The Gordon Institute of Business Science’s (GIBS) Illovo campus played host to a lively interrogation of two key pieces of research commissioned by the Network for Business Sustainability South Africa (NBS-SA) recently. NBS-SA links research and practice in support of better informed decision-making on sustainability concerns. Its leadership council consists mostly of senior strategy and sustainability managers of leading companies.
Based on central themes identified by the leadership council in July 2013 as being ‘top of mind’ and ‘obstructing day-to-day decision making’ within corporate South Africa, the research responded to the following questions:
• How can business engage in medium and long-term strategic planning that is linked to a
shared vision for a sustainable future (in South Africa)?
• How can we measure and value social capital for business decision-making and reporting?
University of Cape Town (UCT) Professor Ralph Hamann, NBS-SA’s academic director, opened proceedings by noting the importance of making creative, and practical, use of these reports. This practical application of academic research by the business world continued to be a primary theme as business representatives and academics shared information and insights, seeking common ground around the concrete application of sustainable practices in business.
The first presentation of the day, entitled ‘Shaping a Sustainable Future Together: How to Strategically Plan Around a Shared Vision’, was delivered by Chanel Venter, a lecturer from Stellenbosch University. The study was based on a global review of almost 200 articles and journal submissions (from developed and developing countries) published between 1921 and 2014.
The research team – comprising, Venter, Queensland Business School’s Dr Martina Linnenluecke and Associate Professor Martie-Louise Verreynne, Sarel Grönum, from the University of Queensland and Dr Retha de Villiers Scheepers, University of the Sunshine Coast - used these data findings to identify key themes and build up a holistic picture of how strategic planning has been approached by companies. The researchers created a model that explains how different planning approaches are related to underlying beliefs and the organisation’s context.
Some approaches assume that the future can be predicted, while others emphasise the need to effectively respond to emergent changes; some emphasise a relatively passive approach focused on the needs of the firm itself, while others entail more proactive efforts to influence the future together with other stakeholders. Each of these planning approaches is associated with different kinds of planning mechanisms, such as forecasting, scenario-planning, or transitions management.
The business representatives highlighted that current trends in social and environmental systems required firms to proactively seek an understanding of these trends and to work with the government and other stakeholders in influencing them. Sue Lund, General Manager for Public Policy and Sustainability at Transnet, highlighted the importance of recognising the role of underlying belief systems among different role-players. This influences the manner in which collaborative planning should be approached. Researchers have a role to play in this process. Venter stated, “We want to make an impact, and not just sit in our offices and do research.”
Similar observations arose out of the second piece of research: Measuring and Valuing Social Capital. This was presented by Prof. Moses Acquaah and Dr Kwazi Amoako-Gyampha, of the University of North Carolina at Greensboro, who conducted the research in conjunction with UCT’s Dr Nceku Nyathi. The researchers’ presentation defined social capital as the benefits that accrue to individuals, organisations and communities from networks of relationships. They identified a number of key dimensions of social capital, including the structure of networks and different forms of trust, and these dimensions give rise to diverse indicators that companies should consider measuring.
The discussion in the Leadership Council suggested that there is much uncertainty among practitioners surrounding the definition of social capital, despite the expectation to report on this in a company’s Integrated Report. There was also a shared sentiment that social capital was a particularly vital concern in the South African context, where a breakdown in trust represents increasingly significant costs to business.
In response to both reviews, the discussion opened up areas of potential focus for future research projects and gaps which both business representatives and researchers were keen to explore. An important theme for discussion revolved around the need to look at the direct benefits of social capital to the business bottom line. As a delegate observed: “By neglecting this, your financial outcomes suffer. The [executive committee] would benefit from this sort of information to help them to see the connections.”
Lund argued, “Social capital is, after all, about a practical approach to managing risk.” This was exemplified in one of the case studies mentioned by the researchers, in which a mining company in Mozambique decided to curtail spending on community projects and proactive relationship management, only to raise these subsequently due to a deterioration of relationships with employees, community members, and the government.
NBS-SA Managing Director, Claire Thwaits summed up the overarching sentiment of the day: “The next step is to create practical tools that have relevance to South African businesses whilst ensuring rigorous scientific research is continuously undertaken to support these tools.” The research project outputs including final academic reports, executive reports and summaries are currently in the design stage and will be released to the public next month.