Inside or outside – who calls the shots?

March 31, 2014

Briefing founder Mike Tuffrey says companies are still not clear enough about how to meet external expectations.

Spending time this week with two very different groups of professionals set me thinking again about where companies should go to get the inspiration, guidance and clear direction on building the responsible and sustainable businesses we need to thrive on this small planet.

The first group was of managers from small firms who are using the quality excellence model to become better businesses, in all respects. The part that is proving hardest for them is the ‘society results’ module, requiring both performance and perception measures on their impacts covering local economy, community, values, ethics and the like.

My job was to introduce the many different external standards, indexes and ratings schemes that purport to answer this question – from the well-known ones like DJSI and FTSE4Good, to specialist models such as CDP and our own LBG, and taking in along the way a snap shot of the 250 or more that we recently mapped.

The unfortunate conclusion was that these models can provide useful tools but they can’t answer the question – what should we do? Each has its own set of assumptions and underlying value judgements about what matters. Without care, they can become the tail that wags your dog.

The second group could not be more different – high powered professionals from the big banks and international investment houses. Here the question was to take stock of the five years since the global financial meltdown and ask – what have we learned? Are expectations of customers, regulators and wider society now clear? Above all, how should we now be doing things differently?

What became apparent to me from their comments is that – sadly – we are not much clearer. To lend more (to first time buyers and small firms) or less (as we are still massively over-indebted)? To prioritise employees (and their bonuses?), customers (but think misselling) or shareholders (including you and me, thanks to the semi-nationalised RBS and Lloyds Banking Group, as well as all of our pension funds)? There may now be greater clarity about what the financial sector should not be doing, but there is rather less in terms of expectations about the positive impact they can have.

This need for external guidance is the reason I’m so keen on the move underway globally to devise a set of Sustainable Development Goals (SDGs) to replace the current Millennium Development Goals, which are due to expire next year. This hugely tortuous process holds the prize of a clear set of aspirations, underpinned by measurable and time-limited targets and endorsed by all national governments.

Of course that will still require inspirational individuals to make it happen: to be the change-makers and occasional troublemakers inside our big companies, small firms and micro start-ups. So I give a warm welcome to a new book just out (which we’ll be reviewing shortly) about that demanding role – Social Intrapreneurism and All That Jazz: How Business Innovators are Helping to Build a More Sustainable World by David Grayson, Melody McLaren and Heiko Spitzeck.

Change from the inside out, or the outside in? Whatever my hopes for the SDG process, we can be sure that the creative tension between these will continue to drive change for many more years to come.

Mike Tuffrey is Co-founding Director of Corporate Citizenship.