Understanding Holistic Sustainability
| By Jennifer Kuklenski |
Holistic sustainability involves the balanced commitment to an organization’s economic, environmental, and social bottom lines.
A while back, I was listening to an episode on Yale University’s Sustainability podcast. The episode was titled “Sustainability 360: A Holistic Approach to Sustainability at Wal-Mart.” I clicked on the podcast episode because I was interested in the title, obviously, and because I was interested in learning about what Walmart had been doing with regard to the social pillar of sustainability, which is an area where the company has received a lot of criticism over the years. Unsurprisingly, the speaker talked very little about Walmart’s impacts on people despite the word “holistic” in the title.
The podcast episode was incredibly interesting, especially in terms of how Walmart was building a low-cost eco-conscious model throughout their supply chain, as well as some of the technological developments the company was working on, like engineering new delivery trucks with fins, which will reduce the amount of fuel consumed during travel. However, I listened for the entire hour and seven minutes and heard almost nothing about the Walmart’s social impacts.
The speaker did briefly discuss fair trade, but there was little mention of the people that work for Walmart, in terms of employee welfare, empowerment, pay, benefits, diversity, equity, or inclusion. This isn’t to suggest that Walmart isn’t making positive social impacts within the organization (they very well could be), but it does illustrate a common problem in sustainability studies and practice – an overemphasis on economic and environmental outcomes at the expense of social outcomes.
A holistic approach means thinking about the big or total picture. Whether you’re doing holistic parenting, holistic medicine, or holistic sustainability, a holistic approach recognizes that each change you make to one part affects the whole.
In a medical setting, holistic refers to addressing the whole person, including their physical, mental, and emotional health, while also taking social factors into consideration. This could be specific to diagnosis, in which case a holistic approach might consider all possible symptoms; or holistic treatment, which would look at the whole situation and not just one or two factors.
For example, when it comes to mental health, a holistic approach considers how a person’s well-being is affected by psychological, emotional, physical, social, and spiritual condition. It might consider the foods people eat, physical conditioning and exercise, family situations, work-family balance, work stress, physical working conditions, exposure to light, Vitamin D intake, air quality, time spent outdoors, and any underlying medical or cognitive conditions that may require treatment or medication.
We can apply those same principles to sustainability. We can look at an organization’s entire value chain and determine where negative impacts can be reduced and where there are opportunities for positive impacts.
Let’s consider the three pillars of sustainability.
The “People” pillar in sustainability considers the impact an organization has on its key stakeholders, including employees, customers, suppliers, investors, and the surrounding community. Sustainable organizations don’t just provide fair compensation to employees. They also work to create a safe, inclusive, motivational culture where employees find value in their work and are given equal opportunities to participate and contribute to organizational success. Sustainable organizations empower their employees and their communities.
Think about your organization. Does it actively hire and promote people of diverse backgrounds, providing everyone with equitable opportunities in decision-making and advancement? Does organizational culture encourage a growth mindset, empowering employees to take advantage of continuous learning and development programs? Does the organization give back to the local community through activities like charitable contributions, volunteer work, and education programs? If the answer to any of these questions is no, then your organization probably has a bit of work to do related to its social bottom line.
The “Planet” pillar is the most well-known pillar of sustainability. It considers the impacts an organization has on the natural environment, including resource use, waste, carbon footprint, ecosystems, wildlife and animal habitats.
Environmentally sustainable organizations try to minimize their ecological footprint as much as possible by reevaluating activities that harm the environment and actively seeking ways to reduce environmental impact. They encourage sustainable behaviors among employees and customers, such as curbing energy consumption and recycling. They make investments in renewable energy or sustainable design, which may increase an organization’s long-term profitability while contributing to a healthier planet.
The prosperity pillar, sometimes called the “profit” pillar, is probably the most misunderstood sustainability pillar. This pillar is not just about making money. This pillar of course acknowledges that all organizations rely on revenue and that businesses must earn a profit to survive. However, this pillar considers the entire economic impact an organization makes through employment, innovation, wealth creation, and philanthropy.
Sustainable organizations seek to create prosperity and recognize that financial solvency doesn’t need to come at the expense of “people” or the “planet.” In fact, research demonstrates that some of the most financially stable organizations are also those that display ethical and responsible behavior toward their stakeholders and the natural environment.
This last point is worth discussing a bit more. In the “Holistic Approach to Sustainability at Wal-Mart” podcast episode, the speaker suggested that Walmart customers don’t particularly care about sustainability, but rather they care more about the affordability of goods and services. Accordingly, Walmart has been finding innovative ways to both cut costs and cut down on its environmental impact and in fact, many environmentally conscious actions can help organizations save in financial terms also.
Leigh Stringer is a workplace strategy expert and researcher who wrote a compelling book called The Green Workplace. In the book, Stringer explains how organizations can save financial and environmental resources through a number of practices, including green procurement strategies, recycling campaigns, work from home policies, carpooling programs, and new building technology.
For example, if an organization builds or renovates its buildings in a way that offers a lot of natural light, the organization is going to save on electricity costs because employees won’t need the lights on as much, or because the organization can install dimmer lights that use less energy. Using this logic, even if customers don’t care about an organization’s sustainability efforts, it still makes good business sense to invest in environmental sustainability initiatives because those investments will result in savings down the road.
The downside to investments based on this logic is that many organizations make only incremental changes that result in meager environmental impacts. They do a lot of lip service, especially if they don’t have the financial means or economies of scale enjoyed by companies like Walmart. They focus on on the changes that will make near-term improvements in the financial bottom line rather than adopting a more balanced approach that recognizes some aspects of sustainability strategy will cost more while other aspects will cost less.
What does holistic sustainability actually look like?
First, it involves identifying new ways to create, deliver, and capture value. It is the process of innovating across the entire system. I call this process the Business Innovation Model for Sustainability. By looking at our value chain holistically, we can begin to identify areas where our organization is strong and areas where we are weak in terms of the triple bottom line. And we can do this for all three stages of our product’s life cycle: the beginning of life, middle of life, and end of life stages. During each stage, we can identify areas where value is captured and uncaptured, which presents areas for value opportunity.
This process can be complex and even overwhelming for organizations that may not have a plethora of resources or knowledge about sustainable strategy. The important thing to remember is that holistic sustainability requires making investments, but the purpose of investments is not to reap the rewards immediately. We make them to reap benefits down the road. Making incremental investments in holistic sustainability does pay off in the long run.
Benefits of Holistic Sustainability
Study after study shows that many organizations practicing holistic sustainability are performing better than their unsustainable peers. Now of course this depends on whether an industry is heavily consolidated, but in more competitive industries, sustainability often wins the day. Socially and environmentally responsible activities may increase revenues and reduce costs. In terms of increasing revenues, improvements in a firm’s environmental reputation can help them capture a growing market niche consisting of environmentally conscious consumers.
Global research by Price Waterhouse Coopers (PWC) found that 78% of customers were more likely to purchase goods and services from firms that have signed up for the SDGs. And a new poll from the United Kingdom found that 1 in 5 people made New Year’s resolutions that involved being “greener.” Although for many consumers, their good intentions don’t always match their behavior at the check-out line, there has been a dramatic shift in consumer preferences toward more socially and environmentally responsible products.
Holistic sustainability can help organizations build stronger relationships with their other stakeholders as well, including employees, community members, and investors. Better environmental management can help organizations reduce costs by improving risk management, reducing capital and labor costs, reducing the amount of waste, and reducing energy and materials costs. Additionally, organizations that are weaving impact into their core strategies are experiencing increased access to diverse sources of financing, from impact investments and philanthropic grants to partial credit guarantees.
Ultimately, an organization’s ability to positively influence society depends on its continuing commitment to improving the quality of life of workers, their families, and the surrounding community, while recognizing the limits of natural resources, preserving the natural environment, and contributing to economic development.
Achieving holistic sustainability requires intentions, good strategy, and a lot of hard work. We don’t need to be perfect, but we do need to make conscious efforts toward social and environmental justice, while pursuing revenue or profit. If we can find that balance, the benefits will be astounding.
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3P Insights is a consulting firm that offers training, speaking and support services to help organizations attract and retain diverse talent, create inclusive workplaces, become better environmental stewards, and improve their overall social, environmental, and economic impact.
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