"In the coming years, if a business is not responsible, it is not a business at all."
Nuno Moreira da Cruz, one of the greatest experts in Responsible Business in Portugal, explains to us why sustainability must be something perfectly intricate with the management of any company.
Nuno Moreira da Cruz has a very clear vision regarding the absolute and urgent need for a company to conduct what he refers to as “impact management”, a strategy guided by the best practices in the areas of ‘Environment, Social and Governance’.
Knowing the universe in which MCG operates and its activity, the Executive Director of the Center for Responsible Business & Leadership at Universidade Católica-Lisbon is pleased to know that the company is giving the proper consideration to these matters in its management. In a conversation with Revista M (MCG’s magazine), Nuno Moreira da Cruz shows us how this is already the “only” way forward…
M Magazine: What is understood today by the sustainable action of a company or organization?
Nuno Moreira da Cruz: I don’t believe in sustainability strategies. Sustainability is “the” strategy, there is no other one. Either this is understood from an “all-in” perspective, as the English say, and not as a “nice to have” where you’re just playing with LED lamps, or it doesn’t work.
Also, when we talk in a holistic sense, sustainability involves everything. A sustainability agenda involves strategy, marketing, operations, human resources… All must be done at the same time. And we are talking about three types of sustainability: economic sustainability because without profit there is nothing else; social sustainability; and environmental sustainability.
Without economic sustainability, there are rarely social and environmental concerns. But it is widely true that without it there will be no profit. The challenge lies in the management’s ability to understand this virtuous circle.
M Magazine: Can the investment in sustainability effectively bring profit to a company?
Nuno Moreira da Cruz: I think we are already beyond that. It is no longer enough just to think that the answer is yes. The question right now is how we can do this in a company. How is sustainability implemented as a strategy? How is purpose implemented within companies? Everything is now about implementation.
M Magazine: Is this concern still just emerging in large companies?
Nuno Moreira da Cruz: Let us not deceive ourselves by thinking that this reality does not affect medium and small companies In Portugal. We can see two clear examples of this: Ikea has just decided that any company anywhere in the world that wants to distribute their furniture only has to work with electric vehicles.
In other words, this management is also affecting small companies, in this case, a small/medium merchandise distribution company. And a Portuguese large company that was competing for a project with a multinational that guarantees 28% of its sales… The specifications they received speak of almost every point of sustainability. And holistic sustainability: prove that you pay the same to men and women, that you don’t use child labor, that you give back to local communities everything you take from them, that your communication channels with customers are perfectly transparent…
This is what sustainability is all about. No one should think that they will be left out of this reality. Otherwise, you won’t have a chance.
M Magazine: What is accelerating this reality? Have we passed the point of no return?
Nuno Moreira da Cruz: It’s simple: the “house is on fire”. It’s when this happens that people finally understand what we’re talking about. The latest IPCC (Intergovernmental Panel on Climate Change) report, which is what António Guterres called the Red Code for Humanity, practically gives the idea that we have passed the point of no return, yes. It’s dramatic.
But the “house is on fire” also in the social sphere, not just the environmental one. As we look at the latest report from Oxfam International, it is clearly indicated that the wealth increase of the world’s ten richest people would lift more than 100 million people out of poverty. Social inequalities are and will continue to be tremendous. And these are not just social tensions between rich countries and poor countries: within rich countries, there are also many poor ones.
Combining the environmental and the social, this sense of urgency is very strong. And the new generations cannot be alien to this reality. In our older generations, we could still say that we didn’t know this is happening. Even if we knew, it’s normal to think it won’t affect us. But these new generations know what is happening and know that they will be greatly affected.
ANd the most talented people have enormous clarity on these topics. One of the first things candidates ask companies is how they position themselves in relation to social and environmental concerns. If this doesn’t exist, they will work elsewhere.
M Magazine: Are Portuguese entrepreneurs awake to sustainability issues?
Nuno Moreira da Cruz: In my experience, I think that three years ago, for example, there were still many closed doors. Today the doors are open or half-open. There are no closed doors. No one is on the sidelines anymore, as surely all entrepreneurs understand that we all must act. There are studies that clearly demonstrate that these issues are independent of generation, geography, or even income level. Of course, in different places on the planet, there are different rhythms, but the trend in these variables is unstoppable.
M Magazine: Is the UN SDG definition making a difference?
Nuno Moreira da Cruz: Everything must be dealt with in a perspective based on these goals. We must be able to not leave anyone behind. Innovation must continue to exist, but everything must be done in a way where we all feel that there is a qualitative leap in our lives. While this is happening, poverty and hunger must be eradicated. If we don’t feel that, innovation and advancement won’t have the light and brilliance that it needs to be. Through the SDGs, which are the strength and the common language, this feeling must exist.
M Magazine: What do governments and companies still lack to have this whole vision?
Nuno Moreira da Cruz: The great barrier to responsible business is in accounting. The ability to include externalities in the company accounts needs to be a reality. This is called impact accounting. We must be able to include in the accounts the costs we are creating for the planet and the costs we are creating in social dimensions. This is a great challenge facing humanity. Too many emissions? Low water savings? Just go to the company’s accounting, the associated financial impacts will be there.
I believe that those companies that are genuinely acting as forces for good – fortunately there are many, including large multinationals that can take these issues forward – realize that this is urgent and think: even if others do nothing, we really have to do something. These companies are very aware of this and are beginning to measure this impact.
In the coming years, if a business is not responsible, it is not a business at all.
M Magazine: What are the most important characteristics of today’s leaders?
Nuno Moreira da Cruz: The most important leadership practices are the same as in the time of Jesus Christ, they haven’t changed. But putting them through the lens of sustainability, the practices related to values, mission, leadership from the heart, giving space to people, trusting… These core points of leadership are more important than ever.
Understanding that the human being must be at the center of the action makes all the difference. We realize as leaders that when someone enters the company, they don’t leave all their characteristics at the door.
We don’t have to manage just one person with is a profession, we have to manage a human being. Leaders who understand this will be the leaders who make the difference.
Nuno Moreira da Cruz and the Center for Responsible Business & Leadership
Nuno Moreira da Cruz is currently Executive Director of the Center for Responsible Business & Leadership at Católica-Lisbon university. He is also the founder & CEO of NMC Leaders. The Responsible Business specialist has a Law Degree at Universidade Católica Portuguesa in Lisbon, a Master’s degree in European Studies at the College of Europe in Bruges (Belgium) and an MBA in IE Business School (Madrid). He is also a Certified Coach (Escuela Europea de Coaching, Madrid) and Mentor for several Startups.