It can be tempting to look at sustainability with only an environmental lens; to focus on issues like climate change, water quality, and biodiversity without getting stuck in social issues which can seem too political. But environmental issues do not occur in a vacuum. The Covid-19 pandemic and resulting economic crisis is highlighting this, by exacerbating immediate social issues like poverty, labour rights and well being, and eroding our capacity to engage and solve our longer-term challenges. The social side of sustainability includes critical issues (and risks) that business should be aware of and addressing. And by focusing on the environmental AND social issues that matter most, you will improve team and other stakeholder engagement, thereby helping you to achieve your goals.
Causes VS Effects
During our collective period of lockdown it has been heartening to hear those few good news stories that provide a positive glimpse of what our future could be like. How our planet can recover and renew if we give it the chance things like better air quality, lower carbon emissions, and wildlife returning to our cities. But while these stories might give us the motivation to drive positive long-term change after Covid-19, they are not the main story here.
Can we truly view these as positive outcomes when we are entering an economic contraction (and social impact) expected to be similar in scale to the Great Depression? Governments are forecasting widespread unemployment, and reduced travel and tourism for the foreseeable future. And that is on top of social distancing requirements which seriously hinder our social and business interactions. The end-game of sustainability is not to protect the environment at all costs; it is to bring about a society that lives and prospers in balance with the environment. In fact, a drastic cut to economic activity without protecting social capital will make it harder - not easier - to address environmental impacts.
Those temporary environmental respites that we've all seen offer a tantalizing glimpse of a future we can deliver if we, the people, overcome our sustainability challenges. But as we enter the recovery phase of the pandemic we must collectively address the root causes of these challenges, or we are doomed to repeat our mistakes.
The 'Social' Blindspot
'Sustainability' can be a hard term to define at the best of times; not only does it have a myriad of interpretations, but there are also overlapping terms that in many cases muddy the waters. Terms like 'Corporate Social Responsibility' (CSR), 'Ethical Business', and 'Corporate Responsibility' (CR). But at its heart, sustainability is about balancing our current needs, our future needs, and our planet's ability to flourish.
In Kate Raworth's 'Doughnut' model of sustainability, this is communicated as our society having a 'social foundation' that needs to be strong and an 'ecological ceiling' that we need to avoid hitting (note that the 'social foundation' is at the heart of the diagram). The concept of a social foundation is also reflected in the structure of the United Nations Global Compact (UNGC), a framework that encourages businesses to adopt sustainable and socially responsible practices. The first six of the UNGC principles focus on the social side of corporate sustainability: respect and protection of human rights, upholding freedom of association, elimination of forced + compulsory + child labour, and elimination of discrimination in the workplace.
A sustainability strategy is not complete until it reflects an integrated approach based on a strong social foundation. A well educated, healthy, secure society provides a foundation that can tackle sustainability challenges simply because it is more resilient. Right now, the pandemic is disproportionately affecting those in society with lower levels of resilience; those who were already exposed to poverty, human rights, and quality of life challenges. Now, more than ever, there is an urgent need for business to protect and nurture social capital.
The social side of sustainability is often a blindspot in business strategies - particularly for those in industries with complex supply chains. Risks in this 'indirect' space can seem harder to address, and it is tempting to assign responsibility to others. However, as disasters like the Rana Plaza collapse in the fashion industry have shown, customers intuitively link up the dots and expect ethical businesses to engage with their supply chains in the same way. Poor social and labour practices are real risks to business, whether they occur in the supply chain or in their own operations.
Another blindspot is that those of us in developed countries often assume that our (society's) 'current needs' are already being met. In fact there are a number of social issues just below the surface - issues like child poverty, inequality, cost of housing, and obesity. These issues have both immediate and longer-term consequences, and require constant attention. Businesses are not immune to these issues, as they potentially impact on staff, supply chain, and customer behaviour.
Re-Framing & Stepping Up
It has been heartening to see that some organisations with environmentally-focused strategies have re-framed their approach in reaction to the pandemic, rather than ignoring the massive social impacts. Extinction Rebellion (the citizen-led organisation formed to pressure governments on the climate emergency) is a good example; they have re-framed their approach by focusing on what they are rebelling for - 'a thriving and just world of regenerative cultures that can weather crises, foster cooperation and look after each other on a global scale'. As a grass-roots organisation Extinction Rebellion is closely tuned into the change in public sentiment, but the learning is just as relevant for business: what are we striving for?
The public are looking to the business community to see who is acting responsibly and stepping up during the crisis. This is not so much about whether businesses are meeting their legal requirements e.g. health & safety, layoffs, and pay cuts - although it is assumed - it's about whether they are going beyond and demonstrating a purpose-driven approach to address the social need. We are seeing food companies supporting with food aid, tech companies addressing the digital divide and remote working, and banks relaxing their fees and penalties. The 'JUST Capital - Covid-19 Corporate Response Tracker' is tracking this across corporate America, indicating that the investment community is focusing closely on business social engagement at this time.
Those businesses that are taking tangible action to support their staff, suppliers and community will see their reputations improve. It might hurt in the short term, but it pays off. They will be the authentic sustainability leaders that we look to as we enter the recovery phase. In contrast, those businesses that took risks around worker exposure to Covid-19, have remained unengaged, or taken advantage of public sentiment will be remembered.
Socialise Your Strategy
Businesses that already have a balanced sustainability strategy, incorporating material social aspects, are well placed to deliver social impact and to support their stakeholders during this time. Their sustainability programmes already provide a solid foundation on which to build a focused crisis response. If however, your business is not so well-placed, there are still meaningful steps that you can take. Here are some tips for socialising your strategy:
- Get Started: The middle of a crisis might not seem like the ideal time to invest in strategy, but there are clear long-term risk and reputational benefits in addressing the social side of sustainability. In fact, the business case may never be clearer, and the sooner you get started, then sooner you can begin to deliver positive impact. The first step is to acknowledge that there might be a gap.
- Be Authentic: The business world has moved on from a scatter-gun approach to philanthropy, where almost any form of community support was acceptable. While philanthropic support remains an important part of community engagement these days, this support is most authentic when it is targeted to communities and causes that the business connects with. In addition, businesses are increasingly becoming aware of the positive social impact that they can deliver directly through their business, whether it be through products and services, supplier partnerships, or customer engagement. Maybe there are even some actions you can take immediately to support the response effort. But don't forget to monitor your efforts to make sure they are delivering real impact.
- Engage Internally: When working on your strategy don't forget your most important source of creativity, inspiration and energy - your team. Involving your team in the process of developing a balanced sustainability programme will help motivate and build loyalty, and increase your chance of success. Especially in times of crisis, socially responsible businesses have higher staff engagement, and are more inspirational to customers. With many people still working from home, has there ever been a better time to engage your staff in some future thinking?
This is the second article of four by Connective Impact, taking a look at what we can learn about sustainability in times of crisis. We kicked off the series here.
In our next article we'll take a look at how some businesses are enhancing their reputation during this time, while many are at risk of being caught short. Those with sustainability 'baked-into' their overall business strategy are well placed to respond and to deliver meaningful action through their own operations and via the supply chain.
We help organisations to build capability and confidence, so they can go out and deliver the ethical and responsible impact that the world needs. If you'd like to learn more about how your organisation can benefit from taking a socialised approach to sustainability, get in touch with us at info@connectiveimpact.co.nz