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TBLI AcademyEngaging your Organization for
Environmental Social Governance (ESG)
2008 TBLI conference, EuropeAmsterdam, 13-14 November 2008
By Tom Cummings
Copyright © by Executive Learning Partnership, CVBA, 2007. All Rights Reserved. No part of this publication may be reproduced, stored in any retrieval system, or transmitted in any form or by any means –electronic, mechanical, photocopying, recording, or otherwise –without the express written permission of Executive Learning Partnership.
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The ELP – TBLI Business Case
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Systems Maps - Only Useful if we do it together!
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Leadership Landscapes
Individuals
Team
Organisation
Industry, Markets and CustomersMacro Business Perspective
What the ELP – TBLI Academy stands for
• 1) Informing companies - the landscape and next gen business
• 2) Engaging with leaders and their teams at both the rational and emotional levels
• 3) Enacting the business plan in a sustainable way
Ministers’ LunchRéunions informelles des ministres en charge de l'environnement et de l'énergie
Learning Journeys
CSR and Strategy
“The current economic cycle doesn’t represent a cycle, but a reset –CSR and strategy have to become part of the same conversation instead of competing ones.”- Jeff Immelt, CEO GE, BSR conference, 2008 New York
Next Generation Business
Existing Paradigm – Existing Business and Organizational Models
Vs.
New Paradigm – New Business and Organizational Models
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ROI on Sustainable Investment
Source: Lawrence M. Miller: Sustainable Wealth, 2008
Assumptions of the Existing Business Models
• Size = Comfort, Safety• Experience = Competency• Knowledge = Formal Education, Diplomas• Measurement = Money
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Existing Business Models
• What rights are being sold (and bought)?• What assets are involved?
– (physical, financial, intellectual, human)– Things are created or invented, distributed, used
and brokered or matched with buyers– Beyond serving needs– To what extent was scarcity vs. plenty considered– What is the lifecycle of this business model?
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Leadership Landscapes
Individuals
TeamMotivational StatesMindtalkMBTI - InsightsEquanimity shift/Dynamic EquilibriumLogos, Ethos, PathosCompeting CommitmentsAttention Units, Motivational States“User Guide”Diagnostics
Organisation“Why Behaviors matter” values and behavior exerciseDesired BehaviorsLeading ChangeConvening Authority/ Organisational Uniqueness Branding, Engaging
Industry, Markets and CustomersValue mappingHero’s JourneyLandscape OrientationMust-win Battles
Macro Business Perspective
20-20 viewNew External RealitiesFuture FactsForecasting and BackcastingTrendpullingStakeholder Mapping
Supporters
Agnostics
Antagonists
Champions
Cynics
Isolate
Convert
Surround
Encourage
Stimulate
“They”
“We”
“It’s a job”
“Yes, but”
“I’m proud”
Commitment Curve
ContactAwareness
Understanding
Positive Perception
Implem
entation
Adoption
Institutionalization
Internalization
Contact
Business Model Canvas
16Source: Alex Osterwalder
Business 3.2
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New Business Models
• For the TRANSITION in which the incentive system will remain
• Shareholders Stakeholders• Production costs True costs• Efficiency Effectiveness and Efficiency• Monetary value Overall value• New measures of well-being, beyond GDP
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New Business Models
• Shareholders Stakeholders
• Production costs True costs
• Efficiency Effectiveness
• Monetary value Overall value
New measures of well-being, beyond GDP
Sustainability vs. Sustainability
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Unsustainable Behavior
Sustainable Behavior
Sustainable Company
Unsustainable Company
Companies with a success
formula that no longer works
Strategy & Financial Perspective
Industry Laggards
e.g., Body Shop after 10 years
Greenmail
Business 3.2
Behavioral Perspective
Aspen Principles for Long Term Value Creation
• 1) Define metrics of long term value creation – Maximize future value – even at the expense of lower near-term earnings– Understand firm-specific issues– Look into industry best practices
• 2) Communications– Frequent corporate – investor communication– Avoid focus on quarterly earnings
• 3) Compensation– Align company and investor compensation policies with long-term metrics
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Source: Aspen Institute
Engagement beyond traditional borders of
leadership
Over the last two decades, large companies have moved through five stages:
Being world classRole modelProactive CSRStage 3
Helping out where governments fail
Activist local citizenDevelopment agent
Stage 4
Joining others in moving urgent global problem-solving along
Global citizenGlobal problem-solver
Stage 5
Reputation protectionGood corporate citizen
Defensive CSRStage 2
PhilanthropyPatronCharityStage 1
MotivationRoleCategoryStage
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New Leadership QualitiesFlat organizations-style personality
Vision and charisma, great communicatorA pattern-seeing mind, providing structure amidst complexity
Creating an opportunities-grabbing rather than issues-raising cultureInnovation-friendly traits
More emphasis on right brain-based skills and attitudesInnovation-friendly values: “workmanship mistakes no, innovation
errors yes”, “management by asking to be stunned”Structuring for innovation: hotspot teams, open innovation setup
Managerial bendsNumerator management rather than denominator management
A relentless enemy of internal process overgrowthYet a stickler for compliance
And a builder of dream teamsIdentity and Mindset
Cosmopolitan, broad based, world-awareRe-energizes through outside networking and scanning
Fearless in fearsome times
Business 3.2 – constant reframing
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Transitions
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Pioneers Followers “Laggards”
20% 60% 20%
Time
Seniorsponsors
Champions
Multi-Level Commitment
‘initiate’ ‘involve’
‘inspire’
‘integrate’‘infiltrate’
All employees
Cross-functional core team
Board members and senior management
senior managers able to influence and make recommendations to the sponsors
Brand workshop champions challenge current practice and act as catalysts in the team workshops
Source: ELP and The Brand Inside
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The ELP/TBLI – ESG Tool Box