Anyone who doubts that we’ve reached a tipping point where sustainability is concerned would be wise to take a look at the latest news from the Management Innovation Exchange.
Last Friday, those great bastions of left-brained management thinking, Harvard Business School and McKinsey, jointly launched a new leg in their “M-Prize for Management Innovation”.
The Long-Term Capitalism Challenge seeks – and I quote – “to accelerate the shift toward a more principled, patient, and socially accountable capitalism – one that’s truly fit for the long term,” and calls for real-world case studies, progressive practice and bold ideas around “reinventing capitalism for the 21st century”.
This is just the latest in a long line of developments that signal that sustainability as I’ve long been wont to define it – as “a perspective on brand and business strategy that inextricably links long-term success with serving a higher social purpose” – has now well and truly hit the mainstream.
Consider the following, and that these are by no means an exhaustive list of developments. These just happen to be the ones that have most caught my eye over recent years…
- 2008 – The emergence of the “low-profit limited liability corporation” (L3C for short) and “B-corporation” marks the birth of new forms of incorporation in the US – ones that enshrine putting long-term value and social impact ahead of short-term economic gain.
- 2009 – Jack Welch, erstwhile CEO of GE and poster-boy for the Milton Friedman/Chicago School mantra that a company’s only social responsibility is to increase returns for shareholders, deals a stinging body blow to that whole philosophy when he describes maximising shareholder value as, “the dumbest idea in the world.” (More on that in a great Forbes article by Steve Denning here.)
- 2010 – In December, outgoing chairman and chief executive of M&S, Sir Stuart Rose, delivers a stark warning to business – that the combined forces of population growth, diminishing resources and climate change represent a perfect storm that will see those with unsustainable business models dead within 20 years.
- 2011 – Just a month later, doyen of competitive strategy, Michael Porter, confidently asserts in an HBR article that “the next great transformation of business thinking” lies in creating shared value – reconnecting company success with social progress. This should no longer be seen as something peripheral to core business, says Porter, but absolutely front and centre.
- 2011 – Paul Polman, CEO of Unilever, launches their Sustainable Living Plan. He does so with very carefully chosen words that, “This is not a project to celebrate, but a new business model to implement,” and clearly positions action on sustainability as a critical driver of value creation.
- 2012 – In February, Accenture publishes a white paper suggesting that the position of Chief Sustainability Officer is on the wane. Regardless of whether or not you think that’s sensible (and I personally don’t, for reasons described in my previous post), it nevertheless signals a major shift in mindset – the reason for the CSO’s apparent demise being a preoccupation with ensuring that sustainability isn’t seen as a separate agenda, but as an integral part of all aspects of strategy and operations.
And now – because, let’s face it, it deserves repeating – let’s add a seventh sign to that list…
On 2 March 2012, Harvard Business School and McKinsey jointly launch a new “M-Prize” competition on the Management Innovation Exchange. The challenge? To find examples that augur and accelerate the reinvention of capitalism as a force for good in the 21st century.
Yessiree, the times they are a-changin’!