Sustainable Excellence: The Future of Business in a Fast-Changing World

October 12, 2010
  • Aron Cramer portrait

    Aron Cramer

    President and CEO, BSR

The economy continues to limp along, and from the debate in this U.S. election season, it seems as though the path to restoring economic vitality is terra incognita. Over the past generation, economic advances have been jump started by fundamental changes: first, globalization, and then the rise of the internet economy.

Today, the best hopes we have for strengthening our economic prospects lie in sustainability, and that's why we have written, Sustainable Excellence: The Future of Business in a Fast-Changing World, which is published today.

In our book, we argue that sustainable excellence will be the defining feature of successful businesses over the coming quarter-century. The business environment has changed rapidly in the past decade, and these changes have only accelerated since the Great Recession hit two years ago. Businesses today face a world that is more global, resource-constrained, interconnected, and transparent than ever before. This presents unprecedented opportunities for the companies that embrace these changes, and turn them to their—and our—advantage.

We see five principles of sustainable excellence, which are crucial ingredients of business strategy to navigate our changing world and deliver prosperity that can, in the literal sense, be sustained.

The five principles you'll read about in our book are:

  1. Think big: create business strategies to meet big global challenges: The world is looking for solutions to big questions, like how to shift to low-carbon prosperity, how to keep economic progress going in water-stressed areas, and how to deliver dignified livelihoods for nine billion people by 2050. Sustainability provides an urgent and compelling mission for every company. For creative companies, this presents a wide-open playing field, and it is why companies like GE have made health and the environment core parts of their strategy. IBM is making "smarter cities" a critical foundation of its strategy. And while business cannot--and should not--be the sole answer to our most pressing public needs, we stand a much better chance of tackling them with business as an active and creative partner.
  2. Use sustainability to drive innovation: Companies are taking on these challenges is by using sustainability as a "design brief" for its innovation laboratories. Best Buy is experimenting with e-bikes, car charging stations, and home energy management. And new companies like Method are building entire companies around product design principles focused directly on increasing health and decreasing chemical use. These companies, and many others, know that they can grow the top line by thinking about sustainability as a catalyst of growth, not a barrier.
  3. Set the right incentives—internally and externally: Companies are economic entities that respond to incentives. Too often, however, these incentives point in the wrong direction. That is starting to change. In the public sphere, business leaders like Jim Rogers of Duke Energy are strongly advocating a price on carbon to speed the transition to a sustainable energy mix. Inside companies, boards are increasingly using sustainability performance as one criterion for executive compensation.
  4. Embrace the transparent world, and collaborate: Before the internet era, transparency and collaboration were values: today they are conditions. Companies are surrounded by windows, not walls. Those that have figured this out are poised to zoom ahead. Nike launched the Green Xchange, a web-based platform for open innovation of more sustainable products, where intellectual property is shared widely. Walmart is creating a Sustainability Consortium, a business/civil society/academic collaboration to create models for measuring product sustainability. And thousands of companies now report publicly on their performance on human rights, carbon reduction, and diversity. This will only continue to grow.
  5. Make consumers your partners: In the final analysis, much depends on whether we can shift away from a consumption-based economy. Simply put, the planet has insufficient resources to extend US-style consumption across the globe. If we as consumers don't change our habits, none of this may matter. And for consumers to change habits, companies have to provide alternatives. Companies like Levi Strauss & Co. and Unilever are trying to make this happen, making radical reductions in the resources needed to make their products while guiding consumers with information about how they use products to save money and save energy.

We wrote this book because we see a world of possibilities for companies that make the transition to sustainable excellence. Indeed, we believe that in ten years, the principles of sustainable excellence will in fact be, simply, about excellence. And even more, we believe these are principles that have the potential to usher in a period of innovative economic vitality that will raise living standards all across the globe.

Let’s talk about how BSR can help you to transform your business and achieve your sustainability goals.

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