We hear a lot about Net Zero, but what about Net Positive?
Camilla de Nardis, PhD, Net Impact Amsterdam Volunteer and Sustainability Consultant at Capgemini, outlines the key takeaways of “Net Positive: How Courageous Companies Thrive by Giving More Than They Take” by Paul Polman & Andrew Winston.
In their new book Net Positive, Paul Polman (former CEO of Unilever) and Andrew Winston (leading thinker in sustainable business) make a convincing case for companies to go beyond reducing their negative impacts and start to give more than they take.
A net positive business, by their definition, is one that ‘improves well-being for everyone it impacts and at all scales – every product, every operation, every country, and for every stakeholder including employees, suppliers, communities, customers and even future generations and the planet itself’.
In short, being net positive is about making things better for everyone. But, can it really be done?
Business for good
We live at a time when an increasing number of companies are taking a stand on social and environmental issues. But the authors point out that this could be dangerous, as many companies talk more than do.
This book urges businesses to step up and address our ‘planetary and moral emergencies’, specifically on climate change and rising inequality. These systemic failures are intertwined and are the consequence of our current economic system’s two main shortcomings: it is based on infinite growth on a finite planet and it benefits only a small part of the global population.
The book is dedicated to ‘the billions of people worldwide who are still left behind, and who deserve courageous leaders who will stand with them in building a better world’. For those wondering why inequality is a business issue, the authors remind us that ‘business cannot thrive in societies that fail’.
While Polman and Winston list the numerous benefits for companies to adopt a net positive approach, this book is not intended to convince anyone we need change, but to provide a framework for motivated leaders to embrace a regenerative mindset and scale up their positive impact.
The book lays out a manifesto for a new form of multi-stakeholder model, based on five core principles:
- Ownership of all impacts and consequences on the world
- Operating for the long-term benefit of both business and society
- Creating positive return for all stakeholders
- Driving shareholder value as a result, not a goal
- Partnering to drive systemic change
Many of the concepts presented in the book are not new, but as the authors put it, ‘there is talk and there is action’. This book is full of examples of companies (first and foremost Unilever) that have already taken steps to create a new form of business. Admittedly, the anecdotes from Paul Polman are among the best (and most surprising) parts of the book (like when he describes how he helped free Greenpeace activists jailed in Russia).
Change of perspective
A critical point that comes up several times across the book is the failure of the shareholder primacy doctrine and short-term profit maximization. While this criticism isn’t unheard of, it couldn’t be more appropriately discussed here since Paul Polman is one of the few leaders who resisted it. When he became CEO of Unilever, he stopped reporting quarterly financial results to focus the company on long-term value creation. Why didn’t more leaders follow suit? Hopefully, this book will make the case for such change even more compelling.
Nevertheless, Polman and Winston reiterate that being net positive must go hand in hand with running a sound business and delivering solid returns to shareholders as a result of doing good. A net positive company ‘delivers profit while creating well-being for people and planet‘.
What it takes
Courage is one of the central themes of the book and a must-have trait for the net positive leader, together with empathy and humility.
For a company to become truly net positive, Polman and Winston propose a seemingly contradictory approach: look inward but with an outside-in perspective. What they mean is that a company should use the lens of the toughest global challenges to set goals that serve to address these, and make sure they are science-based. The book reminds us several times that democracy and science are the two pillars of society and that they must be always defended.
An entire chapter is dedicated to goal-setting as the authors revisit the SMART (Specific, Measurable, Achievable, Realistic and Time-bound) approach, suggesting to ditch Realistic and Achievable for Result-oriented and Ambitious. Goals should be ambitious, they explain, tackling the larger life-cycle footprint to ensure a positive impact beyond the organizational boundaries.
Going the extra mile
One of the key aspects of a net positive business is that it actively pursues long-term partnerships which are built on deep trust and transparency. These can be divided into two categories. The first are partnerships aimed at solving sector-wide problems. The second go a step further to address the wider systemic issues and require the three prongs of society: business, government and civil society. This opens the door to net positive advocacy, where companies lobby for policies that benefit all of society (including, somewhat surprisingly, higher taxation).
At this point I was already very impressed by the book, but what really got me on board was the chapter about ‘embracing the elephants’. This talks about all the issues that companies usually don’t want to address. Examples mentioned are excessive executive pay, tax avoidance, corruption, short-term share buybacks, trade association lobbying, human rights abuses, money in politics, and broader diversity and inclusion. That takes real courage. Talking about the elephants is what all leaders should do. These issues are not political as the authors remind us. They are about the well-being and success of our society.
Perhaps the only moment of disbelief occurred while reading about how Unilever used marketing to create what they call purpose-driven brands (they use the example of a deodorant). This made me question whether a mission or purpose should be forced on to each and every product instead of changing what a company sells altogether.
In fact, we learn in the book that only 28 out of 300 Unilever brands are fully purpose-driven. Is this good enough? It is not, the authors admit, so much remains to be done. Becoming net positive is a long journey and no company (including Unilever) is there yet. The ultimate question should be: ‘is the world better off because your business is in it?‘
While business leaders are the main target audience of the book (gift it to your boss!), it is actually addressing everyone. We can all contribute to a culture of purpose and service to the world. Let’s all get on that journey right now.