Aron Cramer, president of BSR, is one of the leading voices in the world of corporate social responsibility, having led his global organization to its position of preeminence on that topic. In the run-up to BSR's annual conference -- and on the occasion of the publication of his new book, "Sustainable Excellence" -- GreenBiz.com executive editor Joel Makower caught up with Cramer to talk about innovation, China, the oil companies, and the state of the art of sustainability.
Joel Makower: To begin, tell me about your new book's title, "Sustainable Excellence." What does that mean beyond the usual terms "sustainability" or "corporate social responsibility"?
Aron Cramer: "Sustainable excellence" is the best way for companies to think about CSR or sustainability as the concepts move into the mainstream of business. Our book advances the idea that companies cannot achieve excellence without integrating sustainability into their fundamental business strategies, and that they will not achieve sustainability goals without approaching them in a hard-headed way that focuses on excellence.
There are several reasons for this. Many of them are familiar to GreenBiz readers: the rise of natural resource constraints, radical transparency, the distinct needs of emerging markets, and changing consumer attitudes, amongst other things. The book tells the story of how more and more global companies, up to CEO and board level, are thinking seriously about these concepts.
Given that sustainability questions are considered strategic matters for business, it is essential that they be approached with a seriousness of purpose that delivers great results, both for companies, and for the wider world. This way of thinking represents an important evolution, and is the best way to capture the full potential of the sustainable business movement. In fact, we close with the belief that, in 10 years, these ideas will be so widely adopted that "sustainable excellence" will be thought of simply as "excellence."
JM: In the book, you encourage companies to "think big," with strategies "that meet big global challenges." How well do you think companies are doing in thinking more boldly about creating business value from sustainability, and what would it take to accelerate this?
AC: More companies are thinking big than ever before, which is great. One of the positive -- though certainly unintended -- impacts of the great recession is that companies are more focused on how sustainability can deliver value, and advance their overall strategy. For me and BSR, which has always aimed to mainstream corporate responsibility, this is great news. On a case-by-case basis, there are many examples of this happening, from familiar cases like GE, to the recent announcement by Nestle to create a new business unit focused exclusively on "nutriceuticals," to "pure play" companies like Method, which make sustainability the defining feature of their strategy.
Despite lots of examples, this transition is not yet systematic. To make that happen, two things can make a fundamental difference. First, economic measures and incentives need to change. Too many things, from water to carbon to biodiversity, continue to be considered "externalities," and public markets continue to promote short-term thinking. This needs to change for companies to feel more confident about reorienting their investments.
Second, the current emphasis on a consumption-based economy needs to shift. As BSR has pointed out in its paper on the subject [PDF], finding ways to inspire and encourage consumers to change their purchasing and product use patterns is also crucial.
There is a lot that business can do on its own, under the existing system. More fundamental progress can be made, however, by changing market rules and consumer actions -- and businesses focused on sustainability should contribute to these changes.
JM: You also talk a lot about innovation, which, as you know, is a big theme this year -- at the GreenBiz Innovation Forum as well as the upcoming 2010 BSR Conference, which has an innovation theme. You talk about how "short-term thinking distracts business leaders from investing in the innovation" for a low-carbon economy. What's needed to change this short-term mindset, and what can companies do in the mean time to align their innovation and sustainability agendas?
AC: We have made Innovation one of the central themes of the upcoming BSR Conference in New York, November 3-5. At the conference, we will be presenting corporate executives and inspiring thinkers from outside business who are embracing the concept that sustainability is actually one of the great innovation challenges business has ever had. We are trying to accelerate a shift in thinking in recent years, as companies have come to see sustainability as a means of value creation as much as value protection.
At the conference, as well as more generally, I think that one of the keys to maximizing innovation is how companies communicate with new audiences. Much of the world's growth -- and business opportunity -- are found in big emerging economies. Unfortunately, this is also where there is the greatest potential for increasing our collective footprint to truly unsustainable levels. It makes no sense, on either an economic or human level, to step back from those markets.