- May 6, 2019
- Posted by: CSR-in-Action
- Category: Insights
Ethical and socially responsible business practices are on the rise – and not just for political gain or attractive soundbites. Companies are discovering such efforts fuel widespread goodwill and profitability. Case in point is a notable commercial Bank in Nigeria. The Bank has consistently demonstrated its commitment to energy reduction by switching off lights in all its operation areas at a given time daily. This achieves two things. First, is energy reduction which saves the Bank tons of money. A second is work-life balance. Due to the implementation of lights out, staff are left with little or no choice to close early to their other lives.
Whether an organisation is implementing a social investment initiative or an environmental sustainability plan, a critical issue required in creating a vibrant and sustainable organisation is to create avenues to get all employees—from top executives to assembly line workers—personally engaged in day-to-day corporate sustainability efforts. The organisation in question maybe a million-dollar entity or a small-scale enterprise, part of its commitment to sustainability would require getting everyone on the same page. Otherwise, it would be difficult to garner goodwill or buy in from its key internal stakeholders.
Bring Everyone to the Table
Without doubt, bringing everyone – board members, executives, middle managers and workers on the same page is a daunting task. Discussions on social good and smart stewardship can sometimes be the tipping point for staff to demonstrate their differences. Strong personalities and ingrained political leanings can for example get in the way.
it is hard for companies to operationalise sustainability goals, even when the people working for these companies, including their leaders, care about sustainability in the world. The problem is that not enough companies have yet figured out how to link their employees’ values and support for sustainability with the employees’ daily work and the company’s operations. In other words, it’s not in the why but in the how of embedding sustainability where the gap lies.
What have companies like Marks & Spencer done to make sustainability personally relevant to their employees such that business decisions at every level of the company are conducted through the sustainability lens? And what can leaders of other companies do differently to overcome apathy and instil the same sense of passion and urgency in their workforces to make sustainability part of their day jobs?
The below steps throws a searchlight into steps taking by key multinational organisations in engaging their employees to be fully involved in sustainable business practices.
Aligning Personal and Corporate Values
Most employees use a rational cost-benefit calculus (what’s in it for me) to decide how to act and please their superiors. In a business world dominated by maximising profit, this calculation often leads employees to behave in ways that their organisations support but that run counter to the values employees use to conduct their personal lives. A study of young employees found that in several instances, employees suspended their own values temporarily in the belief that laudable ends justify questionable means. Rarely did these employees have the support from others within the company to voice their values and question the work they were being asked to undertake.
Such a reciprocal relationship between organisations and their employees (i.e., sensing superiors’ desires and acting in accordance) has also been noted by management scholar Paul Strebel, who found that employees and organisations have reciprocal obligations and mutual commitments that define their relationship. Those agreements are what Strebel calls “personal compacts,” and corporate change initiatives (such as a transition to a sustainable business model) require changing the terms of these compacts and fundamentally reconciling personal and corporate values. Unless leaders define new terms and persuade employees to accept them, “it is unrealistic for managers to expect employees fully to buy into changes that alter the status quo,” writes Strebel.
Personal compacts have three dimensions: formal (job descriptions, employment contracts, performance agreements), psychological (rewards, recognition, expectations, and commitment), and social (perception, culture, and values). Successfully integrating sustainability into a business requires management to reconcile the gap between personal and corporate values in all three dimensions. In the formal dimension, employees observe whether sustainability is integrated into job descriptions and training programs and whether sustainability targets are tied to employees’ variable compensation. In the psychological dimension, employees observe whether sustainability performance is rewarded and recognised and whether superiors set performance expectations that align with sustainability. And in the social dimension, which is key, employees observe whether there is consistency between what the company says about its values in its mission statement and what it practices.
Spell Out the Economic Case for Sustainability
Helping employees see the economic case for operating in a more sustainable way is not always easy, but it is crucial; otherwise, people will think that sustainability is just about “doing good” and not also about “doing well.” General Electric’s Ecomagination program to develop cleaner technology solutions, for example, has grown in 10 years from a $700 million R&D commitment to a $15 billion-a year business. And Marks & Spencer’s Plan A sustainability program generated a net benefit of £160 million in 2014-15.
How does a manager make the economic case for sustainability to employees? At IBM, environmental goal setting has long been an integral part of the company’s overall planning process. The company uses the process to engage its business units and employees in addressing environmental challenges. The process begins with the corporate staff completing an in-depth analysis of the ways in which IBM’s businesses intersect with the environment. Draft goals are then developed, considering the company’s environmental objectives and its commitment to be a leader in the area of environmental sustainability. The specific goal recommendations and underlying analysis supporting the goals are then reviewed with business units to secure their buy-in. Through this process the business units gain an understanding of the environmental drivers and objectives behind each goal as well as the business and societal benefits.
Create Sustainability Knowledge and Competence
Sustainability cuts across all aspects of a business, from energy consumption to procurement. To bolster the “can do” belief and attitude among employees, it is important to invest in educating employees about sustainability as well as to create systems and processes that make it easier for employees to integrate sustainability into their business decisions. Many sustainability initiatives require specialised knowledge and expertise—such as talking to suppliers about sustainable sourcing or using an eco-efficiency tool to evaluate a new product. No wonder, then, that companies as diverse as BASF, IBM, Marks & Spencer, and Nestlé have invested heavily in training and development, as well as systems and processes, that enable sustainability decisions to be made at a large scale.
Make Every Employee a Sustainability Champion
Every successful company shares one thing in common: strong leadership. And nowhere is that more important than in creating a sustainable company. As John Brock, CEO of Coca-Cola Enterprises, put it in the context of setting a sustainability agenda: “Frankly, the single most important thing in my view is leadership. You’ve got to have somebody who believes in it [sustainability]. It’s the CEO. That’s the number one. And then you’ve got to have an executive leadership team that is equally committed to it.”
At Unilever, as part of leadership development, the most senior executives are encouraged to identify their personal purpose in life to help them shape their future career at the company. They are then invited to choose one of Unilever’s biggest sustainability challenges linked to business growth—such as water scarcity, sustainable sourcing, or women’s empowerment—and work in groups to develop solutions to present back to the top leaders in the business.
It’s not enough to have sustainability champions at the top—they must be cultivated at all levels and geographies of the organisation. At Unilever, the attention to sustainability training has led to widespread adoption of sustainability among company employees. In fact, 76 percent of Unilever’s 170,000 employees feel their role at work enables them to contribute to delivering to the sustainability agenda, and about half of all new employees entering the company from university cite Unilever’s ethical and sustainability policies as the primary reason for wanting to join. In a world where fewer than 20 percent of people go to work and feel happy, a workforce like Unilever’s, where almost 80 percent of people feel engaged, is a competitive advantage.
Co-create Sustainable Practices with Employees
Another important way of embedding sustainability in a company is to engage employees in the co-creation of sustainable practices. And a way to do this is to act on employee initiatives. Company executives can start by making it clear that funding for sustainability projects is available and readily applied when an employee develops a good idea. The former chief supply-chain officer at Unilever, Pier-Luigi Sigismondi (now executive vice president Unilever South East Asia), says that a typical employee reaction to sustainability programs is: “Are they really serious about this? Where is the capital to do this great sustainability project?” To which he or his team answers: “Here’s the capital—show the business case, and then you will have the funds.”
Companies get more and better ideas when they bubble up from the bottom. A great example of this is Marks & Spencer, which now has clothes-recycling boxes in its stores that provide income for the international nonprofit Oxfam. The boxes were an employee’s idea that received support from the board and achieved great success.
Once company employees begin to see the positive impact and economic returns on social and environmental investments that they helped create, they start believing that they do have a role to play, and the ideas start to flow. It is essential for a large company to provide the framework for people to play within, and then things happen almost by magic.
Encourage Healthy Competition Among Employees
An effective way for an organisation to embrace a new set of goals and foster an “I should do it” spirit throughout the company is to create a culture of healthy competition among employees. Competition stimulates creativity, and the skills that spur competition—a willingness to push boundaries, trust group members, and collectively solve problems—are the same skills needed for innovating on the sustainability front.
Connected to Care, an initiative launched by BASF in 2015, is an example of healthy competition. The chemicals company provides every employee with an opportunity to join a team, develop a corporate volunteering project in one of three core BASF areas—food, smart energy, and urban living—and submit the project to Connected to Care. In 2015, more than 500 project ideas were received from about 35,000 employees across all BASF regions worldwide. All employees worldwide are able to vote for their favourite projects.
Make Sustainability Visible Inside and Outside the Company
Several social cognition models point to the important role that visibility and salience play in changing people’s beliefs and attitudes and influencing behaviour. Measuring and communicating progress on key sustainability indicators always attracts people’s focus. People want to succeed in the dimensions that they are measured on. No wonder, then, that leading companies develop indicators to track the progress of their sustainability agenda, which they share with external stakeholders and employees.
Unilever, for example, has an annual review of USLP progress with stakeholders around the world and produces an internal sustainability scorecard that is updated every quarter. Senior management’s performance-related remuneration is based in part on progress against sustainability targets. Indeed, the company has moved beyond simply reporting progress to engaging external stakeholders to co-create potential solutions to social and environmental issues.
Showcase Higher Purpose by Creating Transformational Change
While external engagement is a critical component of transitioning to a sustainable business, it is also key to building credibility and legitimacy, and consequently pride and identification, with employees. Unilever set audacious targets and made them public, so it is incumbent on the company to communicate progress and motivate employees to deliver them.
Leading sustainability companies have another thing in common: they want to make a bigger impact by influencing and working with other companies, whether in their value chain or among competitors. Doing this fosters a sense of unity among employees because they see that achieving sustainability is not just about themselves, or even their own company, but rather a societal issue with global implications, all of which inspires them to join in.
Purpose and Productivity
We should all aspire to leave our world a better place. For an individual, that means behaving in a sustainable manner in his or her personal life. For a company, that means having a meaningful and strategic purpose and finding ways to tie that purpose into the values and day-to-day work of individual employees.
Every person wants his or her working life to have a higher purpose that goes beyond doing a job and earning an income. Yet too many people spend most of their waking hours in workplaces that fall short of providing that higher social purpose. Companies that can resolve the tension people feel between their personal values and the best interests of the business will benefit by having a highly engaged and productive workforce—proud to play a part in bringing positive change to communities around the world.
- Glazer, Robert (2018) https:// Engaging Employees in Corporate Responsibility Is a Brilliant Strategy. entrepreneur.com/article/323218
- Edwards, Carlyann (2018) How to Increase Employee Engagement in Sustainability https://www.businessnewsdaily.com/10868-increase-employee-sustainability engagement.html
- Polman, Paul & Bhattacharya, CB (2016) https://ssir.org/articles/entry/engaging_employees_to_create_a_sustainable_business
- Strebel, Paul “Why Do Employees Resist Change?” Harvard Business Review, May/June 1996, p. 86.
- Michael G. Pratt and Blake E. Ashforth, “Fostering Meaningfulness in Working and at Work,” in Kim S. Cameron, Jane E. Dutton, and Robert E. Quinn, eds., Positive Organizational Scholarship: Foundations of a New Discipline