Skip to main content

How Can Companies Take Ownership of Sustainability?

On February 21st, Bhattacharya talked about his research interviewing employees about making their employers more sustainable as part of the Business, Environment, and Society Speaker Series
Braden Beaudreau, MBA Student

Braden Beaudreau, MBA Student

“I feel like I have to check my morals at the door on the way to work.”

This is how one employee at a prominent business responded when asked about his company’s sustainable business practices. The interviewer, CB Bhattacharya, as part of a research project, has spoken to 100+ employees in diverse roles at 25+ companies in order to discover their opinions about what (if anything) their companies are doing to be more sustainable. In the majority of interviews, including the one quoted above, Bhattacharya discovered that many employees believe their companies are not doing enough to promote sustainable business. In fact, those interviewed expressed how middle- and upper-level management often don’t support efforts in sustainability—even when the company is widely perceived by the public as a leader in sustainability.

Employees desire meaning in their work. Enabling sustainability ventures from the top down can help many environmentally- and socially-conscious employees achieve the satisfaction of making a difference in the world. The question that begs to be asked is: Why not make this possible?

On February 21st, Bhattacharya talked about his research as part of the Business, Environment, and Society Speaker Series, hosted by the Ray C. Anderson Center for Sustainable Business at Georgia Tech Scheller College of Business. Bhattacharya is Professor and H.J. Zoffer Chair in Sustainability and Ethics at the University of Pittsburgh Katz Graduate School of Business. The presentation, “Someone Else’s Problem No More: How to Gain Competitive Advantage Through the Sustainability Ownership Experience,” was based on employee interviews at top companies, including Disney, McDonalds, Nestlé, The Coca-Cola Company, and Unilever. Bhattacharya’s talk (also a subject of a recent Harvard Business Review article) focused mainly on how companies are failing to own the sustainability problem.

According to Bhattacharya, we are currently consuming 1.5 times the natural resources our planet can renew annually. By 2050, that number is anticipated to rise to 3. A factor contributing to rampant overconsumption of our natural resources is that more than half of all businesses ignore the United Nations’ Sustainable Development Goals (SDGs). At most companies, sustainability is treated as someone else’s problem. Even if a company admits that sustainability is important, it will often focus instead on what it perceives as more important tasks at hand. Some companies just pass the buck. Small companies, for instance, may feel that it is the responsibility of large companies to tackle the problem. However, since large companies may focus on shareholder value and maximizing profit, it is easy to see how sustainability goals may fall by the wayside. Despite large hurdles ahead, our planet needs business leaders to step up.

Why do companies fail to take ownership of sustainability? Generally, Bhattacharya found that companies lack the willingness and/or ability to change. The lack of willingness may be attributed both to the dominance of short-termism in business as well to a tendency to distrust philanthropy or corporate social responsibility (CSR). As mentioned earlier, I have learned during my business education that most large companies focus on creating value for their shareholders and maximizing profit. Few employees, based on Bhattacharya’s interviews, believe that sustainability can lead to large growth in either of those areas.

Bhattacharya recommended a few fixes for the willingness problem. To resolve short-termism, company leaders need to wake up and recognize that many investors care about sustainability and are more willing to invest in a company if they see evidence of sustainable practice. To fix the suspicion of CSR, leaders need to be trained to recognize the financial benefits of sustainability. To turn the tide of resistance to change, all company leadership must be unified by policies that emphasize purpose and by a definition of the company along the lines of its commitment to sustainability.

Bhattacharya proposed a sustainability ownership model, which recommends steps a firm can take to become more sustainable in practice.

Phase I: Incubate: Company leaders contour the company’s specific purpose in the world and concretize the purpose into measurable goals.

Phase II: Launch: Company leaders entice and enable ownership by educating stakeholders about the connections between business and sustainable goals. Leaders also give stakeholders tools to invest themselves in achieving these goals. This step requires actual financial commitment to sustainable goals, which is understandably a big step for firms.

Phase III: Entrench: To “entrench” means to make sustainability a routine practice. Employees begin to treat sustainability as something people just do. This step requires leaders to demystify how employees can contribute to sustainability within the company, to enliven sustainability practices as well as learn how they can expand systemic change beyond company walls.

Like anything else worth fighting for, becoming more sustainable won’t be easy. However, taking personal and company-wide ownership of the problem is the key mental jump to starting on that path. Many employees already care about sustainability because it helps them to derive meaning from work. Many investors care because they want to put their money into companies that benefit the world. Many CEOs, too, say they care. However, many companies’ actions have yet to follow. It’s time for companies to catch up and care much more about investing in sustainability.

Braden Beaudreau is a first-year student in the Evening MBA Program at the Scheller College of Business. He is a 2017-18 Scheller Sustainability Fellow.

This website uses cookies. For more information review our Cookie Policy