Scenario Planning for Sustainability
Earlier this month, FSG managing principal Peter Kennedy presented to the New York metro area chapter of the Sustainability Leadership Forum (SLF). SLF brings together senior executives from large organizations to share knowledge, insights and best practices in sustainability leadership. Peter’s topic was scenario planning for sustainability strategy and planning, and how to manage the uncertainty that surrounds climate change impacts, regulatory policies, international agreements, economic growth and public attitudes.
Many of the SLF participants were interested in discussing the integration challenge of more focused sustainability plans with broader corporate strategy undertakings. FSG recognizes this as a common scenario-planning dilemma. Even for companies that assign a high value to responsible environmental policies, the tendency is for sustainability to be treated as an isolated undertaking, and not a central part of enterprise strategy. Securing a seat at the corporate strategy table is often a challenging, long-term play for sustainability professionals. And yet, in fact, scenario planning – when it encompasses a broad range of realistically complex future operating operating environments – can be an effective tool for introducing sustainability thinking into the corporate mainstream.
Notwithstanding the Trump administration’s decision to pull the US out of the Paris climate agreement, environmental and sustainability concerns are not likely to become less pressing anytime soon – not with the planet warming, the US suffering multiple Category 4 hurricanes this year, and consumers ever wary about the food they are consuming and the pollutants being pumped into the environment. But given the lack of global leadership on the subject, it’s hard to see anything on a large enough scale for the world to meet its ambitious carbon emission targets. The current Economist feature on the climate change topic describes in depressing detail just how formidable the challenges are. All of this provides enough real-life fodder to keep both sustainability leaders and scenario consultants up late at night.