Last month saw the publication of "Changing Tack," a report that is the final output of The Regeneration Roadmap, a project undertaken during the last 18 months by GlobeScan and SustainAbility to assess progress on sustainable development over the last 25 years.

In a column providing an overview of the report, my colleague Chris Guenther suggested that "extended leadership" will be required to accelerate and scale sustainable development progress and ensure that present and future societies and ecosystems have equal opportunity to thrive. He spelled out the report's point of view that the private sector has the opportunity to demonstrate "extended" leadership in order to accelerate progress. Six attributes of extended leadership were deemed most important: vision, goals, offer, brand, transparency and advocacy.

"Changing Tack" holds that the six attributes, especially undertaken together, will directly improve company sustainability performance and increase organizational resilience. Equally, the report emphasizes how critical it is that leaders think of the system conditions that need to change to enable sustainable development. This article builds on Guenther's previous column and briefly explores why systems thinking and an acceptance of interdependence are such critical elements of extended leadership.

Bigger than any of us

"Changing Tack" sets up an enormous challenge -- the re-shaping of the economic system in a way that exploits its strengths while ensuring that future innovation and growth occur within planetary limits -- and asks companies to embrace the imperative of sustainable development leadership.

Fundamental here is the premise that the economy and markets can meet their potential to be a positive force in delivering sustainable development only if sustainability is addressed at the level of the whole system. This requires a collective effort that looks into the root causes of problems and how relationships between system elements might evolve to allow better, more sustainable outcomes. Critical to any chance of success are businesses' relationships with one another, government, investors and consumers, and the manner in which private sector interests complement or align with civil society's actions and the influence it in turn is exerting to bring about change.

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Urging more collaborative and systemic approaches does not undercut or undermine the work individual organizations have done. "Changing Tack" emphasizes the need for best practice from business, the policy realm and civil society to be replicated and expanded as rapidly as possible. But it acknowledges that the myriad separate leadership efforts evident today, even at their most outstanding, are not producing enough progress in aggregate.

Simply put, many sustainable development challenges go beyond what any one organization can do alone. (For a more detailed assessment of sustainable development progress, see SustainAbility's and UNEP's just released GEO-5 for Business, summarized in this GreenBiz article.) In addition to this being a moment when we need business leadership, sustainable development is at a juncture when more effective collaboration, at scale, will be essential to success.

Market potential

The Regeneration Roadmap sought to understand and attend to flaws in the economic system -- market failures such as information asymmetry and externalities that act as impediments to sustainability progress. The Regeneration team agrees with observers such as Jeremy Grantham of asset management firm GMO: "[Capitalism] does all the little things brilliantly. But a lot of the stuff that Adam Smith didn't get around to, [capitalism] does rather badly -- and that is basically the tragedy of the commons."

Grantham believes that if government took responsibility for defending the water, air, soil and land we depend on, capitalism would prove without peer in terms of ability to make sustainability real. But governments struggle to reach consensus on the common good, let alone set enforceable treaties or guidelines to deliver that consensus. Others, such as investors and consumers capable of sending market signals to incent more sustainable corporate behavior, don't yet exert adequate pressure to bring significant change.

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"Changing Tack" finds hope in nascent initiatives with business at their center, including:

• Roadmap to Zero Discharge of Hazardous Chemicals (ZDHC), a coalition of apparel companies and stakeholders collaborating across the industry value chain to eliminate the discharge of toxics by 2020

• Nike-NASA-USAID-US State Department LAUNCH partnership. which applies systems thinking and approaches to "identify, showcase and support innovative approaches to sustainability challenges" on topics as diverse as waste, energy, health, water and sustainable materials

• Efforts to institutionalize pricing of natural resources, such as the Valuing Natural Capital Initiative and Natural Capital Declaration

• Calls from business to policymakers to expand and improve policy tools, such as carbon pricing schemes designed to mitigate or correct market failures that pose risk to the private sector's long-term strategies and investments as much as the welfare of others.
 
Extended systemic leadership

It's critical that more and greater collaborations and innovations such as those above be rapidly prototyped, assessed, improved, evolved, re-applied and widely distributed. This is what we anticipate to be the result of companies applying and integrating the extended leadership attributes in "Changing Tack."

Companies which apply the attributes best and with the system in mind will exhibit:

• Vision that goes beyond ensuring the company is a going concern to one equally concerned with system integrity as its own success

• Goals that bypass best-in-class relative performance in favor of absolute improvement targets rooted in the best available science and understanding of ecosystem carrying capacity

• Products, services and business models (Offer) that address societal and environmental needs at the same time as consumer wants -- what Umair Haque sometimes calls "betters and services" and which we describe as differentiating by being both different and better in sustainability terms in "Changing Tack."

This approach and style (applying equally to brand, transparency and advocacy in addition to vision, goals and offer) demands different and better organizations and collaborations, too -- leaders who realize mutual success and the common good are equally business and moral imperatives that must be addressed for the benefit and prosperity of all.

Image by JNT Visual via Shutterstock.