The concept of sustainability in business has become mainstream, and market forces have driven sustainability strategy. But, in its current form, business sustainability will not solve the root causes of the problems it is intended to address, says Andrew Hoffman in “The Next Phase of Business Sustainability,” recently published in the Stanford Social Innovation Review. Hoffman is the Holcim (US) Professor of Sustainable Enterprise at the University of Michigan and a faculty member of the university’s Erb Institute for Sustainability in Business. To enact change on a larger scale, business must transform the market. The Erb Institute calls this “market transformation,” and it is the next phase of business sustainability.
Hoffman explains that the previous phase, which the Erb Institute calls “enterprise integration,” has involved businesses responding to shifts in the market by integrating sustainability into what they already know how to do. But market transformation looks further forward—it involves business transforming the market to make it more sustainable.
And businesses are equipped to make it happen. “The market is the most powerful institution on earth, and business is the most powerful entity within it,” Hoffman writes. “Business transcends national boundaries, and it possesses resources that exceed those of many nation-states.”