The New Climate for Business

The Decisive Decade Ahead

These changes come as we enter the decisive decade of the 2020s. The next 10 years will be decisive for business, and for all of us. We will either deliver on the Sustainable Development Goals (SDGs) or we won’t. We will peak emissions in line with the Paris Agreement or we won’t. Business will regain public trust or it won’t. We will re-establish social mobility and reduce income inequality or we won’t.

Here is what we know for certain: The diverse and powerful assets of business are essential if we are to build a resilient, fair, and sustainable economy. It is impossible to imagine achieving the promise of the decade ahead without business. And it is equally impossible to imagine that outcome with business as usual. This is a time when the scale of change and challenge requires big vision, high levels of ambition, and a strong sense of urgency.

The inescapable implication of this is that sustainable business as we have known it is not enough. So, standalone sustainability projects will have their place, but incremental improvements won’t deliver the SDGs. The fundamental changes reshaping our energy systems, our food supply, and water availability demand comprehensive systemic solutions. Sustainability disconnected from investors, policymakers, and communities will have no credibility. Measurement and reporting that fails to embrace all forms of value misleads markets and leads to bad outcomes. And, in an era of profound change, risk averse leadership only creates more ... risk.

The New Climate for Business demands a radically new approach to business and markets. As Marc Benioff wrote recently in the New York Times, “Capitalism as we have known it is dead.” Business as we need it, however, is only getting started. As we enter the 2020s, businesses will be judged by their purpose, their ambition, their urgency, their openness, and their innovation. The only businesses that will thrive in the decade to come, and quite possibly the only businesses that will survive for the long-run, are the ones who will master these challenges.

The question then is how business will “meet the moment.”

How Will Business Meet the Moment?

At this critical time, when business leadership is so badly needed, how do we define it?

This starts with purpose. As the Financial Times wrote in September, “businesses that combine profit with a wider purpose will benefit from the reinforced commitment of employees and customers. Those that fail to do so will not survive to become the companies of the future.” For all the talk these days about purpose, this hits the right note: It is only those companies with a clear and motivating purpose that will make it through the fundamental changes reshaping our world and the world of business. And more and more, businesses are defining their purpose in terms that make important contributions to the achievement of the SDGs: through nutrition, clean transportation, financial independence, and healthcare, for example.

The businesses that will thrive in the decade to come will be the ones with the most ambitious plans. Business is traditionally reticent about expressing big goals without being sure that it can achieve them. This caution is as unsuited to today’s world as the rotary phone or an all-male board of directors. Ambition is the best way to create truly resilient business strategies.

Ambition must start with climate, where the drive for net-zero carbon objectives has fast taken hold. What’s intriguing about this is that many of those embracing net zero—from nation-states like the United Kingdom to companies like Maersk—cannot be sure about the precise pathway to this achievement, but state the goal nonetheless. Big questions require big solutions, and it is exciting to see companies and business leaders shed their timidity about what is possible. There can be little doubt that this approach is not only the only way to achieve big goals, but also motivates and attracts staff and provides a north star during a time of change.

Business leadership will also be defined increasingly by a company’s commitment to and facility for collaboration. The vision of leadership as a solitary exercise by a singular visionary leader must be retired. The leaders we need today know the limits of what they can accomplish on their own, know how to partner effectively, and understand that achieving their goals with respect to sustainability can only happen through systemic change. We are facing systemic challenges: an economy that has exacerbated inequality, an energy system that must shift to net zero, food systems under threat, and a social contract that is failing to meet 21st-century realities. It is only with a commitment to large-scale collaboration that we can shift these systems in a more positive direction.

Today’s Priorities

And it is the Sustainable Development Goals that provide the north star for business and the world. To reach big long-term goals, we must act with urgency today. Here is an urgency agenda for 2020, built to deliver for 2030.

In Conclusion

Les Trente Glorieuses (The Glorious 30 Years) is part of history—one of prosperous growth and peaceful society. So too is the period since 1989. Now we face another hinge point in history, and it is up to us to build the future, and to work toward a “Glorious 2030.”

Dean Acheson, the U.S. Secretary of State in the aftermath of World War II, was famously “present at the creation” of the postwar order that led to considerable human progress. We, who are present at the creation of our new era, would do well to remember his words: “Always remember that the future comes one day at a time.” As we grapple with this New Climate for Business, let us use every day to turn business to the task of innovating for social benefit, attacking climate change, and reversing inequality.

Photo credits: Matt Howard, Robynne Hu, Fey Marin, and Alex Wong via unsplash.com.