Why We Need A Sustainability-Centric Recovery Model For The Future Of Business
How will the future look like in a post COVID-19 era? What can we do to support the global socio-economic recovery? What will become the new business as usual?
The scale of the socio-economic impacts of the coronavirus pandemic is an ever-evolving focus area, as the world continues to face an unprecedented health crisis, which has brought the global economy to a standstill, temporarily shut down industries, and still locking down certain countries to contain the further spread of COVID-19.
According to an April report published by the IMF, the global economy could shrink by 3% this year, hindering sustainable development across all dimensions, economic, social, and environmental. At an organizational level, there is no question on the enormous stress that the pandemic has put on businesses, from a rushed transition to virtual working ecosystems, a disruption in supply chains, and a decreasing product or service demand, with some companies being critically affected and unable to navigate these challenging times.
But what has been remarkable in these unprecedented times is the global solidarity and responses of governments, the private sector, and the civil society in mobilizing resources towards reducing the impacts of the pandemic. We have seen aid being deployed towards countries in need, organizations repurposing manufacturing lines to produce medical equipment and supplies, and individuals starting initiatives to uplift their communities.
And so, the question which now surfaces more and more is how will the future look like in a post COVID-19 era? What can we do to support the global socio-economic recovery? What will become the new business as usual?
This crisis has forced us to rethink business models and strategies, and undoubtedly, we have seen more focus than before being placed on impact, purpose, and sustainability. Organizations have been demonstrating that their capabilities and resources can be leveraged for the benefit of their stakeholders, the very same principle of sustainability. We have numerous examples of waivers of leasing fees, some that have committed to retain all their employees despite minimal operations, and others that have entirely repurposed their facilities, or prioritized giving back to the communities.
Sustainability has been increasingly under the spotlight over the past years, with the commercial benefits being highlighted in multiple case studies and research from all over the world. Not only it leads to strengthening the engagement of a business with its stakeholders, but when looking at a business through the lens of sustainability, it supports minimizing risks across its entire value chain, as well as optimizing costs and leading to developing innovation capabilities, just to name a few.
Could sustainability see more business adoption, and would the new economy paradigm focus increasingly on sustainable models, which bring purpose at the forefront? In a recent Bloomberg interview, Alan Jope, CEO, Uniliver, has highlighted that impact, which is deeply rooted in the company’s model is still at the foundation of business decisions amidst the pandemic and acts as the guiding compass of Unilever’s strategies “We truly believe that by positioning our brands on doing real good, by running our supply chain in a sustainable way, by being a responsible employer and creating great opportunities for people, a byproduct will be better financial performance.”
The organizations that haven’t been critically affected by the crisis have a unique opportunity to focus their resources towards rebuilding a prosperous ecosystem and supporting the socio-economic recovery. As a starting point, organizations can assess how the value created for their stakeholders could be enhanced, be it through their primarily products or services or by extending their responsibility within the communities they operate in.
For example, looking at circular approaches and reintegrating or repurposing waste, could reduce manufacturing costs, and at the same time, reduce the pressure on natural ecosystems. Localizing some of the supply chains could create new jobs and decrease the carbon footprint from transportation. Investing in the skills development of teams could prepare them for future roles as well as enhance their productivity or level of engagement.
It all thus begins with capacity building for sustainability, and looking at the UN Sustainable Development Goals on all their interconnected dimensions, economic growth, social well-being, and a lessened pressure on natural resources. This is an area which we have always been focusing on, supporting not only the leadership, but also the teams, steer away from the perception that sustainability is satellite volunteering or giving back projects, but rather can become an integral part of a business model and build organizational resilience, competitiveness, and performance. It is probably a moment to evaluate how any organization, regardless its scale, can drive progress towards the SDGs by maximizing the positive impact it can drive to its stakeholders.
If we look at other global examples, Canada has, for instance, announced a new economic relief program for companies, linked to those organizations disclosing their climate credentials and acting on climate change, in order to support the national sustainable development goals. This model could be replicated across continents and jurisdictions and lead to an increased transparency on ESG disclosures as well as an enhanced action on sustainability challenges.
At a city level, Amsterdam has committed to the adoption of the doughnut economy model in order to support the city’s recovery post pandemic and build a long-term strategy. The doughnut model shapes an economy paradigm which revolves around sustainable development and reflects in the SDGs framework, with “the safe and just space for humanity” being based on a solid social well-being foundation and within environmental parameters, or “planetary boundaries.”
Can sustainability frame our long-term global and organizational recovery strategies? There is certainly potential- we at Concerto TIC also ran a survey on LinkedIn with the results so far being that over 60% of the respondents expressed their strong feeling for sustainability being adopted on a broader scale post COVID-19, and more than 20% suggesting that this could be a possibility. As such, a new world is ours to make.
Mihaela Nina is Partner at Augmentation X, a business growth studio, focused on conceptualizing, prototyping and managing digital products, technology systems and digital solutions, that enable businesses to drive both commercial performance and brand value. In her role, Mihaela leads the growth and client concept management of the flagship digital communications product of the company, Augmentation eXperience.
Prior to Augmentation X, Mihaela has founded Concerto TIC, a boutique sustainability advisory firm, as well as built revenue growth strategies across a wide spectrum of levels within the hospitality and services sector, having developed and driven the largest paid membership program of IHG MENA, as well as restructured and led the membership strategy of the most prominent business club in the region, Capital Club Dubai.