It’s time to start tackling grand challenges systemically
By Steve Kennedy
Despite years of warnings and several close calls, most countries and many companies were caught off guard by COVID-19. Few government or business leaders had thought much about pandemics, and now most are in a rush to return to ‘normal’ as soon as possible. But as understandable as that wish is, it would be a mistake to focus on turning the clock back to 2019: instead firms need to wake-up to the interconnectivity of the grand challenges we face in the world, and realise opportunities to build synergistic solutions tackling root causes and building resilience.
The biggest lesson for leaders is that COVID-19 did not come from out of the blue.COVID-19 is highly likely to be a zoonotic disease. These diseases are passed from animals to humans, something that will continue to happen more frequently as companies continue to put pressure on the natural world. When firms disrupt ecosystems in destructive ways, such as mining, logging, and making way for agricultural land, wildlife is often forced to move to more populous areas in search of food, shelter, and a new habitat. This pushes wildlife into new interactions with humans, and creates an opportunity to share viruses. This is why preventing environmental destruction is central to any strategy to avoid the next pandemic.
is Associate Professor of Business-Society Management at Rotterdam School of Management, Erasmus University.
His research and teaching focus on the areas of corporate sustainability, climate change and sustainability-oriented innovation. Dr Kennedy’s current research interests include how corporate sustainability strategies are translated into successful innovation and the formation of future-ready sustainable business models.
“COVID-19 has also put the spotlight on the lack of resilience of many national economies, companies, and supply chains.”
Unfortunately, firms and indeed governmental leaders often do not seek to address the root causes of grand challenges. To date, we have seen firms respond to COVID-19 in ways such as helping to provide PPE equipment for frontline health care workers, but they are yet to announce stronger commitments and initiatives to stop environmental destruction. Firms need to accelerate actions that limit the need for new raw materials, improve environmental standards of suppliers, and shift to business models that regenerate natural capital.
Most of the time, business and governmental leaders commonly struggle to address grand challenges systemically. Issues such as biodiversity loss, inequality and climate change are parcelled up and dealt with in isolation. As a result, business and governmental leaders lose precious opportunities to find synergistic solutions – and worse still, make one challenge worse when solving another.
For example, in 1987 governments around the world signed the Montreal Protocol to ban chlorofluorocarbons in order to protect the hole in the ozone layer. However, this major diplomatic achievement was marred by a mistake that was only corrected in 2016: the treaty permitted the use of hydrofluorocarbons as a substitute – easier on the ozone layer, but being extremely potent greenhouse gases, bad for global warming.
Obviously, such a ‘whack-a-mole’ approach to policy doesn’t make much sense in the long run. Yet a recent University of Oxford study analysing government COVID-19 recovery plans internationally, showed that 92 per cent do not include any plans to reduce greenhouse gas emissions to tackle climate change but concentrate exclusively on promoting ways to preserve ‘business as usual’. Instead of using this time as an opportunity to transition to more sustainable production and consumption systems that reduce the risk of future pandemics and other crises, these policies would take us back to exactly the level of vulnerability we had in January 2020.
From efficiency to resilience
COVID-19 has also put the spotlight on the lack of resilience of many national economies, companies, and supply chains. Many have been found wanting, with countries found to be over-reliant on tourism and firms too dependent upon one channel to market and just-in-time supply chains. Business theorists and strategists have long prized efficiency maximizing output over organizational resilience, leaving the firms and ecosystems they depend on vulnerable to shocks. For instance, monocropping is a good way to maximize yield, but leaves farmers highly susceptible to climatic changes, diseases, and price swings. On a systemic scale, it also increases our collective risk, by accelerating biodiversity loss and aggravating climate change through reductions of carbon sinks and increases in greenhouse gas emissions.
Recovering from COVID-19 is a chance to redress the balance of efficiency on one hand and diversity and redundancy on the other. Farming practices such as intercropping, silvopasture and agroforestry can all be utilised to build resilience in the natural ecosystems on which we all depend on so heavily. For some firms this can mean pushing thinking and action far beyond the confines of the company and even the commercial ecosystem.
The outdoor clothing brand Patagonia, for example, is now investing in regenerative agriculture, a point of leverage where executives saw that their company could make the biggest difference.
In the end, as Patagonia has already realised, we are all part of the same system. Only by learning to approach problems holistically with due consideration of interconnections and resilience will we ever be able to make
a lasting, positive difference to life on earth. As the systems thinker Russell Ackoff put it, we need to think about ways to ‘dissolve’ the problems that we face rather than constantly fighting symptoms. We now have a great opportunity to change our paradigm of problem solving. Let’s take it.
“Recovering from COVID-19 is a chance to redress the balance of efficiency on one hand and diversity and redundancy on the other.”
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