10/31/2012 08:55 am ET Updated Dec 31, 2012

The Growing Momentum Behind Sustainability Management

For the past three decades I have taught public management at Columbia University. Since about 2000, my growing focus has been on the emerging field of sustainability management. This new field of study combines organizational management with the field of environmental policy. In a blog post I wrote in June 2011, discussing my book Sustainability Management, I observed that "all effective management must be sustainability management." In the year and a half that has passed since then, the centrality of sustainability issues has only been reinforced. In some respects, a concern about sustainability is an effort to correct modern management and move it away from theory back into the real world of physical resources and constraints.

In the past several decades, we have developed what I sometimes call a brain-based economy. The high value added elements of modern economic life involve analytic concepts, technological development, mathematical models and communications creativity. This is in stark contrast to the economy one hundred years ago. At the start of the 20th century, 40 percent of U.S. workers were employed in agriculture. By 1930 this had dropped to 20 percent and today it is about 1 percent. We have developed a highly mechanized, energy intensive, high throughput economy that is chewing up the planet's resources at a ferocious pace. This has resulted in rising prices of some raw materials and in massive destruction of environmental resources that provide us with free "ecological services" such as clean water and air.

Shutting down this economy is not an option. In fact, given the needs of the developing world, I fully expect the world's economic production and consumption to grow dramatically through the 21st century. The only way this growth can be both achieved and maintained is if we pay far more attention to the natural resource base of our economies and the impact of economic development on self-renewing, interconnected ecological systems.

The cost of mistakes will continue to grow if we do not learn how to manage our organizations and their production according to the principles of environmental sustainability. The most obvious recent examples of the costs of these mistakes are the billions of dollars that were required to clean up the BP oil spill and the Fukushima nuclear melt down. There is also the trillion dollar-plus cost of global toxic waste clean-up and the increased costs of filtering polluted water to make it potable. Here in New York, the City is spending over $200 million a year on communities and landowners surrounding its water supply to protect this resource and save the cost of constructing and maintaining a $10 billion water filtration system.

The principles of sustainability management are built on an understanding of our dependence on nature for human well-being. Nature is not protected for its own sake, but for ours. Traditionally, managers have been concerned with financial management, human resource management, information management, production processes, strategy and marketing. Today's managers must also pay attention to the use and cost of natural resources, the cost of waste production and disposal and the environmental impact of organizational outputs and waste. These physical dimensions of sustainability can no longer be ignored. They are an increasing percentage of an organization's cost structure. They can no longer be wished away -- there are too many people in the pathways of exposure to industrial poisons.

The world is more crowded and its economy more complicated then it used to be. A storm that might have missed human population centers a century ago can now affect millions of people. As I write this and watch the now routine mobilization of the nation's "emergency response" system in the aftermath of Hurricane Sandy, I observe the growing organizational capacity and technology devoted to storm response and reconstruction. Electric and water utilities are paying increased attention to the need for infrastructure resilience, and in the next few years will be paying even more attention to this issue in the face of reduced public tolerance for service interruptions.

In New York City, our entire government was mobilized to ensure safety and return the city to normal as soon as possible. There is active discussion about the need for more resilient infrastructure in the wake of Superstorm Sandy. While the storm here was unprecedented and caused great pain, it is unlikely to be as unusual in the future as it was in the past. If an emergency happens every year, it's hard to call it an emergency anymore.

Our planet is more crowded and resource-stressed than ever. These facts, along with a more interdependent global economy, places increased demands on organizational management and inter-organizational networks. A waste that could be released into the air or water in 1940 and avoid human impact can no longer be disposed that way. Coordination among the decentralized networks that produce the goods and services we depend on requires well-functioning transportation, water and energy infrastructure.

The fossil fuels burned by a nation of 100 million Americans in 1915 was minuscule compared to the fuel consumed by an America of about 150 million people in 1950. That is in turn a small percentage of the energy used by America's 312 million people today. Our use of energy and consumption of raw materials dwarfs the America of a century ago. If we are to continue this level of production and consumption we must learn how to reduce the one-time use of natural resources and base our economy on renewable resources. We must also take far greater care to keep toxic substances out of our water, air and food supply.

The management of this complex and interconnected economy and the maintenance of the planet that it depends on require sophisticated sustainability managers in the private and public sectors and a set of environmental rules that can't be bargained away for short-term material wealth. While I see progress in that direction in some companies and in some localities, it is too little and too slow. Although I believe that President Obama truly understands the need for sustainability management, I see no sign that Mitt Romney gets it at all. In any case, best chance of progress is not policy from the top but increased pressure from communities and citizens to push companies and governments. That pressure seems to be building, and along with the growing number of people studying and improving sustainability science, policy, management, design and construction, I remain optimistic that the transition to a sustainable economy is gaining momentum.