Pekka Mattila: Rethinking Sustainability - From Whitewash to Longevity

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Dr. Pekka Mattila's presentation at the Join Our Core event on April 16, 2013.

http://www.aaltoee.fi

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Pekka Mattila: Rethinking Sustainability - From Whitewash to Longevity

  1. 1. FINLAND / SINGAPORE / POLAND / SOUTH KOREA / TAIWAN / CHINA / INDONESIA / SWEDEN / RUSSIAJoin Our Core16.4.2013Dr. Pekka MattilaRethinking Sustainability -From Whitewash to Longevity
  2. 2. Why have we becomedisillusioned withsustainability?26.4.2013 Pekka Mattila 2
  3. 3. Why the reality-perceptiongap exists? (Peloza & Loock & Cerruti & Muyot 2012)• Category biases – IT vs. Mining• Brand identity biases – Disney vs. Wal-Mart• Senior management visibility• Noise – Recency bias• Owned media – Packaging• Differences between stakeholder groups26.4.2013 Pekka Mattila 3
  4. 4. Towards sharedvalue26.4.2013 Pekka Mattila 4
  5. 5. Top three impediments(Berns & Townend & Khayat & Balagobal & Reeves & Hopkins &Kruschwitz 2009)• Companies don’t understand what sustainability it – andwhat it really means to the enterprise• Companies have difficulty modeling a business case – oreven finding a compelling case – for sustainability• Execution is often flawed26.4.2013 Pekka Mattila 5
  6. 6. Rethinkingsustainability• “Meeting the needs of the present withoutcompromising the ability of future generations tomeet their own needs.”Norwegian Prime Minister Gro HarlemBrundtland in 1980sWorld Business Council for SustainableDevelopment26.4.2013 Pekka Mattila 6
  7. 7. Shared value(Porter & Kramer 2011)• “The concept of shared value can be defined as policiesand operating practices that enhance thecompetitiveness of a company while simultaneouslyadvancing the economic and social conditions in thecommunities in which it operates.”• “Shared value creation focuses on identifying andexpanding the connections between societal andeconomic progress.”26.4.2013 Pekka Mattila 7
  8. 8. Shared value(Porter & Kramer 2011)• “The concept rests on the premise that both economicand social progress must be addressed using valueprinciples. Value is defined as benefits relative to costs,not just benefits alone.”• “Value creation is an idea that has long been recognizedin business, where profit is revenues earned fromcustomers minus the costs incurred. However,businesses have rarely approached societal issues froma value perspective but have treated them as peripheralmatters.”26.4.2013 Pekka Mattila 8
  9. 9. Building the business casefor CSR (Keys & Malnight & van der Graaf 2009)• Time frame: short and long term• Nature of benefits: tangible and intangible• Benefit split: business and society26.4.2013 Pekka Mattila 9
  10. 10. Institutional logicpays off (Moss Kanter 2011)• “Traditional theories of the firm are dominated by the notion ofopposition between capital and labor, disconnecting businessfrom society and posing conflicts between them.• By contrast, great companies use a different operating logic.They believe that business is an intrinsic part of society, andlike the family, government, and religion, has been one of itspillars for centuries.• Great companies work to make money, but in their choices ofhow to do so, they consider whether they are buildingenduring institutions.”26.4.2013 Pekka Mattila 10
  11. 11. Institutional logicpays off (Moss Kanter 2011)1. “Institutional logic is built on a foundation of purpose andvalues, which serve as a buffer against uncertainty andchange.2. Conceiving of the firm as a social institution generates along-term perspective. Short-term financial sacrificebecomes permissible.3. Strong institutional values can evoke positive emotions,stimulate intrinsic motivation, and propel self- or peerregulation.”26.4.2013 Pekka Mattila 11
  12. 12. Institutional logicpays off (Moss Kanter 2011)4. “Through the formation of public-private partnerships, firmsconsider the public interest along with business priorities.5. The attention placed on social conditions often generatesexperiences and ideas that lead to learning for innovation inproducts, services, and business models.6. Employees can be treated as self-determining professionals,coordinating and integrating activities and producinginnovation through self-organization in addition to formalassignments.”26.4.2013 Pekka Mattila 12
  13. 13. FINLAND / SINGAPORE / POLAND / SOUTH KOREA / TAIWAN / CHINA / INDONESIA / SWEDEN / RUSSIAJoin Our Core16.4.2013Dr. Pekka MattilaRethinking Sustainability -From Whitewash to Longevity

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