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green@work : Magazine : Back Issues : May/June 2004 : Staying in the Game

SINGLE BOTTOM LINE SUSTAINABILITY

Staying in the Game
Sustainable self-interest and the war for talent in the corporate arena.

by Paul Gilding


I recently had a discussion with a senior executive who was considering accepting a key leadership role, with a sustainability focus, at a major company. She wasn’t sure she wanted to work for a large company again. “Maybe I can do this for a few years and then do something with real value to the community,” she said. “I want to pursue my passion for social change so I probably should be working for a non-profit.”

We have deeply ingrained views in our society about the respective roles of types of institutions. Companies make money, NGOs advocate for the social good and governments set the rules of the game. It’s time we challenged these assumptions. They are holding us back from opportunities to advance the corporate sustainability agenda.

Think of the language that we use: “for-profit” and “not-for-profit.” We use these terms laced with meaning and assumptions about core motivation. “For-profits” exist for the pursuit of financial gain, while a “not-for-profit” exists for some more noble cause.

Of course profit and growth are huge motivators for companies and this “self-interest” heavily influences their behavior. But NGOs also legitimately pursue “self-interest,” and while the goal may not be personal financial gain, it is still a powerful driver of behavior.

Some argue that a company will always pursue shareholder value and, therefore, can’t be trusted to deliver on the broader social interest. But is that fundamentally different from a NGO pursuing its own organizational interests? Yes, companies need to deliver a return to shareholders to stay in the game. But NGOs need members and donors to survive, so they act in ways that keep these members and donors happy and supportive. And politicians will almost always act in ways that satisfy their constituents so that they can stay in power.

We all rail against self-interest in others while we pursue it ourselves. Companies say NGOs are conducting one campaign or another “just for the profile” or “just to raise funds” (with the irony lost on them of a company attacking someone for pursuing financial gain). NGOs claim companies are pursuing a strategy “just for profit” (thus arguing that the motivation determines the legitimacy of the behavior). We all attack politicians for pursuing political self-interest (as though behaving in a way that gets the support of the people who put you there is somehow distasteful, even though it’s the underpinning premise of democracy).

In my view, the issue is not the structure or ownership of the organization. Certainly, organizational form—whether it be “for-profit,” an NGO or government-owned—heavily influences behavior, but it does not determine it. What ultimately determines behavior is people and their values. So there are companies that pursue social interest and there are NGOs that pursue narrow self-interest and, of course, companies and NGOs at all points in between. We need to focus less on the “form” and more on the behavior of the people involved.

Why does this all matter? It matters because our view of organizational types leads us to ideological positions rather than analytical ones. We may feel comfortable and self-satisfied when we attack the motivations of other organizations, but it leads us to a lack of rigor in judgements. The result is simplistic views about important and complex issues.

We need to assess organizations of all types based on what they achieve and how they behave, not how they are structured. By doing so, people with a passion for making the world a better place will begin working where they are most needed, regardless of whether it is at a company, a NGO or a government.

We need people, like the corporate executive above who wants to pursue her social change passion, to do so in the corporate sector if that’s where the need is and their skills suit. We need people to do so because we need corporate executive teams to champion these views front and center in their internal discussions about their business plans.

Additionally, companies need to attract these people for their own self-interest because our executive above is not an isolated case. Many business school leaders tell me that the best and brightest talent coming through their ranks put far greater emphasis on the values—and the social value—of their future employers. Given the current war for talent between leading companies, attracting the best people now requires companies to know what they stand for and what social value they intend to deliver to society.

By the way, she took the job and is now mobilizing a multi-billion dollar company to help her change the world.



Paul Gilding (paul.gilding@ecoscorp.com) is the founder and CEO of Ecos Corporation, which provides strategic advice to corporations on how to create value through sustainability
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