To rethink how we do business, we must rethink how we value business. The idea of measuring extra-financial performance is nothing new: more than a hundred sustainability ratings and indices claim to do just that. But they’re not sending the right signals to drive a change in behaviour, for three reasons:
- Current metrics measure relative improvement, not absolute progress.
- Current metrics don’t recognize long-term ambitions and bold actions.
- Current metrics fail to give companies the actionable insight they need.
We need a new approach, one which shifts the focus away from today’s best practice toward tomorrow’s required practice: The Future Fit Business Benchmark
NEWS AND MORE ON FUTURE FITNESS
NEW SUPPORT TOOL TO HELP ORGANISATIONS FUTURE-PROOF THEIR BUSINESS STRATEGY.
The Natural Step has recently launched a new analysis tool and accompanying service to assist organisations explore what Future-Fit Business means in practice. The service integrates the Future-Fit Business goals into our well-developed coaching services to help build capabilities inside an organization to future-proof business strategy and manage the transition toward required practice. Download the flyer for more info!
HOW SUSTAINABLE ARE SWISS COMPANIES?
The Natural Step’s representatives in Switzerland, together with management consultancy HPO, have recently completed a CEO study based on the Future-Fit Business Benchmarks’ goals and definition of required practice for sustainable business. The findings are striking: While Swiss entrepreneurs have recognized the importance of sustainability, the potential is still largely untapped. The study looks at where Swiss manufacturing companies are today on sustainability, what obstacles need to be overcome and the future outlook. The report is available in German.
FUTURE FIT BREAKFAST SEMINAR
Dr Geoff Kendall, CEO of the Future-Fit Foundation was our invited guest at a breakfast seminar in Stockholm to introduce the Future-Fit Business Benchmark to Swedish business partners.
You can watch a recording of the seminar here: Go to recordings.
How is The Natural Step involved with the Future-Fit Foundation?
Future-Fit Business Benchmark began as an initiative co-led by The Natural Step Canada and 3D Investment Foundation. The Future-Fit Foundation was born out of that collaboration and tasked with developing the Benchmark as an open source tool. The Natural Step has entered into a strategic partnership with the Future-Fit Foundation to promote mutual objectives related to accelerating change towards a sustainable society. The Natural Step teams around the world have experience working with goals resulting from sustainability and Future-Fitness. We have almost three decedes of experience combining the concept of sustainability and future-fitness with guiding change initiatives within organisations.
What is the Future-Fit Business Benchmark?
Existing indexes and measuring systems are not sending the right signals to drive the necessary change in corporate and investment behavior, perhaps even leading us to think that incremental change is a substitute for the sometimes necessary transformation in business models. At the crux of this problem has been the lack of a clear picture of where science tells us we need to aim. That’s where The Natural Step and the Future-Fit Business Benchmark have something to contribute.
Why do we need a different approach?
The Future-Fit Business Benchmark is all about challenging the way sustainable business performance is being defined and measured. The need for a new approach stems from a growing recognition that the current way we value business performance is not supporting environmental protection and social progress in the way that it should. More and more voices are speaking up now about the need to move away from incremental improvement to be ‘less bad’ and that there is a problem with talking about best practice in isolation from the global crisis and existential threat of un-sustainability. It is simply not enough if we are really serious about creating a thriving future.
In the words of John Elkington, pioneer of the concept of the triple bottom line, ‘the Future-Fit Business Benchmark is an idea who’s time has come’.
So what does it mean to be future-fit?
It’s rather obvious that we all need to do better if we want a thriving future. The window of opportunity is closing and business risks are increasing, so there’s clearly a business case to all this.
The real question we need to ask ourselves is: ‘When we sum up our activities, are we part of the problem, or truly part of the solution?’
How can we tell? The starting point is to define our ambition or full intent:
A future-fit business is one that in no way undermines the possibility that humans and other life will flourish on Earth.
So how can we define the desired future state?
A science-based systems view of sustainability helps us to understand the drivers of today’s global challenges and the requirements for society to be met. The system conditions for a sustainable society (sustainability principles) promoted by The Natural Step form a peer-reviewed definition of where we need to aim. Many businesses we’ve worked with over the years have used these to assess their role and reach, before translating these into ultimate objectives and intermediate goals specific to their organisation and continue to enjoy the related benefits.
The Future-Fit Business Benchmark looks at a generic business and how it interacts with stakeholders to define a set of universal break-even goals and positive pursuits.
What does it mean to move from ‘Best Practice’ to ‘Required Practice’?
For society to become future-fit, it is insufficient to look at available ‘best practices’. To become future-fit, and ensure the possibility that we can flourish on Earth forever, every company – no matter what its size or sector – must reach specific thresholds of performance across a range of social and environmental issues.
The Future-Fit Business benchmark includes 23 goals that when taken together define the social and environmental break-even point that any company must reach to gain its entry ticket to a sustainable future.
How does the work of The Natural Step and the Future-Fit Business Benchmark relate to Planetary Boundaries?
The sustainability principles and framework promoted by The Natural Step are grounded in systems thinking, consensus on upstream causes and the science of what we need to do to create a sustainable society.
The Planetary Boundaries research has identified 9 key parameters that indicate how the Earth system is being destabilized (predominantly human behaviour) and being pushing out of the relatively stable Holocene period into a state that is less favourable for humans, the Anthropocene. By aligning with the social and ecological system conditions for a sustainable society, thereby addressing the key causes driving these indicators accross thresholds, one can avoid tipping the planet and running into the issues identified in the planetary boundaries research.
Since the Future-Fit Business goals define what a business needs to do to align with these system conditions, one can conclude that Future-Fit Businesses do not contribute to tipping the planetary boundaries.
How does the work of The Natural Step and the Future-Fit Business Benchmark relate the UN Sustainable Development Goals?
The UN Sustainable Development Goals are a set of 17 objectives, and related indicators, that represent the priorities for sustainable development. Almost all nations on the planet have committed to achieving these by the year 2030.
The TNS Framework and the Future-Fit Goals are cross-referenced with many different indicators and frameworks. This offers a way for companies to accelerate and demonstrate their contribution to the global agenda. We must also recognize that the process of sustainable development continues beyond the year 2030 and aligning with the scientific requirements for a sustainable society allows proactive solutions beyond that point.
How does the Future-Fit Business Benchmark relate to concepts like Net Positive?
How does the Future-Fit Business Benchmark relate to the Framework promoted by The Natural Step?
How should those who’ve worked with The Natural Step relate to the Future-Fit Business Benchmark?
Thousands of organisations around the world are already applying the Framework for Strategic Sustainable Development and its sustainability principles to define their own unique and positive place in a sustainable world and navigate towards it. What the Future-Fit Business Benchmark adds to this is a set of universal goals for all businesses to interpret sustainability principles, as well as a new way to assess and compare progress in a consistent and meaningful way.
If you’ve worked with our framework, you’ll now benefit from having a way to cross-reference your own sustainability goals with the universal goals in the benchmark and a way to measure progress that is comparable with others. You’ll also recognize that ‘backcasting from success’ involves much more than meeting the universal performance benchmark and that’s where our framework, methodology and tools continue to be of use.
What is the new perspective future-fitness offers (and what is backcasting)?
Reality shows that benchmarking with the past, peers, or short-term goals is insufficient to accelerate required progress. It requires benchmarking with a future state. The concept of backcasting – planning from a future position of success – is at the core of our work. The Natural Step is known for backcasting from sustainability principles.
The definition of future-fitness is all about beginning with the end in mind, defining the desired future state for sustainable business that we all need to achieve. The required state is an entirely different reference point and one that is critical when the trends we can see are part of the problem and when we need a better way to accelerate true performance toward sustainability.