Sustainability Driven Responses to Coronavirus
We are starting to see thought leaders and businesses provide examples that speak to the possible linkage of sustainability driven responses to the coronavirus. The linkage is best characterized in two words “recovery” and “resiliency”. In many respects the level of recovery and the degree of resiliency that we accomplish depends on our ability to learn from and leverage the lessons that our response to the virus has presented to us. Correspondingly, we can see examples of value created by sustainability in company culture and practice. These are but a few of the connections between sustainability and the corona crisis. We have an opportunity to be better.
We cannot afford missing an opportunity if recovery is seen only in the single dimension of economic performance. Sustainability practitioners understand that divorcing planet and people from economic strategy risks both short and long-term consequences as well as missed opportunities for better, prolonged performance. The actions for “recovery” started in May as businesses and communities began the process of reopening.
On April 7, McKinsey & Company put out an article, “Addressing Climate Change in a Post-Pandemic World” that starts with a particularly insightful quote. “The corona crisis holds profound lessons that can help us address climate change – if we make greater economic and environmental resilience core to our planning for the recovery ahead.” Confronted with the question can we afford to pay attention to climate change and the broader sustainability agenda their insight supports their assertion, “we simply cannot afford to do otherwise.” Investors, customers and the general public were and likely still are interested in sustainable performance. We can expect in some sectors that those expectations will be heightened as the corona crisis has heightened awareness of the need for resiliency as an integral part of recovery as well as new business models.
Businesses, investors, communities and individuals rely on the performance of infrastructure for stability and certainty. Consider the following 16 critical infrastructure sectors on which we rely and for which we have responsibility if we are to pursue sustainable practices (for your business, there may also be others):
Defense Industrial Base
Health Care and Public Health
Information and Technology
Nuclear Reactors, Materials & Wastes
Food and Agriculture
Transportation Systems Water and Wastewater
Several of the above sectors have been and may continue to be materially challenged as a result of the corona crisis. Coming out of the corona crisis there is an opportunity to pursue improved critical infrastructure using a sustainable focus.
In April, The World Bank Group published (For Discussion) “Proposed Sustainability Checklist for Assessing Economic Recovery Interventions.” In many respects, the checklist starts to set short-term and long-term decision making in the context of sustainable actions. While designed for Economic Recovery Interventions, the checklist also provides an easily adaptable framework for considering a variety of actions which could be undertaken for recovery on a broader basis.
Similarly, the World Economic Forum has weighed in on the value of investment in infrastructure as a part of both recovery and resiliency.What then is the relevance of sustainability to your business, large or small, beyond the larger global issues cited. McKinsey has also provided an analysis directed at health care but still relevant to businesses considering their strategies to recovery. McKinsey provides an easy to read analysis about the road to the “next” normal with several good guideposts here.
McKinsey has good insights built around 5 concepts: resilience (one that will have a direct bearing on how sustainability is perceived by your company), resolve, return, reimagination and reform. I particularly liked a line from their reimagination section – “Institutions that reinvent themselves to make the most of better insight and foresight, as preferences evolve, will disproportionally succeed.” That same section goes on to pose what may be a very poignant point – what happens when the pursuit of efficiency gives way to the requirement of resiliency?
Innovation is likely to be a core requirement for both recovery and resiliency. Innovative, sustainable companies know and respond to risk – economic, environmental and social. Many sustainable companies didn’t know that there would be a pandemic but were prepared for “disruptive (pandemic) risks” and “transformational (new business models) risks”. A report from Deloitte observed - “Few have made the connection between innovation and sustainability or have used sustainability as a way to improve innovation performance.” – Deloitte “Sustainability Driven Innovation." The report goes on to state that for those companies that have, the results are staggering – “sustainability leaders are more than 400% more likely to be considered innovation leaders.” Sustainable companies have a very potent tool, innovation, to discover and pursue the next normal.
Sustainability has always been about the pursuit of a better future. That purpose driven view can drive if not accelerate action. Sustainability can, if we let the potential develop, become a framework for not only managing but also emerging from the pandemic crisis.