Could this be the secret to accelerating corporate sustainability efforts?
Behavioural economics is becoming increasingly topical. The current incarnation in the UK is known as the “nudge” theory. It is the manifestation of the realisation that the “carrot” is not only more powerful than the “stick”, but it is also considerably more cost effect. As “the pen is mightier than the sword” (Lytton 1839) so “the carrot is mightier than the stick”.
In UK Prime Minister David Cameron’s “Big Society”, it also tends to have a more local and therefore relevant focus. The basic principle of the “Big Society” is to encourage people to once again become active owners of their society, rather than passive participants following government dictates. Government has realised that although the sticks of tax and legislation adapt behaviour they often do not change behaviour. The real test is what happens when the stick is removed.
The aim of “nudge” theory is to make a change in behaviour more than just temporary, to make it become habit or “the norm”, to make it a sub-conscious action.
A person’s name, image and reputation are, for most people, assets that they value and want to maintain to a high standard. They are one of the characteristics of human nature that the nudge theory plays to. It is focused on tapping into ways that impact a person’s self esteem, ways that will encourage people to “do the right thing” because they want to, not because they are being forced to.
One example of the application of the nudge theory is the UK Carbon Reduction Commitment (CRC), which demonstrates a combination of both the stick and the carrot “nudge”. As well as effectively becoming a carbon tax (the stick), one of the major components of the CRC has always been publishing a league table. This is where each participating organisation (both public and private sector) will be ranked on how well they are performing in reducing their carbon emissions. Currently there is no direct financial consequence to the league position but clearly it has a reputational impact. In addition, it enables you to see and benchmark your performance with your peers, encouraging you to up your performance and so create a circle of virtue. CRC nudges the participant to reduce their energy consumption by enabling comparison and hence competition and also provide a vehicle for the benchmarking of performance.
The concepts of nudge theory can be applied as a solution to a number of sustainability situations. I believe people and organisations inherently want to do the right thing and behave in a sustainable manner. The issue is more about getting over the initial inertia and making a permanent change in corporate behaviour.
We have successfully started the sustainability journey by encouraging “organisations” to embrace carbon reduction initiatives, but aren’t we missing the vital ingredient that could significantly accelerate corporate sustainability achievement – namely the employees?
But how does an organisation engage their employees to assist with corporate sustainability achievement?
Well, here are some simple examples:
- Green champions can be identified and their actions publicised. Understanding what behavioural changes a colleague has made can be extremely persuasive.
- Forums can be established where people can easily join-in: share, discuss and vote on ideas, where they can also influence the creativity and actions of others.
- Make sustainability fun, competitive and social by setting goals and targets and giving relevant rewards as they are achieved.
- Making sustainability initiatives easy to understand and easy to use within the organisation by removing perceived barriers to participation. For example, this can be as simple as providing access to video-conferencing as an alternative to travel
These are just some simple examples of mobilising employees, nudging them in the right direction, constantly helping them to do what they probably already want to do, but just don’t know how. By approaching this in a connected, global and coherent way, it is possible to rapidly create a workforce that lives and breathes sustainability and at the same time feels much better for it!
