CEOs, POWER AND SUSTAINABILITY

An article I saw in the Guardian entitled “6 Reasons CEOs feel powerless to drive sustainability into their companies” was bound to attract my attention.

I thought I would give the six reasons quoted and my response to each of them.

1.  PEER PRESSURE. The article says “CEOs are fearful of sticking their necks out in public when the vast majority of their peers, even those with sustainability programmes in place, remain in denial about the scale of the dangers from climate change, resource scarcity, growing inequality and the decimation of biodiversity” Frankly, I find the idea that CEOs can be excused because they are frightened of their peers, pathetic. CEOs are appointed, generally because they are seen as leaders and have drive and determination. I thought fear of peers was for the playground not the Boardroom.
2. LACK OF BOARD SUPPORT. I am a bit more sympathetic to this, but only a bit. CEOs are expected to provide strategic leadership and addressing issues of sustainability is highly strategic. CEOs need to spend time understanding the issues and gathering the evidence and then should be able to win the board around.
3. LACK OF INVESTOR SUPPORT. Again if I can quote the article “Even harder than changing the mind sets of their own directors is convincing shareholders of the need to stop their obsessive focus on short-term profits and consider long-term sustainability.” I found that most shareholders did have a relatively short term focus, maybe a year or two. However, I can also confirm what the article says about Unilever. “CEO Paul Polman has tried to get around this by actively seeking out investors who can take a longer view and asking them to invest in the company.” There are funds out there with a sustainable focus, probably over €15bn managed in the UK’s alone.
4. STASIS IN MIDDLE MANAGEMENT. The treacle layer of management is a well known phenomena but CEOs have to find ways around it. I used a blog posted on the Intranet to get my messages across to everyone. When pressure comes from above and below then things start to happen.
5. COMPLEXITY OF THE GLOBAL ECONOMIC SYSTEM.  It is true that even the leaders of large organisations can feel overwhelmed by the sheer scale of the global challenge. However, I don’t accept the premise that this means you don’t do anything. All change starts with action by small groups of people and the best time to start is always now.
6. LACK OF POLITICAL AND REGULATORY SUPPORT. Finally this is a reason I have some sympathy with. However, some companies seem to encourage an unhelpful regime as they think it suits their own short term agendas.

So I guess you can say that I don’t think the case for inactivity is, in any sense, made. The business case for embracing sustainability is strong but as the article says “It can feel very lonely if you are a CEO who recognises the need for system change, but we need to see courageous leadership” You can only lead if someone follows so if you know someone in the position of leadership who wants to make change happen then help them build unstoppable momentum.