Survey Uncovers Divisive Issues Threatening Progress Towards Sustainable Business

Russell Reynolds Associates (RRA) released a global study, Divides and Dividends: Leadership Actions for a More Sustainable Future, revealing what a cross-section of the global workforce thinks about business leaders’ efforts to advance the sustainability agenda. 

Fielded across 11 countries, the global report was designed to understand the state of sustainability within organizations today by surveying more than 9,500 people from three distinct groups: C-Suite executives, next-generation leaders and employees. The responses revealed how these groups are united or divided in how they view several key business issues, including the maturity of their organization’s sustainability strategy, and the progress company leaders are making against that roadmap.

“While discussion about sustainability has gone mainstream and many organizations are quick to promote their sustainability credentials, rhetoric does not always equal action,” said Clarke Murphy, CEO of Russell Reynolds Associates. “We set out to conduct a survey that is unprecedented in its scope and scale to uncover the divides and disparities that threaten global business in order to identify the opportunities to bridge the gap.” 

Key findings from the global report include the overall disconnect between what C-suite executives say they are doing on sustainability versus what employees and next-gen leaders see on the ground, as well as perceptions on employee equality and how slow-changing company culture and organizational complexity can be impediments for businesses. The survey also pointed to the importance of developing and empowering next generation leaders as one of the clearest pathways to addressing these issues, by shifting mindset and culture. 

 

Key Global Findings

• The Sustainability Say/Do Divide
  While 79% of C-Suite executives say the environmental practices of their company are as good as industry best practices, only 54% of employees agree. And while 73% of C-Suite leaders say that their organizations place the same importance on sustainability as they do on profits, just 48% of employees say the same. Leaders should be mindful to understand and close this perception gap.
• DE&I Challenges Run Deep
  Bias and favoritism still have a strong hold at the top, with 64% of C-Suite leaders saying that senior leaders in their organizations show a bias or favoritism towards those like them.
  
  When asked about promotions, 61% of C-Suite leaders say it is easier for men to get promoted than women (regardless of their capability and performance). Considering ethnic bias, 62% of C-Suite leaders see an issue.
  
  While many organizations are working hard to improve the diversity of their leadership teams and setting concrete goals, the survey found that C-Suite leaders are clear-eyed on how much more progress is needed.
• Next-Generation Leaders at the Vanguard
  Next-generation leaders are well positioned to be drivers of sustainability. The survey found that four in ten have had three or more job responsibilities that have involved improving environmental or social outcomes (e.g. by changing processes, creating or redesigning products). Organizations have an opportunity to further enable and empower these leaders.
• Leadership Progress Slowed by Culture and Complexity
  C-suite leaders say the greatest barriers to embedding sustainability across the business are slow-changing company culture (36%) and organizational complexity (35%), followed by a lack of drive from senior leadership (30%) and a lack of organizational investment (28%). 
  
  The survey also suggests that many leaders may lack the soft skills to spur action on sustainability. Few employees see their senior leaders exhibiting relevant soft skills: Only approximately one-third of employees say the senior-most leaders at their organization exhibit transparency (37%), humanity (35%) and hopefulness (34%). Even fewer say they display humility (23%) and self-awareness (24%), or that they are authentic (29%) and lead by example (29%).
  
  The study emphasizes the need for leaders to inspire change and incite action by using soft skills, including self-awareness, humility, and authenticity to overcome obstacles and show progress.

“We are at a crossroads where businesses have an incredible opportunity to build, sustain, and benefit from a better future for all,” said Murphy. “In uncovering the divides that affect businesses globally, we are uniquely positioned to offer solutions that incite real change to generate cultural and business transformation for people, planet and profit," said Murphy. 

Alan Jope, CEO of Unilever, said: “I congratulate Russell Reynolds Associates for leading this project, although I am left somewhat disappointed by the findings. They highlight that sustainability remains misunderstood by many. We know that the average time horizon for investors is 13 years—continuing on our current path, the world will be a terrible place in 13 years. We must act today. Business must seize the dual opportunity to improve performance by putting sustainability at the heart of business strategies and secure the future for our people and our planet.”

Ilham Kadri, CEO and Chair of the Executive Committee, Solvay, said: “As this research from Russell Reynolds Associates makes clear, organizations need to go beyond risk and reputational management and focus on harm reduction and value creation. To do that, leaders not only need to communicate a compelling vision with great ambition; they also need to embed sustainability and concrete actions into their strategy, operations and leadership culture to improve drastically on climate, nature and people.”

To access the global report and search for insights by geography visit: www.russellreynolds.com/divides-dividends


Methodology:

Russell Reynolds Associates fielded a survey in 11 growth and mature markets across three job levels. Responses were collected from 8,594 employees and next-generation leaders, and 907 C-Suite leaders. 

The 9,501 business leaders surveyed were from medium to large size businesses and represent:  

• C-suite leaders including CEOs.
• Next-generation leaders who report directly to the CEO or other c-suite executives.
• Employees at multiple levels that do not report to the c-suite.