Just two per cent of corporate sustainability programmes achieve or exceed their aims, compared to 12 per cent of other corporate transformation programmes, according to a report from management consulting firm Bain & Company.
The change traps
For its report Achieving Breakthrough Results in Sustainability, Bain surveyed 300 companies involved with sustainability transformation. It found that even well-intentioned companies can run into obstacles that prevent them from achieving their goals, which the report calls ‘change traps’.
“Once companies learn to navigate common roadblocks, they open the door to a transformational journey and the potential to leave a legacy, prompting companies to redefine what it means to be a leader in their industry,” said Jenny Davis-Peccoud, who leads Bain’s sustainability & corporate responsibility practice.
'Change traps' include:
- a lack of resources and competing priorities are the two top obstacles employees say threaten to derail sustainability programmes;
- a lack of incentives for driving sustainability change, with fewer than one-quarter saying they are held accountable for sustainability through incentives;
- many employees do not see sustainability as a business imperative – although more than 60 per cent of survey respondents cited public reputation as the key driver for sustainability change; and
- employees don't prioritise sustainability because of perceived business trade-offs.
See the chart below on the barriers and success factors involved in sustainability programmes.
Four ways to make change happen
However, the report's authors emphasise that improving a company's sustainability can invigorate the core business, bolster the customer value proposition, secure the supply of key resources, lower operational costs and improve employee satisfaction. The report also warns that organisational change takes time. Bain outlines four ways in which companies can improve their chances of implementing a successful sustainability programme:
1. Public commitment
Bain's report states: “Many executives hesitate to make their goals public, fearing reprisal from third-party watchdogs if they fall short. Sustainability leaders manage that downside risk by engaging proactively with stakeholders. They affirm that the benefits of public commitments significantly outweigh the risks by creating a shared sense of mission and helping companies stay the course during difficult phases.”
2. Lead by example
Bain's research shows senior leadership support is the most important factor contributing to success, and visible actions—not just words—make the difference. CEOs create the vital lift-off energy for sustainability efforts and regenerate momentum throughout the journey.
3. Focus on the business case
Growth for brands with a demonstrated commitment to sustainability was four times faster than non-sustainable products in 2015, according to the Nielsen Global Corporate Sustainability Report.
4. Use incentives
Companies that achieve ambitious sustainability goals embed sustainable behaviours and processes throughout the business and make line managers responsible for delivering results.
CTMfile take: The failure rate – 98 per cent – of corporate sustainability programmes is really shocking. Bain's report makes some interesting suggestions on how goals can be achieved through incentives, commitment and looking for the business case. This kind of approach to effecting change could be applied to other types of transformation programmes.
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