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January 30, 2020 | 5-minute read (827 words)
During this year’s World Economic Forum in Davos, Switzerland, many CEOs shared their commitments to a sustainable future, mirroring the forum’s theme, “Stakeholders for a Cohesive and Sustainable World.”
Check out what several high-profile business leaders said about sustainability, technology and other issues during the forum.
1. Tech Transformation Comes with Training
Traditional businesses across the globe are transforming technologically to stay current in today’s environment, and companies have to be on top of artificial intelligence, cloud-based platforms and other cutting-edge programs to grow, said Ernst and Young CEO Carmine Di Sibio.
He foresees blockchain as a growth driver, despite its challenges. “There’s a school of thought that an open, public network would work well for everyone,” he said. “There are drawbacks, but we think it’s doable. Think if the internet was born in small pieces all over the place, it wouldn’t really work well. The same is true for blockchain. We’re doing a lot around blockchain, we believe in an open blockchain.”
Technology can also go beyond the traditional uses, expanding into new arenas, said Workday CEO Aneel Bhusri. He stressed that technology isn’t meant to necessarily replace humans, but to enhance the experiences we have. “Machine learning is this great technology that lets you sift through vast amounts of data and make predictions,” Bhusri said. “Humans are not great at making predictions, but they’re great at making judgments once the predictions are in front of them.”
Using vast amounts of technology, however, will require training across the board. As humans adapt to new systems, they will require reskilling, said Adecco CEO Alain Dehaze. “We know that we lose about 40 percent of our skills every three years, so basically you are obsolete in skills after 10 years, so that’s why we call for lifelong learning.”
2. New Environmental Solutions Are Needed
Although most companies are working toward sustainable futures, that will require innovating around new solutions that are realistic, said Dow Inc. CEO Jim Fitterling.
For instance, although there’s been a lot of talk about cutting down on plastic use, consumers are still interested in the material. “Plastics demand continues to grow three to four percent per year,” he said. “The alternatives [generate a] three to four times higher greenhouse gas carbon footprint than plastic. So sustainability brings you back to plastics — it’s the waste issue that’s got to be solved.” This creates incentives for recycling and new economic models that perhaps didn’t exist in the past, when consumers weren’t interested in post-consumer recycled packaging.
This sentiment was echoed by Coca-Cola CEO James Quincey, who said, “The objective with plastics is not no plastics, it’s zero waste and a lower carbon footprint … our objective is get the bottles back and make new ones.” In fact, Quincey noted, Coca-Cola is making great strides in this area. “We’ve already identified that in the coming months, we’re going to have the first market in the world, Sweden, where all of the bottles were made from 100 percent recycled PET, total circular economy.”
And Coca-Cola isn’t alone in this goal. Nestle has committed to spending up to $2 billion on recyclable packaging that’s safe for food and beverages by 2025, said CEO Ulf Mark Schneider.
He understands that shareholders may not view that massive financial commitment positively, but it’s imperative for the firm’s future. “We’ll find other efficiencies in our manufacturing and supply chain to make up for this. You could say those efficiencies could have been added to the bottom line, but for a food and beverage company/consumer packaged goods company, it’s important to stay relevant to consumers. Consumer tastes are shifting fast, and so they want to know that their packaging is not causing environmental concerns, and so this is all about staying relevant to today’s consumer.”
3. Evolving Takes Time
As traditional companies continue to evolve to stay relevant in today’s environment, they must take the time to evaluate what works for their business model and what doesn’t.
That’s the challenge that Marriott CEO Arne Sorenson took on when the hotel chain noticed the rise of home sharing models such as Airbnb. He said the firm’s leaders asked themselves, “How do we take a collection of hotels with a loyalty program and offer more choice, greater loyalty, connectivity, and drive more stickiness with our customers?”
That might involve a variety of factors, and Marriott evaluated how it could get into the home share space while still building on its commitment to strong customer experiences. “We’ve done that at the high end of the market,” he noted, and it involves the assistance of professional home managers that ensure superior guest experiences. The company started with 2,000 homes and has 6,000 in the pipeline “to give our loyalty members additional options,” he said.