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Blog | Tuesday February 5, 2019

Improve Sustainability with New Air Freight Alliance

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To protect people from the catastrophic effects of global warming beyond 1.5°C, business must continue to take action to limit climate change. As such, BSR is pleased to announce the launch of the Sustainable Air Freight Alliance (SAFA), a forum for buyers and suppliers alike to collaborate on air freight emissions reduction. The alliance is now open for membership, and we invite all interested parties to join an introductory webinar (U.S. time zone/Asia time zone).

While countries continue to make progress on their individual national commitments under the Paris Climate Agreement, industries have the power to mobilize large-scale emissions reductions. As an example, the International Maritime Organization (IMO) announced in April 2018 that the shipping sector would aim to halve its emissions by 2050 against 2008 levels.   

While countries continue to make progress on their individual national commitments under the Paris Climate Agreement, industries have the power to mobilize large-scale emissions reductions.

Currently, air transport represents around two percent of global carbon dioxide emissions. However, the air freight sector is projected to grow at five percent per year until 2050—faster than any other mode—and with potential to increase emissions significantly. In recent years, the industry has undertaken collective engagement through the Air Carbon Initiative and the development of a reporting protocol agreed via the Global Logistics Emissions Council in coordination with the International Air Transport Association (IATA). The aviation industry has also achieved performance improvements and commitments thanks to the leadership of the International Civil Aviation Organization (ICAO), IATA, and individual airlines.

However, there remains no consistent forum for direct business-to-business exchange between the various stakeholders, which is key to driving collaborative solutions. There is also a general lack of transparency around the application and use of the environmental performance information requested from airlines by shippers for their reporting and decision-making needs.

To address this gap, leading airlines, shippers, and freight forwarders have united to develop the Sustainable Air Freight Alliance—a unique buyer-supplier collaboration to track and reduce carbon dioxide emissions from air freight and promote responsible freight transport.

Following an incubation with active contribution from over 15 companies, SAFA is now open for membership. Participants include DB Schenker, DHL, Finnair, GEODIS, H&M, Maersk, Nike, and United Airlines.

The leading forum for air transport sustainability, SAFA provides a platform for collaboration allowing companies to:

• Build dialogue with business partners to understand needs and strengthen long-term business relationships
• Demonstrate company and industry leadership on sustainability
• Reduce exposure to risks (such as regulations) to the air freight industry by leveraging collective knowledge and action
• Credibly measure and report their emissions performance
• Help shape international standards, in line with ICAO, IATA’s work, and sectorial initiatives
• Access a collaborative forum for sharing sustainability information, best practices for reducing GHG emissions, and innovation opportunities to help achieve company goals

To find out more about the Sustainable Air Freight Alliance, please register for an introductory webinar (U.S. time zone/Asia time zone) and reach out to our team.

Blog | Wednesday August 10, 2022

Business Leadership in the Great Fragmentation: Part 2

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Editor's Note:

It is obvious that we are living through a time of profound and accelerating change. Our world has been rocked by a series of disruptions: COVID-19, war and social conflict, rollback of rights and democracy, and now high inflation and the risk of recession. These developments have jolted society, and business.

To help our 300+ member companies navigate this volatile environment, we're releasing a series of blogs over the coming weeks to build insight into how to shape business approaches that address this unique moment. Following the first piece on the role of business in combatting societal fragmentation, today we focus on how business can reorient their efforts around four main objectives.

We’ll conclude with a deeper dive look into how BSR’s 2025 strategy can help your company to navigate these turbulent times—and how you can collaborate with our global network to push us further, faster, to achieve a more equitable, just world for all.

The Business Response

The divisions caused by “The Great Fragmentation” are a barrier to achieving an economy that drives equitable and sustainable progress. This represents the great project of the 21st century: enabling all people to thrive and live in dignity on a healthy planet.

The Great Fragmentation also presents an extremely serious challenge for business. Social division, political dysfunction, and constant conflict result in complexity, costs, and structural barriers that undermine the ability to plan and operate. 

To meet the needs of our fragmented world, business can reorient their efforts around four main objectives: 

• Close the gap between ambition and delivery on ESG: Business can accelerate delivery of existing commitments. The gap between corporate ambitions and tangible impact hinders social progress and invites skepticism of the bona fides of business’ stated objectives. The gap between stated net-zero commitments, for example, and tangible delivery—let alone progress—sparks cynicism and social division. Delivering on goals is not only an end in itself—it can also heal divisions regarding economic models and establish trust in business as a credible partner.
• Take on the sources of fragmentation directly: Business activities are an important source of fragmentation. Mis- and disinformation, income inequality, and gender and racial pay gaps arise in part from business models and actions. Businesses cannot be a bystander as society fragments. It has an opportunity—and obligation—to remedy the steps it is taking that contribute to widening divisions. The failure to act is a missed opportunity and risks further erosion of trust in business and, more broadly, global market economies. 
• Modernize and strengthen the social contract: At the root of this fragmentation is the fact that our social contracts have outlived their use. Existing social contracts are largely based on the world as it was in the immediate aftermath of World War II and are no longer fit for purpose. Modernized and strengthened social contracts can provide the security and mobility people need and deserve, establish the foundation for dynamic and equitable economies, and address 21st-century questions, such as the role and application of new technologies and the energy transition. For business, a more constructive role regarding social contracts also means moving away from reflexive opposition to tax and regulation.
• Increase engagement in constructive public policy solutions: Finally, it is essential that business reorient how they use influence in the development of public policy. It is long past time that the discrepancy between business aspirations and the lobbying efforts of trade associations was erased. In many places, not least the United States, this also means that business should engage more forcefully to ensure that democratic processes are restored and sustained. Business can make fundamental changes to their approach to political contributions and be willing to withdraw support for political figures undermining democracy and rule of law, even if they may advance other policies seen to be “business-friendly.”

Conclusion

There is little doubt that many business leaders would prefer not to have this assignment. Traditional business questions are challenging enough with an economic downturn looming, the ongoing march of new technologies, and continuing disruption of business models. Diving into the fragmentation presents a risk. Turning away from this central problem, however, creates even greater risk. It is unrealistic on the part of business to assume that others will step in to turn the page. It is irresponsible for business to look away from the sources of fragmentation where they take responsibility. And it is unwise to assume that business is immune from the impacts of our deep fragmentation.

By redoubling efforts to deliver on ESG ambitions, helping to reshape the social contract, directly addressing the causes of fragmentation, and taking a more active role in positive policy engagement, business can help reorient societies away from a vicious cycle of division and restore a more favorable operating environment. This is the only sensible path forward if we are to collectively escape the descent to further fragmentation and a world that is increasingly ungovernable, inequitable, and unlivable.

Blog | Thursday March 14, 2024

Business Leadership Amidst 2024 Elections Around the Globe

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Election night is a big thing in every newsroom. Pizzas are ordered and journalists hunker down for a long night of watching the returns arrive. In 2024, at a global newsroom like the one I help run, we're going to have scores of election nights. All across the globe, voters will be heading to the polls in what is shaping up as one of the biggest years ever for elections. It's worth taking a pause, as a group of us did in Davos, to consider the many risks that those elections could face, and what the role of business ought to be in ensuring that the polling is free and fair.

Marc Lacey, Managing Editor of The New York Times

The stage is set for 2024 to be the biggest ever year for elections. This is the inescapable truth that was at the core of the dialogue we convened at the World Economic Forum Annual Meeting in January.

In Davos, geopolitics, AI, disinformation, citizen trust, and questions around leadership presented a perfect storm of risk this year when more than half the world’s people live in countries where elections are scheduled. Already, 20 companies have made specific commitments to deploy technology to combat the deceptive use of harmful AI content in the 2024 elections at the Munich Security Conference in February.

But, if the ability of global institutions to fulfill their duty is being questioned, as over half of the world’s voters go to the polls, then what are the stakes for businesses?

Do business leaders have a duty to ensure that democratic processes are protected, and if so, what is it? When employees, citizens as well as consumers demand businesses take a stand on the issues that matter, why might business leaders feel hesitant or ill-equipped to do so? BSR and Kite Insights hosted a discussion to explore that very subject: Business Leadership Amidst 2024 Elections Around the Globe. A discussion that one of our speakers, Sandrine Dixson-Declève, Co-President, Club of Rome, said was ‘one of the most important’ of 2024.

Rebuilding Trust amidst AI, Deepfakes and Misinformation

In a year with over 64 national elections (plus the EU) around the world, Sandrine’s reflection is well-founded. New York Times Managing Editor Marc Lacey, who moderated the roundtable, took it a step further, inviting the speakers to ponder if these ‘60+ elections’ should in fact constitute “one big election”. In today’s polarised societies, elections can feel like an emotional referendum on which national and political institutions voters trust most, if any.

The upcoming European Parliament election embodies this question of institutional trust in the context of the rise of far-right populism, noted Daniel Sachs, Founder and CEO, P Capital Partners, and Vice-Chair, Open Society Foundation. At the same time, he pointed out how “populism and polarisation are not necessarily an ideological battle. If you poll why people switch to the fringe, it’s because they want change from the status quo and they don’t see centrist parties as credible leaders of that change”. So, perhaps a valuable question for business leaders to ask themselves is how can they represent and facilitate inclusive systemic change while remaining politically central or even neutral?

One option might be how you show up publicly in the right way. But artificial intelligence has disrupted and destabilized how leaders are perceived publicly and whether the public information about them is authentic, pointed out Teresa Hutson, CVP of Tech for Fundamental Rights, Microsoft.

AI may be the next big business opportunity, but it also poses unique challenges to democracy and elections. Digital innovations, such as generative AI, are producing a seemingly infinite number of ‘deepfakes’, or digitally generated artificial content, ready to distract and deceive the public. Mistrust and populism are amplified by such misinformation and disinformation.

Teresa Hutson shared her concerns around how nation-state and non-state actors are already targeting democracies and sowing the seeds of disruption through online deepfakes. In India, for instance, where 945 million people are eligible to vote in what was called the “largest coordinated event in history”, the impact of audio deepfakes on voters is particularly worrying. “If you are on the internet, you can be faked”, Teresa said. And, in a world where deepfakes are so good that candidates themselves cannot always see the difference between their own voice and digitally generated copies, “how can you ensure voters are getting quality information while able to distinguish trusted speech from a deepfake?”.

It's an unnerving thought. That’s why Teresa and Aron Cramer, President and CEO, BSR, call on other tech companies and civil society to work together to enable online communities to respond in the face of misinformation and disinformation: “Businesses can use their voice to move regulation in a positive direction, they have the legitimacy to speak up”, said Aron, while acknowledging that this can be an uncomfortable space for business leaders to operate.

How businesses—and business leaders—can build trust in the context of 2024’s elections?

Nonetheless, in this perfect global risk storm, business has again emerged as the most trusted institution, according to the recently published Edelman Trust Barometer. On issues like climate change and inequality, over half of survey respondents want business to do more; and just a tenth of respondents feel business is overstepping on these issues.

Why might consumers and employees trust business? “People trust what they know”, commented Teresa Hutson. Workers might be inclined to trust their employers in the same way that people trust their family, neighbours, or university: because they are close to them and well-understood. At the very least then perhaps there is time for some kind of localized informal legitimacy and even duty for business leaders to engage in these topics on behalf of their employees.

Today, individuals have immeasurably more power than ever, meaning that people increasingly demand and expect what Aron Cramer calls “a DIY world: people want what they want, when they want it”. This consumer and people-led world marks a departure from the great political or civic institutions that traditionally drove change. “We are wrong if we think the battle of democracy is won at the ballot”, said Daniel Sachs. In a time when institutions are weak and businesses enjoy public trust, “it’s no longer enough for the private sector to support civil society to challenge institutions. We need to engage in non-partisan democratic systems change”. Facilitating and unlocking the latent potential in citizen and employee-led action can help them do that in a way that is a more comfortable space to business: through democratic innovation.

For some business leaders, the most obvious action is to influence change through politics. But ‘influence’ can be a dirty word in the murky world of public-to-private sector relationships, as Aron noted. In some democratic systems, business is seen as having too much influence, highlighted Sandrine Dixson-Decleve: through political capture of regulators by corporates; lobbying of lawmakers; and obstruction of intergovernmental processes like United Nations climate change meetings. If influencing regulation is uncomfortable ground for businesses, then business leaders should perhaps seek to steward systems change, helping inform and guide governments toward the level of change that societies need. This is the ethos behind Steve Waygood’s concept of macro stewardship, which could serve as a helpful framework for business leaders in a year of unavoidable political interdependency.

We get the political leaders we deserve. How do we get the political leaders we want?

So, how should business leaders go about engaging and inspiring the political leadership we want and need?

First, businesses can look at their own leadership to ensure that it is diverse, equitable, inclusive, and empathetic. To facilitate systemic change, businesses must themselves be the change they seek to influence by creating an environment where inclusive leadership is rewarded, not attacked.

When women public figures face gender-related abuse, observed Sandrine Dixson-Declève, that further reduces women's incentive to step up and lead in business and politics. Both Sandrine and Daniel Sachs reflected that the negative way we speak about political leaders in society and culture has made it an undesirable career and diminished society’s trust in leaders, a cultural narrative that businesses could help revert. “We should talk respectfully about it and encourage others” to enter politics, Daniel commented.

Business leaders can also take decisive action toward systemic change in areas they’re directly involved with. This means anticipating and proactively mitigating the potential harms of their products, suggests Teresa Hutson. For instance, AI-generated audio helps people who have lost their voice, but it can also be used to create audio deepfakes. Similarly, thoughtful engagement between private and public sector leaders around the challenges that businesses understand best can help strengthen the role democratic institutions can play in systemic change. “Business leaders need to engage in the dynamic of change of political systems”, as Daniel Sachs put it: less so in the individual issues of the day and more so in the practice of informing, incentivising, and stewarding systemic change, because healthy democratic systems and stable elections are good for business, for society and for the planet.

With over half of the world’s population voting in an election this year and the perfect storm of geopolitics, AI and misinformation, this year’s elections are facing broad, deep and new risks. Business leaders have the opportunity—and duty—to help re-establish trust that leads to outcomes that enable progress on crucial social, economic and environmental questions, and contribute to building social cohesion amidst polarization and fragmentation. But where might a business leader start? Three possible steps resonated throughout the discussion:

1. Promote citizen engagement and action, including your own employees.
2. Raise awareness of the risks in the digital information ecosystem, so that the citizens and employees have reliable information on which to base their judgements.
3. Use your voice as a leading business to reinforce the importance of democracy and rule of law.

Blog | Wednesday August 2, 2017

How to Build Effective Sustainability Governance Structures

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Successful integration and effective management of sustainability at a company requires having committed leadership, clear direction, and strategic influence—and none of this will happen without a robust governance structure. Sustainability governance helps a company implement sustainability strategy across the business, manage goal-setting and reporting processes, strengthen relations with external stakeholders, and ensure overall accountability.

How and where sustainability fits into the overall corporate structure can be very revealing of a company’s direction and priorities. It’s important to keep in mind that there is no cookie-cutter structure that can be applied; every company must tailor its approach for what makes most sense given its business model, structure, resources, and level of sustainability integration into the business.

Based on BSR’s sustainability management work with our member companies, here are four considerations to keep in mind when building effective governance structures:

1. Commitment begins at the top. Reporting to the CEO or other key C-suite leadership can help demonstrate that a company is serious about sustainability.
2. Accountability must be established and communicated clearly. Accountability helps ensure that sustainability is integrated with other business goals. Including sustainability performance into the company’s annual goals and employee performance review and compensation processes may be helpful mechanisms.
3. Alignment between the structure and the business is imperative. Sustainability governance structures that align with and complement the existing business model and organizational structures can be more successful than creating redundant or competing structures.
4. Flexibility to adapt and build up on the sustainability program across business units and regions can advance the sustainability agenda. Allowing for some adaptation can help ensure the sustainability program’s relevance to a business unit’s own strategies or region’s local conditions. It also can generate employee engagement.

With these considerations in mind, below are examples of best practices in forming sustainability governance structures:

• Head of Sustainability: Having a dedicated “head” is necessary to ensure there is focus on driving sustainability strategy and advancing the company’s program—it can also signal the company’s commitment. A majority of top global corporations with which BSR works have dedicated sustainability leaders with varying levels and titles, like Chief Sustainability Officer. These people can be the internal and external “face” for sustainability for the company.
• Formal Board Committee: Sustainability oversight by the board of directors increasingly is integrated across several formal board committees, but also can be accomplished through a dedicated committee. Board committees can be an important vehicle for educating the board on sustainability issues and helping demonstrate corporate commitment to sustainability at the highest levels. Companies that have boards that review and monitor various aspects of their CSR programs include American Express, which has a dedicated Public Responsibility Committee, and Shell, which has a Corporate and Social Responsibility Committee.
• Cross-Functional Executive Sustainability Committee: Below the board level, having a cross-functional executive committee that engages leadership across business units, regions, and functions provides further oversight and strategic guidance. It also mobilizes employees to implement strategies. The functions involved can vary, but may include risk management, supply chain, operations and facilities, marketing, public affairs and communications, human resources, environmental health and safety, and investor relations. For example, Bank of America has a Global Environmental, Social, and Governance Committee led by the vice-chairman and composed of senior leaders across the company.
• Sustainability Teams: Having a core team can help coordinate daily activities and implement companywide initiatives. While a dedicated team is very common, it’s important for it not be siloed, but rather integrated and engaged with business units and functions. NIKE Inc., for example, has a Sustainable Business and Innovation team that plays a key role in helping integrate sustainability across the company’s value chain, from innovation to retail.
• Sustainability Supporting Structures: Working groups or committees, which may have a dotted-line reporting relationship to the head of sustainability, can assist integration of strategy and goals by supporting and even substituting sustainability teams. Individuals in these support structures may be the “owners” of priority sustainability topics and are responsible for implementing strategies, tracking performance, and engaging employees. Representatives may come from real estate and facilities, communications, human resources, risk management, supply chain, and other groups. IBM, as one example, has a Corporate Responsibility Working Group that meets monthly.
• External Advisory Councils: While external advisory councils may not officially be part of the governance structure, they can serve as a valuable mechanism to advance the company’s agenda and get outside perspective on a variety of ESG issues. Dow Chemical, for example, has a Sustainability External Advisory Council composed of global thought leaders from various organizations, such as environmental NGOs, academia, businesses, and governments.

Developing sustainability governance structures may take time, but it can help ensure successful management of ESG issues at your company. How does governance help you accomplish your goals?

Blog | Monday January 9, 2017

Sustainable Business Leadership in 2017: Game On

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At the start of last year, we were still riding the highs of 2015, which saw important progress on sustainable business. The year just past, 2016, for multiple reasons, was less positive. How will 2017 break the tie?

Let’s start by looking back to where we were a year ago. Here’s the good news: The twin successes of 2015—the Sustainable Development Goals and Paris Agreement—set a powerful long-term agenda for decades of progress. But as the year unfolded, this sense of progress dwindled as we witnessed the Brexit vote, refugee crisis, and terrorist attacks in Europe; the Trump election in the United States; and declining support for civil society around the globe.

And yet, serious though they were, the events of this past year need not represent the new normal. Looking ahead to a new year with new conditions, here is our suggested playbook for how business can lead in this new environment.

Stay true to the values underlying sustainable business: As I wrote in the immediate aftermath of the U.S. election in November, it is essential during times of change to stay true to enduring values and principles. Sustainable business is premised on respect for people and communities, basic fairness in the economy, and preservation of natural resources and the environment to ensure prosperity for future generations. These values continue to guide us at BSR and underpin all our work with member companies and other partners. Indeed, the 2016 U.K. and U.S. election results in many ways reinforce, rather than contradict, the importance of economic fairness, even though the results may not deliver the outcomes many of us want. Our values will continue to serve as a north star throughout 2017.

Increase the commitment to economic fairness: Just as we remain steadfast in our values, we cannot be blind to the anger and resentment expressed by many during the past year. We need to acknowledge the views of many that our economies do not enable all to participate fully. The sustainable business agenda therefore needs to prioritize economic fairness more fully. This means attention to multiple issues, including inclusive economic growth, preserving quality jobs in the age of automation, gender equity, and executive pay. In 2017, BSR will be expanding our efforts in inclusive economy issues, along with new ways of looking at the connection between environmental sustainability and jobs.

Accelerate irreversible changes to the energy system: While the apparent hostility to climate action from the new American administration is highly problematic (and unwise), progress on climate will continue for a number of reasons. First, the cost of renewables is plummeting, and new technologies are improving on a similar pace, creating an unassailable economic argument for continuing the transition to low-carbon models. Second, new business models (such as distributed energy systems) and new products (such as longer range electric vehicles) are coming into the mainstream. Third, many of the highest growth markets—think China—remain steadfast in their commitment to a shift to cleaner energy. Finally, states and regions have no intention of making a U-turn on their shift to low-carbon models, regardless of Washington’s policies or Europe’s dysfunction. For these reasons and more, the vision of the Paris Agreement remains not only intact, but vibrantly alive. BSR will continue to aid companies on their own climate strategies, as well as to work through partnerships like the Renewable Energy Buyers Alliance and We Mean Business to ensure that progress continues.

Promote innovation: The nostalgia for past grandeur that is driving politics in many parts of the world misses the point. New business models, new technologies, and new ways to access products, services, and experiences are changing fast. The pace of change may be distressing for many, but the essential nature of change is on balance positive, and is essential to truly inclusive growth that the past never achieved. As BSR looks to redefine sustainable business in the year ahead, we will explore how to build on new models (such as the inclusive sharing economy), new products and services (such as access to renewable energy), and new partnerships (such as the Global Impact Sourcing Coalition) to advance new solutions to ongoing sustainability challenges.

Raise the voice of business: Finally, in our new political environment, the voice of business needs to remain strong and clear about the importance of sustainability. Business is global, and despite market pressures, smart companies make decisions intended to last well beyond the next election. As we have noted since the success of the Paris climate negotiations in late 2015, the private sector can do itself and wider society a favor by reminding policymakers of the importance of the sustainability agenda. BSR will work with our member companies in the year ahead on climate advocacy, the protection of human rights, and the development of reporting and market frameworks that advance long-term value creation.

All in all, despite the multiple shocks of 2016, we see many reasons for optimism. And yet, optimism unmatched by commitment is an empty wish. With that in mind, let us redouble commitment to building a just and sustainable world, based on core principles, and with strategies that are adapted for changing realities and that address the very human aspirations underlying the turbulence of 2016. In doing so, we will see ongoing progress and reason for renewed optimism at the end of this pivotal year.

Blog | Thursday December 14, 2017

The Top BSR Insights of 2017

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To close out the year, we looked through our archives to see what insights from our sustainability experts you most enjoyed reading. Common themes appear throughout: a focus on futures thinking, increasing consumer demand for sustainability, new expectations for ethical and sustainable business, and the importance of continuing work to empower women.

Here are the most-read BSR blogs and reports of 2017.

Top Five Blogs of 2017

1. HERproject at 10: Celebrating HERsuccess, Inspiring HERfuture
   By Christine Svarer, HERproject Director 
   On International Women’s Day this year, we took a moment to think about what we have achieved with HERproject over the past 10 years and what we have left to do.
    
2. Introducing the Sustainable Futures Lab
   By Jacob Park, Sustainable Futures Lab Director 
   In September, BSR launched the new Sustainable Futures Lab, a new practice that will conduct research on horizon scanning and big data and offer consulting on scenario planning and “future-proofing,” all to meet the increasing needs for futures thinking.
    
3. Investors, Consumers, and Markets Demand Climate Action: Four Trends for Your Business to Know
   By Emilie Prattico, Former Manager
   Here are four business-driver trends that you should know as you explore how to implement climate strategies that support a low-carbon economy.
    
4. The State of Sustainable Business in 2017: Results from the Ninth Annual BSR/GlobeScan Survey
   By Laura Gitman, Senior Vice President
   Data from this year’s State of Sustainable Business Survey indicate that there is no question if business will lead on climate change, inclusive growth, human rights, and other sustainability priorities. Now we must answer how.
    
5. When the Business Case and Shared Value Aren’t Enough
   By Laura Gitman, Senior Vice President
   Yes, businesses have to earn profits and provide a return to their investors, but has the focus on a business case for everything undermined what it means to be a good corporate citizen?

Top Five Reports of 2017

1. Big Brands, Big Impact: A Marketer’s Guide to Behavior Change
   By Elisa Niemtzow, Managing Director; Edwina McKechnie, Manager
   In this report, we explore how companies can trigger simple behavioral shifts that enable more sustainable lifestyles, grow demand for more sustainable products, and create business value. It also offers insights on how sustainability teams can more readily engage with internal marketing colleagues.
    
2. The Five Levels of an Ethical Culture
   By Alison Taylor, Sustainability Management Director
   This working paper highlights the five levels at which business can build an ethical culture: at the individual, interpersonal, group, intergroup, and inter-organizational level.
    
3. The Future of Sustainable Business
   By Aron Cramer, President and CEO; Jacob Park, Sustainable Futures Lab Director; Eric Olson, Senior Vice President; Elisabeth Best, Communications and Marketing Manager
   The time is here for a new approach to sustainable business. Business as usual won’t get the job done—and sustainability as usual won’t suffice. This paper offers our thinking on where to go next and kicks off the conversation for 2018 and beyond.
    
4. Empowering Female Workers in the Apparel Industry: Three Areas for Business Action
   By Christine Svarer, HERproject Director; Racheal Meiers, Former Director; Berkley Rothmeier, Manager
   This business brief proposes three areas where apparel companies can build from a strong foundation to better drive improvements in outcomes for women workers and promote women’s economic empowerment around the world.
    
5. The Supply Chain Leadership Ladder
   By Tara Norton, Managing Director; Meghan Ryan, Manager; Jeremy Prepscius, Asia-Pacific Vice President
   This working paper introduces the Supply Chain Leadership Ladder, a maturity model for supply chain sustainability programs that companies can use to develop their program toward deeper impact.

Blog | Monday January 29, 2018

Managing Sustainable Business in a Rapidly Changing World

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At our 25th anniversary Conference in October 2017, BSR launched an effort to collaborate with our member companies to redefine sustainable business. Our new report launched today, Redefining Sustainable Business: Management for a Rapidly Changing World, provides a new framework for how leaders can reimagine sustainable business inside their own organizations.

When we looked in detail at the state of sustainable business in companies today, we saw that disruptive new trends and drivers—in particular, climate change, new technology, and structural economic shifts—are reshaping the business landscape. Companies are highly aware of these dynamics in the external environment, but there is also a sense that rhetoric has not yet caught up with reality. Our survey and interviews revealed misalignment between the external stakeholders who most influence companies’ sustainability agendas and the people and internal departments that are most frequently engaged on sustainability issues.

We believe that the best response to this situation is not to continue advocating for further integration of sustainability into business strategy, but to change the very way that companies design strategy and create value. The era of stand-alone sustainability strategies, with subsequent integration of sustainability into company strategy needs to end; the creation of resilient business strategies that take sustainability as their foundation needs to begin. New types of leadership and a reimagined sustainability function can address these challenges and build company capacity to design and deliver resilient business.

What, exactly, do we mean by this?

First, companies need to act to transform strategy, governance, and management within their boundaries. This involves creating strategies that account for disruptive change and use strategic foresight and futures thinking to embrace uncertainty and build resilience. This approach will naturally place sustainable business issues front and center—because sustainability issues can no longer be separated from core business issues. Boards and senior executives need to develop the expertise and insights to plan for the longer term and build on the momentum from investors we see today to explain and demonstrate social purpose. The sustainability function also needs to be reimagined as a driver of influence and innovation. Change leadership will become the single most important skill a sustainability practitioner can develop.

Companies also need to proactively enable their external environments to understand and provide input to their sustainability efforts through new approaches to transparency and engagement with all stakeholders, not just shareholders. Technology tools like Polecat provide enormous new opportunities for companies to understand the social and environmental systems they operate in and gain deep insight into stakeholder perceptions. Too many companies have yet to take advantage of this; they have resisted increased transparency and interactive engagement with new stakeholders. There is a need for business to proactively shape the company narrative by reconsidering both reporting and engagement in the context of wider societal needs and debates.

Finally, companies should influence the policy and legal environment via vocal support for sustainable business. Silence on key policy issues is no longer an acceptable stance: The public—and your employees—wants to see more concrete evidence of business values and want business to take a more active role in shaping policy for the long term.

Our report sets out a framework for action that is also a vision for the future. We have no doubt that the perspectives shared in this paper will evolve as the world changes, ever more rapidly, around us. However, we believe the fundamental tenets of the “act, enable, influence” blueprint will remain a constant, and we are eager to further refine this approach in partnership with our member companies.

We invite our member companies and other interested stakeholders to engage with us to continue to shape the future of sustainable business. To that end, we will host a series of dialogues, events, and debates throughout 2018 to shape a future for business that meets the needs of all stakeholders. We look forward to continuing this conversation.

Blog | Monday July 2, 2018

Building Responsibly Announces Worker Welfare Principles

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The rapid growth of the construction sector has attracted large engineering and construction firms, a broad range of multinational and local subcontractors, and millions of low-skilled migrant workers to regions that often have weak local regulation on human rights issues. Workers in these regions are vulnerable to a host of labor and human rights violations, including forced labor, poor working and living conditions, debt bondage, and restrictions on worker representation and association—issues that are not easily solved.

Additionally, this sector faces unique challenges in its efforts to address these human rights concerns, including the decentralized nature of companies’ operations; the short-term nature of projects; industry interconnections (companies are clients of each other); multi-tiered supply chains; and the complexity of relationships with public-sector clients, who are also legislators and regulators where they do business.

For these reasons, Building Responsibly—a business coalition of leading engineering and construction companies working together to raise the bar in promoting the rights and welfare of workers across the industry—has developed a set of Worker Welfare Principles that establish a common, global baseline for the treatment of workers in the engineering and construction industry.  

On June 21, Building Responsibly launched these Principles with its founding members, who include Bechtel, Fluor, Multiplex, Vinci, and Wood. Together, Building Responsibly members employ more than 400,000 people and operate in more than 100 countries. The Principles were developed in consultation with a diverse set of public, private, and civil society stakeholders.

James Walker, group head of ethics and compliance, Wood, and vice-chair of Building Responsibly, told us, “These Principles represent the first major output of our collaboration through Building Responsibly and establish a model others may adopt as they seek to engage with these challenges and issues. Authored by businesses in consultation with external stakeholders, the Principles are rooted in international human rights standards and responsive to diverse global business contexts, ensuring that they are both ambitious and achievable.” He added, “We look forward to ongoing collaboration with workers, clients, business partners, civil society, and others to encourage widespread adoption of these Principles and good practices across the industry.”

Through the 10 Principles, companies commit to ensuring that:

1. Workers are treated with dignity, respect, and fairness.
2. Workers are free from forced, trafficked, and child labor.
3. Recruitment practices are ethical, legal, voluntary, and free from discrimination.
4. Freedom to change employment is respected.
5. Working conditions are safe and healthy.
6. Living conditions are safe, clean, and habitable.
7. Access to documentation and mobility is unrestricted.
8. Wage and benefit agreements are respected.
9. Worker representation is respected.
10. Grievance mechanisms and access to remedy are readily available.

Companies will work to implement the Principles by:

1. Ensuring commitment from leadership;
2. Managing oversight of contractors and supply chains;
3. Providing training to leadership, employees, and workers;
4. Enabling transparent reporting of incidents and concerns; and
5. Engaging with other industry members and all affected stakeholders.

While Building Responsibly is proud to achieve this milestone, the initiative intends to use the Principles to further shape industry practices by developing detailed guidance notes and tools to support companies’ implementation of the Principles. It also plans to, in collaboration with stakeholders, create a roadmap for solutions that improve the rights and welfare of workers in the industry.

For more information about how to get involved, please contact us or visit the Building Responsibly website.

Audio | Tuesday November 28, 2023

Leading with Ambition with Aron Cramer

Preview

Aron Cramer, BSR President and CEO, chats with David Stearns on the topic of Leading with Ambition, exploring:

• Why companies should be enthusiastic about these changes to reporting requirements and regulatory frameworks.
• The apparent tension that these reporting requirements have created between ambition and compliance and where the pitfalls might be for companies.
• Whether there is a possibility that new requirements and reporting rules might actually unlock greater ambition.
• Advice for companies pursuing an ambitious sustainability strategy, and whether there is business value in this approach. 
• The evolving role of the Chief Sustainability Officer on strategy, leadership, and external communications.
• Whether these regulations and compliance frameworks go far enough.

Blog | Wednesday April 26, 2023

Embedding Human Rights from Boots to the Boardroom

Preview

The focus on human rights at the Board of Directors and C-Suite levels often starts in response to one of two situations: a crisis or scandal that forces a company to respond, or pressure from regulators, investors, and other stakeholders to implement a due diligence program. That pressure is very much on the rise, with emerging legislation in the EU such as the Directive on Corporate Sustainability Due Diligence and the Uyghur Forced Labor Prevention Act in the US making it incumbent upon leadership to proactively manage human rights issues across their value chain on an ongoing basis—which requires moving from the due diligence phase into long-term implementation and integration.

Through our partnership approach, BSR works with companies to move beyond the due diligence phase into implementing long-term human rights action plans, governance, systems, cultural integration, and stakeholder engagement to embed those processes across the business.

From experience, successfully implementing a long-term vision for human rights requires the following four steps:

1. Set and Communicate the Ambition

First, establish the level of ambition for mitigating or remediating identified risks. This often requires understanding stakeholder expectations and peer practices, your own company’s leverage, and, most importantly, requires a clear mandate and commitment from the top. This commitment should be accompanied by clear governance and measurable KPIs at the corporate level to channel efforts and track progress. Ambition level has implications for resources—budget, staff time, and strategic planning. Buy-in from the C-Suite and ideally the Board of Directors is critical to securing the resources and mandate needed to follow through.

Putting it into practice: After conducting a human rights assessment and gap analysis for a telecommunications company, BSR presented the results and recommendations to the Executive Committee. The Executive Committee agreed that the company faced significant human rights risks across its value chain and that additional resourcing would be needed to effectively manage those risks over the long term. BSR provided a briefing to the Board to build understanding and awareness of human rights issues for the company and supported the development of two corporate-wide human rights KPIs that were integrated into the following year’s strategy.  

2. Identify the Right Owners 

It is crucial to understand who within the company is the right person and/or department to own the different dimensions of the long-term action plans. Sustainability and/or human rights teams cannot implement follow-up alone. Instead, the entire business needs to take ownership where relevant—whether procurement teams that have direct engagement with suppliers, or product development teams that can embed human rights thinking and concepts like “privacy by design” at the product design stage. Making the business case to manage human rights will look different for each part of a business; for some, it will be a natural extension of their current focus, and for others, it may at first appear at odds to or irrelevant to their core work or context.

Putting it into practice: After an incident at a mining company’s asset in Australia, BSR was asked to provide a human rights training to help build an understanding that human rights are global, universal, and relevant in all jurisdictions. Through informal conversations during breaks in the schedule, the team got to know the participants and identified individuals who seemed ready and interested to embed human rights in their area of work; some were members of the senior leadership team, and others were junior technicians. Working with the Communities and Social Performance Manager, BSR helped build a network of human rights “champions” who could learn from each other, provide mutual support, and be a sounding board as they each continued to work to embed human rights into their separate core functions.  

3. Integrate into Business Functions 

Addressing human rights risks and impacts requires small, incremental changes to everyday processes. Understanding how teams perform their day-to-day roles and making those subtle changes to incorporate human rights thinking into everyday business activity is key.

Putting it into practice: Working with a company in the travel, tourism, and hospitality sector, BSR supported the training of customer service agents to spot concerns raised by customers that could relate to conditions of forced labor or human trafficking. In addition to raising awareness of these issues and educating customer service agents on what to look for, BSR also reviewed the escalation and reporting criteria to ensure that when issues of concern are identified, they are channeled to the right teams for proper handling.  

4. Monitor and Track Progress

Establishing milestones, metrics, and creating an associated governance structure that allows these milestones to be tracked over time and teams to be held accountable to them are critical for long-term success. Integrating human rights frameworks and measurement into a company’s Enterprise Risk Management (ERM) system can help ensure that senior leadership regularly has visibility on the company’s most salient human rights risks and mitigation actions. In addition to a traditional ERM taxonomy that looks at business impacts, integrating a human rights framework helps companies consistently track their potential “outward” impacts on society.  

Putting it into practice: BSR worked with a consumer goods manufacturer to conduct human rights impact assessments across many countries over the course of several years. To support the long-term mitigation and remediation of the issues identified in each country, BSR helped develop action plans, related metrics, KPIs, and timetables. The client worked with BSR to develop a web-based monitoring platform whereby the corporate human rights team could monitor progress across all action plans in real time. Ownership and accountability for each action plan was critical to its success, which included both local and corporate-level roles and responsibilities.

As implementation of the UNGPs has matured, there is consensus and growing awareness that a human rights program is much more than a one-off due diligence process. In fact, a human rights program is an ongoing, ever-evolving process that includes regular due diligence, long-term implementation of action plans, and continuous maturation and adaptation of strategies to provide mitigation and remedy on behalf of rightsholders. Taking the long view, and following the steps outlined above, will help companies implement, embed, and integrate human rights into their business and seal the new accountabilities for executive leadership and boards in a meaningful and impactful fashion.