Responsible management and outstanding management are closely linked because they both pursue the same goal: the sustainability of the organization in a sustainable environment. But now, it has been imposed, at least in Europe, and driven by investors and governing stakeholders, the need for the sustainability of organizations and the sustainability of the environment (environmental, but also economic and social) to condition each other. It is not surprising, therefore, that the different social responsibility, quality and outstanding management standards converge. For example, the explicit references to aspects of social responsibility mentioned in the key concepts of the new EFQM Model, which came into force in 2020:
✓ Understanding the ecosystem:
“An outstanding organization researches and understands the ecosystem, including Megatrends, and the consequences on it of the United Nations Sustainable Development Goals.”
The outstanding organization not only controls its impact on the ecosystem and on the SDGs, but also the interrelationships between the global environment (megatrends) and its market / scope of action and between it and its stakeholders.
✓ Consistency with Purpose:
“ An outstanding organization understands the importance of its Purpose being acknowledged as a force for good in its ecosystem”.
The EFQM Model revolves around the ‘‘Purpose’’ of the organization (the fundamental reason why the organization exists), which must serve as the basis for managing it in a coherent and consistent manner. All approaches, processes, projects, plans, structures, relationships, etc. they must deploy the ‘‘Purpose’’ and evidence their contribution to it. Here the new model incorporates concepts that were already assumed in the CSR frames.
✓ Organisational Culture and Leadership:
“An outstanding organization:
– Demonstrates the desired behaviours for acting ethically, with integrity and a social conscience, making sure its People demonstrate these desired behaviours in their own actions.
– Expresses and promotes concern for the environment and the scarcity of resources, raising awareness of the importance of adopting a responsible approach to the environment.”
In the new EFQM Model, the classic concept of ”hierarchical leadership” evolves towards the more participatory ”organizational leadership”, in which all people contribute, regardless of their position in the organization chart, to the purpose of the organization. This, in turn, acts and is recognized as a leader in its ecosystem.
✓ Engaging Stakeholders:
“An outstanding organization:
– Establishes communication channels that make it easy for Customers to interact…
– Adapts to the evolving needs and expectations of its People, both current and future, taking account, for example, of changing expectations on Organisational Culture & Leadership, gender balance & parity, diversity & inclusion and the desired working environment.
– Makes itself transparent and accountable to this Key Stakeholder group, establishing and maintaining high levels of trust at all times.
– Uses its Purpose, Vision & Strategy to develop a clear understanding and focus on how it will contribute to its Society.
– Ensures its Key Partners and Suppliers act in line with the organisation’s Strategy and that mutual transparency, integrity, and accountability in the relationship is established and enhanced.
Involvement for their effective contribution to the achievement of the SDGs, yes, but also in the co-development of the value generated by the organization.
✓ Creating Sustainable Value:
“An outstanding organization designs the value and the value creation approaches to reflect their lifecycle in a responsible way, considering impacts on public health, safety and the environment.”
The product, service or solution created must be sustainable. This is where the CSR of the organization comes into play. But first, you have to create it, that is, you have to design, communicate, sell and deliver “value”, as well as implement a global experience of “something that differentiates from others.” If not, sooner or later the organization will cease to be sustainable because it will cease to exist. In many organizations, CSR does not enter the value chain and remains in the reporting of results or in the optimization of resources, but not in the deployment of a strategic approach.
✓ Leverage technology and information:
“ An outstanding organization evaluates and manages, based on circular economy principles, the full lifecycle of existing and emerging technologies, to maximise the benefit for all.”
” An outstanding organization ensures that data, information and knowledge are treated and used in an ethical way, respecting the needs and rights of those providing the data, information and knowledge.”
Socially responsible organizations have an important challenge here. Governing stakeholders does not legislate at the same rate as the development of information technologies. Making the right business decisions is based, more and more, on the knowledge and information generated from data, which must be obtained ethically, without taking advantage of the pending legal gaps.
✓ Predictable Results:
“An outstanding organization measures what the perceptions are in relation to, for instance:
Customer:
– The branding and reputation of the organisation, including its social and environmental performance.
– The usage of technology by the organisation to help deliver sustainable value.
People:
– The organisation’s commitment and achievements concerning gender balance, parity, diversity and inclusion.
– The organisation’s support for family and personal life.
– The organisation’s support, empowerment, recognition and development.
– The working environment, pay and benefits.
– The reputation of the organisation, including as a Leader in its ecosystem.
– Communication within the organisation
– Talent attraction and engagement.
Business & Governing Stakeholder:
– The financial management, security and sustainability of the organisation.
– The governance structure, transparency, accountability and ethical behaviour of the organisation.
– The social and environmental responsibility of the organisation.
– The management of risk and compliance
– The branding and reputation of the organisation.
Society:
– The organisation’s ability to meet the expectations of its Society.
– The impact the governance of the organisation and the degree of transparency and ethical behaviour have on the community.
– The impact the operations of the organisation has on the community.
– The sustainability of the organisation’s contributions to the community in terms of its economic, social and environmental practices.
–The organisation’s commitment to move towards a Circular Economy.
–The organisation’s commitment to, and achievements in, reducing inequality, increasing diversity & inclusion and achieving a gender balance.
Partner y supplier:
– The social commitment of the organization.
– The organisation’s commitment and achievement to move towards a Circular Economy.
– The governance structure, transparency and ethics of the organisation and its practices.
– The sustainability of the relationship between the organisation and the Key Partners and Suppliers.
As we can see, EFQM Model includes, as proposed examples of perception results, a good part of the performance indicators that are usually used in current sustainability reports (GRI, IIRC, EINF…).
Wait for events and get carried away is not an option in the VUCA (Volatility, Uncertainty, Complexity and Ambiguity) environment in which companies have nowadays to develop their activity. Predictive measures are at least as necessary as business result indicators or those included in social responsibility reports.
Therefore, in my opinion, outstanding management must necessarily be responsible according to the EFQM Framework. But, what about the other way around? I think not exactly, since outstanding management must also be agile, focused on the future and the transformation of the organization, that aspires to leadership in its sphere of influence and that collects, in addition to performance results, the perceptions of all your key stakeholders.