Responding to global business critical issues

Abstract

PurposeThe main aim of this research was to review which FTSE 350 companies were responding to social, ethical and environmental business‐critical global issues such as climate change, governance and technology. If they were, did this response result in innovation and transformation? The 14 issues were identified by a range of business practitioners and experts through a visioning exercise.Design/methodology/approachIndependent data analysis of the companies, excluding around 50 investment trusts, by SERM Rating Agency provided a sector review of how companies were innovating or transforming their business as a response to the 14 issues. This review identified 40 companies as being most active in demonstrating their response. Of these 40, further analysis identified ten companies that showed signs of innovation or transformation.FindingsThe identified ten companies demonstrated evidence of pilot business transformation (or incremental innovation towards transformation) as a direct result of responding to the issues. For example, a mining company's HIV treatment program for its workers in South Africa. Most approaches were characterized by a wide‐ranging series of incremental changes, with no convincing examples yet existing of transformation implemented across the entirety of the company's operations. Hints of this radical direction, however, are evident from the vision statements of several organizations.Research limitations/implicationsThe research methodology is dependent on publicly available evidence. However, the implication of the research findings is that the 14 issues identified can be viewed as opportunities rather than obligations. Realizing the opportunity relies on integrating the issues in the core strategy of the organization.Practical implicationsThis paper provides insight for business strategists and practitioners into potential new ways of working by companies. It illuminates an emerging source of innovation and ultimately business transformation driven by the growing significance of world issues to implementing corporate strategy and delivering sustainable profit.Originality/valueThe value of this paper is in the insight it provides on how companies are finding a source of innovation through responding to global issues.