Unleashing the sustainable business
2 October 2023 – This working paper explores the meaning and influence of organisational culture and proposes some key principles and associated behaviours that may underpin a purpose-driven organisational culture that delivers a sustainable future.
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About
Organisational culture is an important driver of business behaviour and therefore of business outcomes and impacts on society. As the need increases for organisations to transform - in response to sustainability crises in climate, nature and society – organisational culture is increasingly coming into focus, since an enabling culture is a necessary ingredient for moving away from Business As Usual (BAU) logic.
Organisational culture is underpinned by (and in turn influences) worldviews, which are the deepest level of assumptions about how and why to act. Purpose-driven organisations are likely to be based on a different worldview to BAU logic, regarding their role in an efficient and effective market economy, how this economy should be governed and the role of a business in it. Therefore, moving from BAU to purpose-driven presents a transformational cultural challenge - and opportunity - for businesses to align with a sustainable future.
In order to enable business sustainability leaders to better understand culture, this working paper explores some critical questions, including:
- What is organisational culture?
- How is culture expressed and maintained in organisations?
- What are the links between culture, performance and purpose?
Drawing from these questions, and the analysis contained in Unleashing the Sustainable Business, the paper then suggests key principles and associated behaviours that may underpin a purpose-driven organisational culture. Furthermore, it identifies a number of requirements for transforming organisational culture in the service of a sustainable future (long-term wellbeing for all). While the paper explains how we might understand culture, it does not set out how to adapt it.
2 October 2023 – This working paper explores the shift towards purpose-driven governance. In doing so, it reveals the current business as usual system of governance, why this is incompatible with governing for a sustainable future and how it can be aligned with purpose.
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About
Unsustainability is, in part, a governance failure. Under the influence of Business As Usual (BAU) logic, corporate governing bodies tend to govern primarily for short- to medium-term profit maximisation without ensuring that they are protecting (or, as a minimum, not undermining) wellbeing and fundamental environmental assets in the long term. As existential threats to long-term wellbeing increasingly become a reality (e.g. driven by climate change, nature loss and social inequality), corporate governance is under growing pressure to understand and change this fundamental decision-making approach.
This working paper argues that purpose-driven governance is part of a solution to the problem of unsustainability. Boards are uniquely placed to encode a purpose and assure the ultimate value that organisations create aligns with a sustainable future and associated achievable objectives. Although there is not yet a consensus on what governance for a sustainable purpose should look like, this is likely to be very different from the BAU type of governance, which will also require a different kind of board leadership.
The paper explores four questions that highlight core assumptions of organisational governance that are rapidly changing and postulates what governance that brings about a sustainable future might look like. The critical questions explored include:
- Who is governance for? From shareholders to all stakeholders: towards long-term wellbeing for all people and planet
- What is governance for? From governance that maximises financial profits to governance for a sustainable purpose
- What motivates those being governed? From governance that protects assets from managers to governance that empowers purpose-driven decision-makers
- How to achieve the goal? From governance as compliance and risk avoidance to governance for innovative performance of the purpose within risk parameters
July 2021 – This working paper summarises why a purpose-driven approach to business is the optimum route to create a durable, equitable and sustainable future.
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Never before has the question of what a sustainable business is and how it can be achieved been more important or urgent. Simply put, sustainability is about achieving prosperity and welfare for all of society over the longer term. The objective of such wellbeing is primarily twofold: first, optimising equitable wellbeing outcomes; and secondly, protecting and regenerating the social and natural resource base that underpins this wellbeing. Given that business serves as the engine of an economy, it is equally legitimate to consider companies as being central to the delivery of sustainability.
So, what are the optimum pathways through which companies can best deliver these outcomes?
This question provides the central thread of this paper, which is the first in a series about the nature, role, and delivery of purpose-driven business. It is the contention of this series of papers that tweaking today’s mainstream economic and business models will fall short in delivering the sustainable outcomes that are now so urgently needed. Such an approach may lead to a ‘less bad’ form of business, but this is no longer enough.
This paper examines an alternative, purpose-driven approach to business that presents a fresh vision for creating durable, equitable wellbeing. We hope this will lead to a shared vision of how future businesses consider their role in society and a common understanding of the potential pitfalls ahead.
This paper is built around the following core tenets:
- Business-as-usual undermines sustainability.
- Tweaking business-as-usual does not lead to sustainability.
- Many of today’s leading companies are still operating under a business-as-usual logic.
- A purpose-driven approach to business is the best route to sustainability.
July 2021 – The second paper in this series seeks to move from theory to practice. It aims to provide management-focused responses on how purpose-driven companies think and act and what it means to transform from a business-as-usual organisational system to a purpose-driven one.
Download Unleashing the sustainable business: how purpose transforms an organisation
Purpose done well, the report argues, operationalises sustainability. It aligns the individual’s desire for meaning with the interests of society, business, nature in a way that other operational business sustainability concepts have so far failed to do.
A mature purpose-driven company will be increasingly displaying its purpose in all aspects of organisational culture – its cultural hardware such as systems, processes, structures, materials, investments, artefacts and all strategic decisions, and its cultural software, such as assumptions, practices and behaviours.
Companies with a robust and genuine intent to deliver long-term wellbeing cannot and should not wait until they get everything right. They need to, and can, be transparent about their goals and carve a robust plan for transition to build momentum with employees and stakeholders for the delivery of their shared purpose.
The paper addresses four critical questions:
- What does it mean to be a purpose-driven organisation?
- What are the first steps in orientating towards a particular purpose?
- How does purpose enable sustainability goals to become fully integrated into company practice and strategy?
- How does a purpose-driven approach reorientate corporate imperatives such as competition, growth, and innovation?
Authors and Acknowledgements
Unleashing the sustainable business: how purposeful organisations can break free of business-as-usual.
The authors of this working paper are Dr Victoria Hurth, CISL Fellow, and Aris Vrettos, Director, Centre for Business Transformation, University of Cambridge Institute for Sustainability Leadership.
The author would like to thank Lindsay Hooper and Ben Kellard for their feedback and input.
Unleashing the sustainable business: how purpose transforms an organisation.
The authors of this working paper are Dr Victoria Hurth, CISL Fellow, and Aris Vrettos, Director, Centre for Business Transformation, University of Cambridge Institute for Sustainability Leadership.
The author would like to thank Lindsay Hooper and Ben Kellard for their feedback and input.
Unleashing culture for a sustainable business
The author of this working paper is Dr Victoria Hurth, CISL Fellow, University of Cambridge Institute for Sustainability Leadership.
The author would like to thank Aris Vrettos, Katie Parker, Dr James MacPherson, Ben Kellard, Bianca Drotleff and Rebecca Doggwiler.
The team would like to thank for their feedback and input to Gillian Secrett, Eliot Whittington, James Cole, Alice Spencer, John Rosling and Dr Tanja Collavo.
Unleashing governance for a sustainable business
The author of this working paper is Dr Victoria Hurth, CISL Fellow, University of Cambridge Institute for Sustainability Leadership.
The author would like to thank Aris Vrettos, Katie Parker, Dr James MacPherson, Ben Kellard, Bianca Drotleff and Rebecca Doggwiler.
The team would like to thank for their feedback and input to Eliot Whittington, Lindsay Hooper, James Cole, Alice Spencer, Prof Richard Calland, Dr Livia Ventura, Dr Tanja Collavo, Philippe Joubert, Dr Axel Kravatzky, Prof Colin Mayer and Prof Lorenzo Fioramonti.
Citing these reports
Unleashing the sustainable business: how purposeful organisations can break free of business-as-usual.
Hurth, V., and Vrettos A. (2021). Unleashing the sustainable business: how purposeful organisations can break free of business-as-usual. Cambridge, UK: University of Cambridge Institute for Sustainability Leadership.
Unleashing the sustainable business: how purpose transforms an organisation.
Hurth, V., and Vrettos A. (2021). Unleashing the sustainable business: how purpose transforms an organisation.Cambridge, UK: University of Cambridge Institute for Sustainability Leadership.
Unleashing culture for a sustainable business
Hurth, V. (2023). Unleashing culture for a sustainable business. Cambridge, UK: University of Cambridge Institute for Sustainability Leadership.
Unleashing governance for a sustainable business
Hurth, V. (2023). Unleashing governance for a sustainable business. Cambridge, UK: University of Cambridge Institute for Sustainability Leadership.