William McDonough says that when they figure out their strategy, most businesses start with value and then set their goals, benchmarking financial and product targets, instead of first focusing on values. He sees a new world arising where companies have to lead with their hearts, and move from values to principles, visions, goals, strategies, tactics, metrics, and then, and only then, to value creation.
The architect and CEO of McDonough Innovation, a globally-recognized leader in sustainable design and development, opened the Health+Wealth of America conference’s final day with a session entitled “Waging Peace with Commerce.” He sees leveraging business as a tool as the only way the world can achieve the Paris Climate Goals and, more broadly, achieve the United Nations’ Sustainable Development goals, which he showed as part of his presentation. “Commerce is, I think, the quickest engine of change,” he said.
He sees all kinds of new systems arising which will enable companies to profit even as they help the world cope with global warming. Carbon emissions can be radically reduced even as we remove much of the CO2 already in the atmosphere with massive new commitments to machines that extract it from the air. McDonough is working with the world’s biggest countries, through the G20 on developing effective global systems for carbon management. He’s also working with several of the world’s largest companies. He says, for example, that we can capture energy from the sun in deserts, use that energy to capture hydrogen in the form of ammonia, and ship it around the world. That way we can power steel mills in Japan with solar energy captured in the Sahara, for example. He estimates businesses doing that kind of thing could be operating within about a year.
The key, he reiterated, is that companies have to want to help the world. The way they’ll do that is if they focus first on their values and only then on what’s best for shareholders. In the end, the two will align, he’s certain.
McDonough was followed by Malcolm Frank, who leads digital business at global consultancy and software giant Cognizant. Frank echoed many of the architect’s points, in a bigger-picture presentation about the role of digital transformation in enabling businesses to server more stakeholders than just their shareholders. That, in effect, means being more socially responsible, much as McDonough advocates.
Frank sees this moment in business as similar to a bicycle racer being in the mountains during the Tour de France—a huge opportunity to break away from the pack and come out ahead. The key is moving incredibly fast, and strategically, when it comes to digital transformation.
“Organizations need to get their data under control,” Frank explained. “The foundation of any digital business is your data. So, can you modernize it, so you can create those moments of magic for a consumer?” Companies need to be able to create engaging, beautiful, and enticing digital experiences if they want to get ahead. But most importantly, they should be focused on data, which essentially, in the end, can put stakeholders at the center of the company.
“We’re now getting to digitizing the pillars of a good society,” Frank said, estimating that digital transformation across sectors is moving four times faster this year because of the pandemic. “Those pillars have been around for centuries, whether that’s the health care system, the banking system, insurance, education, government.” He sees this digitization around the pillars of a good society being pushed by COVID. “This is a terrible chapter that we’re all going through—but if there’s some silver lining, I think it’s to catalyze these elements that will drive great benefit.”
He gave the example of health care—once companies can use digital data to track and serve patients they can keep them healthy and save money in the end. Today’s system is a “sick-care system,” he said. And the pro-active capabilities of the health care industry, once it’s driven by data, can be replicated in industry after industry.