, NBS needs to source ideas, not just from researchers, but also from managers with deep practical experience. We need to take a more active role in mobilizing ideas that are on the frontier of knowledge. There is a hunger for good ideas.
In writing from my desk, I hope to bring some of those good ideas to you. I will highlight published and in-process articles that I’ve read, the observations I’ve made, and the conversations I’ve had that have piqued my interest and provoked my thinking. I hope my musings will similarly provoke yours.
In January's newsletter, we have highlighted the most visited articles in 2018, which I encourage you to read. What surprised me most about this list is the ‘most visited’ article: the workshop that NBS hosts for research centres worldwide
. In 2018, NBS hosted its fourth biennial workshop, which builds capacity and promotes collaboration among research centres. I was surprised that the top article wasn’t about ideas, but about community. It reinforced for me that bringing people together is one of the most important things we do.
I hope you help me in my pursuit of mining emerging sustainability knowledge. Please do reach out to me directly to share frontier ideas that can advance both the research and practice of business sustainability.
Stay tuned for ideas ‘from my desk’ in future newsletters.
Share your ideas
I'd love to hear your frontier sustainable business ideas. Here's where you can find me.
LinkedIn: Tima Bansal
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