Business In Society
Facebook Twitter LinkedIn

Business in Society Blog

Prestigious business media voice offers new assessment of current, future CSR, sustainable development.

The Economist, in its latest assessment, appears to give “corporate sustainability” qualified support.

First the good news, the summing up by this highly influential publication: “The new wave … is more akin to investing now to have a license to operate in the future, when consumers, lobbyists and regulators will be ever more demanding about the way firms behave. ..It will boost their long-term competitiveness, rather than their short term profits.”

That follows admiring mini-portraits of selected sustainability leaders: SABMiller, Domtar (an American fiber company) and, especially, Unilever.

There are, of course, many companies achieving similar breakthroughs. In one such business universe, some 8,000 companies around the world, members of the United Nations Global Compact, are operating — admittedly, with varying degrees of commitment, results and satisfaction — in concert with UNGC sustainability principles in environment, labor rights, human rights and anti-corruption

Earlier in the article, The Economist sets a somewhat negative tone by implying that sustainability may be a “buzzless buzzword”: “A survey of 2,000 companies by the MIT Sloan Management Review and Boston Consulting Group found that two-thirds of businesspeople thought social and environmental matters were ‘significant’ or ‘very significant’ but that only 10% thought they themselves were doing enough about it.”

It seems passing strange — almost a non-sequitur — that executives’ discomfort with their progress on a significant/very significant business model is a platform for questioning that business model.

Also worth pondering are some key omissions in this sustainability  “freeze frame”– presumably for lack of space. Fast-evolving Integrated Reporting is one. Others include sustainability operational concepts such as “shared value”, “natural capital” and “B” companies.

And, in the context of short-term benefits to sustainability leaders (see Eccles and Serafein Harvard Business School study on profitability 1992 -2010), there is the value of the corporate positive reputation, represented on the balance sheet as “soft assets” — in some companies exceeding “hard assets”. Our colleague Paul Holmes has noted that significant business decisions now have four critical outcomes — legal, financial, operations and reputational.

As in the past, The Economist  has done us all a service by focusing attention on the evolving sustainability business model. The hope is that it will continue to do so.