Why 'Sustainable Excellence' Matters More Than Ever

I met Aron Cramer in 1995, weeks after he joined BSR, the San Francisco-based global network of more than 250 member companies working on sustainable business strategies and solutions. He went on to open the organization’s Paris office in 2002 and became BSR’s president and CEO in 2004. I’ve had the good fortune of working with BSR in a number of capacities since its founding in 1992, and have watched Cramer emerge as one of the world’s most articulate thinkers on the opportunities and challenges that lie at the intersection of business and sustainability.

On the occasion of the paperback publication of his book, Sustainable Excellence, co-authored with Zachary Karabell — and in the run-up to next week’s 2011 BSR Conference, November 1-4 in San Francisco — I caught up with Cramer to find out how corporate responsibility has changed since we last talked a year ago, the impacts of the economy on sustainability and what the public expects from business these days.

Joel Makower: Let’s talk about what’s changed over the past year or so, and where things are going. For starters, what’s the impact of today’s economy on companies’ search for sustainable excellence?

Aron Cramer: Well, the prospect of an extended period of economic stagnation is underlining and reinforcing some aspects of sustainable excellence, and it’s reorienting some of them. Some of the things that remain as true — in fact, I’d say are more true in light of a weak economy — are the importance of innovation to sustainability, because every period of economic retreat shows that innovation is central to companies’ forward progress.

Those companies that stop investing in innovation during bad times stay in bad times. And those that redouble their efforts come out more quickly and are the champions that can take advantage of a rebounding economy. And because the world’s biggest challenges continue to be linked to sustainability, this period of stagnation only reinforces the need for companies to look at ways they can develop new products, new services, new partnerships that will allow them to turn sustainability into a business opportunity. So that’s been reinforced, and I think it will only be more true in the years ahead.

Makower: It seems to be harder to look to business as a savior at the same time that the private sector's standing is so low.

Cramer: One of the ways that the agenda is absolutely changing is that there is economic vulnerability in the West on an order of magnitude that we’ve not seen for decades. And that is changing the sustainability agenda because the level of trust in business is very, very low. People feel as though their needs may not be taken care of.

We’ve got chronic unemployment throughout the West and no prospect that that’s going to turn around anytime soon. And for the first time since the Rio Summit in 1992 — in the modern history of sustainability — we’ve got a large percentage of the western population that feels as though they are on the edge. That’s why we’ve seen the Occupy Wall Street movement gain some steam. I think this means that questions around executive compensation, around transparency, around governance, around what a company is doing with respect to lobbying, the level of profits that some sectors — particularly the financial services sector and the energy and extractive sectors — these are all going to be getting greater scrutiny.

So if the agenda has been defined along environmental lines in many ways over the last few years, the social and economic side is becoming much more important. It’s something that companies overlook at their peril.