Sustainability after Covid-19: Interview with Jonathan Normand
By Richard Bousfield
On June 25th, Greenbuzz Bern, Berlin, Geneva and Zurich join forces to discuss the topic of Sustainability after Covid-19. We spent some time with Jonathan Normand, founder and executive director of B Lab Switzerland.
How did you come to be where you are now, and what motivates you forward?
I started my career as a risk manager in the financial industry. I worked for international companies and, in one way or the other, I’ve always been involved in humanitarian causes. In 2007, I decided to make better use of my knowledge and the experience I gathered over the years. I wanted to help serve a greater cause, and this was finding ways to use business as a force for good.
I worked in management systems for a decade or so. So, to me, it rapidly became obvious that businesses can’t manage what they don’t measure. Companies need data, first to make informed decisions, and then to measure the impact of their decisions. With that in mind and my call for a greater purpose, I decided to co-found the company CODETHIC in 2007. Soon after we would publish an international standard that we developed internally, giving a decision-making tool to corporations to helping them to harness a sustainability strategy.
In 2014, aligned with my vision that a multiplier effect was key to achieving global sustainability, I supported the launch of the global non-for-profit B Lab in Europe. The international NGO provides private companies with an online, free, and confidential tool to measure their social and environmental performance. Companies can be rewarded with the “Certified B Corp” certification if they meet three requirements: first, their social and environmental performance have to meet the high standards of the NGO and undergo a performance audit. Second, the companies shall amend their legal statutes to incorporate the dimension of sustainability to its management’s fiduciary duties. Last, companies have to commit to high levels of transparency, by publishing their impact performance score publicly.
Altogether, the criteria make for a strong, credible vehicle for change.
Are we witnessing differences in the coping responses and mechanisms to Covid-19 between companies with higher and lower sustainability practices?
Yes, we are. And that’s what makes verified sustainability practices and standards a vehicle for change. Sustainability practices build business resiliency. We know that the Certified B Corp companies weathered the storm of the 2008 crisis way better than their less sustainability-oriented counterparts. And the first indicators we’re receiving show that with the very different crisis at hand, B Corps and sustainability-engaged businesses are indeed more resistant and responsive.
For instance, these companies built strong social capital with their workforce over time, and in times of crisis, this attitude is rewarded. Treating employees with respect, offering them fair wages, continuous education opportunities, and active listening make up for a dedicated and loyal workforce that proves tremendously helpful for the company, and sometimes makes the difference between the life or death of the company. Similarly, intelligent and sustainable value chain management is decisive. To approach suppliers’ relationships not as a mere “supply vs. payment” relationship but rather as a true partnership makes all the difference. There’s a relationship based on trust, flexibility, and genuine willingness to support each other: the BCorp movement united with the Declaration of interdependence. These bonds are invaluable in times of value chains’ shake-ups, and a sharp edge over competitors.
Do we need to rethink our current economic models and what are B-Labs recommendations for this?
Yes, we do. As highlighted in a recent article I wrote, we must shift gears now and engage fully in the transition from an extractive model to a regenerative one. This transition is supported by the shift in mindsets that we’re witnessing more and more, towards the values of collective intelligence, care and transparency. Our current economic models are not designed to cope with the degree of complexity that we’re facing. The simplest example of that is the deliberate absence of consideration for externalities in measuring businesses’ operations – and, ultimately, value. How can we justify, in 2020 with less than 10 years to avert a full-fledged climate crisis, that companies are only assessed upon the cash they generate, upon their financial performance? What about the ecosystems they’re relying on to merely exist?
The list of reasons why we need to rethink our broken economic models is endless, so I’ll just add one more example: why keeping on assessing the countries’ development and success on a GDP basis? Whereas we know that the metric is flawed because fundamentally incomplete. We should instead think about how a system of metrics such as the Planetary Boundaries’ – and the Doughnut Theory coined by Prof. K. Raworth – can help us as a society thrive within the limits of our planetary ecosystems. Things are moving here, with the city of Amsterdam announcing that its post-Covid recovery plan will be established based on this theory’s principles.
B Lab’s recommendations are that of systems’ change harnessed by multi-stakeholders’ partnerships, a redefinition of the notion of success based on the positive impact of companies on their stakeholders, and strong governance principles (e.g. sustainability-aligned fiduciary duties).
Are we already seeing actions, in any sectors, that are indicative of a potential, broader systems change?
Yes, we most definitely are!
Initiatives worldwide are spanning, and what’s new here is both the scale and the scope of these initiatives for change. From the local, community-level up to multinationals and supranational levels we’re seeing forces pushing massively towards the integration of sustainability practices. The European Union and its Green Deal, companies and governments elaborating international standards for reporting on extra-financial information (i.e. company’s social and environmental impacts), major business leaders publicly calling on governments to embed the environment at the centre of their Covid-recovery financial plans, or pledging to shift from shareholder capitalism to stakeholder capitalism and a redesign of business practices (e.g. Imperative21 Coalition). A momentum at that scale is simply unprecedented and there is no turning back. Even the mammoth oil and gas companies – Big Oil as we call them – are now publicly talking about the extinction of their business, acknowledging that much of their unexploited oil fields might actually never be drilled.
One thing that’s also new and frankly encouraging is that companies finally realise that sustainability is not a function or a role only, it’s a huge driver, for their long lasting differentiation and positioning. They have to incorporate sustainability goals within their business model and in their fiduciary duties. As I like to say, companies cannot operate in an environmentally and socially harmful way during the day and just set up a foundation for PR-beautification on the side anymore. Embedding positive social and environmental practices, thinking, and metrics in their operations and business model will be vital for companies over the next decade, and a powerful accelerating force to shifting towards a regenerative economic system.
For more information on the event, please visit: https://www.greenbuzz.global/bern/