It’s time to move beyond business as usual

Climate and environmental scientists have warned us for decades, and we are slowly coming to understand that business as usual is no longer serving humanity and our planet, and that it will need to change.

Why is this so important? Stockholm Resilience Center puts it clearly: ”From global warming to the biosphere and deforestation, from pollutants and plastic to nitrogen cycles and freshwater: Six of nine planetary boundaries are being crossed, while simultaneously pressure in all boundary processes is increasing, new research published in the journal Science Advances shows.”

In short, the challenge is urgent and we are not moving fast enough. Many different researchers can confirm that far too little has happened to mitigate the environmental crisis of our world or to capture the vast potential that it presents.

So, how do we move forward?

Regulations and legislation are only part of the answer. On top, we will need to move beyond what we learned in business school. As a first step, we will need to look beyond business as usual, to build Better Business. Ultimately, however, business will over time need to become Regenerative.

Business As Usual

What do I mean with ’business as usual’?

A ’business as usual scenario’ can be thought of as future patterns of activity which assume that there will be no significant change in people’s attitudes and priorities, or no major changes in technology, economics, or policies so that normal circumstances can be expected to continue unchanged.

I’m personally referring to how businesses have been run over the past decades; the modus operandi that has been considered normal; and what has been taught in business schools since the 1980s, and even before that. But where does this ”normal” come from?

Evidence suggests that it might be strongly tied to Milton Friedman. Because in 1970, Milton Friedman wrote a New York Times article titled “The Social Responsibility of Business Is to Increase Its Profits.” In the article, Friedman argued that business leaders have no other responsibility than to increase the profits of the firm. And, that shareholders are the primary stakeholder of any business.

Simplified interpretations of this article seem to have shaped business as we know it today – and even taken it too far. Why? Possibly because Milton Friedman became a very influential economist during his career. In short, he was an American economist and statistician who received the 1976 Noble Prize in Economics. He became an advisor to the republican US president Ronald Regan, and to the conservative UK prime minister Margret Thatcher. He was even described as ”the most influential economist of the second half of the 20th century … possibly of all of it” by the Economist.

This now more than 50-year-old article has hence been attributed by many as the origin of the short-sighted shareholder capitalism that we have seen grow into the new normal during past decades, and is a key characteristic of ‘business as usual’ today.

Profit maximization and short-term value extraction have over time simply become the norm in business.

Defining Business As Usual
Source: Better Business Better Future, Elisabet Lagerstedt (2022)

Many are now asking themselves what are the characteristics of the new paradigm evolving beyond business as usual. Since it obviously does not work. And because, as a society, new paradigms or ideas, simply evolve into the new normal over time. Our contexts and ideas change, and with that, our society.

So, what could this evolving paradigm look like?

Regenerative Business is unfolding on the horizon

I believe the paradigm unfolding on the horizon will be characterized by the idea that the purpose of business is to advance the prosperity of humanity within the boundaries set by nature.

This idea includes circular, regenerative, and more equitable business and operating models, and sustainability as a fully integrated part of purpose, strategy, business models, value chain, and offering. It also includes new models for collaboration based on mutual interest and higher good.

What is today often referred to as Regenerative Business fits nicely into the description of this evolving business paradigm and is probably one of the answers we are looking for in order to mitigate the current planetary crisis.

A Regenerative Business has regenerative practices, cultures, and leadership and truly goes beyond what we today see as ‘business as usual’.

As a simplified concept, it is also similar to Net Positive Business, as described by Forum of the Future, and Paul Polman.

So, what is Regenerative Business?

Plainly said, a Regenerative Business is a for-profit organization that returns more to society, the environment, and the global economy than it extracts or takes out. It has a multi-generational outlook and takes into consideration the good of society and our planet.

It respects the rights of all other living beings; has robust circular flows; is innovative, adaptive, and responsive; contributes to the health and well-being of the whole; works collaboratively across ecosystems; and balances collaboration and competition. It values all ‘rightsholders’, including natural, social, and living capital, as well as financial capital. It’s aiming for a higher good with zero footprint and a positive ”handprint”. And sustainability, circularity, and regeneration are completely integrated and a natural part of purpose, strategy, offering, business model, and operating model.

Defining Regenerative Business
Source: Better Business Better Future, Elisabet Lagerstedt (2022)

As beautiful as this may sound, my own 25+ years of business experience tells me that Regenerative Business Models probably feel far away for most business leaders, having led their whole professional lives and careers in ‘business as usual’ and have been successful in that arena.

Taking a first step from business as usual is, however, key to getting started. And there, we find a stepping stone that I call Better Business.

Better Business

A successful and research-based way to transform and transition beyond business as usual is through learning and experimentation – because we simply don’t have the full answer in advance. Especially interesting in this context is to learn from those who are since long in the frontlines of the Sustainability Revolution.

Doing so presents us with a bridge between business as usual and regenerative business. A bridge that I call Better Business and have described in my latest book Better Business Better Future, published in January 2022.

Learning from the frontlines and applying the principles of Better Business will simply us help reduce the perceived risk involved in this transformational change, and provide a strategic map to help us navigate this field. It even has the capacity to help accelerate the urgent and important shift.

Defining Better Business
Source: Better Business Better Future, Elisabet Lagerstedt (2022)

Even though Better Business still may sound rather far away for some, I believe that it is only a stage of development—or a bridge to what is emerging—rather than a new state or status quo. It is definitely better for people and the environment than business as usual, but it is still not fully regenerative.

We are already seeing more and more companies developing into Better Businesses, and like Interface—one of the world’s leading and most recognized companies in this field—some companies have already raised the bar and aim to become fully regenerative.

Interestingly, Better Business is a conceptual area that was pioneered in the mid-1970s (even though the term Better Business was not used) and is already inhabited not only by its pioneers but also by early adaptors and an early majority. Some of the companies in the frontlines today are Unilever, Patagonia, Natura &Co, IKEA, Interface, Ørsted, Tesla, and Danone. All by the way also identified as the companies best at integrating sustainability into their strategy, as to GlobeScan SustainAbility Leaders Report.

Hence, there are several companies to learn from, and even ‘only’ Better Business can be considered far beyond business as usual for anyone with a more traditional business mindset and skillset.

It’s time to rise to the challenge

In the face of the massive adversity related to the Sustainability Revolution, it is, of course, easy to feel too small to make a difference. But instead of seeing our potential contribution as limited, we need to realise that our zone of influence as corporate business leaders can be much larger than we tend to think. This is because the world of corporate business is particularly well equipped to help solve the problems of the world through the ingenuity, creativity, collaboration and resources that it can so often call forth more effectively and efficiently than other human organizations.

And we, as corporate business leaders, can go far beyond demonstrating in the streets. We can actually move capital, minds and action, and cooperate to nudge consumers into making choices that co-create the healthy future that we want and need for our business, humanity and the generations to come—our own children and grandchildren included.

Thanks for reading this far! Do you feel drawn to my work? Please discover my book Better Business Better Future (2022) and The Better Business Acceleration Program (online). They will both help you accelerate your path toward Better Business and a better future.

Elisabet Lagerstedt

Elisabet Lagerstedt is the founder and director of Future Navigators. As a trusted advisor, consultant, and Executive Coach, she helps business leaders navigate beyond business as usual to build Better Business and co-create a better future - through insight, strategy, innovation, and transformation. Elisabet is also the author of Better Business, Better Future (2022) and Navigera in i Framtiden (2018).