Shifting Mindsets to ESG Approaches in Business

Resilient businesses keep track of relevant global trends, and companies have long understood how to manage risks associated with those trends. More recently, they are learning about the distinction between risks and impacts, and are getting better at articulating and quantifying both. The right frameworks and specific metrics for reporting on sustainability and ESG efforts are critically important but are not the full picture. One major aspect may be missing in truly achieving sustainable results and becoming a leader in this space: a shifting mindset. In this article, we will focus on two mindset shifts and their ability to make a significant impact beyond the business.

I’ve spent my entire adult life as a scientist—with biochemistry and pharmacy degrees—and have found great comfort in the reliability (for the most part) of the natural world. As a scientist, however, I also realize the importance of being adaptable—being prepared for that “reliability” to change in a heartbeat. In my opinion, the best scientists also are acutely aware of how much science does not know or cannot yet explain. Concepts that might be emerging or not fully understood, but powerful nonetheless…like mindset.

As I matured in my career, I got to work with amazing CEOs, like Indra Nooyi, Ministers of State, high-level UN policy makers, and other senior leaders and visionaries across the world. While they have many traits in common, I observed one, in particular—they all acknowledge, and appreciate, the importance of mindset. A broad statement, so let’s unpack it a bit further, and focus on two “mindset” shifts, in particular: (1) “breakthrough mindset,” which challenges us to move beyond incremental impact, and (2) “just and regenerative mindset,” which is an important evolution for companies to take on their journey toward strengthening corporate purpose. Both are intricately linked to ESG approaches of companies.

In future blog posts, you’ll be hearing from Inogen Alliance leaders across different geographies about how “ESG” terminology varies, and how important it is that—no matter what it is called—the “spirit” of ESG is advanced. That’s also similar to mindset shifts. They might be called different things, but you will see as you continue reading that the principles are common, and they are what really matter.

BREAKTHROUGH MINDSET

Many of us are familiar with the “Triple Bottom Line (TBL),” coined by John Elkington over two decades ago. The triple bottom line “is a business concept that posits [suggests] firms should commit to measuring their social and environmental impact—in addition to their financial performance—rather than solely focusing on generating profit, or the standard ‘bottom line.’ It can be broken down into ‘three Ps’: profit, people, and the planet.” It helped companies think differently about their activities, but never had the impact for which Elkington was hoping. In 2018, he suggested that it was time for a strategic recall of TBL: “TBL’s stated goal from the outset was system change….It was never supposed to be just an accounting system. It was originally intended as a genetic code, a triple helix of change for tomorrow’s capitalism, with a focus on breakthrough change….”

Breakthrough change is possible when you adopt a “breakthrough mindset.” As the follow-up to TBL, John Elkington coined that term, originally in the context of the UN Sustainable Development Goals, but it applies to any significant, seemingly intractable challenge. It’s intended to spark the kind of innovation needed to move beyond incremental change. Small steps are important, but so is larger, systems change—breakthrough change. Elkington’s approach (now Project Breakthrough) is now part of the United Nations Global Compact, whose principles are endorsed by over 12,000 CEOs. This eight-minute video explains the “breakthrough mindset” through inspirational interviews and examples from leaders across the globe. Here’s a distillation of five things that mindset shift includes (but watch the video to learn more):

1. Re-perceive challenges as opportunities
2. 10X your ambitions (don’t just get 10% better, get 10-fold better)
3. Love the problem, not the solution
4. Invite others to join in
5. Embrace uncertainty

Albert Einstein is often credited with this quote, “We cannot solve our problems with the same thinking we used when we created them.” Breakthrough mindset helps us unleash new thinking with which to solve big problems. An important element of breakthrough solutions is to include as many diverse perspectives as possible, from all manner of people with different lived experiences. Integrating a global approach with local cultural norms and realities most often results in a winning combination, and you’ll be reading more about this in future posts from members of the Inogen Alliance.

JUST AND REGENERATIVE MINDSET

While breakthrough mindset can apply to solving any of the world’s greatest problems, this next mindset shift is more related to elements of ESG, and in fact represents a way to link them all together. Let’s look at the evolution that has led us to the concept of “just and regenerative.”

This graphic from Forum for the Future depicts the history of how many businesses traditionally approached environmental and social impacts:

1. Risk mitigation mindset – be less harmful
2. Zero harm mindset – do no harm
3. Do good mindset – repair and replenish
4. Just and regenerative mindset – build capacity for justice and regeneration

Businesses traditionally are particularly good at understanding risks. So, it makes sense that early on, many businesses were looking through the lens of risk mitigation; that is, to be less harmful. Then, as the environmental movement became more mainstream, companies shifted their mindset from one of purely risk mitigation to zero harm. I can recall when I was at PepsiCo, that it was quite progressive for Frito-Lay to adopt a mindset of “leave no trace” with respect to its environmental impacts.

As an understanding of the power that companies wield—both good and bad—grew, so did the expectations of the business. “Do no harm” was no longer sufficient, and a new mindset emerged—one of “doing good,” based on the concepts of not only conserving natural systems but repairing and replenishing them. This is where I think many companies are now—working collectively, sometimes even pre-competitively—to address shared challenges. Great progress, but not sufficient to tackle the problems with which the world is grappling today. That’s where the next major and necessary mindset shift comes in—one focused on justice and regeneration.

In their report, A Compass for Just and Regenerative Business, published late last year, Forum for the Future and the World Business Council for Sustainable Development describe a Just and Regenerative Mindset as “much deeper than how a business minimizes its environmental impact or prevents human rights abuses, a just and regenerative mindset gets to the heart of how we recognize our interdependence with other people, other living beings and ecosystems, and ultimately how we enable all living beings to not simply survive but to thrive together.”

Can you see now why I chose these two categories? A Just and Regenerative Mindset is a perfect example of applying breakthrough thinking! It will require a completely different way of doing business, and of how business is seen in the world. The report authors say it best:

“A business with a just and regenerative mindset pursues a future in which:

• Social and environmental systems are thriving;
• Planetary health has been rapidly stabilized;
• Human rights are universally respected;
• Fairer ways to create and distribute value have been adopted; and
• Resilience and vitality across generations and geographies is supported.

These outcomes all depend upon a different way of thinking and acting being embedded across business, government, and society. We see this different way as wise because it recognizes that harming and exploiting the operating context an organization depends upon will damage that organization sooner or later. Instead, this different way of thinking and acting builds the capacity and ability for all life to grow, evolve and thrive.”

Doesn’t that describe the future we all want?

Let’s challenge ourselves, our Inogen Alliance business partners, and our clients across the globe to embrace breakthrough solutions toward a just and regenerative society.

Guest Author Dan Bena:

Dan's accreditations include Senior Consultant, Antea Group USA and Chair of the Antea Group USA Strategic Advisory Board; CEO, Dan Bena, LLC; Honorary Professor, Glasgow Caledonian University; Board Member, United Nations Association, Multiple NGOs; Former Corporate Water Steward and Head of Sustainable Development, PepsiCo. He recently spoke at our Spring Associate meeting for Inogen Alliance in Spain and has spoken at over 100 venues that span the business, government, academic, and non-profit worlds. providing a wealth of expertise within purpose-driven leadership, ESG, and Sustainability across sectors and geographies. Find more on his work here: https://www.danbena.com/about

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