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Anca Novacovici Headshot

Sustainability -- Finally Mainstream?

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Sustainability is ubiquitous -- it is on the news, touted on corporate websites, and marketed on the products we find on the shelf. The Harvard Business Review defined it as a business mega-trend in 2010, putting it in the same category as electrification, mass production, information technology and globalization. Even with all of this attention, however, can it be considered mainstream in the business world?

Sustainability, like many new concepts, has followed a typical bell curve. While some might argue that we are now in the early or even late majority part of that curve, I would argue that businesses are just barely transitioning to the early majority phase -- at least in the United States.

A 2011 KPMG study on corporate responsibility reviewed reports from over 3400 companies worldwide, and categorized American companies as 'scratching the surface' as opposed to companies mainly in Europe which were seen as 'leading the pack.' According to the study, while "ninety-five percent of the 250 largest companies in the world now report on their corporate responsibility activities, two-thirds of non-reporters are based in the US." These are companies that have focused more on communicating their actions than on actually operationalizing sustainable business practices. This is something that I have also seen when working with organizations on their sustainability initiatives.

Companies are implementing sustainability initiatives because consumers, shareholders and investors are asking questions and are incorporating sustainability into their purchasing and investment decisions. It used to be that only environmental and political activists followed a company's sustainability activities -- at least in the case of the larger companies. Now, because it is at the top of stakeholders' agenda, companies are communicating their sustainable business practices -- even though they may have only changed out their lights and put in recycling bins. This is the case not only with large companies, but also applies to medium-sized and smaller organizations.

How many organizations can you name off the top of your head that have actually shifted the way they are doing business, and consider sustainability a core business value? In order for sustainability to be considered mainstream, it should be as much a part of an organization's structure as IT or finance. The innovators and early adopters have begun down this path.

One could argue that most organizations have not yet started because sustainability is a relatively new concept and therefore it takes time to adapt and adopt -- and to find the resources (internally and externally) to populate that area of their business. I would agree. Sustainability as part of the organizational structure and culture is still in its infancy. It requires a fundamental shift in doing business.

At the 2012 CERES Conference, CERES shared the results of a U.S. study of 600 large, publicly traded companies and where they stood on sustainability, defined as governance, stakeholder engagement, disclosure and performance. Their findings? That "companies are moving, albeit too slowly, given the urgency of the sustainability challenges we face."

So, is sustainability mainstream? Although the buzz around it may have us thinking it is, organizations in the U.S. still have a ways to go to internalize sustainable business practices.

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