This article is sponsored by Anthesis.
In his keynote remarks at GreenBiz 22 in February, Paul Polman called us to action: “In addition to changing our own organizations, we need to use our scale and influence to change the larger systems around us.”
This is the expanded mandate for today’s leaders: the work of proactively engaging — and collaborating to shape — the social, environmental, economic and political systems that will determine our collective future.
And it is a tall order.
Business leaders are already facing highly competitive markets and acute operational challenges. They are already working to deliver more growth, more sustainably. They are already responding to elevated investor and customer expectations. Now, they are also asked to go beyond this already challenging “day job” to influence the long-term integrity of larger systems.
For those who accept this invitation, I share below four questions that have helped to activate system-focused leadership for Anthesis and our clients.
1. Are we asking big (generous, strategic, system-level) questions?
John Elkington recently issued a recall on his Triple Bottom Line (TBL) framework, because it could too easily be used to reduce big (generous, strategic, system-level) ambitions for “people, planet and prosperity” to smaller (immediate, tactical, organization-level) questions.
Big questions can become smaller questions.
- “How do we engage people?” can become “How do we treat our people?”
- “How do we steward the planet?” can become “What are our climate risks?”
- “How do we share prosperity?” can become “Are we profitable?”
The smaller questions are perfectly legitimate, but they simply restate conventional measures of business performance, such as employee satisfaction, supply chain risk and profitability. They do not ask us to influence larger systems.
True leadership questions in this decisive Decade of Action ask us to establish constructive, mutually beneficial relationships with the larger systems of “people, planet, and prosperity”:
- How can we contribute to the integrity and inclusiveness of communities?
- How can we contribute to the justice and accessibility of democratic institutions?
- How can we contribute to the health and vitality of ecosystems?
- How can we contribute to the equity and transparency of economies?
- How can we contribute to the accessibility of information and technology?
These big, system-level questions have long been central to government and civil society. In the decisive decade, they are also defining questions for executive leaders in the private sector.
2. What is our strategy for systems change?
In 1963, Peter Drucker famously distinguished between efficiency (doing things right) and effectiveness (doing the right thing), which Warren Bennis and Burt Nanus updated in 1985 to add: “Managers do things right; leaders do the right thing.”
Today, effective leadership includes both doing the right thing for my organization and also doing the right thing for larger systems.
Regardless of scale, effective leadership requires prioritization and strategy. And at the systems scale, it is no longer enough to ask, “What is our strategy for responding to larger social, environmental, economic and political changes?” Executive leaders must now also ask, “What is our strategy for influencing and activating those changes?” Which means asking:
- How can my organization best contribute to a collective positive future?
- Which larger systems should our impact strategy target for influence?
- Where are we uniquely positioned to initiate or support specific system changes?
- What tactics will most effectively activate system change?
These questions help leaders to prioritize the opportunities for system change that are most relevant and appropriate for their organization and define a strategy for effective system change: the new space of “doing the right thing.”
3. What does sustainable performance mean for us?
Whole Foods CEO and co-founder John Mackey describes the transition from shareholder to stakeholder capitalism as “a shift away from the traditional conception of a corporation, in which increasing profits for shareholders is seen as the primary responsibility of the businesses [toward] businesses as serving a wider community of stakeholders, all of whom are connected through mutual interests and benefits.” This expands our definitions of success and performance.
The success of a company increasingly depends on its sustainable performance: the extent to which the business achieves deep, meaningful, operational integration of its business strategy (“How do we thrive within larger systems?”) with its sustainability strategy (“How do we contribute to those larger systems?”) to unlock unrealized value and opportunity (“What is our purpose in the Decisive Decade?”).
A few key questions can drive this integrated approach to sustainable performance by both expanding the definition of success and embedding it at an operational scale.
- How do we measure success at both the company and system level?
- Where should we adjust our overall business strategy to achieve this success?
- Which metrics should be introduced to our performance measurement systems?
- What governance and accountability changes can drive sustainable performance?
- Where can cross-functional collaboration enhance sustainable performance?
The expanded focus on system-inclusive sustainable performance sets an organizational change agenda for integrating sustainable performance goals and metrics within teams and cultivating collaboration across teams to ensure strategic alignment across the entire business.
4. Who could we collaborate with?
No single company, regardless of its size, can drive system change on its own. According to Andy Ruben, Walmart’s first VP of sustainability, The Sustainability Consortium was co-created by Walmart because the company “recognized that large-scale societal change requires different societal sectors playing to their strengths.”
For example, as Laura Phillips, Walmart’s current Senior VP of global sustainability, highlights: “Food loss and waste is a massive global challenge. … No one company can address this challenge alone.”
The message is clear. Walmart cannot go it alone and neither can we. We need collaboration to drive large-scale system change. And in many cases, collaborations are already underway. These include collaborations that are:
Executive leaders should ask the following questions as they identify opportunities for collaboration:
- Which are the larger system shifts that we have prioritized?
- Who else wants to influence or activate those larger system shifts?
- What are the challenges that we share in our efforts to activate system change?
- How could we collaborate to co-develop shared solutions to those shared challenges?
Sixty years ago, John F. Kennedy invited Americans, “Ask not what your country can do for you. Ask what you can do for your country.” And he invited fellow citizens of the world, “Ask not what America will do for you, but what together we can do for the freedom of man.”
In Paul Polman’s challenge, I hear an echo of that invitation: “Ask not what the world can do for you. Ask what together we can do for the world.”
Because together, we can change the future. It starts with asking the right questions.
April 13, 2022 at 01:19PM