I remember standing in an elevator with a copy of Epstein’s Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social, Environmental and Economic Impacts. A guy next to me notices the book and says “Making sustainability work?! I’m still trying to figure out what it means!” At that time I was trying to answer that question for myself and thought of one or two things to say – but nothing concise enough to fit the proverbial elevator pitch. Here’s though what I could have told him over a beer or two…
When talking about what sustainability is, I think of three Russian nesting dolls ordered by increasing order of influence (outside least, inside most) on: my fellow citizens, my colleagues and professional relations and my family and close neighbors. Here’s what I understand about sustainability for each of these communities.
We’re usually a national of some sovereign nation-state – Belgium in my case. Over time, the ever increasing amounts of people living together have warranted the need for government and laws from city-states 5,000 years ago to nation-states today. The increased concentration of people in cities had a positive effect on innovation which resulted in increased resources available and allowed again for more people to join the party (in a positive feedback loop). There are little over 200 sovereign states today engaging in trade with one another exchanging services, capital, services, finished goods and natural resources depending on their respective endowment.
The development of a nation is tightly related to its government and laws and has commonly been measured in economic terms of which the Gross Domestic Product (GDP) is the best known metric. Rise of living standards or welfare became a priority after World War II in a world then divided by two ideologies. In 1960 Walt W. Rostow had published The Stages of Economic Growth: A Non-Communist Manifesto a seminal text which categorized societies from an economic standpoint in five levels: the traditional society, the preconditions for take-off, the take-off, the drive to maturity, and the age of high mass-consumption. This Development Economics lead to the creation of the World Bank, IMF and GATT. We’re at the height of the industrial age and consumerism is king.
But GDP as a measure of welfare is somewhat limited as it is really a measure of economic activities leading to monetary transactions. It ignores distributional issues among nations and elements of human activity which cannot be valued via some market mechanism. As it focuses on flows, it ignores the impact of productive activities on stocks (including natural resources.) With the publication of Limits to Growth in the early seventies, governments were made aware shortcomings in natural resources under rapid population growth. The Brundtland delivered in 1987 a report to the United Nations in which the term sustainable development was put forward and defined as development which meets the needs of the present without compromising the ability of future generations to meet their own needs. Development of both developed and developing countries had been at last expanded to social, environmental as well as financial elements. In 1992, the United Nations Conference on Environment and Development (UNCED), informally known as the Earth Summit, adopted five important agreements including Agenda 21” and the UN Framework Convetion on Climate Change (UNFCCC). I looked up concrete examples of sustainability measures related to Agenda 21 for two countries I related to – Belgium and Switzerland.
Response to environmental damage is important and part of Jared Diamond’s Five Point Framework which he devised studying the reasons why societies collapse. Unfortunately, it is not always easy to be aware and understand what our respective states do for the environment. There’s even less a sense of influence. Awareness in our society seems to be championed by private individuals (e.g. movie makers, activists, philanthropists) or corporations engaging people on issues which are key to them. This brings me to the second Russian doll and way to look at sustainability: the enterprise.
Most of us are engaged in some form of remunerated work (value creation in exchange of money) which pays for shelter, food and more stuff depending on where and how we live. This can be as self-employed in one-man operation or as employee of a 100,000+ global corporation. Either way, with a little experience, one enjoys more influence in this narrower professional community than in the previous one.
Corporations have traditionally been driven by shareholder value maximization placing the interests of its shareholders above global sustainability imperatives. Sustainability for business consisted pretty much in doing that for as long as possible while preserving the integrity of its business model. Corporate Social Responsibility (CSR) or the need to incorporate self-regulation on other aspects into the business model has emerged in the seventies and evolved into a number of guidance and reporting standards based on the idea that a business needs to consider a number of elements beyond shareholders such as environment, consumers, employees, communities nearby production places, and other members of civil society such as NGOs. Considering and reconciling all these different dimensions is difficult.
In 2003, Hart and Milstein proposed a tool which helps identify practices and strategies for sustainability without losing sight on shareholder value. Their Sustainable Value Framework identifies two axes: time (today/tomorrow) and scope (internal/external) thus creating four spaces to which they pin specific sustainability drivers affecting shareholder value:
- Internal/Tomorrow: disruptive innovations, clean tech, footprint
- Internal/Today: pollution, natural resource consumption, waste generation
- External/Tomorrow: population increase, poverty, inequity
- External/Today: civil society (e.g. NGOs), transparency, social media
Companies should perform adequately in all quadrants and the framework can be used as an assessment tool to diagnose where your organization stands.
Earlier I mentioned integrity of business model which was recently well captured by Simon Senek in a TEDx talk. This talk highlights among other things the importance of product design. Consider the following excerpt of Natural Capitalism: Creating the Next Industrial Revolution by Hawken et al.
Every product we consume has a hidden history, an unwritten inventory of its materials, resources, and impacts. It also has attendant waste generated by its use and disposition. In Germany, this hidden history is called “ecological rucksack.” The amount of waste generated to make a semiconductor chip is over 100,000 times its weight; that of a laptop computer, close to 4,000 times its weight.
Life-Cycle Analysis (LCA) is the technique that will help calculate similar figures for your products. This will create a baseline from which you can improve the product design by making alternative decisions about raw materials used to make it. Below is a nice example of eco-design by Sustainable Minds who show the application of LCA to a bottle opener.
Any business wants to be sustainable. Sustainability adds a new set of decision drivers to the equation and I believe there are enough tools and techniques to guide businesses in making decisions in this new expanded decision space. What seems lacking is the transparency and control mechanisms to ensure companies are truly making improvements in their products and services. The 2009 BP Sustainability Review was produced in accordance to CSR standards AA1000 yet it did not provide any warning signal about the complex containment of the “giant oil discovery in the deepwater US Gulf of Mexico” announced in the same report…
After a days’ work, I return home to my family and nearby friends of the neighborhood where I live. This is the third Russian doll and the place where I can most influence and make decisions together with my Life partner, children and perhaps also with some neighbors. Sustainability at this level is rooted in ethics with a set of values tending towards satiety and frugality. This is not the case everywhere though. Consumerism has taken over most occidental cities and challenges our value system to the point activists, such as Annie Leonard, have to remind us about the dangers of mindless consumption:
Rob Hopkins, a permaculture educator who initiated the Transition Culture movement speaks less of sustainability in favor of resilience or the ability to absorb important changes which are anticipated from Peak Oil and Climate Change. There are some key differences between the Transition movement and conventional environmentalism: group focus instead of individual focus, less campaigning and protesting in favor of participation and education, or seeing the man on the street as the solution rather than the problem. Rob is not alone. Another example of this style is Nils Peter Flint’s Micro Macro Monde which shares a similar vision to that of transition towns. These initiatives are deeply rooted in Permaculture which consisted originally in a set of agricultural principles born after the first oil shocks in the early seventies. It expanded since then from food to other aspects such as economics, building or energy.
What’s in Common?
Sustainability at each of these three levels shares a number of common elements:
- Systems thinking
- Limits to Growth is based on a sophisticated system dynamics model called World3. In future posts, I’ll get back to sustainability at the enterprise level through Stafford Beer’s fascinating Viable System Model. The twelve Permaculture principles incorporate systems thinking, e.g. No. 4 apply self-regulation and No. 2 accept feedback or catch and store energy.
- Cross-disciplinary collaboration
- The concepts presented at the three levels demand the combination of multiple talents to address issues – social, economic, financial, ecology, design, architecture, permaculture, etc.
- Shared futures
- Finally and most importantly, the importance at all levels to first define what Future we actually want. This is perhaps the most complicated achievement but nonetheless necessary. Rob Hopkins has been able to rally over 400 towns in the Transition movement based on a shared vision for the Future without a single implemented energy descent action plan…
Next in this series of “Google and reading dumps” will be about metrics. I’ll share what I could find in terms of measurable outcomes and discuss some of the standards referred to in this post.
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