So, How Sustainable is the Wal-Mart Sustainability Index?

To quote Eric Clapton: “It’s in the way that you use it.”

The Wal-Mart sustainability index is measuring whether suppliers are measuring their impact on energy usage, greenhouse gas emissions, waste, resource depletion and the communities in which they operate. Essentially it’s binary with annotation. Are you or aren’t you? If you are, please describe what you are doing.

Wal-Mart is gathering data. The key question is “What for?” Wal-Mart has sustainability targets and standards. They can be found here. They are doing good work. Of particular note are their Sustainability Value Networks. In these networks they’re bringing together “leaders from our company, supplier companies, academia, government, and non-governmental organizations (NGOs)” to work in categories that are core to Wal-Mart’s business. It is a matter of course that they will compare what they are learning from their suppliers with their own progress, most likely incorporating best practices along the way.

So, how will they use it with the suppliers? In the answer to this question lies the answer to the question in the title of this post. And, to really uncover the meaning in that answer requires us to look at the quality of relationships Wal-Mart forms with the suppliers and the quality of relationships the suppliers form with their network.

What do I mean? First, sustainability is something we do together. Fundamentally local and place based, sustainability depends on the quality of our relationships with the world around us. Reducing impact is good, however, relationship-wise this creates a less bad quality of connection. Imagine a spouse telling you that to strengthen your relationship he/she was still going to be bad but, from now on, less bad than before. A start? Yes. A strong foundation for a long-term relationship? No.

Second, sustainability is long term. What are we trying to sustain? Us. How do we do that? By sustaining what sustains us. One way to conceptualize this is a Value Web. Incremental reduction, though currently necessary is not sufficient. We become the slowly-boiled frog. The quality of relationships in our value web slowly erode, the web disintegrates and less bad leads to very, very bad. Simply, we need more good.

So, back to Wal-Mart and their suppliers. Moving forward, the better they are able to build networks of Collaboration that strengthen and enhance the Value Web the more sustainable the Wal-Mart sustainability index becomes. This is where those Sustainability Value Networks could really become value-abling. And, the more coherent their approach, the more effective the networks become at being sustainable. Again, it’s in the way that they use it.

So, now, think about this: For a retail giant like Wal-Mart this is a big hairy audacious undertaking that will touch pretty much all of us for generations to come. This matters. So do we.

So much depends on how we are, what we see and what we do now. As we do as we do we get what we get, becoming what we become. These are interesting times…

Tags: best practices, Coherence, collaboration, Eric Clapton, greenhouse gas emissions, NGO's, Sustainability Index, Sustainability Value Networks, value web, Wal-Mart, waste reduction

The Wal-Mart Sustainability Index: An Overview

Retail giant, Wal-Mart, debuted their Sustainability Index in July. You can download Version 1.0 of the Index here. The latest list of questions on the survey is here.

The survey is divided into four categories: Energy and Climate, Material Efficiency, Natural Resources, People and Community. In essence, it will function as an baseline measurement tool that sorts suppliers by having them demonstrate they are in control of their energy (GHG), waste (solid/water) management and reduction initiatives, material sourcing (production/certification), and community engagement (awareness of impact). At best, it points toward Cooperation. Basically, though, it sets a bar of Compliance for companies that want to do business with Wal-Mart

Though the first category is titled “Energy and Climate” a more appropriate heading would be “Greenhouse Gas Emissions.” The four questions in the category are focused completely through the lens of reporting and reducing greenhouse gas emissions.

The second category, “Material Efficiency”, is dedicated to reduction of solid waste and water use. Linked closely to Wal-Mart’s Packaging Scorecard and their Zero-Waste initiative, it is asking companies to demonstrate how they “reduce waste and enhance quality.”

Category three, “Natural Resources” focuses mainly on sourcing and certification, asking companies to report on origin of materials, purchasing guidelines and 3rd-party certification.

The fourth category is “People and Community” and centers on corporate awareness of and engagement with the communities in which they operate. The first question is telling. It asks if companies know where all of their production and manufacturing facilities are. It’s a start…

Relatively unexceptional in its content it still has very strong potential to be a game-changing move. The reason is simple: as a supplier, to do business with Wal-Mart means doing business their way. Though they are not setting any baseline requirements at the moment, nor are they auditing suppliers (answers to the 15-question survey are received in good faith) they are asking suppliers to complete the survey. To do so means you want (and really need) to have policies and controls in place or risk getting pushed out by companies that do.

Ultimately, this points to the development of an embedded system of and processes for sustainable business. The question suppliers for Wal-Mart have to answer is: “How far do we want to go?” Simple Compliance or Conformity? Cooperation? Collaboration and Coherence? Or, systemic Constellation?

Up next: How sustainable is the Wal-Mart Sustainability Index?

Tags: Climate, Coherence, collaboration, Community, Compliance, Conformity, Constellation, cooperation, Energy, GHG, greenhouse gases, Material Efficiency, Natural Resources, Packaging Scorecard, Sustainability Index, Wal-Mart, waste, zero waste

Nike, Creative Commons and Best Buy Building Collaboration

Interesting post at Worldchanging details an approach by these companies to open up their sustainability innovation using Green XChange:

Combining technology and the Creative Commons licensing structure, Green Xchange provides a platform where companies are able to issue licenses to other companies, allowing them to access patented research. The patent owners determine the terms for use, creating a contract that other interested parties accept before accessing the information. Patent holders can protect sensitive information by screening which types of companies may access it, and they can also set the cost for its use. The funds generated would theoretically provide a revenue stream to fund further research.

Like it. This is the kind of thinking and practice that can make sustainability sustainable. Now we need mindsets to follow practice. As they say at Worldchanging:

The main obstacle in persuading companies to share their valuable knowledge is fear…Green Xchange challenges companies to view them as something transferable, and potentially profitable when shared. 

…If Green Xchange succeeds in changing the way we think about transferring intellectual property and benefiting from shared ideas, it could usher us into a new realm of thinking of sustainability (and potentially other fields like medicine) as a truly collaborative endeavor.

Could not agree more. An abundant world awaits.

Collaboration is where we start unlocking our potential to solve the problems we’re facing at a level higher than the thinking that got us into them. Compliance and Conformity just are not sustainable. Cooperation, though good, is not going to be enough either.

Coherence, a step beyond Collaboration, is where it all comes together-we start being the change we want to see in the world. And if we can start to act in Constellations, our unfolding present and our children’s futures may really begin to shine, brilliantly.

Tags: Best Buy, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, Creative Commons, Green XChange, innovation, intellectual property, Nike, patents, Worldchanging

Beyond CSR: Being Sustainable

There is growing evidence that CSR as commonly practiced is not an effective use of corporate resources.

In a recent McKinsey poll of 391 CEO’s whose companies participate in the UN Global Compact, the CEO’s listed “competing strategic priorities” as the most significant barrier to implementing an integrated strategic approach to CSR. This was followed by:

• complexity of implementing their strategies across diverse business functions and divisions
• lack of recognition by financial markets
• differing definitions of CSR across regions and cultures

…companies aren’t using that tool [CSR] as well as they could. Executives doubt that their philanthropy programs fully meet their social goals or stakeholders’ expectations for them.

their corporate philanthropy programs are very or extremely effective at meeting social goals and stakeholder expectations. Their companies take a somewhat different approach than others do: their programs are more likely to address social and political trends relevant to the business and to be influenced by community and business needs. Executives…say that efforts are already more likely to involve collaboration with other companies. Finally, these companies are much likelier than others to say they are achieving any business goals they have set for their philanthropy programs in addition to social goals.

So, what’s happening here?

We are seeing a clear difference between companies that see CSR as a “tool” or one of many competing strategies and those that are embedding CSR priorities into the business. It is a story of commitment. Or, as Charlie Parker said, “If you don’t live it, it won’t come out your horn.”

Companies that aren’t “living it” are doing CSR for other reasons. Generally they fall into one of three categories: Compliance, Conformity or Cooperation. What these categories have in common is fragmented, frequently externally driven, adoption of CSR behavior. 

Organizations that are “living it” have found a way to integrate CSR and their business. They usually show up in the categories of Collaboration, Coherence and Constellation.

Further, organizations that are “living it” frequently aren’t doing CSR at all. They are being sustainable and, at best, targeting abundance. By “being sustainable” I mean generating value for a wide range of stakeholders within the company and in the communities, regions and countries in which they operate.

This is a big difference. What the McKinsey polls point to is this: being the change you want to see in the world is good business. Doing CSR, while not a bad thing, as a strategy (competing with other strategies) is ineffective, inefficient and, basically, not good business. 

Don’t get me wrong. Giving and philanthropy are good. These acts help people, communities and the environment, a lot. Doing philanthropy and CSR as a strategy is good. Being sustainable is better. Better return on investment, better use of resources, better, bigger impact.

Beyond strategy, being sustainable is a way of thinking, seeing and doing business. Being sustainable is living it and enjoying the value we create. Being sustainable is, simply, better business.

Tags: CEO's, Charlie Parker, Co-operation, Coherence, collaboration, Compliance, Conformity, Constellation, corporate philanthropy, csr, McKinsey, stakeholders, strategy, sustainability, UN Global Compact

Six Levels of Sustainability: What You Be is What You Get (6)

“Sustainability” is not always sustainable. Simply, doing and describing what you do as sustainable does not make it so. For organizations (and us, personally!) to be sustainable in what we do, we have to be sustainable in who we are and how we see the world. This gives us our best shot at doing something that is actually going to get or generate sustainable results. In the following series of six posts I will introduce the six levels of engaging in sustainability:  Compliance,  Conformity, Cooperation, Collaboration, Coherence and Constellation.  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact.

Constellation is characterized by reaching across industry, sector and national boundaries to create “constellations” of organizations capable of making systemic level change that benefits a multitude of stakeholders including, of course, the constellation members. These constellations are characterized by high degrees of transparency and innovation in a rich learning, rich opportunity environment. They are driven by a strong sense of purpose to build systemic capacity wherever they may be operating.

Constellation

• Sustainability is internally driven and collaboratively realized in multi-stakeholder interventions
• Example sustainability activities: Kalundborg, a workable, meaningful approach to changing climate change, expanding Burgerville’s quality of supplier relationships throughout Cascadia, the “Integral Cities” movement.
• Being at Constellation innovating and organizing from an abundance mindset.
• What we see at this level is our capacity to effect systems level benefit and change with an array of other capable stakeholders.
• What we are doing is creating long-term value and resilience in the systems in which we do business thus making them and us more sustainable.
• What we get from Constellation is a strong, healthy, positive-value, business opportunity generating Value Web.
• Operating at Constellation is our best bet at sustaining the systems that sustain us and allow us to economically innovate and ecologically flourish.

We are just beginning to see Constellation level work emerge. The simplest way to imagine it is collaboration at a systems level. The project, instead of being clean tech. development project would entail a focus on a node or multiple nodes of the value web. Again, if the way Burgerville develops and maintains relationships with suppliers was expanded and implemented with a number of restaurants and suppliers across Cascadia we would be looking at a constellation-like scope and impact.

Tags: abundance, Burgerville, Cascadia, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, Country Natural Beef, integral cities, Interkannections, Kalundborg, resilience, sustainability, systems level change, systems thinking, transparency

Six Levels of Sustainability: What You Be is What You Get (5)

“Sustainability” is not always sustainable. Simply, doing and describing what you do as sustainable does not make it so. For organizations (and us, personally!) to be sustainable in what we do, we have to be sustainable in who we are and how we see the world. This gives us our best shot at doing something that is actually going to get or generate sustainable results.  In the following series of six posts I will introduce the six levels of engaging in sustainability:  Compliance,  Conformity,  Cooperation, Collaboration, Coherence and Constellation.  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact..  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact.

Coherence is signified by an organization or reorganization around a clear sense of purpose and deeply embedded principles that promote sustainability beyond the scope of simply doing business in the conventional sense. The organization and its people begin to fulfill an intentionally larger role in the communities and ecosystems in which they operate.

Coherence

• Sustainability is generated from clearly articulated and realized principles and purpose.
• Example sustainability activities: Intentional long-term and multi-win relationships with suppliers that connect with developing and implementing community enhancement programs internally and with community stakeholders while creating and enacting related business practices that create zero waste and actually restore land and stream quality that significantly lowers risk and increases revenue and value for the business, suppliers and local communities.
• Being at Coherence is striving to be the change you want to see in the world while being successful.
• What we see at this level is a multitude of business opportunities and potential through engagement with the value web.
• What we are doing is “walking” our sustainable “talk” by leveraging value web relationships to generate multi-win, interconnected value as the example activities cited above demonstrates.
• What we get from Coherence is excellent risk management, long-term stability through a healthier, more robust relationship with the world.
• Remaining at Coherence has little in the way of negative consequences unless the culture becomes stagnant, insular or arrogant.. As the company evolves it is highly likely that opportunities to begin doing Constellation level business will appear. To seize these opportunities the role of proactive leadership throughout the organization, high levels of awareness, communication, innovation and resilience are necessary.

When we think of companies at this level, Burgerville, a Portland, Oregon area quick service restaurant chain comes to mind. Their mission is simple: To serve with love.  Their inter-relationship with the communities and market in which they operate is complex. In terms of engagement with the value web they are actively generating positive, clearly visible interconnected returns in nearly all of the nodes. They don’t so much have suppliers as they have deep, mutually enriching, value generating relationships. More on Burgerville coming soon.

Tags: Burgerville, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, innovation, Interkannections, Oregon, Portland, principles, purpose, resilience, risk management, sustainability, walking the talk, zero waste

Six Levels of Sustainability: What You Be is What You Get (4)

“Sustainability” is not always sustainable. Simply, doing and describing what you do as sustainable does not make it so. For organizations (and us, personally!) to be sustainable in what we do, we have to be sustainable in who we are and how we see the world. This gives us our best shot at doing something that is actually going to get or generate sustainable results. In the following series of six posts I will introduce the six levels of engaging in sustainability:  Compliance,  Conformity,  Cooperation, Collaboration, Coherence and Constellation.  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact.

Tags: Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, NGO's, organizational learning, philanthropy, self-organizing systems, stakeholder engagement, supply chain, sustainability, systems thinking, value stream

Six Levels of Sustainability: What You Be is What You Get (3)

“Sustainability” is not always sustainable. Simply, doing and describing what you do as sustainable does not make it so. For organizations (and us, personally!) to be sustainable in what we do, we have to be sustainable in who we are and how we see the world. This gives us our best shot at doing something that is actually going to get or generate sustainable results. In the following series of six posts I will introduce the six levels of engaging in sustainability:  Compliance,  Conformity,  Cooperation, Collaboration, Coherence and Constellation.  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact.

Cooperation

When we act at the Cooperation level our focus shifts to giving back and helping out. We engage in philanthropy and charitable giving/support of select causes because we’ve decided or believe it is the ”right” thing to do. 

• Sustainability at this level focuses on a mix of internal and external drivers calling for  “giving” and “helping out.”
• Example sustainability activities: Charitable giving, service days, volunteerism, targeted but disconnected internal and external CSR campaigns, employee-specific giving schemes, standards for suppliers, stated socially responsible principles and purpose.
• Being at Cooperation is about philanthropy. We feel a sense of responsibility to help and support causes of personal interest and meaning.
• What we see at this level is our capacity to do good, to help out and support social and environmental responsibility.
• What we are doing tends toward transactional giving and improvement. We help you. We help ourselves. We tend toward doing for vs. doing with.
• What we get from Cooperation is improved operational sustainability in targeted areas and the very real sense we are making a difference in the lives of the people and conservation efforts we choose to help.
• Remaining at Cooperation limits the effectiveness of the time, energy, financial and human resources we apply to socially responsible action and sustainable business.  Activity gets confused with accomplishment.

From our research it is pretty clear that most organizations are currently operating around the Conformity and Cooperation levels. Further research by a partner in the US found that over 60% of the companies they surveyed were operating between Compliance and Cooperation. In terms of sustainability, we believe our greatest challenge and opportunity is moving beyond these levels because it is our thinking and behavior at these levels that has brought us to where we are today. Simply, Compliance, Conformity and Cooperation are showing themselves to be unsustainable.

Tags: charity, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, corporate social responsibility, csr, philanthropy, sustainability

Six Levels of Sustainability: What you Be is What you Get (2)

Tags: brand reputation, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, green washing, NGO's, shareholder relations, strategy, sustainability, sustainability report, workplace safety

Six levels of Sustainability: What You Be is What You Get (1)

“Sustainability” is not always sustainable. Simply, doing and describing what you do as sustainable does not make it so. For organizations (and us, personally!) to be sustainable in what we do, we have to be sustainable in who we are and how we see the world. This gives us our best shot at doing something that is actually going to get or generate sustainable results. In the following series of six posts I will introduce the six levels of engaging in sustainability:  Compliance, Conformity,  Cooperation,  Collaboration,  Coherence and Constellation.  We use these at Interkannections to help our clients clarify their current goals around sustainability and map out their paths for deepening their practice and impact.

Each level includes and transcends the one before it, adding additional functionality and value.

Compliance:

• Compliance can be seen as baseline best business practice. Without a strong foundation in compliance we tend to be constantly firefighting and fighting for survival.
• Sustainability is externally mandated and internally enforced.
• Example sustainability issue: meeting workplace safety regulations
• Being at this level is basically about staying out of trouble and reducing risk. We focus on compliance with rules, regulations and requirements in order to avoid penalties and stay in business.
• What we tend to see at this level are the need to meet short-term goals and maintain immediate profitability.
• What we are doing is trying to establish stability as we establish ourselves, move into new markets or new areas of business.
• From Compliance the positive value we get is ongoing permission to operate and stability.
• Failure to evolve capacity to include and move beyond Compliance mires us in largely transactional and frequently win-lose relationships with the world around us as we seek to fulfill self-centered short-term needs. 

You probably know people and organizations that struggle in this area. The best way to move out of a compliance focus is to develop strong operational standards and protocols that are part of a larger sustainability initiative. That initiative must be closely tied to financial bottom line improvements and positive visible change.

Tags: bottom line, Coherence, collaboration, Compliance, Conformity, Constellation, cooperation, Interkannections, operational standards, profit, reducing risk, regulations, rules, sustainability, workplace safety