July 23, 2017

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Ending Pilot Paralysis Through Scaling as CEOs Lose Confidence in Corporate Sustainability

"A decline in the perceived importance of sustainability among global business leaders is not encouraging for those working to align business with sustainable development."

Davidwilcox

By David Wilcox

The results of the Accenture CEO Sustainability Survey were reported this week at the tri-annual UN Global Compact Leaders Summit in New York City. This was an occasion for UN and sustainability leaders to come together to encourage top CEOs to be more participatory in these critical issues.

As reported by The Guardian’s Adam Aston:

In collaboration with some 1,000 business allies, the UN today issued an updated "architecture" aimed at intensifying companies' role in advancing economic development, improving human health and reversing environmental degradation…Secretary General Ban Ki-moon emphasized the growing need for private companies to coordinate their market efforts with UN's long-standing development goals.

The business engagement architecture is designed to "drive and scale up corporate actions to directly advance United Nations goals," Ban said. The blueprintBuilding the Post-2015 Business Engagement Architecture, marks a high point in the UN's ambitions to engage with business. When it was launched in 2000, Ban said, "there was no clear agenda for business."

Addressing Issues of Sustainability: Mediocre at Best?

With the inclusion of the term "engagement," it is no surprise that podium pronouncements Sustainability_diagnostic_coverproceeded positively. Yet at the same time, these same sessions also included quotes from the CEOs in the survey expressing concern about the mediocre progress most corporations are making in addressing issues of sustainability. That lack of progress is causing CEOs across nations and industries to lose confidence.

From the survey’s results:

"CEOs see business caught in a cycle of ‘pilot paralysis’ – individual, small-scale projects, programs and business units with an incremental impact on sustainability metrics – and while they see a role for business in promoting sustainable development, their responsibilities to the more traditional fundamentals of business success, and to the expectations of markets and stakeholders, are preventing greater scale, speed and impact."

Heavy damage from this paralysis is showing: 45 percent of the CEOs surveyed believe that sustainability will be "very important" to the future success of their business. In 2010, that percentage was 54 percent. In the words of the survey, "This drop is striking in the context of intensifying global challenges…A decline in the perceived importance of sustainability among global business leaders is not encouraging for those working to align business with sustainable development."

Throughout the multiple plenary and breakout sessions where the new architecture was presented, familiar refrains were heard:

  • Leaders must learn from failure.
  • Fail and learn faster.
  • Stop repeating what doesn’t work.

UNGC's Leaders Summit Highlights Need for Change

A new set of guidelines and some positive thinking are just not enough to persuade leaders to push their organizations toward sustainability while their own pilot-paralysisconfidence is waning. Where we are now looks a lot like Einstein’s famous definition of insanity:

"Doing the same thing over and over again and expecting different results."

For me, listening to the speakers at the Leaders Summit reinforced how essential change is right now. The new business engagement architecture is a thoughtful addition, but the disconnects and contradictions from the CEO survey require a straightforward admission that we have lots of learning opportunities to share – mostly from failure – but are nearly devoid of success stories of any kind on the critical topic of scale.

To enhance that learning process and to enable businesses, NGOs, governments and the UN to change the frameworks that are resulting in failure and stagnation, I offer three rules that can address this pilot paralysis. This sequence of rules can also serve as a set of guidelines for any partnerships that are developing through the business engagement architecture.

 Rule 1:  The only way to learn to scale is to test at scale.

Rule 2: The only way to test at scale is to concentrate resources around models and interventions that have already proven to be effective and show potential to be sustainable at larger scale.

Rule 3: Once the focus shifts to scale, all resources need to be applied to scaling. Only invest minimal resources in measuring impact or other non-scale activities.

These three rules start with a simple challenge: Learn by doing. But then the program veers into a set of demands that require all players – in corporate sustainability, CSR, philanthropy, development and donor driven organizations – to commit CEOs-CSRan act of heresy. That heresy is this: Scaling requires focus. You can't do it if you are second-guessing whether you are scaling the right thing, constantly spending valuable resources on measuring impact or paying people to talk about an unsustainable model. (Social Entrepreneurship, Social Innovation: Not the Same Thing).

And the decision aboust what to scale is based on a variety of evaluative processes: Impact testing, measurement, policy, model, resource and "side effect" testing. That’s how sustainable solutions to one or multiple problems are identified. Once an intervention has proven effective and the business or delivery models are selected, learning to scale must flow from actual scaling. Through the scaling, new challenges emerge which then become the focus of the next round of activities.

ReachScale has developed this three-rule sequence through working directly with a variety of scalable social enterprises. Once the most innovative initiatives have been identified, optimal scaling capabilities are developed to best leverage corporate assets. [For more about this process, see Where Will the Household Names in Social Enterprise Come From?]

When it comes to scaling, you learn by doing. And there is no better way to address the pilot paralysis that is crippling our progress toward a more sustainable world.

The opinions, beliefs and viewpoints expressed by CSRwire contributors do not necessarily reflect the opinions, beliefs and viewpoints of CSRwire.

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