The Leonardo Centre on Business for Society, created by Imperial College Business School, launched on 16 June as a global laboratory for experimentation and the innovation of sustainable and inclusive ways to do business.
It will bring together experts from environmental, social and medical science with management, finance and engineering scholars to develop and leverage data for real-world collaborative experimentation with businesses and institutions.
To achieve this ambitious goal, it will connect 15 research centres at Imperial College London and 150 global scholars in 60 universities around the world.
One of the unique aspects of the new centre is a machine learning-enabled dataset on corporate sustainability behaviour, with millions of initiatives across all sectors and 90 countries, categorised by the sustainable development goals (SDGs) promoted by the UN and by the types of action that companies undertake to execute these initiatives.
Commitment to environmental and social impact
This dataset represents a major breakthrough in our understanding of what works – and what does not work – in companies’ commitments to environmental and social impact.
It will allow us to study what bundles of sustainability initiatives can generate the best financial performance together with the best environmental and social outputs. This will be the holy grail in our quest for a sustainable business enterprise model.
Beyond the data, this centre will pioneer the involvement of companies in real-world experimentation of innovative approaches to the way a business works, with the view to identifying what are the most effective changes in different sectors and different countries to become sustainable enterprises.
This will see the launch of pilot projects to test the impact of stakeholder-oriented governance structures, leadership and cultural models, strategic decision processes, incentive and control systems, business models, and all the other core elements of a business.
“Investors, banks and indeed society, will increasingly differentiate between companies that meet this gold standard and those that do not,” warned Mark Carney, former Governor of the Bank of England and current UN Special Envoy for Climate Action and Finance, at the launch event of the Leonardo Centre. “That means backing companies with credible plans with the necessary finance to turn plans into action; and divesting those who don’t demonstrate credible intention to transition.”
Zero carbon impact is taking centre stage
The fact that around 200 of the main financial institutions have committed a total of $75 trillion to accelerate the transition to net zero carbon impact by 2030 (the Glasgow Financial Alliance to Net Zero) means that these concerns are taking centre stage in the financial markets.
A large number of global thought leaders attended the event, including Sanda Ojiambo, CEO, UN Global Compact; Lord Callanan, Minister for Climate Change and Corporate Responsibility, UK Government; Dominic Waughray, Managing Director of the World Economic Forum; Peter Bakker, CEO of the World Business Council for Sustainable Development; and Lise Kingo, chair of the Leonardo Centre and former CEO of the UN Global Compact, among many others in business, institutions and academia.
Dominic Waughray, MD of the World Economic Forum, considers the transition from principles and guidelines to real-world change interventions of paramount importance. It is not about whether, nor when, your company will join this historical trend.
Leaders must rethink the purpose of their business
It is about how fast and how effectively it will experiment, fail, learn and scale with the new integrative business models, in collaboration with customers, suppliers, employees, investors and local communities.
This shift in mindset will mean leaders will have to rethink the purpose of their business and how it creates value for their investors in financial, human, social and natural capital. This critical shift is already happening. Clarke Murphy, CEO of the global head-hunting firm Russell Reynolds Associates, shared the results of a study of 5,000 CEO search assignments. Those that included the sensitivity to social and environmental responsibility progressed in only two years (2018-20) from as little as 4% to 30%.
The development of a stakeholder-oriented mindset, with its implications for the regeneration of the natural and social environment, is no trivial feat, however.
Businesses must put biodiversity above profit
Sir Andrew Cahn, a non-executive director at Huawei and a speaker at the launch event on 16 June, insisted that “in the context of climate change, the loss of nature, biodiversity, and other challenges, we need leaders who can persuade others against our evolutionary instincts and nature, putting these challenges before profit”.
Here is where the labs created by the Leonardo Centre will serve a pivotal role in identifying the most effective leadership approaches that both companies and business schools will be able to adopt.
The centre plans to involve about 200 companies over the next 10 years in sustainability change interventions, and more than 100,000 managers in three types of labs: the “Leadership”, the “Enterprise” and the “Systemic Change” labs.
The Leonardo Centre wants to give its stakeholders and the wider business world the tools and the knowledge to align their business activities to a common good-oriented purpose. Business leaders will drive this agenda forward, with the engaged support of government, academia and civil society.
This is why Imperial College created a living lab for businesses committed to lead the transition towards a sustainable future. This ambitious project will do more than create better businesses – through its research, education and engagement, it will drive ideas which transform lives.