Episode 4, Game Changers and Transition makers: Transforming capitalism for good

Elena Lambros:

Hello and welcome to ESG Matters at Ashurst. I'm Elena Lambros, the Ashurst Risk Advisory ESG and Sustainability Partner.

Welcome to the latest episode of Game Changers and Transition Makers. In this series, I'll be speaking to entrepreneurs around the globe who are at the forefront of driving the sustainability agenda through innovative business ideas and company startups.

In this episode, I'll be joined by Sarah Downie, CEO of the Shared Value Project. Sarah is responsible for the overall strategic direction and management of the Shared Value Project, engaging with the organization stakeholders and members to lead, foster, and promote shared value in Australia and New Zealand. She has more than 20 years cross sectoral leadership experience, seeking to solve the most deeply rooted and complex societal issues.

Thanks for joining us today, Sarah. Really delighted to have you on the podcast.

Sarah Downie:

Very happy to be here.

Elena Lambros:

Well, I thought it'd be good if we could just start by, give us a little bit about yourself and your business. What is Shared Values and what is it out there to do?

Sarah Downie:

It's a big question. Let me start at the beginning perhaps with what Shared Value is for those that are listening that maybe have heard the term but might not fully understand what we mean by shared value.

Shared value is a term that was coined actually out of Harvard in 2011 by Michael Porter, who some will know as the guru of corporate strategy and competitive advantage, and Mark Kramer, who on the other side of the fence, a guru of a strategic philanthropy, and he created Collective Impact. Really they came together actually in personal circumstances and discussed what if environmental and social issues were actually thought of as sources of growth and opportunity rather than things to be dismissed or thought of as externalities.

This concept has been around for a long time, and the Shared Value Project here in Australia is really here to champion that idea, which I've got lots more to say on, but maybe that's just worth opening with. Happy to expand on what's drawn me to it, if that's of interest.

Elena Lambros:

Yeah, that absolutely is of interest. I love the fact that this happened back in 2011 and we're now seeing this trend around people really understanding the impact of ESG and the purpose in their life and also that kind of link to what that means in a corporation because there's a lot of conversation around what a corporation is and should be these days. Really kind of understanding what made you interested in this and how you came to be involved in shared value would be great, I think to understand.

Sarah Downie:

Well, my background is a little bit scattered, to be honest. I'm a little bit schizophrenic in the sense that I started in corporate world actually in brand and advertising for a lot of years. So working with big corporate seeking to understand what they wanted to be, how they wanted to define themselves, what their DNA was.

To be honest, a social purpose back then really wasn't a big part of the conversation. Very rare for that work to include a conversation around what is your role to society. That's not something that was top of people's minds.

And so I guess like a lot of people after spending a lot of years in that corporate space sort of started to think about my own purpose. What do I want to achieve? You start to use words like giving back, which I kind of cringe at to be honest now because I realize how much I get out of this work.

Back then I thought I would give back, and I sort of took myself out of that world and went straight into the not-for-profit world and lived in the not-for-profit world for 10 years or so. But the funding struggles in that environment were really something that I kind of could never shake off, that we were doing so much great work, but yet you were constantly trying to work out how you would get the next bit of funding to secure the next piece of important work that had to be done.

And so I really looked to the corporate sector, to the private sector and thought there's so much resource there, there is so much money there. I mean it's far bigger than if you combined all of them, the nonprofit and government sectors together, the private sector just [inaudible 00:04:13] them. We have to get better at this. There's just no way for us to do it without the weight of the private sector.
I realized after spending some time investigating what that might look like, that it wasn't a new idea and that Mark Kramer and Michael Porter had come up with it already in 2011, and I discovered this idea of shared value and I just thought that's what I need to do. I need to work out how to bring the private sector closer to these problems and actually get them to understand that they can and should have a really significant role in solving these big wicked problems.

And so that drew me into shared value, which is a membership organization. We work I guess with the willing, those that want to actually to do this work, which is a fun job to have, I have to say.

Elena Lambros:

Yeah, I love that. I love hearing you talk around your personal journey. I would say that seems to be reflected quite a lot recently. I know you didn't like the term give back, but people are thinking about how they give back. I do think having that private sector import is probably really important. There's a lot of innovation that happens there. There's a lot of people. There's a lot more money flows, easier access to funding and all of that. So I can absolutely see why this is such a great idea.

How did you then go about putting that into play? You've got what you decided was a really great kind of integration point. What did you do?

Sarah Downie:

Well, I think like often, it's just a bit of a stars aligning, which is really fortunate for me. But what I would say is on reflection, I would say to people, don't jump out of what you're doing, which is what I did because at the time I thought I needed to take a completely left turn 180 and move out of my world that I was in that I had built a pretty senior career in to jump into the not-for-profit sector.

Whilst that was incredibly fulfilling and I certainly learned an awful lot in that space, I now coach people to say, don't do what I did. Actually try to work out how you're going to bring a social purpose into your work because that's actually what we need to do.

We need to not create two separate worlds. We actually need to create one world where everyone can understand within their role, whatever that looks like, how they can consider the intersection of social and environmental issues into their everyday work. If everyone did that, if everyone brought that lens to everything they did, then we'd be awfully closer to creating the kind of world I think that we want to live in.

For me, I guess it was jumping from one world to the other and then saying, "Okay, how do I bring these two worlds together?" I was just really fortunate that the CEO of the Shared Value Project role became available and I jumped at it and have been able to, I guess make it a little my own in the time that I've been in this role for the last three years.

Elena Lambros:

Yeah. Well, I'm sure they're very lucky to have you and how exciting to be able to shape it in the way that you want.

How do you work with organizations and private companies, and what do you actually do with them to help bring that lens, that environmental and social lens to their thinking and to their people?

Sarah Downie:

Well, to your earlier point, it has changed over the years. I think what we're doing today is actually quite different to what the organization was doing 10 years ago. 10 years ago, it was a big advocacy role. It was championing the idea that business should and could have a role in supporting society.

But to your point, I think we're kind of there now. We're not doing it, but we do understand that it's a need. We don't need to convince people so much that this is the role. We need to help them with how to do that.

That has changed the nature of how we work with organizations. So we're much more in helping actually getting into their organizations, rolling up our sleeves with them in role of coach, if you like, and helping them think about which social and environmental issues are actually material and strategic to their business because not all of them will be.

So working out which ones are, and then what their strategies are to actually deeply connect with those issues and how they can influence, whether it's their products and services, whether it's their employment strategies, their operations, or indeed their community work.

We play the role of coach and we also do a lot of education training because I think the other big piece in here that we recognize is there's a big skills gap. As we now ask businesses to do this work, they haven't grown up doing this, they haven't gone through their education, they haven't gone through university courses that have brought this perspective and lens in. It's actually a really enormous re-skilling upskilling that needs to be done in every role and at all levels, which obviously we can't do on our own, but we do our piece to bring some of the new skills into organization.

Elena Lambros:

Yeah, that's amazing, and again, just really exciting that businesses are opening up to that and willing to have that support and that help in-house. I think that's really great.

If I think about that then and that trying to change and the influence that you make, what does success look like for you?

Sarah Downie:

I think it just looks like making a difference. I know that sounds a bit of a shorthand answer, but this is quite a big shift and I really truly believe that this concept of capitalism is and needs to be rewired. I do think that there is a capitalism 2.0 that will exist where business does understand its role, it does have a social purpose, and in some ways it gets back to the very beginning of business, which is a very deep connection to community and the role that it plays.

I think this is happening. I see it in pockets, not on a large whole scale yet, but I truly believe that this is happening. I guess for me, success is being a part of that transition. As I said, that's certainly not something that our organization thinks it can do on its own. This is happening all around the globe and there are many fabulous organizations contributing to this cause. But we certainly want to play our bit in Australia in helping that transformation take place.

Elena Lambros:

Yeah, excellent. On that, do you work around Australia?

Sarah Downie:

Yeah, we do. Our team is based in Melbourne, but an awful lot of our program happens virtually and online and has got even better at that obviously since COVID days. Most of our in-person functions are in Melbourne and Sydney, but we're always interested to work with like-minded people in other states to get a sense of community all over Australia because this work isn't easy. It's really rewarding, but it isn't easy. And so having peers and having that sense of community of practice I actually think is incredibly important for this work.

We find a lot of individuals put their hands up in organizations that just really want to be a part of it, want to be change makers, want to be champions for this work. So kind of connecting them with their peers, both in terms of online communities but also in-person communities is pretty important to the cause I think.

Elena Lambros:

Yeah, no, I agree. And then when you are talking with all the organizations, if you think about having a community practice and getting in there, do you find that you have different conversations now at the executive level or with boards? Are they also really important in terms of influencing it and having those conversations at that kind of top down level?

Sarah Downie:

Yeah, they're incredibly important. I would love to say that this work can be done from anywhere in the organization, and in little ways it can. But ultimately you do need that executive mandate. You need to create time and energy and space for this work to be done. It is at its heart an innovation strategy because it's asking businesses to think differently about how it creates the products and services that it creates, how it does business.

It's pretty difficult for employees to do that work without executive buy-in. We are having very significant conversations at that executive level. And I do think there is a much bigger willingness for executives to do that. That's not just sort of the chief sustainability officer, it is increasingly the chief strategy officer or chief transformation officer or the COO. Certainly if the CEO leads it, then generally speaking, it does create much more energy for the work within the organization.

The board is a really interesting one. I actually think that that's the next big influence. At the moment, I would say the board's very focused on compliance and risk. And what we're encouraging is that that does shift to a bit more of a strategic conversation, that we start to see environmental and social issues not just as risks to be managed, but importantly as sources of opportunity and growth, because only then will they actually invest in the money that it's going to take to kind of shift the dial. Boards are very important, but I actually think it's quite early days in terms of board involvement in shared value in particular.

Elena Lambros:

Yeah, no, I think that's a really interesting point, and I think something that I always think through quite often in these environmental and social areas, your strategy at the moment is really so linked to your risk management. It's hard to just focus on risk management without actually thinking through what does that mean strategically for your organization, the direction you go to. There is quite an opportunity to have that kind of linked conversation and focus on it at the same time.

What would be your key to re-imagining current systems and as we like to say in this podcast, changing the game?

Sarah Downie:

I think there's so much that needs to be done, but I do actually think it's in the systems. I think the Shared Value Project has done a lot of work with individual organizations, organization by organization, working with the willing, supporting them on their journey, helping them bring shared value into their organization, doing the training.

I think all of that is really good work, but if we're going to do this at scale, it's the systems that need to be impacted. I think boards are a really important part of that. How we think about governance needs to shift. The investor landscape is already shifting. There's more that can be done there.

The education system, I sort of get on my soapbox a little bit about that because there's no point bringing enthusiastic young people who already have this vision through an old teaching methodology that has them think that this somehow needs to be divorced from the work that they do or that they need to choose between doing good and frankly earning money. An overhaul of what we're teaching and how we teach is a big part of this that would make my life easier if people were coming into the workforce already with this knowledge and lens. It's much harder to try to get their attention once they're in busy jobs.

It's all the parts of the system I think that really need influencing and then a little bit of bravery maybe in changing the game. I think we're not going to get there through incremental change. We need some people to bust out of this thinking and really push this agenda, show us that it can be done, show us that it's going to be really rewarding for everyone if done genuinely and authentically, and then they kind of become the beacons for others to follow.

Yeah, I think that could the leaders please stand up thought process to say, let's have a little bit of leadership here, bit of bravery, and let's really step into this opportunity because it is an opportunity. It's not something to run scared of. It's sort of just waiting. It's waiting for people to jump in and change the game.

Elena Lambros:

I love that. I think it is absolutely an opportunity, and I like the way that you said, "Would the leaders please stand up?" I think there's so much happening in this space, it's incredibly important.
So then if we just take a step back, I ask everybody this question, what is your own personal commitment to environmental or social sustainability in the next 12 months?

Sarah Downie:

It's a big question. It's kind of in every part, isn't it? I mean, personally, I think there is a degree of walking the talk. It is the little things because we're actually asking for behavioral change to take place. We're asking for everyone to make decisions that actually might not be the easiest of options. It might take 10% more work to make a decision about what you buy. And taking the time to think about the brands that sit behind it and what their commitments are, that does take a little bit of personal commitment.

But if we want corporates to be able to really invest in this work, they kind of have to know that their customers are going to be willing to choose them over their competitors. Personally, I guess I'm trying to be that consumer, not consume things I don't need to and really get behind the brands that are doing this work authentically because I'm asking them to do this work. And I know this work is harder than a quick buck.

I'm trying to influence my teenager to do the same. I have to say that's a little harder, but we need our young people to understand the decisions that they make are influencing their future. So yeah, I think it's individual decisions as well as the big systematic decisions that I'm working on every day.

Elena Lambros:

Yeah, that's right. It's those personal decisions that can influence my behavior and those bigger ones as well. I think that combination is great and a very effective way of doing it.

And then finally, my last question is if you could provide listeners with one action to take away, what would it be?

Sarah Downie:

I'd love every listener just to think about their current role today, not a future role, not a different role, not something that they wish they could do, but just exactly their role, whatever that is. And think about what can I do within my role if I thought about a social or an environmental issue that was relevant to my role today, and how could I think differently about the way I go about my every day to make a difference on that? Because we do think that this is bigger. There's bigger challenges to be solved. I couldn't possibly make a difference.

Elena Lambros:

It can feel overwhelming.

Sarah Downie:

It can feel overwhelming, but if every single person just thought about whatever they do and just thought about the social or environmental issue that connects with their current role and just made a small change, then that would build some learning muscle. It would build some enthusiasm to do more, provide a little case study. There is a lot we can do within our current roles. We don't all have to jump out and do something new. Don't do what I did. Do it in your current role.

Elena Lambros:

I think that's a great takeaway. On that note, I'll wrap it up, but thank you so much for your time today, Sarah. Love the work that Shared Value does, and it's been really interesting to hear about the work that you do and your background as well. So thanks for joining.

Sarah Downie:

Thank you so much. It's always such a wonderful opportunity to share and to get the word out there, so I really appreciate you inviting me on today. Thank you.

Elena Lambros:

Thank you for listening. I hope you found this episode both worthwhile and insightful To learn more about our podcasts, visit ashurst.com/podcasts. This Game Changers and Transition Makers miniseries follows on from our 30 for Net Zero 30 series, and I would encourage you to click on the link in the show notes to find out more.

To ensure you don't miss any future episodes, subscribe now via Apple Podcasts, Spotify, or wherever you listen to your podcasts. And while you're there, please feel free to leave a rating or a review. In the meantime, thanks again for listening and goodbye for now.