Sustainable Growth Strategies: 360 view in Belgian companies. Quality Research

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1 Sustainable Growth Strategies: 360 view in Belgian companies Quality Research CxO Leadership Forum 2011

2 Purpose? Qualitative Research amongst CxO s members internal processes on Sustainable Growth Strategies Who? 25 qualitative personal phone interviews amongst CxO s Board of the Wise and CxO s Experts Groups : CEO Finance Human Resources Logistic ICT Marketing

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4 Sustainability within companies

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6 Sustainability is present Awareness seems to have been created

7 Not behaving sustainably is no longer an option All undertake, to some extent, actions in the field of sustainability Sustainability is more and more seen as a need / willingness to adapt to the changing environment and to a new, long term oriented economic model

8 Sustainability remains a broad concept provoking a wide range of associations and internal triggers

9 Urgency Modern Innovation Finance Relationships Social Impact Consciousness Vision Emotion Connecting Creativity Impact ICT Partnerships Health Investment Distance Sustainability Transparency Trust Long Term Growth Strategies Facebook Technology Services Safety No way back DNA Bottom - up Time Education Marketing Human Ressources Authenticity People Management New generation Continium Greenwashing Health Profit Values Nature Industry Globalization Conviction Responsability Identity Mind set Top Down Communication Water Government Female Return Logistics Future Engagement Determination Measurable Consistency Entrepreneurship

10 External triggering factors can be identified: Media & Press Demograpical reality NGO Retailers Social pressure Civil society Customers Politics Ecological situation Trade Unions Policy Competitors Clients Er ontstaat een stroomversnelling waarin je gedwongen wordt door politiek en economie. Er is een maatschappelijke druk en daar willen we als eerste bij zijn. Het moet van het beleid komen, zelfsturing is er niet in voldoende mate.

11 However Sustainability >< Sustainable Growth strategies Sustainability isn t always part of a corporate vision implemented as a culture linked to company strategies linked with value creation set as overall goals (within all departments) Conditions to convert sustainability measures to a long-lasting, in depth, sustainable growth strategy linked to tactics (measurable projects) Het zit in alle metingen ingebakken. Als we het van uit strategisch oogpunt belangrijk vinden moeten we het ook in de belangrijkste objectieven integreren. 11

12 Ability to execute More industry oriented impactful when it comes to Planet (carbon footprint) Challengers Leaders Less strategic Must do external demand Non-believers Visionaries Sustainability as strategy - want tocreators of a sustainable demand More service oriented People Business - less impactful internally when it comes to Planet (carbon footprint) Completeness of vision

13 Sustainability within different company departments

14 Ability to execute This has of course an implication on Internal integration of sustainability into operational processes : Voor ons is het niet zo moeilijk om duurzaamheid te implementeren, aangezien het een deel is van onze waarden en normen. Het is ingebakken, waardoor het gemakkelijker is om iets te cascaderen. SILO ATTITUDES Frictions between departments less involvement More difficulties in implementing sustainable processes Completeness of vision COMMON GOALERS all heads / departments pointed in the same direction when it comes to sustainable processes Overall high involvement Easier to implement sustainable processes

15 CEO PROFIT Integration PEOPLE PLANET

16 Within a fast changing and chaotic world, a new type of leader has arisen Duurzaamheid wordt een strategie van succes. He s a co creator of future trust based business models

17 Awareness and Responsibility are amongst their key features: Put other accents people management Are Human Think alternatively Have other attitudes: sensitivity, modesty, empathy, integrity, generosity Set an exemplary role Have a global mindset Are world centric Are facts oriented: <> Mirage Are long-term oriented Clearly focus on values: ethics, humanity, social relevancy, equality, honesty, transparency, commitment Think holistic

18 His overall goal: improving business for future generations Ons doel is om telkens een beter bedrijf door te geven aan volgende generaties. The CEO s conviction, vision and philosophy make the difference: By finding a balance between growth, responsibility and core values By translating his internal values into an external vision By determining the company culture and its perspectives The anchoring of sustainability

19 This by acting accordingly to the companies philosophy Setting sustainable goals Measuring sustainable actions Demanding direct reporting and accountability Appointing a CSR manager / Excellence Centre Als je geen CSR Manager hebt dan gebeurt er niet veel, hij zorgt voor bewustwording. We zijn een resultaatgericht bedrijf. Wat je niet kan meten mag je vergeten, ook qua duurzaam ondernemen.

20 Finance PROFIT PEOPLE PLANET

21 CFO s are the extension of the CE0 and the guardants of realism: VALUE for VALUES They are the ones who define the notion of profit who determine the investment of money and time who come up with creative and innovative solutions We zijn er van overtuigd dat duurzaam ondernemen de weg is naar financial sustainability, naar profit op lange termijn.

22 Sustainable measures more than a sustainable growth strategy Sustainabiliy = Cost Consistent Sustainable Growth Strategies Sustainabiliy = Investment Sustainability if profitable As a short term, economical benefit Cost / investment related Economical need > internal conviction PROFIT Sustainable profit = growth As a long term, in depth benefit Larger meaning given to Profit, beyond the ratio Cost / Investment Important aspect of time Necessary to respect one s DNA and be 100% consistent Economical need // internal conviction PEOPLE PLANET

23 Human Resources PROFIT PEOPLE PLANET

24 Sustainability is more and more becoming an HR story.. Or how to have a positive return on society It s about: Building long-term relationships Giving opportunities Internal transparency Taking responsibilities Maintaining ethical standards Taking into account demographics Je hebt een impact op de maatschappij waarin je werkt But overall: It s about building a company culture

25 HR and Sustainability the reasons why: A new generation is born Demand consistency and transparency Attracted by socially relevant jobs Become brand ambassadors They are imperative within a sustainable culture Duurzaamheid wint aan belang als selectiecriterium voor jonge werknemers: die wensen meer en meer in duurzame, zinvolle bedrijven te werken.

26 Happy employees are better employees and good employees are needed People Business Withholding current employees and their knowledge Improving performance by creating a sustainable culture They reflect who you are

27 Sustainable actions in the field of HR are numerous and broad New workplaces Work life balance Safety International Employees rights Knowledge Humanity Families Respect Enriching employees life Flexibility Ethics Long term relationships Worldwide Sustainable goals Het mag geen opgelegde bedrijfsoefening zijn, de mensen moeten erin geloven. Iedere medewerker moet als hij aan zijn shift begint s morgens,s avonds terug gezond naar huis gaan. Duurzaamheid wordt in de persoonlijke objectieven van onze medewerkers geplaatst. Ze zijn zeer trots dat ze een bijdrage kunnen leveren. 27

28 Important tensions remain, questioning companies interpretation of: Social responsibility Eg. Local employment, Delocation Profitability Eg. Productivity, Efficiency >< Work Life balance, equality, education Human Resources strategy Eg. Positive Discrimination, financial compensations when sustainable goals are achieved, salary >< education/ fulfillment Duurzaam ondernemen zit mee in ons verloningsysteem. Als je iets belangrijk vindt moet je dat belonen. HR is belangrijk op het vlak van duurzaamheid: het bieden van gelijke kansen qua geslacht, leeftijd, maar we doen wel niet aan positieve discriminatie. Ik zie verschillende spanningsvelden: op financieel vlak bij het aanwerven van minder valide personen of op productievlak qua efficiëntie als iedereen 4/5 werkt.

29 Logistics PROFIT PEOPLE PLANET

30 Within logistics, creative alternative solutions are sought for They reinvent and dare Waste management Relationships with suppliers (business code of practice) Transport (Partnerships) Measurement «Goederen transport wordt meer en meer een prioriteit, we zullen slimmer moeten transporteren.» (including sustainable criteria, accept external audits, ) Certification «Duurzaamheid gaat gepaard met creativiteit.» De logistieke sector moet doorbreken en de alternatieven vinden.

31 However, their creativity relies on other actors Het is slechts als de overheid zal taxeren op ieder km die teveel gereden wordt dat er iets zal veranderen. They feel dependent on (and expectant towards) local / global governments their internal finance department their sales department «Bepaalde criteria zullen sowieso opgelegd worden, onafhankelijk van het kostenplaatje.» (Just in time management, service towards clients, ) their internal freedom (to experiment, to set up pilot projects )

32 They have an educational role to play «Hoe meer verschillende bedrijven voor duurzame maatregelen zorgen binnen de sector, hoe meer de maatregelen aanvaard worden.» They influence customers and companies when it comes to sustainability: By changing the traditional perceptions of logistics By approaching Just in time management differently By creating partnerships By seeking alternatives Je zou aan gecombineerd wegtransport kunnen doen maar dan riskeer je dat de klanten minder vaak bevoorraad worden, waar de business units het niet eens mee zijn.

33 ICT PROFIT PEOPLE PLANET

34 The ability to process sustainable changes within ICT is important ICT is een marginaal gegeven binnen de industriële sector als je naar de carbonfoodprint kijkt. Binnen ICT kan alles duurzamer: je hebt green data center, energy recovery, evoicing, virtualisatie wat toelaat evenveel te doen met minder materiaal. There s however a global feeling ICT is less impactful Time demanding change program ICT supports other departments: impact is often attributed to other departments (HR department, Sales, Finance, Logistics,. ) ICT clearly depends on the company culture and attitudes (Shutting down screens,,. )

35 ICT is an important innovative actor, but it needs the freedom to be so Efficient GPS Purchase R&D Heating Home working On-line client service Document management Software Investment Results Evoicing Cloud computing Hardware Processes Ecological Driving systems On-line follow up Home working On-line communication Printing Within ICT Within other departments

36 Marketing PROFIT Translation PEOPLE PLANET

37 Marketers are translators more than initiators They are vulnerable to markets reactions They feel stigmatized (Greenwashing) and under pressure Uncomfortable feeling : it s about doing more than about saying Dependency on the company culture A difficult topic of communication Needing specific communication channels 37

38 Sustainability and Marketing seem to be fundamentally opposed Sustainability remains a second purchase drive Not a USP: remains secondary Relevancy depends on type of product Het is geen marketingstrategie, het is een noodzaak. which indicates Marketing needs to be reinvented

39 Conclusion

40 We are at a changing point in our current business model Entrepreneurs will have a future social leading role: They will have to reply to changes as: Simplicity Complexity Ego- centric World- centric Competition Collaboration Profit Profit + Purpose Value Values Linear thinking Holistic thinking Taking Giving Control Flexibility Efficiency Sustainability

41 THANK YOU FOR YOUR ATTENTION Values-driven consumer research Workshops Consumer information platform Qualiblog Sustainable brand positioning Stakeholder audits & interviews Contacts : Thérèse Tasmowski Caroline George t.tasmowski@quality-research.be c.george@quality-research.be