As people and organizations become aware of our global environmental, social, and governance issues (ESG) the motivation to solve or mitigate these issues grows. Who doesn’t want a positive impact on organizations, people, and the planet? Okay, but how to assess your expected positive impact? How to decide if if it’s worth the effort? When improving something – the organizational culture, or your organization’s ESG impact – five questions help to decide what to do and what not to do. Let’s learn from the Effective Altruism (EA) movement and be more effective as leaders, consultants, and co-workers.
I feel inspired by the Effective Altruism (EA) movement. EA focuses on what individuals can do to make the world a better place. For instance, you can give your time by volunteer work, you can donate money, or choose a career that has a positive impact. EA is a rational approach aiming at doing the most good possible with a given amount of resources, in ways that are sometimes counterintuitive but focus on evidence-based rather than emotionally driven decisions. If you want to know more about this, I recommend reading Doing Good Better, by William MacAskill.
Though EA’s primary focus is on individuals, we can apply this thinking to organizations as well. EA asks five questions before deciding on actions with a possible positive impact. This line of questioning can inform our decisions, also as leaders or consultants considering organizational development or improving organizational culture or their organization’s ESG impact. The five key questions are:
- How many people benefit and by how much?
- Is this the most effective thing you can do?
- Is this area neglected?
- What would have happened otherwise?
- What are the chances of success, and how good would success be?
1. How many benefit by how much?
EA applies this question to choosing between two charities. But it’s an intriguing question for leaders and consultants as well. For instance, when I consult with a client organization on developing a positive organizational culture – all staff will benefit.
By how much? That depends on how successful the culture development process will be. This differs widely per organization – how busy are they, and how much time, money, and energy can they spend on this? How motivated are they? How quickly do they quit when it’s harder than anticipated, and so on?
That’s why a careful intake is necessary before working with clients, or before getting buy-in from your top executive team or board of directors. We need to educate them first on what organizational culture entails, why it matters, possible outcomes, possible cost, and effort, but also on their personal impact. Top executives can make or break organizational development programs by “being the change they want to see” or the opposite; not walking the talk. Leaders play a crucial role by giving or withholding support and by persevering or quitting too soon.
2. Is this the most effective to do?
This is a great question for consultants and leaders too. There’s a myriad of organizational symptoms that relate to culture and a ton of activities that cause positive or negative ESG impacts. So, what to choose?
EA’s research shows that the best charity programs are exponentially better than the very good ones. MacAskill concludes: It is common, in many different contexts, to see a minority of input factors accounting for the majority of output. For example:
A few particularly bad earthquakes have accounted for the majority of earthquake deaths;
A few cities house the majority of city-dwellers;
A few people hold the majority of the world’s wealth.
This follows the 80/20 rule: 80% of the effects come from 20% of the causes. This reasoning goes for organizational development interventions and ESG actions as well.
Where do you expect your 80/20 impact?
You can work on improving the culture, but sometimes the organization doesn’t have the time, money, energy, will, or ability to do that right now. You might find other interventions that are more effective in this situation.
For instance, one of my client organizations was so overloaded that they couldn’t do intensive culture development after their initial culture assessment. The assessment made clear that their culture was too individualist and pushing for results – leaving people exhausted and competing between themselves. Even business units were competing. People couldn’t spend time on workshops to identify typical behaviors and beliefs in the culture, let alone come up with improvements. They had too much on their plate.
The organization decided to roll out a quick intervention. They discontinued individual bonuses and introduced collective bonuses that enticed people and business units to collaborate. As their culture valued results, this incentive worked. Without much time spent on talking and understanding, the collective bonuses directed behaviors to collaboration. For the time being, this was the most effective they could do. (Though the deeper layer of know-trust-and-like your colleagues from other business units was not developed. If they would spend time and effort on this, they could develop a positive culture with even better results).
This goes for deciding on ESG actions as well. For instance, reducing plastic, and single-use packages is great, but if you collect re-usable packages and recycle them, what are the CO2 emissions? What’s most effective? Do the research, calculate, and contemplate!
3. Is this topic neglected?
A given amount of money will make a greater impact in an underfunded area than in a well-funded one. It’s more effective to focus your donations on causes that don’t make the news, and that are more likely to be underfunded. It’s the law of diminishing returns in action. Where does an extra dollar, or extra effort, make the most difference?
Apply this question to your organization’s issues. Organizational culture is often neglected, even though people talk about it in slogans like “Culture eats strategy for breakfast”. Yes, right, but what actions do you take? Is it just talk, while you spend your budget and efforts on something else?
The same goes for ESG actions. Do you produce a lot of plans, focusing on governance, reporting, and complying with regulations while you continue business-as-usual? Or do you take on a neglected topic, such as how to transform your business model to be future-fit? A future-fit business might discourage material consumption and make money by recycling resources, repairing things, and changing their service, instead. Do you stay shallow or go deep? Are you greenwashing? Or tackling a small issue but leaving the root cause intact?
One neglected topic of organizations is their own transformation. How can they become true agents of change, helping humanity tackle its ESG challenges? How to contribute to degrowth and moderate consumption? How to grow regenerative products and services?
Another neglected topic is action! We talk about topics more than we do. Do you talk or do you take action, for instance regarding climate change?
And, another good one: what’s the neglected question in your organization that’s not being asked?
4. What happens otherwise?
MacAskill encourages us to ask not “How much good am I doing?” but “How much good am I doing that wouldn’t have been done otherwise?”
A provocative question for leaders and organizations. What happens otherwise?
What’s the expected value of developing a positive organizational culture?
What will happen if our organization does charity work or donates a percentage of profits? What good are we doing that wouldn’t have been done otherwise?
I also use the question: What happens if we do nothing?
What’s the cost of ignoring a toxic culture? In the short term, and in the long run? What are the risks and opportunities?
What happens if we keep emitting CO2 at this rate and we don’t wane ourselves off fossil fuels? What if we put in these efforts and our clients don’t appreciate it and don’t want to pay more for clean products and services?
The possible lines of questioning are endless – apply them to organizational culture, to ESG actions, to any improvement to gauge your efforts and impact. Is it worth it?
5. What are the chances of success, and how good would success be?
This question might not be easy to answer. Often you just can’t tell. Reality is volatile, uncertain, complex, and ambiguous (VUCA). Moreover, it’s non-linear and happening while you’re making other plans. It’s not so predictable.
You expect that your staff likes to be engaged in choosing your organization’s contribution to the Sustainable Development Goals (SDGs) but, as it turns out, people are complaining that you add brainstorming workshops to their overloaded schedules. They feel overburdened by the SDGs. They interpret such workshops as managerial blabla, as this is how meaning is made in your organization’s culture. Regardless of your good intentions – you really wanted to use the SDG sessions to engage employees and build a more collaborative culture and improve some ESG impacts. Employees feel not taken seriously and are wary of new managerial hypes. You need to repair the relationship first.
Their response gives you new information. Specific SDG sessions may not be valued, but sessions on topics that employees choose will be! Start where you are, where they are. Build the relationship first to get better results later.
Also, our perception of low-probability events is highly skewed. Either we give too much weight to them (for example, when we buy a lottery ticket) or we ignore them (for example, when the accident-management plan at Fukushima nuclear plant excluded plans for a severe accident because the likelihood of one occurring was deemed negligible). Low probability, high impact events are called “black swans”. How can you predict or prepare for black swans?
Expected value
The concept of “expected value” is helpful: what do you expect to gain or lose in the long run if the event happened many times. Expected value is calculated by multiplying the probability of an event happening by the value if it does.
Sometimes, even though an event is highly unlikely, its potential impact is huge (it has a high expected value) and this makes it worth taking seriously. Here are your black swans, but also less dramatic events. For instance, a single action by a single person is highly unlikely to have a significant impact. But occasionally one person’s action will be a tipping point that changes a lot.
Most of the time, declining to buy one chicken breast will have no impact on animal wellbeing overall. But now and then your one purchase less will be the tipping point that makes the store manager decide to order less chicken, and that will have a significant impact, perhaps leading hundreds fewer chickens to be slaughtered. Research has shown that, on average, every time one less egg is purchased, total egg production falls by 0.91 eggs. For every liter less of milk that is bought, total milk production falls by 0.56 liters. For every kg of beef, the figure is 0.68kg, for pork 0.74kg, and for chicken, 0.76 kg. Here’s your motivation to consume mindfully: you are part of the transition that humanity needs.
This is my key message for organization development. You matter as you influence your co-workers daily. I use this in culture development, where one “influencer” gets support from a colleague, and they become two influencers who talk and think and act differently – and inspire other team members – until you see a social movement emerge that influences the organization to change. Even in large corporations, individuals influence teams and influence other teams. Here is your minimal leverage: convince one other to change and you have doubled your impact. Your maximal leverage might be even bigger.
- Ask the five questions to maximize your positive impact!
© Marcella Bremer, 2022
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