Any views expressed in this article are those of the author and not of Thomson Reuters Foundation.
By John Elkington
Disruption carves a path, one that calls for business, government and civil society leaders to move beyond incrementalism and to dare, dream and design a whole new way forward.
Some people are born disruptive, some acquire a disruptive streak, and some have disruption forced upon them. In my case, the sense that the economic system was deeply dysfunctional set in early. When I studied economics in the late 1960s, particularly the work of economists like Nikolai Kondratiev and Joseph Schumpeter, I acquired a life-long taste for the long-wave framing of economic history.
That led our new venture, Volans, to publish The Phoenix Economy in time for the 2009 Skoll World Forum, arguing that the Global North was headed into a period of protracted ‘creative destruction’, an era offering major new threats to change-makers, coupled with major new opportunities. Some dismissed the analysis, claiming that we were simply in one more recession among many, but such counter-claims have become more muted over time.
Now, in time for the tenth Skoll World Forum, we have launched another short report, sketching out the macro-environment in which we will all have to operate into the 2020s. Titled Breakthrough: Business Leaders, Market Revolutions, it charts an accelerating trend whereby business leaders pick up the torch from activists, arguing the need for system change
Our aim is to stretch the horizons and ambitions of business leaders across the Global C-Suite—the constellation of around 1,100 companies worldwide that now control around half the world’s market capitalization. And to encourage them to put their shoulders to the great wheel of social and environmental change.
An insane ambition, some will argue, but it’s one that Volans (which celebrates its first five years on 1st April and was recently certified as Britain’s second B Corporation) plans to devote itself to over the coming years.
To guide us on our own journey, our small team labored over a map that tracks the evolution of our agenda to date—and sketches some of the ways in which the Global C-Suite has already been impacted. We reproduce it below—and now offer a short, guided tour, as a first step towards introducing other key elements of the report in later blogs in this series.
The vertical axis of the diagram shows some of the key forces and drivers that have fuelled the agenda and propelled a growing number of companies and sectors to tackle environmental, social and governance challenges. Wind the clock back far enough in relation to any issue and you find that the original agitation for change came from activists, NGOs and other organs of civil society.
The Breakthrough Map
Over time, however, the torch tends to be picked up by governments and then by different parts of the worlds of business and finance. Leading companies have worked out how to partner with each of the new influences on the vertical axis. Today, for example, we see growing mainstream business interest in the potential lessons to be learned from the growing range of social and environmental enterprises.
In parallel, we also now see growing interest in pre-competitive initiatives designed to bring the resources of many different companies to bear, from the Zero Discharge of Hazardous Chemicals coalition in the sportswear sector through to The B Team, led by Sir Richard Branson and former PUMA CEO Jochen Zeitz
Focusing back on the diagram, a diagonal trajectory runs from bottom left to top right, taking us from an early state of denial (where business lobbyists either dispute the existence of a problem or energetically deny any link to the activities of a particular industry) through to the point of breakthrough—where the system jumps to a different, and hopefully more sustainable, state.
Along the way, we see regulators and legal businesspeople focusing on compliance with new rules. Over time, too, a growing number of corporate pioneers shift the needle, moving beyond compliance to new forms of citizenship and corporate social responsibility. The next step beyond that, in the CSR space, is the evolution of new forms of social innovation, social entrepreneurship, coupled with new forms of impact investment and ‘shared value’.
The diagram’s horizontal axis plots the growing number of C-Suite roles that have become embroiled in all of this as the agenda becomes more complex, more urgent and, for a growing number of sectors, increasingly strategic. The CSR and social innovation phases have seen the appointment of a growing number of Chief Sustainability Officers (CSOs), a profession whose rise we track in the report. But for true system change CSOs can only hope to play a catalytic role. Ultimately every C-Suite role has to be involved, including the Chief Financial Officer (CFO), with the CSO’s early agenda properly embedded in all key functions.
One question we have often been asked since our Breakthrough Capitalism Forum last year, is what criteria should be used to define a breakthrough innovation, technology, business model or policy? Based on our research to date, we believe that any such initiative needs to be:
- Future-ready: Able to work well in a world of 7-going-on-9 billion people, providing affordable access to key products or services, while respecting planetary boundaries
- Ambitious: Aims to transform key aspects of capitalism, and drive radically better outcomes across the triple bottom line
- Fair: Helps tackle equity issues, including the transfer of intergenerational debt created by public borrowing, natural resource extraction and environmental destabilization
- Disruptive: Has potential to constructively disrupt the current economic and/or governance orders, moving the needle from incrementalism to system change
All of which makes the 2013 Skoll World Forum’s theme even more timely. “Disruptive innovations can reshape industries, supplant old technologies, and topple political regimes,” the Forum website declares.“To bring about the scale of change social entrepreneurs envision, they must think like disrupters, first understanding the forces that have created and fueled our greatest challenges, and then designing solutions aimed at nothing less than to bring about a more just, sustainable, and prosperous world. Disruption carves a path, one that calls for business, government and civil society leaders to move beyond incrementalism and to dare, dream and design a whole new way forward.”
Let’s do it.