Sustainability Strategy for Troubled Times

After years of awful play and results, the Detroit Lions football team had clawed its way toward the top only to be confronted by a painful new reality, as injuries wiped out their defensive starters and they began to lose badly. Head Coach Dan Campbell’s message to his players was simple: “We’re here. What are we gonna do about it?”

That’s the message for every corporate sustainability leader, as we go into the new regime in Washington. Despite some push-back, sustainability programs enjoyed four years of fair tailwinds helped by a clear positive direction from the US government. Now the forecast is all for headwinds and storms, led by the new Administration in Washington. And so the question for corporate sustainability leaders is: “We’re here. What are we gonna do about it?”

The Business Context

Companies already find themselves in the crossfire between political pressure to roll back policies and programs, and pressure from others to stay the course (including from European and California regulators, customers, employees and NGOs). Investors are lining up on both sides of the battle. This crossfire will only get more intense. 

For some companies, the pressure to roll back commitments will be a relief. Some companies never believed or meant their commitments to begin with. Others thought it would be easy to meet, modify or mute their commitments while still doing business as usual. And some companies really meant it, but have hit hard limits to making their achievements match their ambitions. For companies in any of those categories, 2025 may offer an opportunity to punt the sustainability ball, and get on with what they consider their day jobs.

For other companies, the need or desire to keep fighting for progress will be very real. These companies may be driven by their real long-term interests: neither climate science nor demographic change will bow to short-term political shifts, and business models need to take that into account. They may feel that commitments made to investors, customers, employees and other stakeholders matter, and need to be honored. Or they may simply be too connected to markets within the US (including California) and around the world (including Europe) to defy the expectations of those markets.

Understandably, some companies may try to stay on the sidelines and not make a decision. They will try to balance the competing interests, while the SEC drops its climate reporting rule and Europe charges ahead with CSRD; while some investors say “go” and others say “stop”. It’s tempting to try to bridge the gap and antagonize neither side. Unfortunately, many efforts to bridge the gap may end up “falling between the bar stools,” pleasing stakeholders on neither side.

The Strategic Options

Simply put, there are three broad options:

1. Push ahead. Seize the moment to differentiate your company from those who are waffling or backsliding.
2. Stay the course. Keep doing what you’re doing, keep working toward your goals and following your policies. Maybe just do it a little more quietly.
3. Strategically retreat.  Pick your priorities and your battles. Pull back from the exposed flanks and weaker positions. Decide which critical few hilltops are worth defending.

I can’t tell you what’s automatically right for your company now. That’s a truly strategic decision, based on your company including its impacts, opportunities and risks; its stakeholders and their concerns and power; and your Board and C-Suite.

Whatever strategy is appropriate, don’t get backed into defending everything you’ve done just because it’s what you always did. This is an opportunity for you to clean up what you inherited or apply lessons you’ve learned.

Avoid the By-the-Numbers Business Case Fallacy

This is a career-defining strategic decision, not a hypothetical business school case study. The sustainability press and social media are in the midst of a frenzied debate over “the business case for sustainability.” The business case for sustainability is “what makes strategic sense for your business.” If you’ve done materiality (traditional or double) as a meaningful strategic process rather than a reporting tick-the-box exercise, it should give you a good starting point for this.

The real business case doesn’t start with numbers.... It starts with meaningful strategic conversations with the people who are central to the business of your business.

The real business case doesn’t start with numbers. It doesn’t start with targets or reports or goals. It starts with meaningful strategic conversations with the people who are central to the business of your business. It will probably move into discussion of scenarios as a way to explore and manage the uncertainties and consider possible directions. 

At some point, it probably will come down to numbers and monetizing outcomes, but it certainly doesn’t start with those. No one will be convinced by your numbers if they aren’t already on board with the direction. The grim reality is that the uncertainties and variables will grossly outweigh any calculations of costs and benefits. You end up predicting “10% improvement, plus or minus 200%” – what one valued colleague used to call “precision without accuracy”.

Seize the Day… before It Seizes You

There are risks to raising these questions inside your company, but the risks of not raising them are greater. In this crossfire context, the odds are too great that your Board or C-Suite will be backed into making statements about sustainability goals and programs when you’re not around. 

To minimize that risk, you should be the one to raise the questions first – and to increase the chance that you’re in the room when they decide on their answers. To be effective:

• Frame the question for C-Suite and BOD so people don’t back into decisions out of context.
• Demonstrate that you’re a valued partner in this strategic discussion, neither an unthinking advocate nor a wilting corporate drone.
• Update what your key stakeholders really care about – customers, investors, truly relevant regulators, communities and NGOs.
• Find out what relevant peers are doing (customers, suppliers, competitors, industry leaders) because that’s something your C-Suite and BOD will care about.
• Focus on real business concerns (including climate adaptation in the face of increasing physical climate impacts), not what’s fashionable or sexy in the consulting/reporting/rating/ranking echo chamber.
• Identify real, actionable options that make sense for your business, not all-or-nothing ultimatums.
• Avoid defending the wrong things. Don’t waste time relitigating past battles.

Above all, protect your access and your right to be in this conversation:

• Be brave.
• Be relevant.
• Be credible.