Empowering the societal transition

Impossible transition?

The daunting scale of societal transition we face in the next decade or two, to avert major disruption or even collapse of our complex civilization, makes most of us feel helpless and discouraged, leading to denial (Trump & Co), action paralysis (many European governments) or over-simplistic “solutions” with marginal impact (please recycle your PET).

How can we positively engage citizens and corporations to act with the required speed and determination?

The recently concluded BSL course “Implementing Sustainability Strategy”, as a mini-trial, offers hope. With nine participants, at least as many nationalities between us, a guest speaker, and myself as a learning facilitator, our management experience ranging from basic materials and finance to software and humanitarian operations – we co-created a 3-day piece of this journey together.

Preparation

To prepare, a few hours of reading and thinking before class helped participants catch up to the latest knowledge and insights. Additionally, answering a few questions helped crystalize one’s thoughts. Finally, in the classroom: rearranging furniture so we are all seated around one big table; then sharing interests and expectations.

Discovery

We quickly moved beyond alarming images showing the climate or biodiversity urgency, air or plastic pollution, and scientific papers explaining the foundations. It was important to put current developments in a proper context – which is the basis of any serious understanding.

We went on a “discovery journey” from the Big Bang (looking into energy, entropy, and life), the evolution of homo sapiens (power of storytelling, oldest remaining human civilizations, agricultural revolution, enlightenment, industrial revolution), economics (concept of GDP, neoclassical, environmental, ecological and other flavors, need for growth, the myth of decoupling, rebound effect), technology (coal, oil, Haber-Bosch, green revolution, absolute and practical limits, technology as master or servant?), finally reaching societal changes (poverty, consumer society, industrial food). Interestingly, most fundamental questions like “What’s the purpose of society” are rarely asked and almost never collectively answered.

Barefoot economics

A useful tool on this journey is Manfred Max-Neef’s “Barefoot economics”, which the author himself condenses in 5 brief yet deeply insightful statements:

  1. The economy is to serve the people and not the people to serve the economy. 
  2. Development is about people and not about objects. 
  3. Growth is not the same as development, and development does not necessarily require growth. 
  4. No economy is possible in the absence of ecosystem services. 
  5. The economy is a subsystem of a larger finite system, the biosphere, hence permanent growth is impossible.
BSL post

Process of Personal Transition, John Fisher, 2012

Application to business

Back to the classroom, back to the companies we work for: it was time to apply this broader understanding. After the usual impact, materiality and lifecycle analysis, we tried a novel approach, asking the questions “Why does this product exist at all?” and “Which human needs does it satisfy”, based on Max-Neef’s Fundamental Human Needs model. A lower-impact solution is then sought that satisfies the same needs. This iterative process works best if part of a broader employee and management engagement process, which we also practiced.

Additionally, our guest speaker Mark Posey shared his extensive experience of how this all came together in real life at Schindler. The discussion lasted three hours including lunch, time very well spent.

Throughout this intense course, to keep everyone engaged, we tried to maintain a good rhythm, alternating videos, reports, class discussion, scientific articles, teamwork and presentations, short explanations, and individual reflection.

Ecosystem services experienced first hand

Ecosystem services are benefits humans derive from biodiversity, such as provisioning (food, medicine), regulating (flood protection, climate), cultural (meaning, heritage, relaxation) and supporting (soil formation, nutrient cycling). Every class day, just before sunset, feeling totally exhausted, we went for a 40-min restorative nature walk. As a result, the long evening group assignment went until 21:45, yet we were fully motivated. What better way to experience the value of cultural ecosystem services?

Feeling empowered

If we could somehow combine a deep understanding of the current situation and how we got there, a humanist vision of society based on human thriving over generations, a determination to experiment in different local contexts, a shared success metric based of high human development and minimal environmental impact, and finally inspiration of past cases of mobilization to face big challenges (example: a short BBC video) – we might actually feel empowered to start the transformation.

This is precisely what we did on a tiny scale at BSL.

Sascha_NICK Author: Sascha Nick, BSL Professor

An exotic Internship between BSL & Sumba Hospitality Foundation

In 2017, Business School Lausanne (BSL) and Sumba Hospitality Foundation (SHF) in Indonesia co-created an Internship program tailor-made for BSL students called Sustainable Development Internship.

You may wonder, what is Sumba? And what do they do? So, let us share a brief presentation of this Foundation. SHF offers a vocational training in hospitality for Sumbanese underprivileged youth. The holistic education program provides students with general courses and enables them to graduate in Culinary, Food & Beverage Service, Housekeeping or Front office. To allow the students to apply and train their skills, SHF has opened ten luxury guest pavilions, a SPA as well as a restaurant & bar to the public. Education, environmental awareness and sustainability are the three most important principles of the foundation. It is in the belief of the foundation that tourism can be a positive force in poverty-stricken regions particularly when its community is involved in the process. The goal of the foundation is to assist in providing viable employment to Sumba’s young inhabitants and break the cycle of poverty while also protecting the environment and their culture.

A large part of the campus is dedicated to the growth and maintenance of a sustainable, organic farm, created with the precepts of the burgeoning field of permaculture in mind. Produce from the land are used in the restaurant and the students are taught current farming methods with guidelines to better cultivate their land. SHF aims to raise the students’ awareness of their environment. The school is powered entirely by solar energy allowing SHF to be completely off the grid and re-uses wastewater for irrigation.

One of our BSL students on Sumba Island, Morgan Manin, is doing his internship as part of his Capstone Project (Master of International Business); I took the opportunity to ask him via email for a preliminary description of his internship, to share with our community.

BSL internship

“Reading about SHF on the website and social media made me choose it to do my internship, as my values match perfectly with the foundation’s values and I believe that I will be learning a lot during my Sustainable Development Internship. After the first week, I have identified areas where I could be helpful and learn, which I can summarize with three main tasks and responsibilities. The first one is to analyze the financials at SHF and therefore create a budget for each department meaning the actual school, the administration, the hotel, sustainability and the F&B, including an indication of Capex by departments. I will also guide the SHF finance team towards greater transparency and define cost improvement initiatives.

The second main responsibility I have is to create a Triple Bottom Line Reporting (TBL). TBL is a progressive mode of reporting and seems suited to the SHF. Sustainability centric practices are deeply entrenched in the DNA of the SHF business model. Environmental and social responsibility sit at the core of daily practices and this alongside the true cost of these operationalized initiatives must be reported. I will then gather information to facilitate understanding around the social, environmental and economic practices of SHF. I will conduct research into TBL, using these understandings and research knowledge, with the aim to create a presentation that highlights sound reasoning and justifies or rejects TBL as a means of reporting at SHF. If TBL is found to be preferred mode of reporting, the presentation will include a step-by-step guide detailing a prescribed pathway toward the implementation of TBL reporting at SHF, and then create the strategy that details how to implement TBL as the reporting mechanism for SHF. In the event that SHF management decides to implement TBL as their primary mode of reporting, I will then begin the process of implementation.

To finish, I will be the IT ‘go-to’ person for the team, helping everyone out on Excel, Word, etc.

I will also consider improved ways of using IT for communication for the SHF team.

Before I arrived here, it was planned that I would have to formulate a business plan to be shared with others wanting to duplicate the model of the SHF. I will, therefore, formulate a business plan, constructed in such a way that it has the capacity to facilitate like-minded operators wanting to duplicate the SHF model.

In addition to my primary tasks and responsibilities, I will have ad-hoc tasks set by the Executive Director, I will take care of the students during their study hours and exams as well as shepherding them at night and being in charge of sport activities for the students; also, I will monitor Community English classes for young Sumbanese children living in the neighborhood.

I strongly believe that I will learn so much through this experience, being in a different environment, living in this community, having multiple tasks matching with what I have learned at BSL, and matching the BSL values”.

Morgan, we are all proud of you, we wish you a great experience and let’s see if we can come visit you at some point on that amazing island!

Dani-Linkedin-300x300Author: Daniele Ticli, BSL Head of Careers and External Affairs

Is sustainable finance becoming mainstream?

The Swiss newspaper Le Temps published a very interesting article on June 20 by Emmanuel Garessus on the topic of sustainable finance.

Based on a study published by Morgan Stanley the day before, sustainable investments worldwide reached a total amount of 22’800 billion dollars, and can no longer be considered a niche market. This means that a quarter of total investments made by professionals are following ESG (environmental, social and governance) criteria.

The annual growth rate of sustainable investments currently amounts to 11.9 % and continues to grow.

The majority of institutional investors, such as pension funds, foundations, insurance companies and sovereign funds, are now investing in this field, which used to be a niche a few years ago. Hedge funds are an exception to this trend.

Europe (12’000 billion dollars) and the United States (8’800 billion dollars) are major players in this field. Theme wise, climate change occupies the top position, ahead of inclusive growth and gender diversity.

Risk mitigation and potential return on investment are the main reasons why professionals invest in sustainable finance.

When I read the article in Le Temps, I had mixed feelings. On the one hand, it is very encouraging to see how quickly sustainable investments are increasing all over the world. On the other, we should remain aware that there are different levels of commitment from investors with regards to sustainable investments. A first level is exclusion (we just choose not to invest in the tobacco industry or in casinos, e.g.). A second level is the so-called “Best in class” approach where we decide to invest in company A instead of company B, because the former one has a better rating according to ESG criteria, even if we invest in non-renewable energy sources. The third level is impact investing where we select companies, which bring a real progress to the world, by addressing environmental or social issues and contributing to reach the UN SDGs (Sustainable Development Goals).

Unfortunately, the article doesn’t give any indication on the way the total amount of sustainable investment is shared between these different levels.

My personal opinion on this topic is that a shift towards more progressive and impactful levels of sustainable investments is as important as the total amount of these investments.

For that reason, the world needs more and more finance professionals with a solid background in sustainability, both at investing companies or institutions and at rating companies.

Philippe Du Pasquier, President of the Board