Baine: execs ‘increasingly allergic’ to simplistic, overly-positive vision of sustainability
Consulting giant tells companies to work out their purpose and how much 'humanity will have to pay' for growth
Baine & Company has published a “visionary CEO’s guide to sustainability,” arguing that the solutions being put forward to environmental and social challenges are often too simplistic.
In the 100-page report, the management consulting firm says it has talked to thousands of executives globally about growing pressure to meet sustainability ambitions.
“They get it. They know they have a role to play,” write François Faelli, Baine’s head of sustainability, and Torsten Lichtenau, its head of carbon transition, adding: “Executives are people too, and many see this as their legacy”.
But, the pair argue, execs “are presented with too many simplistic answers to what they know is an incredibly difficult balancing act,” including managing the tension between short-term returns and long-term objectives.
“Feeling ‘taxed and told,’ they are increasingly allergic to simplistic pictures of the sustainability revolution as a land of opportunity and higher returns,” they write.
Another major worry for executives is the divergence between their public pledges and their ability to deliver on them, according to the report. In Baine's research, 67% of large-company executives claimed to have “bold” sustainability ambitions with clear environmental, social and governance targets, but only 3% said they were on track to meet them.
In a chapter written by other Baine consultants, the lack of progress is attributed to firms trying to achieve their objectives without getting buy-in from the business units tasked with executing the plans.
“Ultimately, the key is to translate broad ESG commitments into team-sized challenges that can become new routines or new innovations,” the report says, acknowledging that “this is very easy to write and very difficult to do”.
Baine makes a number of recommendations, saying that executives should ask three questions during their next strategic cycle: what’s the company’s purpose, how much will “humanity have to pay” for its growth, and what obstacles could it face as the world enters “a period of scarcity, shortages and physical risks”.