The Urgency of Sustainable Leadership—and the Promise of Social Entrepreneurship

On this Earth Day, we honor our planet and recognize the importance of climate action and environmental stewardship. We acknowledge our interdependence—and the gravity of the stakes if we fail to meet the moment.

What is the role of business in this epic challenge? Of leaders and entrepreneurs? Of all of us?

The Role of Business

Business leaders of course must address cash, profits, and growth as they manage their venture’s financial health amidst market pressures. Thankfully, there are not just costs associated with environmental stewardship but real opportunities.

“For far-sighted companies, the environment may turn out to be the biggest opportunity for enterprise and invention the industrial world has ever seen.”The Economist

Businesses operating sustainably have the potential for:

  • Increased sales
  • Cost reduction
  • Risk mitigation
  • Reputation enhancement
  • Operational efficiency
  • Customer loyalty
  • Pricing premiums
  • Innovation benefits
  • Competitive advantage
  • Talent attraction, motivation, and retention

Of course, these gains are not automatic. Leaders must figure out viable business models and strategies, leveraging innovation and efficient operations while engaging with partners in the community and their supply chains.

None of this can happen without leading people well. Organizations must have an intentional culture that allows people to sustain excellent and ethical work over time.

“I think every business needs a leader that does not forget the massive impact business can have on the world. All business leaders should be thinking, ‘How can I be a force for good?’ What I see is demand from our people to be a business that is good, makes a profit, but also does something for the planet and humanity. I think this is a trend we will see more of.” Richard Branson, British entrepreneur, philanthropist, and founder, Virgin Group

The Promise of Social Entrepreneurship

One of the driving forces of changemaking on this front is social entrepreneurship. It’s one of the great mega-trends of our time, but it can be a bit complicated and confusing. What is it?

Wikipedia notes that social entrepreneurship “uses entrepreneurial principles to organize, create, and manage a venture to achieve a social change.” I define it simply as “creating an innovative enterprise that generates social value.”

It’s best illustrated through examples. Today there are many exciting examples of social entrepreneurship and innovation in action:

  • Karma is a food app in Sweden that connects surplus food from restaurants, cafes, and grocery stores to consumers for a lower price. Users eat food for less money, and businesses receive an additional revenue stream–all while reducing food waste.
  • The Palazzo Italia is a building in Milan with a smart, biodynamic concrete skin that absorbs and breaks down pollutants—making it a smog-eating building. Photocatalytic cement captures pollution when it comes into contact with light, which is then transformed into inert salts. The building, designed by Nemesi Studio, is net-zero energy.
  • Valani is a fashion brand that bridges the gap between sustainability and feminine style by offering sustainable, vegan apparel for women. Its plant-based fabrics are dyed with low-impact, non-toxic dyes and can be composted. One dress, for example, is made from 100% banana viscose, made from discarded banana tree stems, a vegan alternative to silk.

“Let’s be honest, sustainability and fashion haven’t always been friends.” Vanni Leung, founder of Valani

Social entrepreneurs often begin with a problem they notice. They learn more about the context and start experimenting with different ways to solve it. For example:

  • Problem: Coral reefs support up to 1 billion people, sustain 25% of marine life, and generate $30 billion annually through tourism and fisheries, but they are dying rapidly. Over 30% of our world’s reefs have died over the past several decades. The oceans are projected to lose 75% of reefs by 2050.
  • Solution: coral farming has been proven to be a viable tool to revitalize reef health. Coral Vita in the Bahamas created a commercial, land-based coral farm that grows and transplants corals to restore dying coral reefs, helping to preserve the ocean’s biodiversity.

 

  • Problem: Potholes are annoying to people and damaging to cars, while roadmaking has a large carbon footprint.
  • Solution: MacRebur in Scotland uses molten, recycled plastic as a replacement for the bitumen commonly found in asphalt roads. Their product is now used in Australia, Dubai, Estonia, Slovakia, South Africa, and the U.S.

“We’re basically using rubbish to create better roads.” -Toby McCartney, co-founder of MacRebur in Scotland, “The Plastic Roads Company”

  • Problem: lack of access to clean water. The WHO and UNICEF note that 844 million people faced this problem in 2015.
  • Solution: Solvatten founder and CEO Petra Wadström created a revolutionary water-filtration technology—a portable water treatment device that also serves as a solar water heater. The sun’s energy inactivates pathogens through UV radiation, while also heating the water to provide additional disinfection. UV light destroys the formation of DNA linkages in microorganisms, making them harmless. Today, about 350,000 people across 20 countries use Solvatten.

The Role of Technology and Innovation

Today, we’re seeing great advances in areas such as biomimicry, circular economy business models, carbon sequestration, regenerative and restorative practices, and more.

Of course, social entrepreneurship, sustainable leadership, and innovation aren’t nearly enough on their own to address the climate crisis. We also need bold and decisive collective action from governments, NGOs, philanthropies, scientists, and individuals changing their behavior and sending market signals to industry.

On this Earth Day, we must take stock and act boldly, decisively, and urgently. So much is at stake. Will we meet the moment?

“If the success or failure of this planet, and of human beings, depended on how I am and what I do, how would I be? What would I do?” -Buckminster Fuller

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Gregg Vanourek is an award-winning author and entrepreneurial leader who trains, teaches, and speaks on leadership and personal development. He runs Gregg Vanourek LLC, a training and development venture focused on leading self, leading others, and leading change. Gregg is co-author of three books, including LIFE Entrepreneurs (a manifesto for integrating our life and work with purpose and passion) and Triple Crown Leadership: Building Excellent, Ethical, and Enduring Organizations (a winner of the International Book Awards). Check out Gregg’s manifesto on how to avoid the Common Traps of Living, or his TEDx talk on “LIFE Entrepreneurship and Discover Mode.” Twitter: @gvanourek

Sustainable Leadership on the 50th Earth Day

Today marks the 50th anniversary of Earth Day, a day on which we honor our planet and recognize the importance of environmental stewardship and our mind-boggling interconnectedness. Since 1970, the world population doubled, from 3.7 billion people to 7.6 billion today. We have made great progress on some fronts, but not nearly enough.

In our triple crown leadership model, there are three mains aims: excellent, ethical, and enduring. We define the latter one, enduring, as “standing the test of time and operating sustainably.” Sustainability can be defined as “meeting the needs of the present without compromising the ability of future generations to meet their own needs” (United Nations) or, quite simply, as “the capacity to endure.”

We view sustainability as having two dimensions—external and internal—the latter of which is often overlooked:

  • External: ensuring appropriate and sustainable levels of resource consumption, while minimizing harm
  • Internal: sustaining people and maintaining the financial health of the organization

Business leaders of course must address cash, profits, and growth as they manage their organization’s financial health. Here, it turns out, there are not just costs associated with environmental stewardship but real opportunities. Businesses operating sustainably have the potential for:

  • Increased sales
  • Cost reduction
  • Risk mitigation
  • Reputation enhancement
  • Operational efficiency
  • Customer loyalty
  • Pricing premiums
  • Innovation benefits
  • Competitive advantage
  • Talent attraction, motivation, and retention

“We see that sustainability drives growth, cuts costs, reduces risk, and helps us serve a multitude of stakeholders.”
Paul Polman, CEO, Unilever

Of course, these gains are not automatic. Leaders must figure out viable business models and strategies, leveraging innovation and efficient operations while engaging with partners in the community and their supply chains.

None of this can happen without leading people well. Organizations must have a conscious culture that allows people to sustain excellent and ethical work over time.

Here too, we have much work to do. Take, for example, the problem of burnout:

  • 44% of employees report feeling burned out sometimes (Gallup, 2018)
  • 23% of employees report feeling burned out at work very often or always; 28% of millennials (Gallup, 2018)
  • Nearly all of the 72 senior leaders randomly surveyed reported at least some signs of burnout (Harvard Medical School, 2014)
  • 60% of health care workers felt burned out; 21% always or often (Harris Interactive, 2013)

“Creating the culture of burnout is opposite to creating a culture of sustainable creativity.” –Arianna Huffington, Cofounder, Huffington Post, and CEO, Thrive Global

Wise leadership can help create the conditions for “conscious capitalism,” including:

  • Long-term thinking
  • Better benefits and long-term employment for workers
  • Embracing diversity and inclusion in the workplace
  • Consumers valued as key stakeholders and not taken advantage of by deceptive practices
  • Responsible environmental stewardship
  • Reducing inequality (e.g., by addressing executive pay)
  • Uniting communities around common causes and solving problems

See John Mackey and Raj SisodiaConscious Capitalism (Harvard Business Review Press, 2013)

There have been big developments on this front in the business world. For example, in Larry Fink’s 2018 Annual Letter to CEOs, he wrote about how companies must have a social purpose and pursue a strategy for achieving long-term growth:

“Without a sense of purpose, no company, either public or private, can achieve its full potential.” -Larry Fink, CEO, BlackRock

This was big news coming from the CEO of BlackRock, one of the world’s largest asset managers, with trillions of dollars in assets under management.

In 2019, the Business Roundtable published a statement on the purpose of a corporationColumnist Barry Ritholtz wrote the following in Bloomberg about that dramatic statement: “For 47 years, the Business Roundtable has lobbied on behalf of corporate America. Much of that time, it maintained a fiction—that the sole purpose of a corporation was to maximize profits on behalf of shareholders. This philosophy has been under assault for several years now, and this week the Business Roundtable announced it wants to put it to rest. In a widely circulated memo, the 200-member organization reversed itself, writing that ‘shareholder primacy’ is no longer the sole purpose of a corporation. Instead, corporations must include a commitment to ‘all stakeholders,’ which includes customers, employees, suppliers and local communities.” By now, we should all be including the environment in our list of essential stakeholders, given our dependence on its resources and conditions.

According to management theorist R. Edward Freeman (creator of stakeholder theory), “Managing for stakeholders is not about trade-off thinking. It is about using innovation and entrepreneurship to make all key stakeholders better off and get all of their interests going in the same direction.” John Mackey and Raj Sisodia note that the way to enable such stakeholder synergy (avoiding trade-off thinking) “is to focus on value creation rather than on value division,” taking us back to the innovation imperative.

When it comes to the external aspects of sustainability, we are today seeing great advances in areas such as biomimicrycircular economy business modelscarbon sequestration, regenerative and restorative practices, and more, in part capturing the attention of the world through the U.N.’s Sustainable Development Goals (SDGs).

These matters are not only the province of CEOs, entrepreneurs, philanthropists, and policymakers. They are our own.

“If the success or failure of this planet, and of human beings, depended on how I am and what I do, how would I be? What would I do?”
Buckminster Fuller

On this 50th anniversary of Earth Day, we must take careful stock and act appropriately—and urgently. So much is at stake.

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Gregg Vanourek is an award-winning author who trains, teaches, and speaks on leadership and personal development. He runs Gregg Vanourek LLC, a training venture focused on helping you lead yourself, lead others, and lead change. Gregg is co-author of three books, including Triple Crown Leadership: Building Excellent, Ethical, and Enduring Organizations (a winner of the International Book Awards) and LIFE Entrepreneurs (a manifesto for integrating our life and work with purpose and passion). Twitter: @gvanourek