Burgess COMMENTARY

Peter Burgess

Making Sustainability Pay

Some say that the future of profit is purpose.

Paul Polman at Unilever, Emmanuel Faber at Danone, Jim Stengel from P&G, have called the business world to its sense of responsibility. After all, business today is probably the biggest force in the world, the only one that can create positive change.

A few leading CEOs have embraced sustainability as a moral imperative, and turned it into an inspiring shareholder story. But did they really have a choice? After all, when NGOs vocally challenge industry leaders in practices as varied as mining, energy, apparel or coffee, building a sustainable narrative could feel like a sound defense mechanism for the most visible corporations.

What is to be challenged, however, is not how genuine the predicament of the purpose-driven companies is. After all, who cares? The real challenge, and the only important question, is how effective it is.

We all know the answer: change is too slow.

We think the reason is obvious: money. Not because profit objectives overshadow the focus on sustainability. Rather, because money is not enough at the core of the conversation.

Practices change, but even within the most purpose-driven companies, sustainability is a department, a group of people that runs a specific agenda—while the business people are bringing the money in. The largest global companies often compete against less visible players, who see sustainability activism as an expensive hobby. Players who are happy to stay under the radar—and often compete with the good old ways, making better sustainability practices appear as a competitive disadvantage. Sustainability gained a voice, but by and large, it runs in parallel—if not in competition—to the world’s main business narrative. As long as this is the case, it real change won’t happen.

In the business world, whatever is a cost or an obligation is bound to come under pressure. Only the practices that drive business will thrive.

The future of purpose is profit.

For those of us who want to make sustainability commonplace, it is hence time we change the paradigm, and recognize that the future of purpose is profit.

To make sustainability a real driver of change, to push followers to adopt better practices, business leaders and sustainability advocates need to reframe it as what it can be: a powerful driver of growth.

The case is ready for it: around the world, a different approach to business is quietly rising. In some countries, Coca-Cola runs TV advertising featuring their community work. Research shows they build purchase—sometimes better than dedicated brand advertising—and it justifies the expansion of these programs (such as the launch of Coke’s new water initiative in China). In India, Africa, Brazil, Unilever and Coca-Cola run initiatives that turn excluded members of the communities into local sales people. It creates much needed jobs, but it also develops an alternative selling path that take these companies deeper into the communities that their classic distribution systems ever could. In Indonesia, Danone develops successful business models with products aimed at solving nutritional issues with the country’s lowest social classes. Consumer research confirms people are ready to make choices on the base of better practices.

Engineering sustainability that pays.

What is needed is a change of narrative. Shareholders appreciate sustainability reports that set clear carbon footprint goals. It makes you sleep better at night and may avoid your investment features in the next Greenpeace campaign. But who says the millions of dollars saved from a bottle with less plastic or a waste recycling program should not be equally boasted about? Sustainability has a bigger future as a business opportunity than it has as a moral quest.

What is needed is also a change of vision. Around the world, teaching children to wash their hands helps reduce infections and diarrhea. Engineering a business model that engages for-profit and non-profit stakeholders allows the soap brand Lifebuoy build scale and sustainability for health campaigns, while growing sales of their products. Improving the livelihood of chocolate farmers, the education of women, or the practice of fisheries can just as much be engineered into growth driving models.

It takes a new way of looking at social action, consumer understanding, business and marketing. It requires new techniques and partnerships, and a reinvention of the way both activists and marketers work.

It’s a lot of work, but it’s the next frontier: to make better practices commonplace, it’s time we make sustainability pay.