In an era where sustainability has become more crucial than ever, the Wisconsin School of Business recently hosted a graduate sustainability event that brought together academic experts, industry leaders, and aspiring business professionals. The event provided deep insights into the current state of corporate sustainability and its future trajectory, challenging conventional wisdom while offering hope for meaningful change.
The day began with an enlightening keynote address by Dr. Ann Terlaak, Associate Professor of Management & Human Resources at the Wisconsin School of Business. Dr. Terlaak presented a compelling narrative about corporate sustainability standing at a critical crossroads, particularly considering the rising prominence of ESG investing and recent SEC regulations mandating enhanced climate risk disclosures.
Dr. Terlaak’s presentation painted a stark picture of our current reality. While discussing the traditional triple bottom line approach (business value, shared value, and social value), she emphasized that despite numerous initiatives and corporate commitments, we’re still falling short of our sustainability goals. She used a powerful analogy to describe our current situation: “We’re pouring water into a full tub, but unfortunately, the tub isn’t draining as fast as we’re pouring.” This visualization perfectly captures the challenge with our CO2 emissions – while reduction initiatives exist, emission rates continue to outpace our efforts to contain them.
Some sobering statistics presented during the keynote highlighted the urgency of our situation:
- 20% of the Amazon rainforest has already been destroyed
- The ratio of CEO to typical worker compensation has skyrocketed from 15:1 in 1956 to an astounding 399:1 in 2021
- Wealth disparity has reached alarming levels, with the bottom 50% of the population’s wealth dropping from 1% to merely 0.19%
A significant portion of the discussion centered around the Business Roundtable statement on the “Purpose of the Corporation,” which promised to promote an economy serving all Americans. However, Dr. Terlaak noted that these initiatives, while well-intentioned, have had a limited impact. She pointed out several key challenges:
- Current ESG reporting has largely become a compliance exercise
- There’s a concerning lack of convergence in ESG scores and ratings
- Questionable scoring methodologies have led to skepticism about their effectiveness
Dr. Terlaak introduced the concept of “cradle to cradle” products as an ideal environmental solution but noted that achieving true circularity remains elusive. She provided examples, emphasizing that “circularity is not always a win-win” – a crucial reality check for businesses pursuing sustainable practices.
The keynote concluded with a powerful call to action, emphasizing several key points for future progress:
- Stop preconditioning future initiatives: act now, measure later
- Embrace corporate political responsibility: businesses must take a more active role in driving systemic change
- Rethink the corporation: move beyond pure shareholderism to a more inclusive model
Dr. Terlaak referenced “The Ecology of Commerce” by Paul Hawken, which famously influenced Interface’s CEO to transform his company’s approach to sustainability. She also mentioned Ray Anderson’s “Back to Roots” message (Anderson passed away in 2011), highlighting how individual leadership can drive transformative change.
While the challenges presented were significant, Dr. Terlaak’s message wasn’t one of despair. She emphasized that our collective efforts, though not perfect, are still better than inaction. The presentation concluded with a powerful reminder that businesses and society share a symbiotic relationship, and true sustainability requires acknowledging and nurturing this connection.
Following Dr. Terlaak’s thought-provoking keynote, an expert panel brought practical perspectives to the conversation. The discussion featured distinguished professionals including Kevin Tubbs (VP, Chief Ethics, Compliance and Sustainability Officer, Oshkosh Corporation), JP Brummond (VP of Customer and Community Engagement, Alliant Energy), Matt Wachter (Director of Planning, Community, and Economic Development, City of Madison), and Amanda Kraus (Climate Change & Sustainability Services, EY), with Tom Eggert from the Wisconsin Sustainable Business Council moderating.
The panel revealed how organizations are restructuring to embed sustainability into their core operations. One panelist described how their company has established dedicated resource planning departments alongside sustainability and change management teams. This integration extends to finance and risk departments, highlighting how ESG initiatives are becoming central to corporate strategy rather than peripheral concerns.
A particularly inspiring initiative shared during the discussion was the “Musky Pond” program (like Shark Tank), where employees can pitch sustainability ideas directly to company leadership for potential investment. This approach demonstrates how organizations are tapping into their workforce’s creativity and commitment to sustainability.
The discussion touched on recruitment strategies for Generation Z, acknowledging their heightened concern for sustainability practices. Panelists emphasized that tomorrow’s workforce expects meaningful action on environmental and social issues, not just corporate statements.
Several key insights emerged into implementing sustainable practices:
- The transition to sustainable operations often requires comprehensive system changes. For example, switching from diesel to electric buses isn’t just about vehicle replacement, it requires extensive worker retraining and operational restructuring.
- Affordability remains a crucial consideration in sustainability initiatives
- The investment community’s understanding of ESG investments needs to improve
- The emergence of new roles like “ESG Controller” shows how sustainability is creating new career opportunities
The afternoon session featured small group discussions with industry professionals, providing intimate insights into sector-specific sustainability challenges. One particularly enlightening conversation with an Alliant Energy professional revealed the complexities of transitioning to renewable energy:
The Energy Transition Challenge
- The three pillars approach (People, Profit, Planet) guides decision-making
- As society decarbonizes, electricity demand increases, creating new challenges
- Regional variations influence renewable energy solutions:
- Iowa leverages wind power
- The Southwest focuses on solar
- Northern regions utilize hydroelectric power
- Some areas explore geothermal options
Infrastructure Realities
- Coal plants, designed for 40–50-year lifecycles, face early retirement due to sustainability goals
- The concept of “carbon sequestration” (capturing and storing carbon underground) offers promising solutions for reducing emissions
- Microgrids and zone-specific solutions provide innovative approaches to renewable energy integration
Among the most valuable insights from the event was learning about two crucial concepts shaping corporate sustainability communication. The first is “greenwashing,” where companies make misleading environmental claims to appear more sustainable than they actually are. In contrast, “green hushing” represents an emerging trend where organizations deliberately underreport their environmental achievements to avoid potential scrutiny or skepticism. These opposing phenomena highlight the complex landscape companies must navigate when communicating their sustainability efforts. While not explicitly discussed at the event, it’s worth noting several promising initiatives that demonstrate the potential for meaningful corporate action on sustainability. Microsoft’s AI for Earth program showcases how cutting-edge technology can be applied to environmental challenges, while Patagonia’s Worn Wear program offers a practical example of circular economy principles in retail. Perhaps most ambitious is Interface’s Climate Take Back™ initiative, which aims to reverse global warming rather than merely reduce impact. These examples illustrate that while the path to sustainability isn’t always straightforward, innovative companies are finding ways to make significant positive impacts.
As we move forward, several imperatives emerge on three levels:
- Individual
- Educate ourselves about our organization’s sustainability initiatives
- Propose innovative solutions through available channels
- Consider sustainability in daily decision-making
- Organizational
- Integrate ESG considerations into core business strategy
- Invest in employee training for sustainability transitions
- Create platforms for employee-driven sustainability innovation
- Industry
- Share best practices and lessons learned
- Collaboration on industry-wide sustainability standards
- Support policy initiatives that promote sustainable practices
The WSB Graduate Sustainability Event demonstrated that while the challenges are significant, the commitment to finding solutions is strong. Success in sustainable business practices requires balancing profitability with environmental and social responsibility challenges that the next generation of business leaders seem ready to embrace.