In March, a report from the Institute for Local Self Reliance was released, mentioning that Wal-Mart was nowhere near meeting the Big Hairy Audacious Goals (BHAGs) that it had set out in late 2005 – that is, to be 100% powered by renewable energy, create zero waste, and to sell products that sustain people and the environment. Porras and Collins, the authors of the original article on BHAGs in Harvard Business Review in 1996, said that a BHAG must be “clear and compelling, serve as a unifying focal point of effort, and act as a clear catalyst for team spirit.” And Wal-Mart’s BHAGs did just that – stories abounded about transforming whole supply chains and their products, assessing each and every supplier’s sustainability performance, engaging employees through Personal Sustainability Plans, and building new green stores. On a personal note, I can remember the initial spine-tingling feeling it gave me when I first heard these commitments – it even inspired me to jump from being a consumer goods market researcher to a sustainability practitioner to tackle these issues.
Several peer BHAGs soon appeared after Wal-Mart’s. Marks and Spencer set 100 ambitious targets (and then some) as part of Plan A in 2007, to be met by 2012, including becoming carbon neutral in the UK and the Republic of Ireland by 2012 and sourcing 100% renewable energy for its stores. That same year, Tesco committed to be carbon neutral by 2050, also promising to carbon label all of its products. Unilever launched its Sustainable Living Plan in 2010 to help more than one billion people improve their health and well-being, halve the environmental impact of their products, and source 100% of their agricultural raw materials sustainably by 2020. It has become common to set goals that may not be reached.
All of these companies, including Wal-Mart, have reported back on their progress and have been transparent in doing so. If a goal wasn’t reached, they’ve stated why it wasn’t reached, mostly learning through trial and error. Marks and Spencer has faced challenges with government policies in renewable energy, and has had to rely on offsets more than it hoped in reaching its carbon neutrality target. Tesco recently stated that they were getting rid of the carbon labelling scheme, due to its lack of critical mass and the long lead time required to calculate the footprint of each product. Unilever has had the benefit of launching their Sustainable Living Plan very recently, and has not yet had to report back on its performance against its commitments. These companies have brought us along for the journey, and we’ve been able to relate to and identify with their challenges, even if their goals have not been met. We have grown to trust them, and that they are proceeding with the right motives.
However, an uncomfortable truth lingers – we know that the environmental, economic and social challenges we face will not be solved by good intentions alone. If we are going to make any serious progress towards a more sustainable economy we need companies not only to set BHAGs, but to more often than not meet them. We need to go beyond merely applauding companies for setting BHAGs and actually hold them to account.
That is not to say we should discourage companies from setting BHAGs if there is a risk they may not be met. On the contrary, we desperately need business to aim higher; 3-5 year targets which are at best incremental will not be enough to deliver sustainable, lasting change.
For now I look forward to encountering that spine-tingling feeling again, when I learn of a global company successfully bridging the Big Hairy Audacious Gap between setting a truly ambitious goal and actually meeting it.