Aligning leadership with sustainability 

The legacy of the “profit-only” paradigm 

Whatever its history, whether stretching back centuries or just a handful of years, every organization comes with its own set of expectations, based on that history. To date, sustainability has very rarely featured in this.

Put simply, the vast majority of organizations were not built with sustainability as the keystone, or even one of the pillars supporting their vision. Given this, it is unsurprising that, when it comes to organizational culture and leadership, there exists what can be described as a “sustainability deficit.” The majority of today’s senior executives were educated at prestigious business schools; gained professional experience via a well-worn, traditional path; and built their careers within a profit-only paradigm based on hitting quarterly and annual financial targets. They achieved this within a conventional business framework based on competing for market share, gaining leverage with key suppliers, and squeezing the margins of other players in the chain. This engendered a strict “command-and-control” managerial style, with an emphasis on organizational efficiency and optimizing use of resources (including human resources). The legacy of this paradigm is still predominant in many organizations and tends to hinder the transition to a sustainable management model.    

Taking real action – not just playing a part

Sustainability requires a different management style and a new set of behaviors. Changing people’s hearts and minds is the biggest challenge – and it must start with the C-suite. While leaders broadly recognize the pressing need for change, they often end up following a simplistic, even superficial approach to implementing it. They “change the narrative,” bringing in buzzwords such as “purpose,” “care,” “trust,” “collaboration,” “openness,” “psychological safety,” “empowerment,” and “tolerance of failure.” In practice, however, executives do not walk the talk: the change in vocabulary is not reflected in a change in attitude and behaviors as expressed through everyday work tasks. We describe this superficial attitude to sustainability as sustainability theater.

Employees soon pick up on a lack of genuine and coherent commitment to change on the part of their leaders and, as the perception gap widens between the values that executives espouse and the leadership styles and behaviors they display, employee cynicism and dissatisfaction will grow in parallel. This misalignment risks undermining the credibility of sustainability strategies within the organization – leading to employee disenchantment – and outside it – feeding skepticism among customers, suppliers, investors, and institutions.  

So, what should executives do to avoid becoming actors in sustainability theater?

Management research into corporate-culture change emphasizes a focus on leaders’ observable behaviors, rather than on vague, abstract values disseminated by the HR department. Authentic cultural change is not simply a recalibration of the existing mission statement or a freshly drawn up manifesto of values. Simply changing the narrative will backfire if it is not backed up by a meaningful change in leaders’ actions, behaviors, and decisions in relation to their employees, customers, suppliers, and local communities.   

40 behavioral cards for leadership in the sustainability era 

Identifying and defining distinct observable behaviors makes it easier to monitor, assess, and review the adoption of those behaviors. Under the supervision of V. Kasturi Rangan, Malcolm P. McNair Professor of Marketing at Harvard Business School and co-chairman of the School’s Social Enterprise Initiative, we developed a set of 40 behavioral cards applicable to leadership in the sustainability era.  

“Cards can be a powerful tool for triggering meaningful discussions, both in an executive classroom and in corporate-leadership meetings,” explains Professor Rangan. “There’s an increasing need to support leaders in raising awareness of the impact of their individual behaviors on the sustainability agenda,” he adds. 

The list of behaviors is organized around four dimensions:  

• Purpose: Once clearly defined, leaders must embrace their purpose and encourage the organization to follow it as a guiding “north star”
• Trust: Leaders must act authentically and credibly in order to gain the  trust of employees, suppliers, and partners  
• Collaboration: Leaders must be open to different perspectives, co-creating with partners and finding systemic (rather than siloed) solutions   
• Innovation: Leaders must build creativity and encourage experimentation outside comfort zones; incremental solutions alone will not be enough to solve sustainability challenges – more immediately impactful solutions are required 

Each of the four dimensions comprises ten specific behaviors: five designated “positive” behaviors that should be initiated and/or encouraged; and five “toxic” behaviors that should be eliminated. Each behavior should be articulated using clear descriptors that enable managers to enact them. We encourage managers to customize the standard list to fit the specific business context and to encompass both environmental and societal dimensions of sustainability.  

After fostering environmentally conscious decisions and actions, it is important to examine the social and people components. “If leaders care for the planet, they should also care for the people,” affirms Guido Stratta, Chief of People & Organization at Enel, a global leader in the fields of electrification and decarbonization.

“Enel combines an environmental focus with the concept of “soft leadership,” based on exhibiting “kindness” towards the firm’s multiple stakeholders.”

Enel’s model of soft leadership incorporates valuing and nurturing personal relationships, trust, and respect for the abilities and commitment of others, while simultaneously maintaining a focus on achieving sustainable business objectives.  

In the table below, we present an excerpt of the 40 behaviors that includes two for each of the four dimensions: one example with a positive connotation and another with a negative connotation. 

In our work with clients, we have found the list highly useful iIn encouraging executives to focus on three or four positive behaviors to commit to, and the same number of negative ones, which they will commit to abating. This exercise works equally well when conducted on either individual or team level. Once the level and type of commitment are defined, it’s important to make monitoring of the commitment transparent and to bring it into practice as part of everyday activities.  

Respecting and upholding the new behavioral structure requires sustained effort. Despite leaders’ best intentions, after the initial burst of commitment, it is tempting to slip back into the accustomed management style. To help leaders, teams should introduce new routines and team practices to support planning and monitoring of new behaviors, including periodic retrospective sessions to discuss the progress of adoption. For example, a specific behavior could be added as a focal point in each departmental meeting.

“By providing time and space for candid discussion and assessment, leaders can facilitate the transition to the new behavioral framework.” 

Feedback and discussion should not be limited to executive peers; leaders should incorporate feedback from employees and other stakeholders beyond the company walls (suppliers, partners, customers, etc.) in relation to progress on behaviors relevant to that group. 

“If managers can set themselves a series of concrete, defined behaviors to follow or eliminate, organizations will see measurable change and tangible benefits.”

In light of the importance of internal organizational behaviors, as detailed above, it is surprising that discussion of behaviors tends to concentrate on consumer behaviors, rather than behavioral change at leadership level. Executive and managerial behavior is pivotal to project credibility and nurturing trust inside and outside the organization. Simply defining a new manifesto of values and cascading it down from the top in the hope that change will follow is rarely successful.

Read an executive summary below.