In the landscape of the transition to a social and sustainable economy, what does the transition for traditional businesses look like? The answer may surprise you.

In my last blog post, I talked about what the landscape of the transition to a social and sustainable economy currently looks like and the challenges of transformational change. I also described the experience of the Global Impact Investing Network (GIIN), the leading body of the impact investing industry, and how it has grown from a grassroots global initiative to a $1.5 trillion dollar industry focused on creating meaningful social and environmental impact in the world. The GIIN is an example of the kind of change we need to see in investment markets as we transition the global economy; similar transformations will need to happen in government, the non-profit sector and in other areas of business. The business transition is also happening in other ways as more impact organizations emerge and supporting infrastructure is built to help them scale. But what about traditional businesses? What does the transition look like for them? 

As I mentioned in my post about how the expectations for business to do good while doing well aren’t going away, there are leading certification programs and communities of practice that traditional businesses can join, such as the B Corp Movement and Doughnut Economics Action Lab, to incorporate social and sustainable practices into their business. However, from a more strategic perspective, as I mentioned in my previous post, the framework of Shared Value, put forward by Michael Porter and Mark Kramer of Harvard Business School, effectively outlines the fundamentals of how and why businesses can and should build their competitive advantage through social impact. While their work is making inroads, they acknowledge that there still exists material challenges to the widespread adoption of this strategic framework, including the need to shift mindsets, see beyond conventional business boundaries, develop measurement and reporting capabilities and adopt broader approaches to working collaboratively.  

Interestingly, through my readings and various other forms of industry immersion, I noticed an alignment between the challenges of putting the shared value approach into practice and the type of transformational change leadership Brené Brown advocates for in her book Strong Ground. In her book, Brown shines a deeply honest lens on what transformational change really is and the kind of leadership required to achieve it. In fact, Brown specifically references the work of reconciling purpose with profit as exactly the kind of paradoxical thinking business leaders of today need to embrace to effectively lead in today’s increasingly complex world. 

What I find so inspired about Brown’s work is how spot on it is from a business strategy perspective, yet how rooted it is in the deep truths of our humanity, which drive so much of how we show up and move through the world, but that are almost never acknowledged let alone accounted for in business settings. While engaging in my own work as a social and sustainable business consultant, I have often thought that we struggle to solve intractable social and environmental issues because we aren’t looking at the whole truth. I am so grateful to Brown and her book for shining a light on the truth and revealing that there is, in fact, a very real and tangible connection between doing meaningful work in a humane way and achieving sustained business success.

Brown, leveraging her decades of research and work on courageous leadership, lays out a clear path for how to make meaning out of our work and lives that lines up with the challenges experienced by companies evolving towards a shared value approach to business. In particular, Brown stresses how important it is for business leaders, in a world increasingly defined by rapid change, to both effectively embrace paradoxical thinking and lead change from a place of deep humanity. She points out that over the course of her work coaching 150,000 leaders in over 45 countries through her Dare to Lead training, that the two consistent lessons that emerged were: 1) how critical paradoxical thinking is to being able to truly understand and navigate the complex world in which we live and 2) there exists a deep global yearning for more humanity and connection with each other and within ourselves. 

When it comes to paradox, Brown is clear that it is both unwavering and embedded in so many aspects of human life – freedom and commitment, philosophy and physics, regulation and innovation and purpose and profit. Therefore, to truly see and understand the world in which we live, we must learn to accept paradox. Brown points out that while paradoxical thinking is an essential skill for today’s business leaders, it is a challenging skill to develop because it requires building a tolerance for uncertainty, pushing boundaries and denying the comfort of our existing ideologies (sounds a lot like the challenges associated with the adoption of shared value mentioned above, doesn’t it?). However, while paradox is admittedly challenging, solving for it is fundamental to unlocking real, shared and sustained value in our world. Or, as Brown puts it when talking about purpose and profit, the goal is to develop the discipline to work through the tension of seemingly opposing ideas until a new, more encompassing, more connected and more nuanced one emerges – such as social and sustainable business.

 I have experienced exactly this kind of tension in my own work. For instance, when considering how to financially stabilize and grow a trading non-profit community owned and operated indigenous art organization. The organization itself is a non-profit and it relies on government funding and commercial revenues from the sale of its indigenous art to fund its operations. Traditionally, these different economic forms are viewed as being in tension with one another; however, I proposed a new strategic approach that tapped into the synergies existing in the alignment of the sectors to unlock more cultural, social and economic value for all stakeholders. More specifically, by directing the organization to tap into its deep indigenous culture and roots to generate meaningful and authentic art – exactly the kind of art that is in high demand in the commercial art world – socially, the organization was also able to preserve the community’s culture and cultivate a greater understanding of its culture among non-indigenous audiences.

But embracing paradoxical thinking is only one part of the equation for business leaders because the solutions and strategies it points to, with its pushing out of boundaries and challenging of established ideologies, often requires companies to undergo transformational change. And transformational change leadership requires changing mindsets and building new skill sets at every level of an organization – tough and courageous work. Given my academic and professional background, I have taken my fair share of organizational change courses and lived through more than a couple corporate change efforts, and it is Brown’s profoundly honest and deeply human approach that is, in my opinion, exactly the kind of change management we need to successfully transition traditional businesses into the social and sustainable economy.

Brown insightfully states upfront that when it comes to transformational change, you can’t build new structures and capabilities on top of old dysfunction, which demands that we challenge the status quo, selectively dismantle existing ways of doing things and relearn. Critically, for Brown, this means abandoning the type of fear and shame-based leadership that is pervasive in business today (not to mention in opposition to a social approach to business) for a deeply human brand of leadership. The kind of leadership that understands that the only way to achieve the kind of broad and disciplined commitment to individual change, team change, culture change and systems change transformation demands is by building a strong foundation composed of an organization’s people and their connections to one another. This means, Brown contends, that we need leaders who can engage in collaboration, deep thinking and connection, as well as tough and productive conversations when they are required. 

Reading Brown’s work and recognizing that it can help move traditional businesses beyond meeting minimum requirements to strategically transitioning into the social and sustainable economy was a real breakthrough for me. Despite the proven advantages of social business, many traditional businesses are still lagging in the transition because they simply don’t know how to approach it, manage it or overcome its challenges. Brown’s Strong Ground provides the industry with a clear path for not only how to effectively manage the transition but also how to return to a more human and connected way to both live and work.

It is clear. In our increasingly complex and changing world, a successful transition for traditional businesses calls for business leaders to both effectively embrace paradoxical thinking and lead change from a place of deep humanity. It’s time.

Get started →