Developing the right type of leaders for climate action
CEMS, which is a global alliance of 34 business schools and universities dedicated to preparing future business leaders, surveyed 4,206 professionals from 75 countries, and the results provided the basis of a report featuring insights and recommendations from a range of experts.
When CEMS last undertook their survey in 2008, they found that technological advancement was business leaders’ number one priority. Now, 43% of leaders believe that the environment is businesses’ greatest challenge, with technological advancement a distant second (26%).
“Leaders […] must understand not only how climate change is impacting their business, but what they could lose if they don’t act,” says Angela Hultberg, Kearney’s global sustainability director.
“Then, irrespective of industry, leaders should feed this thinking into business planning, priorities and investment decisions. Sustainability is a fundamental disruptor because it will impact your business in every way, and we need leaders who can handle that,” she says.
The report’s first academic contributor, Dirk S Hovorka, professor in business information systems at the University of Sydney Business School in Australia, kicks off by arguing that current business thinking is deeply embedded in “a system of goals and ideology” that constrains action, because companies have much more immediate concerns.
Hovorka believes that biodiversity and the environment is talked about as if they are external and separate from us, and that one of the biggest challenges is convincing society that the responsibility lies with humans.
“The environmental crisis is not somebody else’s fault,” he says, “it isn’t corporations or government, but every single person contributing to this problem.”
Many business schools, he argues, make the mistake of promoting the idea of inspirational ‘guru’ leaders who will miraculously solve our environmental problems, while also making money. This management approach, however, is inherently disempowering.
“In fact, everyone’s activities are interconnected,” he contends. “If individuals adopt the ‘collective leadership’ philosophy we can effect positive change more effectively.”
Andrew Delios, professor in the department of strategy and policy at the National University of Singapore Business School, appears to disagree when he argues the need for bold leaders who establish “strong organisational objectives that drive the cultural change needed for a greater focus on ESG [environmental, social and governance] issues”.
Steering a more central course, Lars Jacob Tynes Pedersen, professor and head of the Centre for Sustainable Business at the Norwegian School of Economics, contends that in this academic and workplace debate, both sides have a point.
“Some believe a visionary outspoken approach can spark change, [while] others believe in a silent revolution with, for example, shared goal setting,” he says. “There is a place for both. There is a tendency to frame the conversation as a ‘battle’ rather than agreeing the sustainability metrics and achieving them.”
Dr Camille Meyer, CEMS programme director at the University of Cape Town’s Graduate School of Business, contends that we need leaders who are prepared to challenge the status quo, because the current social structure always benefits a particular group of individuals and organisations.
The problem is, however, that if this prevailing system goes unchallenged, it leads to larger and larger inequalities. “Eventually the level of inequality becomes too great, and the system fails,” he says. “It is best to break this cycle before it happens.”
Tomorrow’s leaders therefore need to be pioneers who have clear and strong values, and who have the courage to try and implement change. “Only pioneering leaders can build awareness and give a voice to others so that they can develop a deeper collective idea of the challenges,” he says.
Nurturing collective responsibility
The report closes with a series of key recommendations for business leaders and educators, among others.
Regarding business leaders, Leading for the Future of Our Planet says that companies must play a greater role in environmental and social sustainability.
Businesses, for example, should develop leaders who prioritise ESG, ensure long-term solutions are embedded in strategies, and nurture a corporate culture of collective responsibility.
One of the key ‘actionable takeaways’ is the suggestion to partner with educational institutions to showcase to students the value that organisations place on ESG.
“Encourage senior leaders to spend time with students discussing their own journeys and how values influence their decision-making,” it says.
Regarding educators, the report argues that teachers within business schools have an exceptional opportunity to positively impact environmental and social sustainability.
Specifically, among the recommendations, the report argues for the need to “incorporate deep knowledge of ESG issues into business education, with the topic woven through the entire curriculum”.
Schools must keep pace with new research in business and science to support ESG theory and, specifically, “incorporate system dynamics, introduce students to Seventh Generation thinking and Herman Daly’s pyramid of well-being to reframe narrow corporate ideology”.
Furthermore, educators need to ensure that students have a deep understanding of the complexity of natural systems and the natural environment, and how decision-making impacts that.
Business schools must work more closely with companies to ensure that theory and practice are synergised, and emphasise the importance of values among students. “Students need to be aware of the complex links between societal inequalities and the environmental crises,” it says.
Regarding the debate outlined above, the report comes down on the side of promoting collective over ‘hero’ leadership. The solution to the environmental crises cannot be down to just “one wise leader”, it argues.
“Averting environmental catastrophe will require a completely new set of business beliefs, behaviours, objective setting and modelling which assigns value to sustainability, and a cost to inaction,” it says.
“For too long we have treated planet Earth as an infinite resource to plunder. In very recent years, however, humanity seems to finally understand that we are headed for environmental catastrophe if urgent action isn’t taken,” concludes Nicole de Fontaines, executive director of CEMS.
“The business world must play a critical role in leading the charge because it has the capacity, capability and resources to drive positive change. The challenge is how to develop – at all levels – bold, exceptional leaders with the awareness and skills to deploy world-saving solutions,” she says.