Company bosses feel constrained by market expectations, but transformational leaders are emerging
Sustainability remains firmly on the business leader’s agenda, but chief executives are increasingly finding themselves constrained by market expectations and unable to quantify and harness the business value of sustainability.
This was the prevailing view that emerged from a new UN Global Compact-Accenture study of more than 1,000 global CEOs from 27 industries and 103 countries. This year’s Global Compact CEO Study claims to be the largest piece of research into the views of chief executives on sustainability to date.
It finds that while CEOs remain convinced that sustainability can be a driver of growth and innovation, businesses are struggling to deliver the business case at scale. An inability to make the connection between sustainability and business value is seen as a critical factor in blocking further progress to embedding sustainability.
And 83% of CEOs believe that an increase in government intervention – by way of providing an enabling environment for the private sector – is integral to advancing sustainability. Government intervention can help move sustainability beyond incremental advances to a collective and transformative impact, says the report.
“What we heard from CEOs is that they are struggling to make the case that links sustainability with business value. Although they haven’t lost faith with markets, they believe that governments are going to have to intervene to set the right market conditions to ensure that the right kind of outcomes are rewarded,” says Peter Lacy, Accenture’s managing director of strategy and sustainability in Asia-Pacific, and lead author of the CEO study.
Of unique interest to this year’s study, Lacy says, was the identification of an emerging group of transformational leaders. These are CEOs of companies that demonstrate both sustainability leadership and traditional high business performance, and they are framing sustainability in very different ways from other companies.
“They are companies that are able to monetise sustainability through their top line,” Lacy says. “They are able to drive a sustainability innovation agenda that is very clearly and tangibly linked to value and that’s where they are able to convince the customer and consumer that this all makes sense.”
What attributes do transformational leaders possess? The report identifies several emerging themes that are enabling transformational leaders to achieve both value creation and sustainability impact.
One strong theme is the ability to move beyond reactive and incremental responses to external pressures in favour of a deeper understanding of sustainability as a driver of innovation, differentiation and growth. These businesses are converting sustainability to advantage and value creation.
Another major point of differentiation, says Lacy, is the commitment of these companies to engage in partnerships and collaboration throughout the value chain. They recognise the value of external collaboration in helping the business to achieve its sustainability goals.
Last, but not least, transformational leaders are measuring the value of sustainability to the company. These companies are quantifying the impact of their initiatives and sustainable business models to the company, as well as tracking their impact on local communities.CEO sustainable business sustainable leaders
May 2014, London, UK
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