[ Foreword ]
l
K a s p u h
I l l u s t r a t i o n : J ö r n
We all have a stake in the future,
so let’s use it wisely
Transforming organizations to become more sustainable is perhaps the defining leadership challenge of our time. The need for change is now urgent, from both a climate and a social perspective. This transformation is a deeply complex and unique task for every business and industry. At IMD, we are fortunate to have the opportunity to learn from and support a diverse range of leaders and organizations as they navigate their way through it. This edition of I by IMD draws on these experiences, as well as deep insights from external experts, to explore the key factors of the sustainable business transformation challenge – from regulation and business models to purpose and talent. Temasek head Dilhan Pillay observes, in our regular CEO Dialogue feature, that stewarding today’s assets for the benefit of those not yet born requires a serious consideration of difficult trade-offs that must be made right away. So, how do we guide our organizations past the fog of challenged planetary boundaries and social inequity toward a state of being sustainable, inclusive, and prosperous? “The future may already be here, but at times it can be damned hard to find,” observes John Elkington, the creator of the triple-bottom-line concept, calling on business to take things a step further toward regeneration. In our framing article, Jean-François Manzoni, President of IMD, and Julia Binder offer a compelling strategic and organizational framework that organizations can deploy to kickstart their transformation. Knut Haanaes and Bryony Jansen-van Tuyll present the “future back” tool that encourages leaders to imagine that a desirable future state for their organizations has already been achieved in order to work out the necessary steps back from there. Sudhanshu Sarronwala argues that sustainability transformations are likely to work only when companies embed an externally oriented and holistic purpose of “doing the right things”. Natalia Olynec traces the evolution and explosion in popularity of the Chief Sustainability Officer (CSO) role, outlining the re-
sponsibilities that CSOs need to shoulder to pilot and orchestrate the transforma-
tion journey. Sam Gill and Jan van der Kaaij highlight the new role that boards must play in this journey as well as the threat of the ESG report-
ing trap – when a company spends more resources on reporting than it does on actually changing the game. Michael Skapinker despairs that neither of the two investment strategies to bring fossil fuel companies to a heel has been particularly effective: divestment equates abdication to more callous investors, and remaining invested in order to drive change requires superhuman patience. He asks: “Could there be a third way?” As always, our issue brims with sparkling insights from our regular columnists. Jerry Davis notes that corporations and their employees were much more rooted in a local context when Milton Friedman famously pronounced that companies had no other welfare obligations than to churn out profits for shareholders. Given that most contemporary corporations are “rootless cosmopolitans”, reading Jerry’s column makes me wonder: if Friedman were to be around today, would he make the same pronouncement? And Shelley Zalis provides a timely reminder of the rising importance of certification and access to training to plug the global tech skills gap. We hope you enjoy reading this edition of I by IMD, and that the articles we present here resonate with you by offering relatable, relevant insights and clear, actionable impact as you seek to lead and transform your organizations. Dive in! ■
Anand Narasimhan, Dean of Research
Sept-Nov 2023 • I by IMD 1
