THE IMPATIENT OPTIMIST

Things are getting better, but not fast enough. Embedding sustainability as a guiding principle in business takes time and new challenges are constantly emerging. If the gap is to be closed, it will be by a combination of opportunity and risk management, with an emphasis on innovation, says Aron Cramer.
Aron Cramer
President & Chief Executive Officer
BSR
“Every day when you wake up, you have to choose whether you want to be an optimist or a pessimist. I think there is ample evidence to support each choice, but
optimism is far more useful.”
Aron Cramer

In a sense, everything has changed. When Aron Cramer, the President and CEO of BSR – an international non-profit business network and consultancy focused on sustainability, considers how corporate sustainability has developed over the past decade or two, he sees huge leaps forward; businesses now commit to zero-waste policies, they switch to 100 per cent renewable energy and they use their supply chains as vehicles for creating opportunities for economic development for more people.

“I don’t think there were many companies doing those things 15 years ago,” he says.

But in some ways, nothing has changed. Too few companies are taking action. We have not curbed greenhouse gas emissions, water stress is growing and human rights violations are continuing.

“Every day when you wake up, you have to choose whether you want to be an optimist or a pessimist. I think there is ample evidence to support each choice, but optimism is far more useful,” says Cramer.

In a sense, it is Cramer’s business to be a guide for companies walking on the edge between optimism and pessimism. To guide them to take action. To do that, you probably need to be an optimist, and this is what he professes to be. When he looks around the corporate landscape, he sees widespread adoption of human rights principles, he sees fast-growing attention to gender equity, he sees companies working with the communities in which they operate, like the Chilean mining company he and local indigenous leaders had a meeting with just the week before the interview.

“Those kinds of things weren’t happening before. They make business better and they make life better for the communities where those things happen. I see many signs of progress, but I guess I would call myself an impatient optimist and say that I think things seem, in general, to be moving in the right direction, but not quickly enough,” says Cramer.

As he sees it, there is a need to accelerate change and to address systematic issues relating to the financial system, the public market, consumers and governments.

“All these issues make progress a little harder to achieve than we would like. However, if I was to choose one thing to change overnight, I would start with the way our public markets operate. I would speed up the transition to more integrated ways of valuing a company’s performance so that the incentives that business leaders have in front of them, not just every day, but every hour and every minute, are more in line with long-term value creation that explicitly considers the sustainability of the company’s business model, products and services and the company’s very essence,” says Cramer.

However, being an optimist, he sees the gap between what is needed and what is being done as closing, albeit slowly. This is driven by what he terms as “a combination of opportunity and risk”. In his view, risk management has been driving a lot of the change so far, especially the fear of losing reputation and provoking negative reactions from the media or civil society. But innovation – the ability to see sustainability as an opportunity – is on the rise, and he believes it will be a much stronger driver in the long run.

“The potential is infinitely greater from the opportunity side than it is from the risk side. Let’s face it, risk management is about preventing bad things from happening. That is an inherently limited concept. We are inspired by businesses when business creates exciting new things that meet our needs, but the needs of the 21st century are not the same as the needs of the 20th century. We’re not building products and solutions for the archetypal American suburban family that defined so much of the post-war economy. Now, we need to design solutions, products and services that make sense for a global urban middle-class in a world that is much more transparent and cannot continue to use natural resources the way it has. The companies that figure that out will be the champions of the 21st century,” he says.


WHAT’S NEXT?
THREE TOUGH QUESTIONS

Aron Cramer sees three big sustainable-development questions: will the massive technological development promote sustainable development or actually undermine it? Can we learn to manage resources in time to avoid both crucial breakdowns in our water and food supply and uncontrollable global warming? And can we create truly inclusive economic development?

To add to all this, sustainability professionals may need to prepare for a period in which their jobs become tougher. “The task of really implementing something like the UN Global Compact’s ten principles is much more prosaic than establishing them. Let’s face it, keeping sustainability on the world’s agenda isn’t as sexy as putting it there,” Cramer says with a laugh.