The global compact's sustainability vanguard
today´s executives have evolved from considering traditional bottom-line performance to delivering on a broader set of ‘capitals’, such as social, human and natural. Companies on
the forefront have integrated sustainability into their business model and strategy across the entire organisation, and understand that sustainability is a driver of future success. Genuine forward-thinking leaders also raise the bar by helping to improve market conditions, push for smarter regulation, and actively spread leadership practices to the wider business community.
At the time of the Global Compact’s launch, the companies that first committed to engage were by definition corporate sustainability leaders. Although some were subject to attacks by NGOs for alleged human rights abuses and reckless environmental performance. By the same token, they were also the very same companies that others looked to for examples of good practice.
In the mid-2000s, the Global Compact began to go to scale, attracting thousands of companies globally. To meet the needs of these new participants, many of whom were just beginning their journey towards more sustainable business practices, the initiative focused on building Local Networks, providing opportunities for learning and support among companies and developing good practice guides to meet their commitment to the Global Compact and its principles.
By 2010 however, it became clear that in order to remain relevant, the initiative would need to support higher levels of corporate sustainability performance, ideally with the most progressive companies as co-drivers. In 2010, the Global Compact released the ‘Blueprint for Corporate Sustainability Leadership’ – a framework for advanced performance within the initiative. The Blueprint was, and continues to be, at the heart of Global Compact LEAD when it was launched by UN Secretary General Bank Ki-moon at the World Economic Forum in January 2011.
The C-suite and senior executive peer-to-peer program that LEAD provides paves the way for learning and collaboration among leaders of sustainable business.
Today, there are 46 companies participating in LEAD, of which 46 per cent have more than 50.000 employees. Almost half of the LEAD companies are European, and nearly a third are headquartered in Asia. Participation is spread across sectors ranging from basic materials, consumer goods and oil and gas, with 65 per cent being publicly-listed companies. Seven of the LEAD members belong to the original 44 participants of the Global Compact in 2000, with the majority joining at the 2011 launch.
LEAD IN PRACTICE
LEAD was designed to challenge companies already on the forefront of corporate sustainability performance to reach even higher levels - to experiment, to innovate and to share knowledge. Comparable to a sustainability think-tank for corporate
high achievers, LEAD seeks to set new boundaries by bringing the practitioners to the table to tackle sustainability leadership across issues and geographies.
LEAD advances leadership within a company in multiple ways:
- Rather than focusing on specific issues, LEAD targets the integration of sustainability across corporate functions and operations, and at the highest levels within companies including C-suite and members of the Board.
- Priority focus areas are raised by the participants, who work together to produce guidance which is first piloted by LEAD companies, and then shared through best practice examples to all Global Compact participants including through Local Networks.
- It leverages the unique position of the Global Compact to provide responsible business leaders with the opportunity to shape the ever-evolving expectations of corporate sustainability.
- It looks beyond improving corporate practices – LEAD actively engages with stakeholders such as investors, business schools, governments and NGOs, providing a joint voice for leading companies striving to bring business into the post-2015 agenda.
Although LEAD is still a fairly new initiative, it is clear that it has provided a vehicle which re-examines the meaning of leadership. Given the scale of the challenge in achieving the vision of the Global Compact significant questions remain. Sharing the experiences of a selected number of companies may not be sufficient to transform the performance of the corporate sector at large, but it is an effective start. The next step for the Global Compact will be to raise the bar generally for all participants, not least amongst the largest multinationals and businesses with a substantial impact.
BRINGING THE BOARD ON BOARD
Lack of board involvement on corporate sustainability was identified as a gap by LEAD participants at the first Annual LEAD Symposium in 2011. As a result, the Global Compact Board Program was developed and eventually launched in 2014 as the the first global Board training program on sustainability. In 2013 and 2014, five LEAD companies piloted the program which received positive feedback. Following the program, participants reported increased awareness within their respective organisations, renewed engagement, more focus on sustainability issues and a strengthened business case for integrating sustainability into core business and operations.
Using high-level experts and former chief executives as mentors, the program aims to 1) support Boards of Directors in fully integrating sustainability into their businesses by providing high-level knowledge and practical solutions, and 2) help Boards realise the decisive role they have in overseeing, incentivising and driving corporate sustainability.
SHAPING THE SUSTAINABLE DEVELOPMENT GOALS FOR THE FUTURE
In September 2015, the UN General Assembly will agree on the Sustainable Development Goals, which will succeed the MDGs that governments around the world signed up to in 2000.
LEAD has been integral in bringing the voice of the private sector to the development of the agenda, and for fostering more effective collaboration between the UN and business in general. LEAD together with the Global Compact ensures
that the private sector is recognised as a key partner in the implementation and achievement of the SDGs, through core business activities as well as private-public partnerships.
Beyond communicating the voice of business during the process of shaping the SDGs, LEAD companies are supporting the development of guidance and tools to encourage widespread alignment of business goals with sustainable development
objectives. Already, one valuable outcome has been the opportunity to build stronger connections between companies and Local Networks, and to explore how companies’ corporate sustainability objectives fit with the SDGs and how they could become more aligned.
Going forward, LEAD is also expected to help shape tools and standards that can guide business action to advance the SDGs over the next fifteen years.
The Global Compact and LEAD ensures that the private sector is included in, and has an important role, in development.
LEAD is a good force in driving that.