Viably creating a sustainable enterprise

“As companies and leaders, you will be faced with the cost of misbehaviour…it’s profitable to do good.” – Professor Roberto Rigobon, MIT Sloan

“How are we contributing to ensure that we can actually create economic opportunities and sovereignty along our supply chain?” – Professor Sagadevan G. Mundree, QUT

To finalise The Future Enterprise series three, a global webinar series in collaboration with MIT Sloan School of Management and QUT Business School, our experts met in person to discuss The Sustainable Enterprise.

Moderated by QUT’s Professor Rowena Barrett, Professor Roberto Rigobon from MIT Sloan and Professor Sagadevan G. Mundree from QUT explored how organisations can create sustainable change.

Sustainable innovation

Sustainability doesn’t need to come at the cost of innovation and leading the market.

Globally renowned biotechnologist, Professor Sagadevan Mundree, outlined how the COVID-19 pandemic, climate change and conflict have resulted in disrupted food systems.

“My message is about people, it’s about partnerships, it’s about the products and importantly the provenance that we as consumers are quite pedantic about,” he said.

“How are we contributing to the sustainability of the planet? How are we contributing to ensure that we can actually create economic opportunities and sovereignty along our supply chain, particularly associated with food?”

Locally for QUT, Queensland’s subtropical climate is perfect for growing pulses, particularly chickpea and mung bean.

Working with the food studies department of a local secondary school, Kelvin Grove State College, Prof Mundree gave students a first-hand experience of food system disruption.

He did this by giving a lecture on sustainability and tweaking their food studies program, leaving the students for three months to develop recipes from these pulse-based flours and local Indigenous ingredients.

Their tuckshop became a testing ground, allowing them to develop recipes and receive feedback from their customers.

Students worked together to develop 24 recipes, which they presented to a Majans food technologist.

Two recipes have now been identified to commercialise, with the 14- and 15-year-old students experiencing the process of partnering with industry and consumers to create considered products.

This approach of value-adding to create sustainable entrepreneurship has continued in Prof Mundree’s project with The Myera Group, a Canadian, Indigenous-owned company.

Using native rice used by Indigenous communities in Australia for the last 65,000 years, Prof Mundree is working with colleagues around Australia to use the provenance of this ingredient to produce a range of gluten-free products.

Measuring sustainable innovation

Professor Roberto Rigobon unpacked the key opportunities to drive sustainable change in business are transparency, measurement and responding to stakeholders’ needs.

Over the last seven years, he has devoted his life to measuring environmental, social and governance (ESG) issues.

“The ESG world has evolved tremendously,” he said.

“We have more than 220 data providers that measure every aspect you can imagine, from treatment of workers to marketing practices, to things like electromagnetic field pollution.”

Creating voluntary carbon markets, where organisations can buy credits for their carbon emissions, and ESG issues are two markets with considerable impact.

“More than $10 trillion of financial investments are directed or affected by these two measurements,” he said.

“This is all voluntary. Not a single regulator has said a single word on any of these.

“This is all happening because we humans think that our behaviour is inappropriate.”

These self-enforced rules, Prof Rigobon explained, are a result of society deciding to change.

What does this mean for organisations?

Understand the cost of your behaviour

Prof Rigobon examined how consumers research and look for aligned attributes from the organisations they purchase from.

“As companies and leaders, you will be faced with the cost of misbehaviour,” he said.

“Stakeholders care about these issues…It’s profitable to do good.”

Prof Rigobon encouraged organisations to choose seven practices within their industry to focus on.

“Say what you’re doing and be open about your behaviour,” he said.

“You will be rewarded.”

Become an industry leader

Another strategy is to encourage all organisations in your industry to disclose their behaviours.

It’s through disclosure that organisations will be able to affect global change, according to Prof Rigobon.

By being transparent about your practices, you will set the standard for your industry and, as a result, encourage others to change.

Prof Mundree expanded on this, saying, “We need strong leadership. We need to at least be on the same hymn sheet and set these targets.

“They could be aspirational, but at least we know that we are actually moving towards dealing with some of these issues and challenges.”

Listen to your customers

Both experts highlighted the importance of responding to your stakeholders’ needs to create sustainable innovation.

Prof Rigobon explained that as a society, we’re changing the way that we behave. This has resulted in both staff and customers demanding change from organisations.

Prof Mundree echoed this sentiment, explaining this prevalence in our food systems, where customers are becoming more cognisant of what they’re consuming, which is changing what companies are creating.

Communicate to change behaviour

Finally, along with listening to your stakeholders, there are opportunities to educate them on problems or opportunities they are not aware of.

This will allow your organisation to build momentum once you have stakeholder buy-in to help solve the challenge or grasp the opportunity you face.

Prof Rigobon discussed how 52 million people currently live in modern slavery and $150 billion of yearly profits are earned from human trafficking.

He explained how prawns being sold de-veined and de-headed have an almost 30% chance of being cleaned by slaves in Southeast Asia.

“We make decisions on budgets based on an awareness of the problem,” he said.

“If we were able to tell humankind how this slavery impacts the products that they buy, you will change behaviour.”

Want to delve deeper into The Sustainable Enterprise? Revisit our global experts’ advice in the webinar recording here.