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Swedish Business Leaders Prospecting Sustainability – Finding the Future with Purpose, Systems Approach, Empathy & Transformation
Abstract
In this report, we are continuing the discussion on the conclusions from the article “The Inter Business Index: Developing a Tool for Measurement and Comparability of Holistic Sustainability in Businesses” that was published in May 2017 by Hallin et al (2017) and claim that there is need for a new perspective that bring sustainability to a new level – that might be more successful at solving our shared global problems. In an attempt to understand business sustainability and its journey from early day CSR initiatives – towards being a central part of business strategy, we have looked at the structures and strategies companies use to understand sustainability, via reporting and profitable models. To deeper understand the importance of leadership and mindset in regard to sustainability, we have examined how the Inter Business Principles of purpose, empathy, system approach and transformation applies to the sustainability challenges leaders are facing today. Through dialogue with business leaders in Sweden and literature on business sustainability, we have identified leadership and investors as keys for corporate sustainability to take its next step.
... Companies are an important part of the fabric of society-and has an important part to play in transforming operations and business models to adapt to planetary boundaries, new innovations and norms in relations to the field. In response, sustainability has travelled up the hierarchy in businesses, having moved from the communications department, into becoming an important issue for owners, boards and investors alike (Hallin et al., 2018). At the same time, several large-scale initiatives for sustainable development were born and pursued. ...
... The corporate sustainability field is in rapid development, and the future of the field is unknown. There is widespread uncertainty amongst business leadership as to what companies should do in their core operations to move towards a sustainable future (Hallin et al., 2018). An increasingly interconnected system further complicates sustainability work and demands new takes on the field. ...
p> Corporate sustainability is a field in rapid development. As our global challenges gain more attention through the overarching strategies forged through for example, Agenda 2030—the role of companies become more important in working towards a sustainable world. Via interviews with students and sustainability professionals, this piece of research examines how the two different groups perceive the future of corporate sustainability and what companies should prioritize to be a part of the solution for a sustainable world. Three different themes per group arose as important, and the result shone a light on how differently the groups perceived responsibility for solving our shared challenges, as well as the need for collective frames as to what a company is and what purpose they serve in the world moving forward. </p
... As empathy is one of the leader's key competencies for a caring attitude toward followers, society, and the environment, it affects leadership effectiveness. Several studies indicate a positive relationship between empathy and leadership effectiveness (Goleman, 1998 (Choi, 2006), responsible leadership (Voegtlin et al., 2020), and sustainability leadership (Amankwa, 2018;Hallin and Mantel, 2018). Due to the extensiveness of the impact of empathy on leadership effectiveness, the field of business management could be advanced by further research on this topic. ...
Empathy enhances leadership effectiveness. In times of the pandemic and increased commitment to fostering diversity and inclusion, it is considered an essential ingredient of leadership. The importance of empathy in leadership is especially emphasized in global organizations operating in a cross-cultural and multicultural environment. This study aims to develop a multi-level conceptual framework of the impact of empathy on leadership effectiveness in the field of business management. For this purpose, a systematic literature review based on Web of Science and Scopus databases has been conducted. The content analysis method was used to analyze and synthesize qualitative data. The research results show that empathy enhances leadership effectiveness through its extensive effects on the level of leader, followers, and organization. It contributes to raising self-awareness, developing listening and mentoring skills, and enhancing the relationships of the leader as an individual. On the followers’ level, empathy in leadership is associated with improving well-being, empowering, and providing role models in developing emotional intelligence. It enhances organizational effectiveness by inspiring diversity and inclusion, increasing employee engagement and retention, and creating a culture of responsibility, care, and innovation. These findings have practical implications for leadership and organizational development specialists, human resources managers, and business leaders. The interdisciplinary nature of the topic calls for the collaboration of researchers from the fields of business economics, psychology, and neuroscience to advance future research on empathy in leadership.
... As empathy is one of the leader's key competencies for a caring attitude toward followers, society, and the environment, it affects leadership effectiveness. Several studies indicate a positive relationship between empathy and leadership effectiveness (Goleman, 1998 (Choi, 2006), responsible leadership (Voegtlin et al., 2020), and sustainability leadership (Amankwa, 2018;Hallin and Mantel, 2018). Due to the extensiveness of the impact of empathy on leadership effectiveness, the field of business management could be advanced by further research on this topic. ...
In this publication we set an objectively complicated task to analyse the opportunities of strategic decision-making during crisis by attempting to make a partial analysis of the ongoing crisis caused by the COVID 19 pandemic and the emerged military conflict between the Russian Federation and Ukraine. Crisis circumstances require societies to quickly rethink and develop adequate strategies and respectively to formulate strategic goals and plan processes. In many cases preliminary analysis and assessment are practically impossible /especially when it comes to natural disasters or crises/ and this requires a different operational order of problem solving, which includes formulating new unconventional goals and then implementing planning not objectified by a particular and accurate analysis. All this puts whole systems and societies to the test, and those who are empowered to manage the process – under high pressure from unforeseen circumstances and not always objective judgments. Which, in turn, creates a number of subsequent critical issues in the management process.
... As empathy is one of the leader's key competencies for a caring attitude toward followers, society, and the environment, it affects leadership effectiveness. Several studies indicate a positive relationship between empathy and leadership effectiveness (Goleman, 1998 (Choi, 2006), responsible leadership (Voegtlin et al., 2020), and sustainability leadership (Amankwa, 2018;Hallin and Mantel, 2018). Due to the extensiveness of the impact of empathy on leadership effectiveness, the field of business management could be advanced by further research on this topic. ...
This article briefly analyses the works of Acad. Mihail Arnaudov. He is an author of insightful research of a number of classics of the Bulgarian and world literature. His determination and persistence with which he worked on his research are incredible and admirable. The long-lasting research activity of Acad. Mihail Arnaudov is “sealed” on the pages of books, periodicals, prints and thematically collected clippings from Bulgarian and foreign publications. With the help of his numerous research works covering the topic of Bulgarian National Revival, Acad. Mihail Arnaudov managed to realize his noble ambition – to create a scientific epic of the spiritual leaders of his people, or the “Unforgettable” as he called them himself, during one of the most difficult and most glorious periods in the Bulgarian history. And with even more passion he kept studying life and works of postliberation writers.
... show that sustainability is moving up the company hierarchy, becoming ever more important for business leadership, investors and boards (Hallin et al., 2018). ...
p> A new complex and global society demands new approaches to solving our shared challenges and making businesses thrive. As a result, applying a systems approach is becoming more important for businesses when forming strategies for the future. The Inter Business Index is a measurement tool to understand a company’s holistic value creation, and one part of the index is a specific measurement focused on a company’s ability to adapt a systems approach to core strategy and operations. By qualitative analysis of annual and sustainability reports of Sweden’s 50 biggest companies, looking at how the companies relate to future needs and requirements, their own sense of responsibility and place in the system, ability to analyze complex problems and ability to make strategic priorities thereafter, the index ranks the companies by ability to apply a systems approach. Our findings show that companies are better at analyzing what needs to be done, but are having a hard time prioritizing their actions to fit. In discussion, we argue that short sightedness of profits companies traditionally has might make this process harder, albeit necessary. </p
The scope of sustainable development is undoubtedly growing, and becoming increasingly more important due to the process of globalization, amounting in complex environmental, societal and economic issues. Although the subject of business sustainability has been gaining traction and resulted in increased knowledge in the field, the business sustainability discourse is still at a young stage, where the different streams of approaches, definitions, systems and measures are fragmented and challenged. Today’s global challenges are so large and complex that they require a new kind of problem-solving and way of doing business. Identifying solutions requires a diversity of perspectives, approaches and capabilities, and the business sector plays a critical role. The integrated approach has been examined to some extent, proposing a holistic manner of moving on to true business sustainability, and a sustainable development on a global scale. This article presents the concept of Inter Business and the Inter Business Index, a tool for measurement and comparability of holistic sustainability in businesses. The Inter Business framework consists of four key-components that describe the skills needed for future-preparedness. In our research, we have analysed the 50 biggest corporations in Sweden and identified purpose, empathy, system approach and transformation as components that respond to the hypothesis that interconnection and integration are key for companies to survive and thrive, whilst contributing to society at large.
Editor's note: This editorial is part of a series written by editors and co-authored with a senior executive, thought leader, or scholar from a different field to explore new content areas and grand challenges with the goal of expanding the scope, interestingness, and relevance of the work presented in the Academy of Management Journal. The principle is to use the editorial notes as " stage setters " to open up fresh new areas of inquiry for management research. GG The deepest resources for the transformation of business, as for society as a whole, lie within the human heart. It is there we have to seek what it is we truly value and yearn for, and where we can harness the strongest motivation to change— ourselves , our organizations, and our world—for the better. Cardinal Vincent Nichols
There have been various researches carried out to study the innovation management in different organizations. Most of these researches are to find out the effect of single variable and its relation with organizational innovation. There are few studies which are having more than one or two variable leading to innovations. This paper tries to find out the maximum number of factors influencing the innovations in the organization. Under this research various past studies are investigated to find out the most comprehensive theoretical model for innovation enhancement. The proposed model is flexible enough to accommodate or adjust the consideration of factors leading to innovation. An organization can adjust it according to its compatibility. Here under in this whole paper the term organization is referred for social enterprise.
This paper proposes a definition of systems thinking for use in a wide variety of disciplines, with particular emphasis on the development and assessment of systems thinking educational efforts. The definition was derived from a review of the systems thinking literature combined with the application of systems thinking to itself. Many different definitions of systems thinking can be found throughout the systems community, but key components of a singular definition can be distilled from the literature. This researcher considered these components both individually and holistically, then proposed a new definition of systems thinking that integrates these components as a system. The definition was tested for fidelity against a System Test and against three widely accepted system archetypes. Systems thinking is widely believed to be critical in handling the complexity facing the world in the coming decades; however, it still resides in the educational margins. In order for this important skill to receive mainstream educational attention, a complete definition is required. Such a definition has not yet been established. This research is an attempt to rectify this deficiency by providing such a definition.
Sustainability is concerned with the impact of present actions on the ecosystems, societies, and environments of the future. Such concerns should be reflected in the strategic planning of sustainable corporations. Strategic intentions of this nature are operationalized through the adoption of a long-term focus and a more inclusive set of responsibilities focusing on ethical practices, employees, environment, and customers. A central hypothesis, that we test in this paper is that companies which attend to this set of responsibilities under the term superior sustainable practices, have higher financial performance compared to those that do not engage in such practices. The target population of this study consists of the top 100 sustainable global companies in 2008 which have been selected from a universe of 3,000 firms from the developed countries and emerging markets. We find significant higher mean sales growth, return on assets, profit before taxation, and cash flows from operations in some activity sectors of the sample companies compared to the control companies over the period of 2006-2010. Furthermore, our findings show that the higher financial performance of sustainable companies has increased and been sustained over the sample. Notwithstanding sample limitation, causal evidence reported in this paper suggests that, there is bi-directional relationship between corporate social responsibilities practices and corporate financial performance.
Acknowledgments: We are indebted to Desiree Schaan for her assistance with coding the articles. We also appreciate insightful comments by Christopher Marquis and Nitin Nohria, research assistance by Alyssa Bittner-Gibbs, and the collegiality of Janet Kiholm Smith and Daniel Turban for sharing additional information about their published studies.
Over the last decade, there has been considerable debate over whether organizations have a corporate social responsibility (CSR), as well as whether socially responsible initiatives predict subsequent financial performance. Business leaders are increasingly concerned with how their organizations can grow and thrive from addressing societal challenges. Strategic CSR can benefit organizations through growth in market share and organizational learning, as well as more committed and engaged employees, supportive external stakeholders, and positive investor relations. We discuss how organizations around the world are prospering by proactively engaging with social and environmental challenges. Seven strategic CSR principles, illustrated by 21 exemplars of strategic CSR initiatives, are outlined. These principles should not be interpreted as a checklist of best practices, but rather as a stimulus for designing financially viable and prudent CSR initiatives, given each organization's combination of mission, resources, challenges, and opportunities.
Purpose
For many years, the content and applicability of various forms of corporate responsibility (CR) for issues in the domain of sustainable development have been discussed within business and society. At times, both concepts are somehow connected to each other but so far they have not been put into a truly holistic and mutual perspective. The purpose of this paper is to introduce a normative concept integrating both aspects into holistic management thinking.
Design/methodology/approach
First, an interdisciplinary ethical reasoning for CR and sustainable development will be given based on the fundamental work of Kant, Rawls, Margalit and others. Based on these lines of thought, both concepts will be integrated into an advanced two‐stage approach of responsibilities to overcome possible shortcomings of an isolated analysis (and application) of either of the two.
Findings
The paper provides an initial normative ethical reasoning why CR and sustainable development should be integrated into holistic management thinking. It discusses CRs for an enabling framework of sustainable development on grounds of a two‐stage approach of integrative responsibilities.
Social implications
The paper will encourage thought leaders in business and society to integrate the goals of sustainable development into management thinking.
Originality/value
Instead of mutually advancing each other, sustainable development and CR so far have not been put into a truly holistic perspective, which potentially limits the significance of both concepts. The paper fills this gap and seeks to overcome these limitations. It offers an inclusive approach to management thinking which combines the micro perspective of businesses with the macro perspective of society.
In this paper, we conceptually explore the role of empathy as a connectedness organising mechanism. We expand ideas underlying
positive organisational scholarship and examine leading-edge studies from neuroscience and quantum physics that give support
to our claims. The perspective we propose has profound implications regarding how we organise and how we manage. First, we
argue that empathy enhances connectedness through the unconscious sharing of neuro-pathways that dissolves the barriers between
self and other. This sharing encourages the integration of affective and cognitive consciousness which facilitates the ability
to find common ground for solution building. Second, empathy enhances connectedness through altruistic action. In giving to
others, feelings of joy and harmony are activated. This in turn allows personal freedom to be enriched and transcendence from
the rational ego-self is reduced to develop a more expansive, integrated and enlightened state underlying connectedness. Finally,
empathy enhances connectedness which results in sharing the quantum field of coherence where there is little separation between
self and other. This means living beyond self-interest in a coherent world based upon interdependent wholeness rather than
atomization and separation. Empathy allows us to find that state of coherent connectedness.
KeywordsConnectedness–Empathy–Interdependence–Organisation–Quantum
The relevance of business models for corporate performance in general and corporate sustainability in particular has been widely acknowledged in the literature while sustainable entrepreneurship research has started to explore contributions to the sustainability transformation of markets and society. Particularities of the business models of sustainable niche market pioneers have been identified in earlier research, but little is known about the dynamic role of business models for sustainable entrepreneurship processes aiming at upscaling ecologically and socially beneficial niche models or sustainability upgrading of conventional mass market players. Informed by evolutionary economics, we develop a theoretical framework to analyze co-evolutionary business model development for sustainable niche pioneers and conventional mass market players aiming at the sustainability transformation of markets. Core evolutionary processes of business model variation, selection and retention, and evolutionary pathways are identified to support structured analyses of the dynamics between business model innovation and sustainability transformation of markets.
In this paper, I examine the relation between Integrated Reporting (IR) and the composition of a firm’s investor base. I hypothesize and find that firms that practice IR have a more long-term oriented investor base with more dedicated and fewer transient investors. This result is more pronounced for firms with high growth opportunities, not controlled by a family, operating in ‘sin’ industries, and exhibiting commitment to IR. I find that the results are robust to the inclusion of firm fixed effects, controls for the quantity of sustainability disclosure, and alternative ways of measuring IR. Moreover, I show that investor activism on environmental or social issues or a large number of concerns about a firm’s environmental or social impact leads a firm to practice more IR and that this investor or crisis-induced IR affects the composition of a firm’s investor base. Finally, firms that report more information about the different forms of capital or follow more closely the guiding principles as described in the IR Framework of the IIRC exhibit a more long-term oriented investor base.
In this paper, we present the two primary functions of corporate reporting (information and transformation) and why currently isolated financial and sustainability reporting are not likely to perform effectively those functions. We describe the concept of integrated reporting and why integrated reporting could be a superior mechanism to perform these functions. Moreover, we discuss, through a series of case studies, what constitutes an effective integrated report (Coca-Cola Hellenic Bottling Company) and the role of regulation in integrated reporting (Anglo-American).
This paper aims to propose the contribution of adopting a systemic perspective to researching sustainability in terms of inclusivity and holistic view, going beyond the limitations of a reductionist approach. Among the different systemic approaches, the methodological lens proposed herein is the one of the Viable Systems Approach, according to which sustainability, which can be seen as a process that is dynamic and changing over time, is linked to the notion of systemic viability and connected to some of the most relevant key concepts of Viable Systems Approach.Through the proposition of the conceptual model of ‘The Viable Systems Cycle’, the authors intend to propose a different approach to the analysis and interpretation of sustainability that concerns the relationship among efficiency, effectiveness and sustainability itself and the way they orient and influence sustainable business behaviors. Copyright © 2014 John Wiley & Sons, Ltd.
Every enterprise has a purpose, but it may not necessarily be apparent throughout the various levels of an organization. In the absence of clarity, employees can act at cross-purposes with differing and even conflicting ideas about goals and how to achieve them. Leaders who can vividly translate the organization's purpose into a personal, unifying vision have a much better chance of getting the workforce focused and moving in a shared direction. A well-designed statement of purpose should be brief, clear, and realistic, and it also should convey a representative picture of the future while enabling and appealing to employees, customers, and the broader community. Wise leaders appreciate the value of crafting a crisp well-phrased statement of purpose, involving as many stakeholders as possible in its creation, and continually communicating its relevance throughout the organization. ©2014 Wiley Periodicals, Inc.
A long-standing ideology in business education has been that a corporation is run for the sole interest of its shareholders. I present an alternative view where increasing concentration of economic activity and power in the world’s largest corporations, the Global 1000, has opened the way for managers to consider the interests of a broader set of stakeholders rather than only shareholders. Having documented that this alternative view better fits actual corporate conduct, I discuss opportunities for future research. Specifically, I call for research on the materiality of environmental and social issues for the future financial performance of corporations, the design of incentive and control systems to guide strategy execution, corporate reporting, and the role of investors in this new paradigm.
Based on Whitley’s “National Business Systems” (NBS) institutional framework (Whitley 1997; 1999), we theorize about and empirically investigate the impact of nation-level institutions on firms’ corporate social performance (CSP). Using a sample of firms from 42 countries spanning seven years, we construct an annual composite CSP index for each firm based on social and environmental metrics. We find that the political system, followed by the labor and education system, and the cultural system are the most important NBS categories of institutions that impact CSP. Interestingly, the financial system appears to have a relatively less significant impact. We discuss implications for research, practice and policy-making.
Pressure is growing from governments and their citizens for business to measure and manage the impacts and outcomes of its behaviour in a range of areas. The demand has led to the formulation of a ‘triple bottom line’ to reflect economic, social and environmental performance.
The World Commission on Environment and Development presented its report to the world at a press conference in London, England on 27 April 1987. The report examines the critical issues of environment and development, suggests concrete and realistic proposals for dealing with them, and proposes far‐reaching changes for implementing the proposals at national and international levels.
Information technology is reshaping relationships between companies and customers, often bringing benefits to both. The unfettered use of technology, however, can erode customer care. For a company to care for customers, its managers and front-line employees must listen empathetically to what they have to say. But a rash of 'innovations' aimed primarily at reducing costs has made many companies opaque to their customers, who are--as a consequence--inadequately served and increasingly frustrated. Equally damaging is the resulting estrangement of employees from customers, a separation that dampens the empathy upon which true care for customers depends. As a number of innovative companies have shown, though, technology need not necessarily sour relations between businesses and those they serve. Indeed, technology can actually enrich them if senior managers (1) affirm their commitment to active, empathetic involvement with customers; (2) understand the ways in which current procedures and systems mediate interactions with customers; and (3) promote the deployment of social networks and other technologies to help customers tell their stories, and to enable workers and managers alike to hear them. Only when employees can step into their customers' shoes can companies add authenticity to the claim: "We care for you."
Sumario: The author calls such drives for social responsability in business "pure and unadulterated socialism", adding: "businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society". In a free-enterprise, private-property system, a corporate executive is an employe of the owners of the business. He has direct responsibility to his employers
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