The Action Gap: Business Strategies for Co-Prosperity

THE ACTION GAP

BUSINESS STRATEGIES FOR CO-PROSPERITY

New World thinking

for conscious leaders

and managers

DILLPREIT KAUR

Copyright © 2024 by Dillpreit Kaur.

All rights reserved. No part of this book may be used or reproduced by any means, graphic, electronic, or mechanical, including photocopying, recording, taping or by any information storage retrieval system without the written permission of the author except in the case of brief quotations embodied in critical articles and reviews.

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An Ode

When we give our own power away,

maybe sometime in the past and we forgot about it

or in more recent times,

we experience an imbalance state,

a quiet disharmony within ourselves.

For some, this state manifests gradually.

For others, it is almost dormant until something happens,

while for the rest of us, it is a daily feeling of resentment, anger, unfairness, and we cope with complaints and rants.

What is dangerous is that, in this state,

we may not know that we might also be taking another’s power away,

creating further imbalance.

We can break this cycle.

It starts with dignity consciousness.

We are all born with equal self-worth.

Social constructs, judgements, and expectations

made us feel otherwise.

This book is therefore a call for us, especially leaders,

to recognise we are all worthy.

CONTENTS

Acknowledgements

Introduction: Business Case For Just Transition

Part I. Operate Undisrupted

Chapter I See Things as They Are

Chapter II Overcome Powerlessness

Chapter III Own What We Can Know

Part II. Communicate Outcomes

Chapter IV Prioritise People

Chapter V Leaders Who Succeed

Chapter VI Co-Prosperity as a Value

Epilogue: Quantum Leap To Transformative Leadership

Reference List

Additional Resource

About the Author

ACKNOWLEDGEMENTS

F or experiences shared in this book, I am much indebted to stakeholders I worked with from around the world. Thank you for trusting me with your ideas, visions and hopes for stronger and more inclusive institutions. For invaluable help along the way, I thank Braema Mathi, Dr Wilhelm Hofmeister, Christian Echle, Jia Rong Low, Paul Singh Gill, Esther An, Melissa Ho and Jasvir Kaur.

INTRODUCTION

W eaving is a common tradition in many of our ethnic communities in Asia especially. This book is many years in the making, intricately weaving my knowledge and insights journey within the systems of sustainability development, spanning more than a decade. It involves my experiences from studying in Singapore, Pretoria, Sydney, and Kathmandu as well as working with Asia Pacific and European change makers. I have worked in what may seem like random fields: human rights, political party building, Internet governance, technology start-up venture building, and most recently, corporate sustainability, unknowingly knowing everything is interconne cted.

This book hopes to seed the new future with a vision of what it could be with practical steps. I hope it is a resource to many about sustainable self-leadership and organisational growth (whatever that might look like for you). Also, there is a procedural essence to building something of quality over time. If we are talking about societal impact or breaking intergenerational cycles of poverty, addiction, powerlessness, then even more so we need to create building models that have a clear vision of a desirable outcome and tangible, simple and teachable steps towards breaking out of one. This book hopes to help co-create that model with you.

Unpacking Sustainable Development

There are several discourses when it comes to sustainability that are well analysed in Green Utopias: Environmental Hope Before and After Nature by Lisa Garforth. Specifically, Lisa makes a differentiation between the aims of two well-known reports that have come to shape how we perceive sustainability today. The first, 1972 ‘The Limits to Growth’ (LTG) report recognised that because of inequalities of economic wealth and industrial development between countries, growth will eventually need to stop for People and the planet,¹ while the later 1987 Brundtland Report premises that ‘it is development itself that is to be made sustainable.’²

For the LTG report, finite natural resources was the cause for environmental crisis, while for the Brundtland report, it is how we grow that is the cause. This is because in 1972, the LTG report used a singular, absolute, and physical worldview while Brundtland adopted a multiple, staggered, and social one.³ Lisa posits these differences in root causes of environmental problems do not matter because we need to accelerate pathways towards sustainability now.⁴

‘Since the policy framework on climate change that emerged in the United Nations Framework Convention on Climate Change (UNFCCC) in 1992, the next fifteen years saw a solidification of scientific consensus that climate change is real, anthropogenic, and consequential’.⁵ It was in 1992 with Agenda 21 that marked the moment at which sustainable development became a goal for policymakers. By the 1990s, corporate sustainability responsibility and shareholder engagement came to the fore for companies as well.

The mid-2000s, after the fourth Intergovernmental Panel on Climate Change (IPCC) report and Stern review, saw a period of consensus on climate change and optimism with popular media and consumers alike.⁶ It was in 2005, when Environment, Social, and Governance (ESG) was coined by the United Nations (UN) Global Compact, which was later embedded in the UN Principles for Responsible Investment in 2006. More hope with the Bali Road map in 2007.

By 2015, the UN Sustainable Development Goals (SDGs) with its 169 indicators and 17 goals were etched, building from its predecessor framework—the Millennium Development Goals (MDGs) from 2000 to 2015. As 2030 draws close, which is the milestone year for achieving the SDGs, it is unlikely all goals will be met given the four-trillion-dollar financial gap for developing economies in sustainable development investments.⁷ Moreover, we have raised our climate ambition to reach net zero by 2050 earliest for most economies, according to publicly-announced sectoral and country road maps, with some exceptions prior to and some after 2050.

Figure 1: Summary of global climate policy high-level developments

Moving forward though, we need to avoid the ‘performance or management of unsustainability’ as proposed by Ingolfur Bluhdorn.⁸ In Green Utopias, Garforth urges us to think about how we live in uncertainty and emerging environmental risks while making the shifts to more ethical alternatives to mitigate these very risks.⁹ While ‘deep ecology holds that new forms of ecological consciousness and environmental ethics grows best in communities that are small, self-sufficient, stable and autonomous’, most of our cities are not built this way. As such, an eco-centric world would be a call for ‘renewal and emancipation’ and ‘collective politics’ where we start seeing nature and culture, the material and the social, the objective and subjective as a sum of a whole and not separate.¹⁰ We all have a part to play.

Business Case For Sustainability

As we transit to industry 4.0, which is mainly the digital transformation of our industries and way of lives, the onus on businesses to comply and ensure economic, governance, social, ethical and environmental (EGSEE) performance has also risen.¹¹ Figure 2 shows these expectations from key actors in the sustainability management ecosystem and the resultant interdependent relationships that will be required to sustain and grow this nexus.

Figure 2: Business Value Creation 4.0 requires upstream and downstream impact consideration across different actors to accelerate change

Such is systems change: it is an open space of adjacent possibilities that we can all tap into to co-create the best outcomes for our communities involved. Businesses cannot only be about people running the organisations. It has to be about a bigger vision, one that preferably aims at improving socio-economic outcomes for all and not just for a handful.

With regards to decarbonisation as it is a pertinent step towards respecting Mother Earth’s finite resources for now, unless we use them in a regenerative and responsible manner, we indeed need to simplify our operations and diversify our sourcing to look for alternatives. There is more noise in the industry about the challenges than there are implementable solutions. This need not be our mindset when faced with challenges.

The sustainability solution is simple—where are we making most of our resources procured (purchased or free) and how are we best utilising it to move towards a regenerative business model that is self-sustaining with revenue reinvested in the organisation’s mission or sustainable financing instruments leveraged in order to fuel more innovation and growth that is sustaining EGSEE goals?

The resource efficiency issue—what to cut back on and what is needed is where we need to begin. A lot of times we do not know who is doing what, and when asked, the staff or business partner may get defensive. We also do not track the impact variables of the products or services we provide, thinking it should work out according to what we have thought. The theory of change behind why we implement many initiatives is missing in most organisations, especially those missing a North Star. This is dangerous as it leads to reckless use of resources and often ends up as a waste of time. But even then, we do not see the folly of our ways, because of our egos or pursuit of simplistic endeavours in fear that if we critically apply ourselves, we might find the can of worms underneath the surface, probing us to really solve the situation.

The business case for sustainability emerges when we realise there are cost savings from implementing this sound rationale of thinking through why we do what we do. By ensuring we think more about the how behind what we do, we not only save money, time, and resources but start to be more compelled towards our North Stars and do better.

Sustainability is therefore as much about the individual as it is society. It is culture as much as governance. And it is meeting objectives with results that support desirable socio-economic outcomes for others. The more value we can capture with our new business models from the start, the better. And closing the loop with mindful consumption and innovative solutions to reduce waste by upcycling or reintroducing into the production cycles of our organisations will be the necessary lever for enabling the low-carbon transition. According to the World Economic Forum, circular economy models can help accelerate this momentum to net-zero energy emissions and multi-sector resource optimisation.¹²

With regards to scope 1, 2, and 3 or direct and indirect greenhouse gas emissions (GHG) reductions, a simplified model where each organisation maps out its entire value chain both upstream and downstream to make a conscious decision on how to reach carbon neutrality before reaching net zero will be foundational. By understanding what we can directly control and what we cannot, broken down into further sub-categories with regards to suppliers, for example, we can better understand where we can get started. The end goal is simple: to reduce as much as possible energy or emissions we release through our business operations. To optimise the resources, we have to make more value out of it than before, to transition towards circular economic business models.

Figure 3: Simplified visualisation of emissions coverage across value chain from source (i.e. cradle) to sale of product/service (i.e. gate)

This will require identifying new business partners who offer low-carbon alternatives and striking partnerships within the industry to decrease the price premium through either bulk purchase via a consortium of industry leaders or association. Much like the example of sustainable aviation fuel credits mentioned above to finance the ecosystem, ingenious finance instruments will be required. And brokering new sustainable or transition finance tools with financiers including insurers and reinsurers will be helpful. The emerging risks to get to net zero are fairly unknown as near-term and long-term timelines vary across geographies. Even though there is a lag in climate change eventually manifesting, near term poses higher transition risks if climate regulations get more stringent along with stranding asset risks from more extreme weather patterns.

Such scenarios will require even more efficient resource management planning and implementation, which many firms have yet to do, understandably so as we transit out of the challenges of a public health emergency caused by COVID-19. As we understand how interconnected most things are in the world, we birth a new approach and mindset to disruption. With climate change potentially raising the likelihood of epidemics due to displacement of wildlife and/or spread of air or waterborne diseases stemming from natural disasters, the need to apply a holistic and systematic lens will grow increasingly important in the coming decades.

If anything, this should excite us as often this is where inventive solutions and innovative technology emerge. And it will only be possible if we are each empowered and enabled to realise our own creative potential to contribute to the interconnected nature of sustainability issues.

Taking Action

The meta-aim of this book is to boost understanding and engagement of different and even untraditional stakeholders when it comes to tackling sustainability challenges. We cannot do it alone. In fact, most of a company’s non-financial data required for corporate reporting is compiled from stakeholders across all business units, portfolio (i.e. subsidiaries), and supply chain. According to CDP, 70–80 per cent of a company’s scope 3 reporting is in their supply chains. As we know, fifteen categories of scope 3 are further streamlined to the few categories that represent at least two thirds of a company’s scope 3 emissions. Based off this, further data