Why should small companies care about their social and environmental impact? One would suppose that a communications agency, a food manufacturer or a tech start-up has little negative impact compared to the big corporate players. Only when realizing that small and medium sized companies (SME’s) employ 60-70% of the workforce* and make up 50% of the GDP* globally, do we understand their crucial contribution to our economy. Not so surprisingly this economic power comes at the expense of the environment and the air we breathe, as SME’s are also responsible for 67% of global pollution*. Thinking about the not so distant future with one more billion people on the planet and the middle class reaching 4.9 billion by 2030**, it becomes obvious that economic growth based on linear (extract-produce-supply-waste) business models will soon leave us with no viable world to do business in. It’s time, now more than ever, for the new business as usual.
A responsible or purposeful business is not something we are taught at management schools nor easily encountered in the corporate and start-up world, where fierce competition sets a crazy pace for companies to survive, often by exploitation of the planet and society. When it comes to business planning the Business Model Canvas is often cited as reference point, given its brilliant way of encompassing all important elements of a traditional business strategy. Agreeably, a great tool to structure the development of a company that I also often use during my consulting projects, however, it always leaves me unsatisfied regarding one aspect: the systemic view on how the product or service we are about to launch would affect the wider ecosystem.
Now that we understand the problem, let’s talk about the solution
Wondering if small companies would change their mindset having a tool in hand that considers the system as a whole when developing a business, I joined forces with Luiz Beltrami and created the 4D Sustainability Canvas. The Canvas and the supporting framework that helps embedding sustainability into business strategy was developed following the social innovation framework of the Amani Institute.
As a result of a 4-month thorough research, interviews, and surveys, we identified 3 main barriers that impede SME’s to think and act upon their negative impact: lack of knowledge, time, and resources. Many entrepreneurs can probably relate to the statement, particularly in the early stages, that the focus is survival; sustainability is considered to be a ‘nice to have’ feature to be adopted once the company has scaled. However, transitioning at a later stage results in greater expense and more a complex task, as it implies a cultural transformation, which does not happen overnight.
To facilitate the shift at a smaller scale, we built a framework that puts the initiative and ownership for conducting a responsible business in the hands of employees. The 4D Sustainability Canvas helps the organization get familiar with the concept of a sustainable business and identify the areas where it can take action to reduce negative and increase positive impact, regardless of the level of expertise. It not only brings awareness, but unlocks the potential of creating new business opportunities that can lead to competitive advantage.
The Canvas is the core of the framework, however, we recommend you follow the 3 steps below to reach the desired outcome:
- Map out the impact of your business in the 4 areas of Employees, Community, Governance and Planet with the 4D Sustainability Canvas
- Explore the UN Sustainable Development Goals (SDG’s) by using the SDG Cards that give you practical ideas on how to link the goals to your business
- Define your SMART goals in response to the impact mapped for all the 4 sustainability dimensions (4D)
Why do we expect this process to be successful?
First of all, because we took the different sustainability tools, such as the UN Compass Guide, Life Cycle Assessment, B Impact Assessment, Materiality Matrix and blended them into one practical tool that anyone can apply following our guide.
Secondly, the principle of this methodology is based on the power of small habits, which proposes that adopting little habits every day leads to changed behavior. We encourage companies to start the journey with small steps, in this case starting with a few sustainability goals. The idea is to embed system thinking into the culture early enough, so there will be no need for an overwhelming transformation at a later stage.
Last but not the least, we harness the power of collaboration, having the whole team participating in the discovery of the company’s wider ecosystem and impact, prompting interesting discussions and fostering ownership of tasks. A sense of collective responsibility emerges.
The first implementation of the framework at La Gracia, a Brazilian communications agency of 25 employees bore out our hypothesis. We closed the 3-hour workshop with 8 sustainability targets, each of them assigned to different team members, who left the room with impressions like:
Moving forward to help building the new business as usual
That was enough to give us encouragement to continue the application of the tool in more organizations like CLP (a Brazilian NGO training public leaders) and Instituto Tiê (an agency for nonviolent communication) , and even left room to feed the need of idea stage businesses to generate positive impact from the start, as recently presented to social entrepreneurs at the Social Impact Award incubator.
The 4D Sustainability Canvas Tools are available online with free access and extensive guide to their application. Since our pilot about a year ago we have been incorporating feedback from users, issued an updated version and translated the tool-kit to one more language (Spanish). We believe in the power of collective, we continue to encourage business owners, employees and consultants to apply and share the framework, leave feedback and be part of an open innovation process so we could maximize positive impact of SME’s.
* World Trade Report 2016 Leveling the Trading Field for SMEs