Economic Sustainability
Economic Sustainability
The business of staying in business
Deborah Doane & Alex MacGillivray
New Economics Foundation
March 2001
Executive Summary
Although sustainability is now generally understood to be a combination of environmental, social and economic performance, this report finds that economic sustainability is the most elusive component of the “triple bottom line” approach. There is not even universal consensus that businesses should be economically sustainable, though most concur that sustainability is desirable to prevent the devastating and inefficient impacts of corporate premature death.
Finding out how businesses actually stay in business is a different and altogether more difficult matter. It is the obvious case that most businesses most of the time manage their economic performance pretty effectively – so why ask how they do it. Despite the excrescence of management handbooks purporting to share the secrets of highly effective businesspeople, it is also the fact that few successful business strategists are willing to share their techniques – for obvious reasons.
There turn out to be surprisingly few tried, tested, accepted, available and affordable management tools and systems for use by the up-and-coming ‘economic sustainability manager’. And it turns out that this is in fact a job-share spread between finance teams, investor relations, strategy units, brand managers, corporate comms, risk assessors, the board, HR, IT and so on – in a way that can look just a bit haphazard from the outside at least.
Innovative concepts like intellectual capital and interesting techniques like brand valuation are beginning to make some inroads into this confusing terrain. Managing ‘sustainability’ – whether the starting point is economic, social or environmental – can help many organisations escape from what they themselves consider a short-termist, profit-and-sales oriented straightjacket they have been stuffed into, and into a
The business of staying in business
Deborah Doane & Alex MacGillivray
New Economics Foundation
March 2001
Executive Summary
Although sustainability is now generally understood to be a combination of environmental, social and economic performance, this report finds that economic sustainability is the most elusive component of the “triple bottom line” approach. There is not even universal consensus that businesses should be economically sustainable, though most concur that sustainability is desirable to prevent the devastating and inefficient impacts of corporate premature death.
Finding out how businesses actually stay in business is a different and altogether more difficult matter. It is the obvious case that most businesses most of the time manage their economic performance pretty effectively – so why ask how they do it. Despite the excrescence of management handbooks purporting to share the secrets of highly effective businesspeople, it is also the fact that few successful business strategists are willing to share their techniques – for obvious reasons.
There turn out to be surprisingly few tried, tested, accepted, available and affordable management tools and systems for use by the up-and-coming ‘economic sustainability manager’. And it turns out that this is in fact a job-share spread between finance teams, investor relations, strategy units, brand managers, corporate comms, risk assessors, the board, HR, IT and so on – in a way that can look just a bit haphazard from the outside at least.
Innovative concepts like intellectual capital and interesting techniques like brand valuation are beginning to make some inroads into this confusing terrain. Managing ‘sustainability’ – whether the starting point is economic, social or environmental – can help many organisations escape from what they themselves consider a short-termist, profit-and-sales oriented straightjacket they have been stuffed into, and into a
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