The NZBCSD Vision 2050 project is gaining momentum. On August 30, over 20 chief executives reviewed the work completed by the Future Leaders group in respect of the Vision “pathways”. From their critique we gained significant amount in terms of expectation as to the project and its outcomes; how the project can extend the engagement with business in general; and the work performed to date and refinements needed.
A key message coming from this session was some deeper thinking about what needs to happen to ensure our aspirational targets for each pathway are achievable. This included the critical role of People’s Values and the supporting infrastructure and system.
The way in which people behave and the attitudes they hold reflect their values. Where these are not supporting the milestones needed to achieve the positive imagination for each pathway, the overall vision will not be achievable.
The implication from the session is that people’s values act as filter across all pathways rather than being separate pathway. If values are to have this critical role in the overall Vision roadmap, then the question arises, how the supporting infrastructure and system support values consistent with our objectives.
Improvements are certainly needed. The signals and incentives of the existing system are creating distortion which is counterproductive to achieving the desired change. The economic system is primary determinant in how we prioritise what is important and in driving behaviour. This is not to say that it reflects our values – more that it limits our choice based on narrow set of conditions. For example, if you are looking for fair trade coffee you may pay more for this even though the human capital impacts of unsustainable farmed beans could be significant. The true cost of the coffee is not reflected – and because economic cost is the primary decision point for many, it influences behaviour.
Yes, there is an element of choice and the old argument would be that if enough people choose the sustainable alternative the market will deliver this. But this is naive assumption when the impacts of the decisions we make are not fully costed.
Translating this to the drivers of business value the impact is significant. According to Ocean Tomo’s Intangible Asset Market Value Study, over 80 percent of the S&P 500 market value is intangible – much of which remains unexplained in corporate reporting and measurement.
At global level, this distortion is being realised. There is acknowledgement that current corporate reporting only provides very limited view of the performance and future economic sustainability of the organisation. The International Integrated Reporting Committee (IIRC) recently released discussion paper (see www.theiirc.org) outlining proposals for an enhanced, integrated reporting framework which could become the basis for all corporate reporting.
This framework aims to deliver material information for investors. It focuses on how the organisation uses and impacts different “capitals” (financial, manufactured, human, intellectual, natural and social) in the delivery of its goods or services. The objective is to deliver less information – not more. To be more future focused and relevant.
While the IIRC developments are positive in addressing the information deficit – the challenge is going to be application and measurement. How do you get consistent approach to measuring environmental or social impacts? Furthermore, how will this change the underlying signals (ie, price) that we see on daily basis and that influence our behaviour?
Our Vision project must address and will be influenced by these challenges. To move the debate forward, education and connectivity are key. This also reflects what the CEOs would like to see from the Vision project. The Vision works need to be accessible and to create platform for open collaboration and engagement. This may manifest in any number of ways, but could include:
• Vision “module” that can be taken and adapted by business for their own exercises and reflecting their own situation.
• Online interaction.
• Ability to benchmark your organisation.
• National framework for discussion. M
Jamie Sinclair is project manager for Vision 2050. [email protected].
