Pekka Mattila: Rethinking Sustainability - From Whitewash to Longevity

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16.4.2013

Dr. Pekka Mattila

Rethinking Sustainability -

From Whitewash to Longevity

Why have we become disillusioned with sustainability?

26.4.2013 Pekka Mattila 2

Why the reality-perception gap exists? (Peloza & Loock & Cerruti & Muyot 2012)

• Category biases – IT vs. Mining

• Brand identity biases – Disney vs. Wal-Mart

• Senior management visibility

• Noise – Recency bias

• Owned media – Packaging

• Differences between stakeholder groups


Towards shared value


Top three impediments (Berns & Townend & Khayat & Balagobal & Reeves & Hopkins & Kruschwitz 2009)

• Companies don’t understand what sustainability it – and

what it really means to the enterprise

• Companies have difficulty modeling a business case – or

even finding a compelling case – for sustainability

• Execution is often flawed


Rethinking sustainability

• “Meeting the needs of the present without

compromising the ability of future generations to

meet their own needs.”

Norwegian Prime Minister Gro Harlem

Brundtland in 1980s

World Business Council for Sustainable

Development


Shared value (Porter & Kramer 2011)

• “The concept of shared value can be defined as policies

and operating practices that enhance the

competitiveness of a company while simultaneously

advancing the economic and social conditions in the

communities in which it operates.”

• “Shared value creation focuses on identifying and

expanding the connections between societal and

economic progress.”


Shared value (Porter & Kramer 2011)

• “The concept rests on the premise that both economic

and social progress must be addressed using value

principles. Value is defined as benefits relative to costs,

not just benefits alone.”

• “Value creation is an idea that has long been recognized

in business, where profit is revenues earned from

customers minus the costs incurred. However,

businesses have rarely approached societal issues from

a value perspective but have treated them as peripheral

matters.” 26.4.2013 Pekka Mattila 8

Building the business case for CSR (Keys & Malnight & van der Graaf 2009)

• Time frame: short and long term

• Nature of benefits: tangible and intangible

• Benefit split: business and society


Institutional logic pays off (Moss Kanter 2011)

• “Traditional theories of the firm are dominated by the notion of

opposition between capital and labor, disconnecting business

from society and posing conflicts between them.

• By contrast, great companies use a different operating logic.

They believe that business is an intrinsic part of society, and

like the family, government, and religion, has been one of its

pillars for centuries.

• Great companies work to make money, but in their choices of

how to do so, they consider whether they are building

enduring institutions.”



1. “Institutional logic is built on a foundation of purpose and

values, which serve as a buffer against uncertainty and

change.

2. Conceiving of the firm as a social institution generates a

long-term perspective. Short-term financial sacrifice

becomes permissible.

3. Strong institutional values can evoke positive emotions,

stimulate intrinsic motivation, and propel self- or peer

regulation.”



4. “Through the formation of public-private partnerships, firms

consider the public interest along with business priorities.

5. The attention placed on social conditions often generates

experiences and ideas that lead to learning for innovation in

products, services, and business models.

6. Employees can be treated as self-determining professionals,

coordinating and integrating activities and producing

innovation through self-organization in addition to formal

assignments.”


FINLAND / SINGAPORE / POLAND / SOUTH KOREA / TAIWAN / CHINA / INDONESIA / SWEDEN / RUSSIA

Join Our Core

16.4.2013

Dr. Pekka Mattila

Rethinking Sustainability -

From Whitewash to Longevity

Education

Pekka Mattila: Rethinking Sustainability - From Whitewash to Longevity