How HR Will Save You Money and Save the World

Posted on by Jeana Wirtenberg

Is it possible that the HR department can have more impact on sustainability than the Sustainability department? Every employee at BASF’s Livonia Plant in Livonia, Michigan is a player in the company’s sustainability efforts. During evaluations, plant workers—from middle managers down to factory floor workers—must set sustainability goals for their job and be able to articulate what sustainability means to them.

Why are chemists and administrators being asked to define sustainability goals for their work? A better question would be: Why isn’t that standard practice in every company.

Over the past two years, I embedded myself in nine companies—all of them sustainability leaders, but none of them common sustainability media darlings—to find out what worked, what didn’t, and what needs to happen next to take sustainability to the tipping point.

I found that commitments to sustainability were strong, but many companies struggled to take their programs to the next level. I also found ample evidence that the future of sustainability rests not with the sustainability/CSR department, but in the most unlikely of places: Human Resources.

We’ve made a lot of progress in the last 10 years, but sustainability is in danger of stalling out. The next stage in the evolution of sustainability is to reach every employee—not just in the C-suite, but at each level of operations. That’s because sustainability lives and dies in the day-to-day decisions made, not just by CEOs, but by everyday employees—middle managers, customer service reps, factory workers, and others.

Sustainability “happens” when a middle manager makes decisions and takes actions in ways that reflect not just the ways of financial profit and loss but of sustainability gain and harm. It happens when a unit leader encourages a team to vet social impact and ethics questions in a team meeting at the same time that they’re vetting options for growing the bottom line. It happens at those everyday levels.

Even the best laid sustainability efforts will fail if employees at all levels aren’t playing a part. If only half the people in your company are involved in sustainability, your goals will only ever be half-fulfilled.

Let’s Shift the Center of Gravity

In the vast majority of companies today, sustainability and CSR programs are managed out of a dedicated function. Those departments have brought us a very long way. But they too often operate in a silo, and they simply can’t reach everyone, everywhere, on their own.

This was borne out in a BSR survey last year, which found that sustainability offices connected to supply chains, the C-suite, and PR departments, but very little to other parts of the company. The center of gravity, so to speak, is set in departments and functions that few employees ever interact with or affect.

We need a shift in the center of gravity; from a siloed department that has little involvement with employees at large to the single department that touches every employee: HR.

Sustainability is intrinsically tied to the types of people you recruit, how you onboard them, how you steer “culture” internally, how you keep accountability, and what professional development programs, incentives and raises you provide. All those things put HR in the perfect position to steward a shift toward total employee involvement in sustainability.

Through my research, I found that one of the biggest stumbling blocks for sustainability efforts is with middle managers. They are the most likely to be trapped between different types of signals and incentives. They’re also the ones who make the daily business decisions that determine what gets done versus what simply gets talked about—and therefore are in a position to make or break sustainability.

But who can blame them for being stuck? In the face of competing signals, employees are likely to revert to old, internalized signals about business—making every decision exclusively or primarily according to finances. That’s basic psychology. The key is to introduce new factors more aggressively and reinforce them universally—from every meeting to every performance review.

To address the problem and reach those middle managers, HR will need to play a central role. We’re redefining how people see their jobs and we’re rejiggering the system of goals and rewards in a way that sustainability departments simply cannot do alone.

Two Critical Roles for HR Managers

Let’s get back to BASF. Far from an anomaly, their Livonia Plant is actually the result of a company-wide policy, making every employee part of the company’s sustainability strategy. BASF found that without engagement with the middle and lower rungs of the corporate ladder, sustainability efforts were lagging and critical problems—especially those observed on the front lines—weren’t being addressed.

So they did two essential things: They required every employee to establish sustainability goals for themselves and be able to articulate them; and they integrated those goals into annual evaluations.

Sustainability strategies can be awfully big and confusing things. For everyday employees they can be nearly impossible to decipher. Requiring that each employee sets their own goals within the company strategy and can define sustainability for themselves makes those big strategies real. More importantly, they give you the opportunity to evaluate the effectiveness and the results of what each employee is actually doing on the ground.

Because if sustainability isn’t part of employee evaluations, then it won’t happen. That might sound pessimistic, but any business leader knows that if you want something done, you’ll need an accountability mechanism.

Many companies might balk at the suggestion that every employee should have a sustainability goal for themselves. Factory workers and middle managers, they might say, are not essential to achieving sustainability. But the truth is, it’s the day in, day out activities of those middle and lower level employees that make or break sustainability. I’ve documented many proven, replicable programs and approaches that can help engage those critical employees in my book, “Building a Culture for Sustainability.”

Sustainability can start out as grand goals, but it lives and dies by the millions of little actions made by everyday employees. It’s time for us to use that to our advantage.

Building Bridges To A Sustainable Future

Posted on by Jeana Wirtenberg

Dr. Jeana Wirtenberg, nationally-recognized expert in organizational change, shares an excerpt adapted from her new book Building a Culture for Sustainability.

Whether they realize it or not, companies today must choose between two fundamentally different paths: the path of yesterday and unsustainability, and the path of a prosperous and sustainable future for themselves, society, and the planet. We are all immersed in the same profound transformation, from a singular focus on profitability to an integrated triple bottom line: a holistic approach that simultaneously unleashes the talent, creativity, and innovation of people, takes care of our planet, and produces a prosperous future for the generations to come.

This triple-bottom-line focus on people, planet, and profits has been talked about for years, ever since John Elkington coined the term in his book Cannibals with Forks in 1998. Like all companies, the nine profiled in this book need to operate inside the current economic reality, which rewards short-term profits and puts shareholders above all else. Yet these companies consciously choose a sustainable path for themselves, their people, and the planet. Why? And how do they do it? What goes into the choices and decisions they make every day regarding how to run their businesses? What challenges do they face? What lessons have they learned?

This book tells the rich and authentic stories of why and how these nine successful global companies, from a wide cross section of industries and sectors, are making the transition to the triple bottom line in the emerging green economy. I describe how they are contributing to, and benefiting from, this transition. I share their struggles, their challenges, their successes, and the lessons they are learning on the journey to sustainability.

My intention in writing this book is to provide inspiration and practical ideas for people in all organizations—small, medium, and large companies; nonprofits; and public and educational institutions. I invite each person reading this book to say aloud, “If they can do it, so can I!” Take note of ideas that may be a fit for your organization, or even kernels of ideas on which you can build a foundation for your own journey to sustainability.

Setting the Context: The Urgent Need for Systemic and Holistic Change

There is no doubt that today we are experiencing global economic, ecological, and socioeconomic justice problems—financial crises, social unrest, and environmental disasters. Systems thinking tells us that these upheavals are inextricably intertwined. They point to a fundamental lack of sustainability and the urgent need for systemic and holistic change. The time for this change is now, and I choose to be optimistic and believe that the needed changes are not only possible, but already occurring. Critical is a shift in how organizations are led, are managed, and operate, moving from the single-bottom-line measure of profit to the triple-bottom-line focus on people, planet, and profit.

When I speak about sustainability throughout this book, I am referring to much more than going green or engaging in eco-friendly practices; I am speaking about a fundamental and profound redefinition of the purpose, way of being, and way of operating of every function and facet of an organization. The voices and actions of the nine diverse companies breathe life into this redefinition as they put the triple bottom line into practice, embed- ding it as an intrinsic part of their vision, mission, purpose, policies, practices, systems, and processes.

They engage their employees in co-creating a sustainable future for themselves and us all, and in this book, readers will experience the ways in which each company is making its own unique contribution to sustainability, fueled by the passion, hearts, and minds—and just plain common sense—of these employees. Readers will find a multitude of examples of how each of the companies’ people are discovering and implementing sustainable business practices and responding to the marketplace with products and services that meet the needs of tomorrow as well as today.

The choice is ours. We are at a critical juncture, and there is little time left. All businesses, as well as shareholders, customers, stakeholders, and the citizens of nations, regions, and cities, must choose sustainability and take control of what we have collectively created. This book distills and represents some of the best thinking and recommendations for how we can and must go about doing that.

Building a Culture for Sustainability

Even though 93 percent of CEOs consider sustainability important to their company’s success, most do not know how to embed it into their company. I propose that culture is the missing link here; it is key to accomplishing the shift to a sustainable future in organizations. And for this reason, I chose to focus on organizational culture in this book. In The Sustainable Enterprise Fieldbook: When It All Comes Together, my colleagues and I described organizational culture as “the shared values, beliefs, and work styles that define what is important to a specific organization,” and note that it “influences acceptable behaviors and practices.”

What does a culture for sustainability look like and how do companies get there? As we will see in the chapters to come, each company defines a culture for sustainability in its own way. Yet there are common threads running through each of these companies’ definitions.

How Do We Get There?

The good news, as evidenced in every chapter of this book, is that culture is fungible. It can change, and business leaders and managers can help shift the balance to sustainable mind-sets and behaviors by influencing their own and others’ belief systems. More good news is that companies don’t need to resort to top-down command and control, coercion, or even peer pressure.

People already care about these issues. Companies just need to offer the enabling environment, encouragement, and reinforcement for people to contribute what already resides within them. I wrote this book to provide pathways for organizations of every size, sector, and industry to do just that.

Three Transformative Business Sustainability Trends

Posted on by Jeana Wirtenberg

Sustainability has come a long way in the last 30 years. Fewer and fewer business leaders are asking, “Why should my company take action?” and more and more are asking “How?”—how do they create impactful programs that will take root, deliver return on investment, and drive innovation across the business? To answer that question, I spent two years embedded within nine major companies — none of the “usual suspects” on sustainability.

I explored the intricacies of their sustainability programs: what worked and what didn’t, and which ideas remained ideas and which became reality. In doing research for my book on building a culture for sustainability, I identified three powerful answers—three emerging trends that can re-shape standard business practices, and therefore shape a future in which sustainability considerations are no more unusual than budget considerations. I call these transformative impact practices in sustainability, or TIPS, and they form a powerful core for changing business culture and mindsets in ways that make sustainability and social responsibility indelible. Here’s a look:

1. CO-CREATION

Sustainability and corporate responsibility are not just top-down mandates, worked out by executives closed off in a conference room. In fact, sustainability works best with the opposite approach: executives working with customers and other external stakeholders to determine what to do and how to do it. It’s what the business world calls co-creation, and it’s one of the most powerful TIPS emerging in the sustainability space. Here are a few examples of the kind of co-creation that, if adopted more broadly, will help take private sector sustainability to the tipping point:

  • Co-Designing Products: Rather than engineers designing sustainability-enhancing products that nobody may buy, companies are increasingly bringing customers into the product development process. These co-created products can reach the greatest possible market and enhance customers’ own sustainability goals, making the product seller and buyer part of a seamless green business strategy. Ingersoll Rand, which manufactures heating and cooling systems used by businesses and consumers, has launched a system for determining its customers’ sustainability objectives and how much they’re willing to pay for products that support those objectives. This enables the company to “upgrade” products in ways that bake in a new generation of sustainability features that people will actually buy and use. In doing so, it makes a real contribution to protecting the environment—especially considering that its customers are heavy energy users.
  • Co-Creative Planning: Co-creation should start in the planning stages, and incorporate customer, employee, community leader, and other stakeholder voices from the outset. Co-creating sustainability strategies is the best way for companies to ensure that their work will take root and have impact. Several companies are already doing this. Alcoa, for example, uses co-creation to set up its community initiatives. Instead of dreaming up nice things to do for the community, it created a deliberate process and trains people on the front lines (for example, plant managers) to use the process to engage stakeholders, analyze and evaluate needs, and determine priorities. This Community Framework system teaches people that meeting community needs is part of their job; it also guides them through the steps needed to do so strategically.

2. BOTTOM-UP

Companies are increasingly adopting bottom-up approaches to sustainability that make employees a vital part of the innovation process. Bringing employees into the innovation process is precisely what many businesses want, and it’s a particularly powerful concept when applied to sustainability. Deep change in business—change that’s truly about social good and sustainability—is no longer as much about what happens at the highest levels of a company, but at the mid- and front-line levels. The latter are the ones who make business decisions and take actions daily that make or break whether sustainability happens.

In addition, once a movement is bottom-up, it’s hard to stop. And that’s exactly what we need! It also has the added benefit of being visible to others, giving it a multiplier effect. At Alcatel-Lucent—a telecommunications company in a male-dominated industry—a few women in France got together and brainstormed about how to create a program to help women unleash their potential. They created a group called StrongHer, which has since grown to more than 950 members (18 percent of whom are men) in 51 countries. The group collaborates on an internal social media network and organizes local events.

Senior management has taken notice, and now regularly consults the group’s leaders and sees it as a model for their industry. At chemical company BASF, everyone in the company—including scientists, sales people, and those on the factory floor—have individual sustainability objectives and have articulated sustainability in their own words and for their own jobs. It’s a top-down requirement aimed at unleashing bottom-up thinking and action that senior executives couldn’t dream of.

3. LONG VIEW

While companies are often accused of having a quarterly-earnings mentality, more and more corporate leaders are including longer-term growth concerns into their strategies. Sustainability requires a long view, and companies are starting to incorporate sustainability programs into a longer-term vision for their companies—not in conflict with shareholders but as a way to satisfy them. This is important for any company operating today that wants to thrive tomorrow, and it means planning for a whole new world of customers, employees, environments, and constraints. Sustainability is critical to future-proofing any company.

BASF has created an environment for strategic planning and business operations that may sound at odds with the near-sighted company stereotype. It’s focused on 2050 and has found ways to make future orientation part of corporate strategy, product development, and partnership creation. In particular, it’s looking at the role it will need to play as the global population reaches a projected 9 billion—something that will happen in our children’s lifetime.

An exploding population coupled with the rapid growth of the middle class in developing countries, in conjunction with ever increasing demand for ubiquitous connectivity around the world, means exponentially more people using the smart devices supported by Alcatel-Lucent’s IP, ultra-broadband, and cloud networks. That’s why the company’s Bell Labs founded a global research consortium called GreenTouch—to achieve the goal of making telecommunication networks up to 1,000 times more energy efficient than they are now.

The choice is deep change or slow death, because the products the world needs and the talent companies need to produce those products are going to be very different in a world that’s flatter, hotter, and more crowded.

The original article appeared at Stanford Social Innovation Review