Have you taken a moment to review the trends in your industry? Often, we get complacent and fall back on what we know to be true without revisiting our competition, studying up on exciting new innovations and checking in on aspects of our business that are no longer relevant. But, if you are going to hold yourself out as an expert in, or even part of, an industry, you need to be saavy.
Along those lines, I thought I should check in on what lies in store for us in 2019 in terms of the commitment of our business world to corporate accountability and social responsibility – social impact. Every company, regardless of business sector, should have stepped onto this train eons ago because the train has left the dock. If you haven’t, you had better RUN to catch up! Here are some things to consider in the coming year:
Artificial Intelligence (AI) – The race is on and countries and industries are scrambling to get ahead. As ethical standards vary throughout the world, the most prominent question will be personal privacy or national security? Last year, the EU took a global lead on protecting the data privacy rights of individuals when its General Data Protection Regulation (GDPR) took effect May 25th. In the U.S., the California Privacy Act was enacted in 2018 and several other U.S. states are also considering their own data privacy laws. All of them have breach notification laws.
Though the U.S. is leading in AI development, other countries may not have the same ethical standards or concerns for individual rights. As regulation is imposed and development in the industry is restricted, will those that don’t, jump ahead as leaders in the AI movement and take over the space?
Competitive collaboration – As Millennials enter the work force, they crave personal development and a collaborative environment, which flies in the face of the competitive, individualistic drives we Boomers loved. But, the case for collaboration is stronger than ever. It takes so much money to develop new products and to penetrate new markets that few companies can go it alone in every situation. In 2019, as the global marketplace continues to flatten, companies are more aware than ever that alliances can provide shortcuts if they are racing to improve their production efficiency and quality control.
CEO activists – The role of CEO will continue to evolve in 2019. It’s no longer enough to drive financial results or to develop innovative products. Employees are pressing CEOs to take a stand on issues like gun control and immigration and today’s CEOs must be activists. We suddenly see chief executives taking a stand on critical, social issues that are not necessarily related to their business such as PayPal’s CEO Dan Schulman, who stood up for transgender rights when he opposed the North Carolina bathroom bill. Taking a huge risk, Ed Stack from Dick’s Sporting Goods, stopped selling AR15’s after the Parkland, Florida school shooting. Have they overstepped their bounds taking these business risks? We are seeing that CEOs who take a stand, who align with important public policy issues—especially related to measures about citizenship and governance—rank disproportionately higher.
The rise of impact investors - Investor interest in environmental, social and governance (ESG) factors has gone mainstream and more than 80% of mainstream investors now consider ESG information when making investment decisions. With over 90% of the largest companies now filing sustainability reports (85% of the S&P 500), socially responsible investing has gradually becoming the new normal.
Although there have been a number of portfolios that targeted ethical and responsible companies, the JUST U.S. Large Cap Equity ETF was launched in 2018 – the first ever exchange-traded fund designed to align with the American public’s priorities for just business behavior. It invests in U.S. companies that are driving positive change on some of the most pressing social issues of our time – including worker pay and well-being, customer treatment and privacy, beneficial products, the environment, job creation, strong communities, and more.
Response to Climate change – It’s pretty apparent that climate change will affect industries such as transportation and agriculture and innovative solutions are in the works. There is a big concern for disaster relief and disaster preparedness and those industries are on the rise. Elon Musk’s Hyperloop concept is explicitly open-sourced, encouraging creativity and entry by other players. Jeff Bezos is betting on battery-operated drones for urban delivery – limiting carbon emissions and congestion. Local sourcing is growing, as is the demand for fresh products which are organic, biodynamic and/or non-GMO. Blockchain will track products farm-to-table.
Sustainability within flattens – In 2019 as corporate accountability programs become the norm, not the exception, sustainability practitioners will be found in, and demanded by, functional departments throughout the organization. Departments such as legal, finance, procurement, human resources will want a sustainability expert among their ranks who can translate policy across the organization and help strengthen the organizations commitment and culture. With this demand, new positions will be created and a new employment sector emerges strong.
So, what about you? Are you ready? We have an exciting year ahead but a less stressful one if you have done your homework!
Copyright © 2019
Linda Lattimore – All rights reserved