Miliband’s got a point – we need to be more discerning in who we celebrate

Who and what we celebrate, value and reward has a real impact on the decisions other people make and how they behave – that’s what all the research tells us.

So Miliband is right in some respects to draw attention to the problem that in public debate over the past 30 years political leaders, business leaders and business school gurus have tended to celebrate all business leaders, without necessarily distinguishing between those who have an overall positive impact on the wider world and those who don’t. This kind of talk does have a real impact on the kind of business we get and the kind of society we get.

Interestingly though, although Miliband’s been clobbered a bit for raising this in his speech this week I think he is picking up on what is already a growing trend – in our research on leadership at Ashridge, we’re seeing that more and more business leaders are recognising that they need more than commercial acumen and emotional intelligence to be effective in today’s world, they also need a strong personal commitment to making a positive contribution to the wider world through the way they go about business, and the skill to act on this.

Not only that, but they are increasingly choosing to measure themselves across a range of metrics that measure their broader contribution to society, not just the financial value they create for shareholders. This way of thinking is also starting to influence how their organisations are approaching their leadership development work.

Bringing this theme into the heart of public debate – and talking about recognising and rewarding good business through the tax system – could be a real boost to this trend. And it’s not necessarily hard to do in practice, despite the criticism Miliband’s received – think of all the work that’s gone into developing what could be appropriate metrics through the GRI process over the past decade. Bringing this nascent trend into sharper focus, paying more attention to who we celebrate, and aligning the influence of the tax system behind that, could play a valuable role in helping build the right kind of healthy prosperity for the medium and long term.

Rick Perry, climate change sceptic: (Republican) States of Denial?

In his seminal book, States of Denial, Stanley Cohen identifies three discrete forms of denial: literal, interpretive and implicatory, each with its own psychological status. Literal denial can be a genuine aversion to a truth too hard to acknowledge. Interpretive denial is a means of twisting the facts to create an alternative ‘truth’ (intentionally or not). Implicatory denial is a not-so-subtle technique for refusing to accept the consequences of the situation. What form might we assume Rick Perry to be displaying as he makes his bid to be the next Republican candidate for the US Presidency?

Given the drought underway in Texas currently, with only 40% of the usual annual rainfall since January and the hottest summer on record, literal denial seems unlikely. Unless we imagine it arises, as Cohen suggests, from a psychological refusal to engage with a reality too painful to acknowledge. Such a form of denial has been shown to be particularly acute in developed world communities more likely to be affected by climate change (such as East Anglia in the UK and the Netherlands). Feeling helpless or culpable whilst contributing to our own undoing creates a cognitive dissonance and potential distress too painful to bear. Literal denial is the psychic consequence and perhaps one we can understand Perry exhibiting.

What about interpretive denial? This is the most common form in the discourse on climate change scepticism. That the scientific data is incorrect or even intentionally falsified (note Perry’s suspicion of Gore’s motives, describing him as a ‘false prophet of a secular carbon cult’). This looks the more likely culprit, although arguably interpretive denial in this instance is still a defense against the anxiety of accepting anthropogenic climate change as occurring. The alternative is that given the sums going into the Republican campaign coffers from the local oil and gas industry, Perry might have been influenced by their lobbying. But surely a god-fearing Christian such as he wouldn’t be swayed by Mammon, would he?

Which brings us to the third possibility – implicatory denial. In this scenario, Perry has a full appreciation of the evidence for climate change and the role of society’s (including his own) greenhouse gas emissions. But he refuses to engage with the consequences. If the belief is that the current drought, and even global climate change more broadly, is an Act of God, then nothing is to be done about it. That would be tantamount to blasphemy.  Psychologically we could interpret this as a form of learned helplessness, which at the level of the man on the street might be excusable, but when running for one of the most powerful positions in the world, isn’t.

So to the ‘too late to do anything about it’ argument, which when combined with the refusal to acknowledge the data or the visible effects in his own backyard, is the most invidious of all. It’s Gidden’s (self-styled) Paradox – we do nothing because we believe it’s not happening, then say it’s too late once the effects are indisputable. Such a combination is a powerful psychic vaccine against accepting responsibility.

So what might help shift this United States Governor out of his state of denial? Providing more data won’t do it. When faced with uncertainty and equivocality we don’t need more information, we need different interpretive frameworks and values (Karl Weick, Sensemaking in Organisations, 1995). And when the arguments are at the level of belief and personal paradigm, no appealing to logic or rational judgment works either. As we mourn the tragic loss of the great environmental entrepreneur, Ray Anderson, could we hope for a similar epiphany to bring about a ‘mid-course correction’ to Perry’s thinking? That might require spiritual faith on a par with Perry’s own.

What alternatives does that leave us with? Perhaps the best we can hope for is that enough other voices speak up strongly and offer their alternative interpretations of the causes of the Texas drought and the need for urgent change. Shifting the cultural beliefs in communities through amplifying more desirable themes and values in public discourse is an effective if long-term strategy, and the way change comes about naturally over time. Social proofing – translating those beliefs into normative behaviours that then become more socially accepted using role models and media – is a good way to shift the cultural norms faster. With ever-increasing use of social media it is feasibly possible to reach an inflection point of values-led change in specific environments, though again it’s not an overnight option. Re-framing – highlighting the language used (such as the defamatory association made between Gore and cults) – would have the advantage of exposing the manipulative devices behind the rhetoric and discrediting them. But would that be enough to shift the discourse? And Perry himself?

Playing Perry at his own game, taking action and making highly visible statements such as Bill McKibben and co’s march on Washington - statements that construct the issues in terms of ethics and the personal responsibility of action and non-action – these will at least keep the debate open and not collapse the discussion to an apparent foregone conclusion. The question remains whether such a change in belief for this potential presidential candidate is change we can believe in.

Why brand your plan? Reasons to put a name to your sustainability strategy

I was recently asked to participate in one of those phone surveys for a leading technology business and comment on the branding of their sustainability strategy.  It led me to think how common it is now becoming for leading corporates to create such high profile reputational brands. And from my experience of transformational change I can think of a number of good reasons for doing so.

Ashridge’s current research into organisational approaches to embedding sustainability has already produced a number of exciting insights and highlighting some effective trends, one of which is this increasing propensity to brand sustainability strategies.  Since M&S leapt to public attention with Plan A, other high profile branded strategies have followed, such as Unilever’s recently published Sustainable Living Plan, Sky’s Bigger Picture and O2’s Think Big. Putting a name to what can otherwise be a hard to  fathom concept offers a number of advantages.

Here are my top five:

1 Branding your sustainability strategy provides coherence. It demonstrates a joined-up, visionary and (the clue’s in the word) strategic approach to responsible business, providing a memorable umbrella under which many initiatives can be affiliated, particularly useful given the diversity of project scale and focus that can be categorized as sustainability

2 It makes budgeting and investment decisions easier because there is clarity about what is and isn’t strategic and what directly contributes to the vision and espoused purpose

3 It is easier to engage employees and galvanise action around a visible intent with a slogan. A branded strategy has the hallmark of senior level blessing as well as offering a touchstone for corporate values (far more tangible than a list of values on a mouse-mat) and it has an emancipatory edge. Employees won’t need to ask permission so readily if they know their behaviours are in tune with the espoused intent

4 To the external world the brand shows not only serious engagement but also invites other stakeholders – customers, suppliers, indeed the whole supply chain – to get on board and participate. It enables business to reposition itself as socially-aware enterprise with the public and foster the ‘shared value’ between business and society that Michael Porter is now advocating. Crucially it supports greater transparency and accountability

5 It makes the job of managing such a comprehensive transformational change programme easier.  The diverse requirements of re-writing people strategies, innovating for new technologies, writing new policies and procedures, let alone shifting behaviour, mindset and deeply rooted habitual norms, can be aligned and project managed around such a visible and exciting point of focus.

If there is one drawback, it is that sustainability is always project, never finished accomplishment.  So whereas the project slogans may get tired and the printed posters fade, the work of creating sustainable enterprise continues indefinitely (isn’t that a common definition after all?). As InterfaceFlor have discovered, after 15 years of Mission Zero, there is still a long way to climb to achieve zero impact.

So, for branded strategies to work at their best, we have to keep refreshing the vision, checking the course and most of all, continue to positively engage, internally and externally, to build the organisations that reflect the reputational brand identities we espouse.

Alexandra Stubbings

Ashridge’s CEO: The role and purpose of a business school, and our strategic response to a changing context

Kai Peters, Ashridge Chief Executive

(This blog piece reproduces Kai Peters’ introduction to Ashridge’s June 2010 Sharing Information on Progress report to the United Nations on Ashridge’s sustainability strategy) 

A changing context

Our context is always changing. In the past few years, the most pressing challenge in the wider context for most leaders has been navigating the challenges of ongoing crises in the global economy. But immediately beyond this lie wider and connected trends with impacts that we are becoming more certain about: demographic change, an eastward shift in the centres of economic power, alarming trends in public health, urbanisation, rising inequality, systematic abuse of human rights, increasing scarcity of natural resources and degradation of ecosystems – forests, water systems, climate.

But it’s not just our context that’s changing; it’s how we understand our context that’s changing too. Much of our economy and industrial processes are still built on assumptions from the time of the industrial revolution, a time of huge technological innovation and improvement in the quality of life for many, a time when we looked around and saw, for example, abundant natural resources and man’s ‘triumph’ over nature. Now, we are increasingly aware of the limits of this narrative, we see that resources are scarce, that ecosystems are more delicate and fragile than we realised. And with globalisation in the 1980s and 1990s our horizons are no longer national but international, with globalised capital flows and trade in goods and services, where decisions taken in one part of the world now have far greater impacts than they used to on the livelihoods of others far distant. The new narrative that is eclipsing the industrial revolution perspective is sustainable development – a new ‘big idea’ that helps us make sense of our changing context and how we need to adapt.

In response, we are seeing new organisational practices emerge: new business models, new products and services, new operational practices. But we are also seeing many older organisational practices continue, practices that are increasingly less relevant in a changing context. Practices that are not healthy for our organisations, for our communities, and for the wider ecosystems of which we are a part and on which we rely.

Why are we seeing these new organisational practices emerge? Some people are changing behaviour because they are persuaded by the scientific evidence of environmental challenges for example, for others it might be more to do with personal values and a concern for fairness and stewardship for future generations. For others again, it might simply be the recognition that if large numbers of people are starting to think and act differently, this means certain markets may shrink while others may grow.

The role and purpose of business schools

So as things change, it is helpful to ask ourselves again: what’s the purpose and role of a business school?

On a practical level Ashridge exists to help organisations and individuals be more effective. We work in partnership with organisations and individuals to help in tackling complex challenges – supporting and developing leaders and leadership, formulating and implementing strategy, fostering and stimulating organisational change. Through bespoke learning and consulting interventions, complemented by executive qualification and open enrolment learning programmes, and underpinned by applied research, we are partners in organisational learning and change. It is our aspiration that, by helping organisations and individuals be more effective, we play a valuable role for society as a whole.

On a more philosophical level, we recognise that part of the collective purpose and role of business schools, along with the professional bodies and major management consultancies, is to act as both stewards and shapers of the body of practices and thinking – the cultural norms – of organisational life.

We steward the collective lessons learned by the countless organisational leaders who have gone before us, often unconsciously, as these ‘past lessons learnt’ become codified and embedded in the conceptual frameworks and tools that inform many of the conversations that take place with today’s and tomorrow’s leaders every day in business schools and more widely.

And as we help today’s managers make sense of a changing context and new practices, we also help shape the broader public debate and intellectual current of ideas within which today’s leaders in organisations make strategic and operational decisions.

We therefore collectively play a limited, but nevertheless significant role in influencing the behaviour of organisations. The questions we ask, what we champion and celebrate, and the values and contexts embedded in our concepts, frameworks and tools, make a subtle but important difference to the decisions others make.

Our strategic response

If this is our purpose and role – what we do – and this is how our context is changing, what does this mean for our strategy? The right strategic response is embodied in the United Nations Principles for Responsible Management Education, which we helped develop.

We need to be challenging organisational leaders with the realities of our changing context and helping them make sense of what this means, not just for their strategy and organisational practices, but also for their broader purpose.

This isn’t a ‘nice to do’, it’s a strategic imperative – only organisations that adapt as their context changes survive and thrive. By leveraging our strengths and by innovating now, we are seeking to protect and extend our competitive advantage. If what our clients value about working with us is our expertise around leadership, strategy and change, engaging with sustainable development is about ensuring that our expertise in leadership, strategy and change remains relevant. This is also, in the bigger picture, what we exist for as a business school and how we add value to society as a whole.

How do we act to make this strategic imperative become a reality? There are three clear areas of focus:

First, we need professional excellence from our faculty – we need them to engage in inquiry, dialogue and thought leadership that asks what our changing context means for our core areas of practice. We also need to be learning from innovative organisational practice where it is emerging, and looking again at our own concepts, frameworks and tools to ensure they are still relevant in changing times.

Second: we then need our faculty to bring this new thinking into our work with organisations and individuals.

Finally, it goes without saying that we also need to apply it to the way in which we manage ourselves as an organisation.

Do we have the capability to deliver? Yes, we believe we do. Although there are obvious challenges, we believe we have the people and the culture to deliver, and we believe we are making the right decisions to support the kind of change we need. Our full June 2010 report Innovation in a Changing Context outlines in a bit more detail our thinking in these three areas, the steps we have been taking, the challenges, and our plans for the future.

Kai Peters, Ashridge Chief Executive, June 2010.

Carbon Counts -3rd February 2011

The latest Carbon Salary Survey was launched today by Acre Resources and Acona with 994 professionals taking part. Now in its second year, the survey aims to plot the developing climate change and carbon job markets including; job functions, salaries and job satisfaction levels amongst other key indices.

The survey arguably defines carbon professionals as those working in:

• Renewable Energy and Clean Technology
• CDM/JI
• VER
• Carbon Finance/brokering
• Carbon/Climate Change Law, Policy or Regulation
• Climate Change Strategy
• Energy Management and Efficiency
• Carbon Management
• Sustainability

Key trends
According to the survey the most popular areas to work in globally are energy efficiency and consulting around CDM and JI projects (low carbon projects eligible for increased funding through carbon credits under the Kyoto Protocol).

Energy efficiency professionals have taken the top slot for the second year running indicating how important demand side reduction is for organisations right now. And as energy prices escalate and environmental taxes begin to bite this job role has a good chance of proving recession proof

On the other hand CDM and JI project finance partly relies on confidence in the broader set of policy signals catalysed by the Kyoto protocol to remain in place and hopefully increase. New entrants into market based approaches to carbon reduction such as California suggest that more of these technical jobs could be required in the future to take these mechanisms to scale.

Energy generation through renewable technologies such as solar, wind and biomass come in next reflecting the excitement and continued growth expectations of the clean energy industry and in the UK particular the feedin tariff initiative seems to have really delivered in terms of jobs if nothing else.

Law/policy and regulation is also very popular and the most well paid of the roles identified acknowledging the complexity of the area and the need to not only understand and develop responses to forthcoming legislation but perhaps that policy and legal expertise can help stakeholders to engage meaningfully in policy development and create more workable frameworks going forward.

Salaries in the sector have risen year on year and 75% of the respondents reported they are satisfied with their jobs, bucking the wider trend of salary deflation in many countries and job insecurity. And we know that there is a strong correlation between satisfaction and productivity, so employers should be pleased.

Further reflections

What is also interesting is what the survey does not render visible. For example following the Copenhagen Accord’s pledge for Annex 1 countries to invest up to $100billion a year to 2020 on moving to a low carbon society, the International Energy Agency released figures suggesting $46 trillion would be needed to take us to 2050, 50% of which would come from adjustments to business as usual and 50% from new investments. It’s the business as usual that I am interested in here, in that as organisations start to treat some of these things as the norm those people who spend time working in climate change and carbon will start to become invisible, in fact they may not even know themselves that they are working in this space. A good example of this is Legal and General Group’s handling of the recent Carbon Reduction Commitment which has been allocated to the tax department rather than the energy manager to be treated like VAT with an aim to reduce it as much as possible. If you ask a Legal and General accountant what they did, do you think they would answer that they worked in carbon and climate change?

So whilst the survey shows an incremental trend in the right direction my suspicion is that it is also hiding a much more fundamental and transformational shift that’s occurring as carbon and climate is absorbed into BAU.

Additionally if we were to look at this from an energy security perspective and ignored carbon I wonder what would happen. My guess is not a lot because regardless of what happens in terms the climate change negotiations and public and leader sentiment around the broader topic, most of these jobs still make sense in a world of increasing demand and dwindling resources.

So does this mean that those climate jobs not focussed on energy that have a longer term eye on structural and cultural transformation are currently being ignored at the behest of the low hanging high energy fruit? And is the growth in technical jobs identified by this survey pointing towards the hockey stick trend required in the job market if we are to meet the challenges set by the IEA?

I guess we will have to wait for the 2011 survey to find out.

Carbon Counts 3rd February 2011

The latest Carbon Salary Survey was launched today by Acre Resources and Acona with 994 professionals taking part. Now in its second year, the survey aims to plot the developing climate change and carbon job markets including; job functions, salaries and job satisfaction levels amongst other key indices.

The survey arguably defines carbon professionals as those working in:

• Renewable Energy and Clean Technology
• CDM/JI
• VER
• Carbon Finance/brokering
• Carbon/Climate Change Law, Policy or Regulation
• Climate Change Strategy
• Energy Management and Efficiency
• Carbon Management
• Sustainability

Key trends

According to the survey the most popular areas to work in globally are energy efficiency and consulting around CDM and JI projects (low carbon projects eligible for increased funding through carbon credits under the Kyoto Protocol).

Energy efficiency professionals have taken the top slot for the second year running indicating how important demand side reduction is for organisations right now. And as energy prices escalate and environmental taxes begin to bite this job role has a good chance of proving recession proof

On the other hand CDM and JI project finance partly relies on confidence in the broader set of policy signals catalysed by the Kyoto protocol to remain in place and hopefully increase. New entrants into market based approaches to carbon reduction such as California suggest that more of these technical jobs could be required in the future to take these mechanisms to scale.

Energy generation through renewable technologies such as solar, wind and biomass come in next reflecting the excitement and continued growth expectations of the clean energy industry and in the UK particular the feedin tariff initiative seems to have really delivered in terms of jobs if nothing else.

Law/policy and regulation is also very popular and the most well paid of the roles identified acknowledging the complexity of the area and the need to not only understand and develop responses to forthcoming legislation but perhaps that policy and legal expertise can help stakeholders to engage meaningfully in policy development and create more workable frameworks going forward.

Salaries in the sector have risen year on year and 75% of the respondents reported they are satisfied with their jobs, bucking the wider trend of salary deflation in many countries and job insecurity. And we know that there is a strong correlation between satisfaction and productivity, so employers should be pleased.

Further reflections

What is also interesting is what the survey does not render visible. For example following the Copenhagen Accord’s pledge for Annex 1 countries to invest up to $100billion a year to 2020 on moving to a low carbon society, the International Energy Agency released figures suggesting $46 trillion would be needed to take us to 2050, 50% of which would come from adjustments to business as usual and 50% from new investments. It’s the business as usual that I am interested in here, in that as organisations start to treat some of these things as the norm those people who spend time working in climate change and carbon will start to become invisible, in fact they may not even know themselves that they are working in this space. A good example of this is Legal and General Group’s handling of the recent Carbon Reduction Commitment which has been allocated to the tax department rather than the energy manager to be treated like VAT with an aim to reduce it as much as possible. If you ask a Legal and General accountant what they did, do you think they would answer that they worked in carbon and climate change?

So whilst the survey shows an incremental trend in the right direction my suspicion is that it is also hiding a much more fundamental and transformational shift that’s occurring as carbon and climate is absorbed into BAU.

Additionally if we were to look at this from an energy security perspective and ignored carbon I wonder what would happen. My guess is not a lot because regardless of what happens in terms the climate change negotiations and public and leader sentiment around the broader topic, most of these jobs still make sense in a world of increasing demand and dwindling resources.

So does this mean that those climate jobs not focussed on energy that have a longer term eye on structural and cultural transformation are currently being ignored at the behest of the low hanging high energy fruit? And is the growth in technical jobs identified by this survey pointing towards the hockey stick trend required in the job market if we are to meet the challenges set by the IEA?

I guess we will have to wait for the 2011 survey to find out.

Cancún, the Economist, and self-fulfilling prophecies

The Economist’s leader article on climate change at the beginning of the Cancún summit paints a bleak picture. Focusing on how to adapt to a changing climate, the story of the article to my reading seems to be that disaster is looming, and although it is technically possible to avert, humankind has largely given up the will to achieve this: “Even if the currently moderate pace of emissions reduction picks up, the likelihood is that the Earth will be at least 3^oC warmer at the end of this century than it was at the start of the industrial revolution… in the wake of the Copenhagen summit, there is a growing acceptance that the effort to avert serious climate change has run out of steam… the fight to limit global warming to easily tolerated levels is thus over.”

Better, then, the Economist argues, to focus on how to live with warmer temperatures. Although there is talk of a massive transfer of resources to help the most vulnerable, it’s not unreasonable to come to the conclusion from the pretty thorough analysis in the accompanying article later in the same issue that in all likelihood, adapting to climate change will in reality involve richer people looking after themselves and leaving poorer people to a pretty bleak fate. Leaving aside the morality of this, even for richer people this strategy is only likely to work for a majority for a generation or two: “Since the beginning of time, creatures have adapted to changes in their environment. Unfortunately such adaptation has always meant large numbers of deaths.”

Now I’m not saying that adapting to climate change isn’t an important thing to be talking about, and its good to see the Economist putting it on the front cover, but the question this article raises for me is this: what kind of actions does a vision of the future like this provoke?

Ashridge Business School is a unique institution blending MBA and other executive degree programmes with customised executive education and change consulting for corporate and public sector clients. We consider our core strengths to be in the fields of leadership, strategy and change, and so we have plenty of specialists who think they know a thing or two about change. My colleague, Alexandra Stubbings, for example, is an organisational development and change consultant by profession and is co-head of Ashridge’s Engaging with Sustainability change consulting practice; her recent client work on climate and culture change includes working with new UK parliamentarians from across the three main political parties as well as several corporate clients.

One of the key principles of her work is that the small scale day-to-day decisions people make tend to be consciously or unconsciously informed by the ideas they have about what the future is going to be like. And these small-scale day-to-day decisions can actually play a pretty significant role in making these visions of the future come true. Think of a business going through hard times – if clients and employees start to believe the organisation’s going to the dogs, they begin to make decisions that often make it more likely that this will in fact be the outcome. Equally if people have something positive to work towards, and particularly if that vision is shared with others they’re working with, it’s actually far more likely that something like this positive vision will in fact come to pass.

Put simply, it’s the rule of self-fulfilling prophecies. And it leads to a delicate dilemma: how to talk about how serious things are, the gravity of the situation, enough to nudge people into questioning their habitual patterns of behaviour, while at the same time not tipping people into despair but building a positive vision of the future that inspires a constructive road out of trouble?

It means, I think, that we need to talk more about the positive implications of change that is already happening. From humble beginnings in the 1990s for example, there is now a real movement for change within the corporate world that is beginning to transform markets – think for example of the recent announcement by Unilever of its 2020 Sustainable Living Plan. Many companies are beginning to realise its possible to act on climate and not only remain commercially viable but actually to protect and create value (as we currently define it). Many are even going further to lobby public policymakers to change the rules of the game to make it commercially viable to act where it isn’t at the moment. While there’s clearly still a very long way to go, this change has a real momentum now.

What is provoking this change in corporate behaviour? In research by Ashridge and the Academy of Business in Society for the United Nations in 2009, over 90% of CEOs and senior executives polled in a global survey believed that building awareness and skill among senior leadership populations and stimulating a change in organisational culture were required for their organisations to effectively respond to challenges like climate change. And what’s really interesting is that there are actually many organisations investing considerable sums in precisely this area. Ashridge research to be published in early 2011 will present detailed case studies of these kinds of learning and change programmes from large and small organisations based across different regions of the world in different industry sectors. The research will draw out the learning from these innovators for the benefit of the many organisations now beginning to think about how to do this. The findings will be discussed at a major conference at Ashridge on sustainability and organisational change in June 2011.

The awareness, the commitment and the skill to lead change among business leaders is growing, and beginning to lead to developments that are having profound implications for markets as a whole. As with previous industrial transitions, there are tipping points which once passed give the change its own momentum. There are an increasing number of signals that we may already have passed such a tipping point with climate. And the more the corporate world begins to act and become a pressure group on climate, the more this change starts to take on its own momentum and create its own vested interests, the more likely it will be that the kind of public policy responses expected last year at Copenhagen will sooner or later come to pass.

Is the glass half full or half empty? Clearly both, but what we know about change would suggest we’re likely to have a far better outcome if we spend more time talking about it being half full. If people start to recognise that positive change is happening, this becomes factored into their visions of the future, begins to influence their actions today, and starts to contribute to and reinforce the positive change. A positive feedback loop. There is hard work ahead, the job is by no means done, but don’t give up hope yet.

Matthew Gitsham is Director of the Centre for Business and Sustainability at Ashridge Business School.

Unilever’s willingness to set themselves specific and quantifiable targets makes this a defining moment in the sustainability revolution

A recent Harvard Business Review article argued that we are currently experiencing an industrial transformation – the sustainability revolution – to rival that of the major industrial transitions of recent times like globalisation, and the information age.

All periods of dynamic change are punctuated by defining moments, and one that comes to mind for me when thinking about sustainability was a week in 2007 when Tesco and Marks&Spencer vied to out-do each other when announcing comprehensive agendas for organisational change on sustainability – this was the birth of M&S’s Plan A, a detailed set of over 100 targets to be achieved by 2012.

The past week is perhaps another “moment” that people will look back on when telling the story of the sustainability revolution. Last week FMCG giant P&G announced a comprehensive package of sustainability targets and yesterday Unilever Chief Executive Paul Polman, joined by two of the intellectual architects of the sustainability revolution Jonathan Porritt and John Elkington, outlined Unilever’s sustainability strategy for the next ten years with some eye-watering commitments the organisation has set itself to achieve by 2020.

I came to the event in Unilever’s London HQ with three questions at the front of my mind: would there be anything new today? Was it real or just greenwash? And what might the broader implications be for others?

Unilever already has a strong pedigree on sustainability, this is the organisation that has been improving health and wellbeing for over a century with products like lifebuoy soap and Flora/Becel margarine. In 1997 Unilever worked with WWF and others to create the Marine Stewardship Council, and in 2007 made commitments to sustainably source all its palm oil, and all the black tea in Lipton and PG Tips, by 2015 – not insignificant commitments from an organisation that buys 3% of the world’s palm oil and 12% of the world’s black tea. Hence the first question I came with: would there be anything really new today? Would the announcement live up its billing as a step change or would it just be more of what we’ve heard before?

Well, what I think stands out Unilever’s announcements – like M&S’s Plan A a few years ago – is how comprehensive these commitments are, how long term they are, and how specific and quantifiable they are. Yes, Unilever has been able to showcase some great examples of sustainable behaviour from some of its brands in the past, but yesterday they announced targets that mean all brands right across their portfolio will be meeting a consistent level of performance. In aggregate, the announcements appear to represent a genuine effort to transform markets because of the influence they will have on the decisions others will make, rather than just window dressing to defend corporate reputations as earlier generations of corporate responsibility activities have often done. To give a flavour of yesterday’s announcements, they included commitments to:

• Help 1 billion people improve their hygiene habits by 2020, and bring safe drinking water to 500 million people by 2020
• Double the proportion of the food portfolio that meets particularly stringent nutritional standards
• Halve the greenhouse gas impact of Unilever products across their lifecycle by 2020 (including the impact of production of raw materials and use by the consumer) as a contribution to meeting the United Nations requirement to reduce greenhouse gas emissions by 80% by 2050
• Source 100% of agricultural raw materials sustainably by 2020, addressing both environmental impacts and livelihoods of producers and workers (moving beyond just palm oil and tea to all Unilever’s top ten agricultural raw materials – paper&board, soy, sugar, fruit&veg, sunflower, rapeseed, dairy and cocoa – and beyond)

The second question I came with was: how credible would this set of announcements be? It all might sound good, but was it about real change or just good PR?

This question was put to Polman in a variety of ways, and his answers were interesting. At one point, citing Stephen Covey’s Seven Habits of Highly Effective People, Polman argued “It’s difficult to talk yourself out of things you’ve behaved yourself into” – from small and pioneering first steps, Unilever has been taking bigger and bigger steps towards systemic change over more than a decade, which has created its own momentum within the organisation which will be hard to reverse and gives Polman confidence that the organisation will step up to the challenge these new targets represent.

Polman gave a wry smile when the point was made that CEO’s terms in office are becoming shorter and shorter, and change on this scale required more than just CEO leadership, it required a fundamental change in organisational culture. Ashridge Business School’s research lends weight to this argument: 92% of the CEOs and senior executives participating in Ashridge’s 2009 study with the United Nations and EABIS believe that change in organisational culture is required to effectively meet the challenges and opportunities of sustainability. That study documented some of the very specific steps that Unilever has been taking to provoke and accelerate culture change through a range of interventions led by the HR function, including innovative leadership development programmes, and the ‘brand imprint’ workshops led by Unilever’s in-house marketing academy for example. Ashridge is hosting a major conference on sustainability and organisational change in June 2011 that will explore these trends in greater detail.

A number of other challenges were made during the Q&A to Unilever’s central thesis that it was possible to double the size of the business at the same time as reducing material consumption.

On the barriers presented by the investment community, Polman was bullish: ‘We know this is the right way to manage our business for the long term, if you buy into this, come invest in us, if you don’t, then don’t’ was the gist of his response.

On consumers: “Consumers do want us to be taking this approach, even more so in developing countries which is where our future growth will come from, and the major retailers as market gatekeepers are really driving change through the whole supply chain. The trick is to innovate to be able to meet this demand without increasing price”.

On the role of government: “We can’t wait for governments to fix these problems, witness the failure of Copenhagen. Industry needs to step up”.

On integration with broader corporate strategy, Polman talked about the role of sustainability specialists in the due diligence process during acquisitions: “Will new acquisitions fit with this new business model in the long term is the key question we will be asking of them” he argued.

It wasn’t all plain sailing, there was some visible squirming when directly asked for the second time how much of Unilever’s marketing budget would be spent on promoting behaviour change rather than selling more products, and there wasn’t a good answer to a question about whether Unilever was really challenging the underlying ideology of consumerism that has dominated commercial thinking for half a century. But to be fair Unilever was upfront about many of the unknowns still to be navigated on the road ahead and overall this came across as both a sincere commitment, and one backed up with real intent.

So what, then, of my third question: what are the broader implications of all this? What are the implications for other organisations? It seems to me to be this: yesterday we saw another clear signal that lends credence to the notion that markets are changing, the rules of competition are changing, and a handful of organisations are playing a leading role in defining what these markets and rules of competition are going to look like in the near future. If you’re not already seriously engaged in this agenda for real change, you need to be.

What will be the next defining moment in the sustainability story? I think we’ll continue to see leaders in different sectors stepping up and announcing similar kinds of substantial long term targets for change that will signal the direction of change in their sectors. How soon, then, before we see coalitions of organisations from the same sector making joint declarations on long term targets for their sector as a whole?

Matt Gitsham is Director of the Centre for Busieness and Sustainability at Ashridge Business School

Psychology of Climate Change

Recently Prof David Uzzell, Professor of Environmental Psychology at University of Surrey, spoke at the Royal Society on the role of psychology in addressing climate change. Leo Hickman quotes him at length in the Guardian Environment Blog.

As a great bastion of evidence-based and peer-reviewed scientific endeavour, I could imagine the Royal Society might wonder why the overwhelming evidence of anthropogenic global warming (AGW) is not enough to rationally convince Government, business and the public in general of the need for urgent and socially transformative change. The problem is that rational argument doesn’t work on an issue which is more ideological than logical. A deeper psychological understanding of what compels ‘belief’ and ‘denial’, and a more sophisticated examination of ‘denial’ (e.g. literal denial of evidence? or acceptance of evidence but denial of implications – splitting), enables more effective forms of influencing behavioural change. But as Uzzell points out, the discipline of psychology alone is not enough. What’s required is a trans-disciplinary approach that benefits from insights from science – conventional and post-conventional, from sociology and anthropology, and from new economics. I would add that a social psychological understanding, that acknowledges the fundamentally social source of our psychological patterns and drives, is necessary for developing responses to the complexity of Climate Change. This means engaging at the level of the individual in relationship rather than attempting to influence individuals as discrete, Leibnizian windowless monads.

Hickman’s blog also references a paper by Pitman and Newell that explores the psychology of judgement and how we make decisions, and the common traps that we fall into. It supports the case that the adversarial discourse of ‘belief’ and ‘denial’ is ridiculously simplistic and a much more sophisticated investigation of drivers towards action and away (disengagement and denial of implications) is necessary and urgent. The implications for organisational change is obvious – as with climate change a more integrated, trans-disciplinary and participative approach is required.

Authentic leadership for sustainability: Bovis Lend Lease Embercombe Leadership Programme

Ashridge is currently leading a programme of research exploring innovation in leadership development in a changing global context: Leading Organisations of Tomorrow. I was really fortunate to be the researcher observing the Bovis Lend Lease-Embercombe Leadership Programme in Devon in June. My ears had pricked up at hearing that this had a ‘wilderness’ component, but I knew little else before my first client meeting. The Leadership Programme is an essential part of an ongoing development programme provided by Bovis Lend Lease to employees on their two-year graduate programme. I observed the first three days of the four-day programme. In this piece I’d like to capture a few of the key features that stood out for me in this unique programme.

The first thing that struck me was the INTEGRATIVE element of the programme. They are two very different organisations: with Bovis Lend Lease a major player in the construction industry, and Embercombe  an unique community of people committed to developing a viably sustainable lifestyle that is integrated with local communities. As one facilitator explained, ‘I want to live in a way which would be possible for all of humanity’. It was clear that the programme has benefited from a partnership of around five years that enables Bovis Lend Lease and Embercombe people to co-design and present the programme. This ongoing collaboration has also enabled ‘sustainability’ to move from being an implicit element of the context to a clearly highlighted value of the programme, in line with Bovis Lend Lease’s stated values.

So what exactly was the programme? In brief, around 20 participants were divided into 5 project teams, headed by an overall team leader. Each project had a specific building task to deliver within the four days of the programme – given the introductory time and hand-over, there were only about two full days for design and delivery. What struck me from the start was the elegant simplicity of the whole process. It was clear from informal chats I had with participants that the combination of authentic tasks and time for considered reflection gave rise to some significant personal insights and rethinking . This is what makes for sustainable leadership.

AUTHENTIC TASKS: Here were real construction tasks, with a real client in a real delivery time. In terms of ‘leadership development’ input, the emphasis was on trusting that the essential lessons for each and all would emerge form the very nature of the projects and the roles each participant played. The underlying principle was that each individual needed to identify his or her own leadership style, strengths and development areas in the context of being leaders, followers and team members. And this was the case. Mac Macartney, who is the founder of Embercombe, acted as co-ordinator, alongside Michelle Palin of Bovis Lend Lease. Mac has an abundance of leadership material to offer, but chose to rely on a few pithy illustrations that surfaced in the context of the project. This was a truly emergent, experiential process.

COMPLEXITY AND DEPTH IN SIMPLICITY: Core to each of the projects was the need to use principles of sustainability in design, material and process. The projects included:
• extending the volunteers hut,
• completing the construction of a central yurt,
• a second firewood shelter to allow for 3-years of drying out,
• a movable male and female compost toilet, and
• extend the ablution block to allow for more hand-basin access.
As the projects were allocated, I had the sense that the teams felt their projects were not overly-challenging. By project handover, however, their appreciation for the intricacies of well-considered, sustainable design and delivery had multiplied.

REFLECTION: Another core element was the attention given to reflective reviewing; drawing participants back from the detail of specific task delivery to promote a broader and deeper awareness of the wider context and their personal learning. This facilitated reflection took place through a joint meeting at the start and end of each day, and at pertinent points through each working day. Each team had a ‘facilitator’. The facilitators were themselves craftsmen with the capacity to guide on key elements of sustainable construction principles, a well as the ability to lead learning review sessions as incidents took place, or significant project phases passed.

RELATIONSHIPS: I’ve already mentioned the Bovis Lend Lease-Embercombe relationship underpinning the programme. On our first day on this programme, there seemed to be at least four different clusters of people: the Bovis Lend Lease participants with their co-ordinators and facilitators, the Embercombe volunteers working and living on site, the Embercombe staff/volunteers who provided the meals, and a group of long-term unemployed youth on a work experience programme. It soon became clear that the project teams were going to need to enlist the support of volunteers and people involved in the work experience scheme to complete aspects of their projects. In a rich (and very real) process of reaching out, miscommunication, misunderstanding and dialogue, the final days saw the emergence of a connected community pushing for successful project completion.

SUSTAINABILITY: The unanticipated need to build community in order to build the various constructions was remarked on by many participants as significant in sustainable work and leadership. Similarly, I found that all the participants I spoke to had shifted from a sense of ‘this is a strange/interesting/weird/intriguing place’ (just as ‘sustainability’ is often seen as a strange/interesting/weird/intriguing concept) to a very personal appreciation of both the Embercombe community and the challenging demands of a commitment to sustainability. In other words ‘sustainability’ had shifted from being something ‘out there’ to something each had made part of their personal meaning.

It will be interesting to explore how this experience impacts on the participants’ Bovis Lend Lease work and lives in the months and years ahead. We plan a number of follow-on interviews with past programme participants to see how they have worked with their Embercombe experiences.

Dave Bond, Ashridge Faculty Tutor

Ashridge is leading a major research inquiry ‘Leading Organisations of Tomorrow’ which is exploring innovation in leadership development through the experience of eight pioneering organisations that, having recognised the need to adapt to a changing context, have integrated a sustainability orientation into their leadership development strategies. Ashridge is inviting senior business leaders as well as professionals from the fields of leadership development and organisational change to come together to discuss these themes in London on 14 October 2010. You can find more information here.