Study shows C-suite regenerative business models need more work

Recent studies suggest that over half of executives believe their efforts to make business regenerative aren’t working effectively. Companies are under mounting pressure to adapt their focus from being resilient to becoming regenerative from their customers, but only a little over 40% are operating in this manner.

Climate action is considered a top priority for all companies and governments worldwide. Critical sustainability measures, like diverting our dependence on fossil fuels toward renewables and waste reduction, all intend to create less impact. However, as customers continue demanding more from businesses in terms of taking effective climate action, polluting less and minimising their impact on the environment isn’t necessarily considered enough.

The core of regenerative business is doing more good, rather than controlling the impact of your actions. A regenerative company focuses on implementing considerate measures to strengthen its socio-ecological impact by regenerating the health and wellbeing of people, communities and the planet.

The problem is while many businesses already believe they are prioritising sustainability, many struggle to convert ideas into decisive action. Research suggests it is a similar case of companies pursuing a regenerative business model.

A study by Kearney of 800 executives worldwide showed that, while regenerative business is yet to be on the mainstream agenda, nearly every leader interviewed believed that transforming their operations to this format was critical. In the study, 58% of C-suites stated that developing more regenerative business models created an opportunity for their business. A further 60% strongly believe that a regenerative culture delivers confidence and commitment in its employees.

Alex Liu, Managing Partner and Chairman at Kearney explained that the survey results clearly show that companies want to move from a predominant resilient strategy to a regenerative one that focuses on transformation, whether inspiring sustainability in the workplace or integrating innovative technology in business activities. 

A regenerative business model can enable significant change at the heart of an organisation. Businesses must take a holistic approach, explore their offerings and then assess how they can generate maximum value for all stakeholders.

Despite recognising the benefits of a regenerative system, only 43% of C-suite executives reported that they were operating effectively in this manner. Attitudes towards progress differ across the C-Suite. The study suggested while 48% of CEOs worldwide believed their business was very effective at operating regeneratively, 58% of COOs stated that their companies required more progress. In total, 56% of global C-suite executives informed Kearney that their plans to become a regenerative business were not working.

According to Kearney, some industries were performing more effectively, such as the retail sector, where many businesses are utilising technology to minimise the waste of energy and resources. The energy industry is also adopting a regenerative approach to sustainability, with 46% of C-suite executives stating that they are already operating efficiently in a regenerative manner.

Looking to the future, companies adopting regenerative strategies could learn from these other organisations. Aside from adapting the supply chain, energy executives believe one of the main opportunities for regeneration is systematic changes to the business model and applying a more holistic and responsible attitude towards analytics.

Becoming regenerative goes beyond restructuring and alleviating the challenges faced in business. Any plan should consider the long-term success of an organisation, enable knowledge sharing and allow for value-added processes. Companies must expand on their strengths and find new opportunities for development and progress in the future. Resilience was the priority in the last few years, but today, we must adapt towards regenerative.