The new sustainable business models challenge

Mike Barry is head of sustainable business at Marks & Spencer. He is part of the team that oversees Plan A, the eco and ethical programme with the ambition to make the company the world’s most sustainable major retailer by 2015. He is also Chair of the World Environment Centre, following six years on the WWF programme committee. Mike Barry spoke with Ethical Corporation’s Steven Wilding. Additional reporting by Giles Crosse.

Ethical Corporation: Tell us, in two sentences, what it is you do?

Mike Barry: My job is to try and guide M&S pragmatically on the long term journey to become a much more sustainable business.

Ultimately one which optimises economic, social and environmental outcomes and is based on a value chain (supply chain/operations/customer) that is zero carbon, zero waste, closed loop, only uses sustainable raw materials and improves human life wherever it touches it.

Ethical Corporation: What are the big issues to watch in 2013?

Mike Barry: The key trend will be an accelerating interest in new sustainable business models (as opposed to ‘less bad’ existing ones’) and the associated need for business leaders to have the skills to really get after sustainability to develop and run these new models.

This willingness to explore new business models will in turn surface the need for Governments to offer greater policy certainty as substantive change commences against an unhelpful short term economic backdrop. There will be a need to lobby government for stronger policy frameworks.

There will also be the need to create better partnerships (with NGOs, other businesses and communities) that enable this transition to happen, it’s simply too large a step for companies to do alone.. And to enable us to begin to optimise economic, social and environmental outcomes we need to complement our ability to count money with an ability to assign a more measurable value to nature and to society.

We will see growing focus on social issues, creating jobs, paying taxes, health and wellbeing, poverty alleviation. Plus the globalisation of sustainability; just as the global economy is seeing a rapid rebalancing between east and west so will sustainability see a shift from a western focus on defining solutions to one where other countries shape the debate, solutions and direction of travel.

Ethical Corporation: In your role as head of sustainable business what are your priorities for 2013?

Mike Barry: I’m working to drive Plan A across our global retail operations, which is nearly 400 stores in 45 different territories building on the success we’ve had with our 700 stores in the UK. Another focus is delivering our ongoing Plan A commitments, eg growing the number of M&S products with a Plan A attribute from the current 31% to our target of 100% by 2020.

We also need to engage our customers further in sustainable change, and develop our internal skills and capacity so we can drive Plan A further into the business, engage more of the value chain and reap greater business benefit. We need to understand better our “destination” and define what a truly sustainable retail model might look like.

Ethical Corporation: In terms of corporate responsibility, which industry sector would you pick out to watch, and why?

Mike Barry: I’m fascinated by the colliding world of mobile platforms, Vodafone, Telefonica, devices such as Apple and Samsung, social media such as Twitter and Facebook and technology/software: IBM, Cisco, Intel, Google, Microsoft. They are the “enablers” to help all other sectors become sustainable, enabling traceability, closed loop, sharing economy, data collection, and the “convenors” where consumers and citizens can meet and share a desire to change and solutions, and feel together they are stronger.

I’m also watching the wellbeing sector, ranging from cure (GSK) to care (Bupa) and the opportunity it has to redefine how we think about physical and mental wellbeing, not just in the UK but globally.

Ethical Corporation: Climate change – mitigation or adaptation?

Mike Barry: It’s both of course but the extreme weather of 2012 has made many businesses realise for the first time that climate change is happening. It’s affecting them and will continue to do so in the future, so adaptation will become even more important.

Ethical Corporation: A government to watch on sustainability?

Mike Barry: I wish there was a long list but there isn’t! I think necessity might force China to respond faster than it planned to the sustainability challenge as it sees the impact of soil loss, flooding and drought and potentially social upheaval. Brazil too may be forced to move faster as it seeks to square its incredible potential as the purveyor of raw materials to the world economy with the enormous social and environmental damage that this can bring too.

Ethical Corporation: Corporation tax – higher or lower?

Mike Barry: Probably about right in the current economic climate. Business needs to have the financial firepower to invest in short term job creation and longer term in building sustainable business models.

Ethical Corporation: CR impact – Obama or Xi Jinping?

Mike Barry: Both the US and China will do more than they have in the past. But I think we are entering a new period of history when the ability of one country and their leader to create or impose global consensus is much reduced.

Don’t expect one country to drive change nor expect 200 to do so together (think about herding cats). Instead look for more interesting smaller alliances of the “willing” or the “impacted” to form on a bi-lateral basis or even a 10-20 country level.

Ethical Corporation: “Shared value” or “sustainability”?

Mike Barry: This is potentially a philosophical distraction from the need to “do” sustainability. Overall I’d say sustainability is the destination, shared value a way of working to get there.

Mike Barry will be speaking at this year’s 12th Annual Responsible Business Summit. He will be moderating a supplier performance session looking at frontline supply chain engagement to enable ethical sourcing.