By Deborah Fleischer, CRB Communications Consultant, and Christina Meinberg, CRB Associate Director.  This is part of a series highlighting the work of CRB alumni.  In this two-part post, we focus on David Sherman, CRB Alumni Advisory Board Member and Haas MBA ’85. Part one focuses on the concept of “flourishing” and part two provides action steps for getting started.

David Sherman has a resume that many business school students would admire.  It includes over 30 years of strategy and sustainability consulting, including helping Walmart embark upon its path to becoming a more sustainable company.  After years of consulting to businesses, Dave is taking the Haas defining principle “question the status quo” to heart, challenging what he feels has become the traditional approach to sustainability.  He argues, “Too often, sustainability is an add-on from the outside, not a core part of the business strategy. I see the solution as ‘flourishing’”.

In the midst of writing the book he is co-authoring, The Flourishing Enterprise (set to be published by Stanford University Press in 2014), Dave allowed us a sneak preview.  He explained his philosophy and approach to ‘flourishing’, influenced in part by Berkeley-Haas Dean Richard Lyons’ work on developing innovative leaders and Raymond Miles, Haas professor emeritus and former Dean and author of Collaborative Entrepreneurship, among others.

The Flourishing Organization

According to Dave, getting to a flourishing world starts at the individual level; it involves unlocking the full potential of employees and partners to drive innovation, creativity, and exceptional teamwork through positivity, having a deep sense of purpose, and connecting with authentic values (using principles of positive psychology) and disciplines such as those used by world-class athletes and musicians. Dave argues that to manifest these characteristics, we must work on ourselves, from the “inside-out”, using both “on-field and off-field reflective practices”.

At a glance, with its emphasis on spiritual well-being and connection to ourselves, others, and the natural world, the term “flourishing” might seem more appropriate at a personal retreat.  Yet according to Dave, many leading companies are already integrating elements of the flourishing approach, including: Whole Foods, Unilever, Google, Natura, Tata, Kyocera, Patagonia, GOJO Industries, and Fairmount Minerals.

Flourishing:  The Next Phase of Management Innovation

Inspired by a Harvard Business Review article on Natural Capitalism  in 2001, Dave left his job as a Vice President at consulting firm AT Kearny to co-found an organization that focused on integrating sustainability into corporations.  Today, he sees the traditional sustainability approach (which all too often emphasizes strategy and operations without a focus on activating and inspiring people and culture) as “too little, too late.”

Moved by a multitude of champions within large companies such as Walmart, Staples, and Sony who connected sustainability to their own deep sense of purpose, Dave has come to the conclusion that our collective impact on the environment will only get better if people are personally motivated to make a difference.  “People will take care of the environment if they are in touch with what is most important to them and aligned with their deepest passions.  If people bring their authenticity and true values to business, they will build a better business and a better world.”

Dave adds, “My work now is about helping people unlock their deepest source of creativity, helping them get in touch with their deepest aspirations and bring their whole selves to work and life.” In his view, the next phase of management innovation will unlock the latent potential in employees, partners, and stakeholders.

The Business Case for Flourishing

Flourishing will not only benefit people and the planet; it also has a handsome profit potential.  According to Gallup, 70% of full‐time workers in America are either “actively disengaged” or aren’t involved in, enthusiastic about, or committed to their work—at a cost in wasted human potential of half a trillion dollars a year.

“Businesses today use management tools to fix strategies, organizations, and processes—the tangible things we can touch and feel.  But now 80% of the assets of the Global 500 companies are intangibles such as intellectual property, brand, and reputation.  These are created through people and hence require that we also focus on intangible and inspirational value drivers such as mindset, emotions, purpose, values, culture, deep creativity, and flow,” Dave explains.  He believes that as big business strives to be more rationale, it has often overlooked the value in nurturing intangibles, which are critical to the early success of most businesses.

Open to Learning From Others

A key to jump starting a flourishing enterprise is to be open to learning from others and valuing a broad range of perspectives.  Dave points to Walmart’s sustainability journey as a case in point.  Walmart was being attacked on social issues.  Its approach was to engage, listen, and open itself to learning on the topic of the environment.  “They went from being in the ‘Bentonville Bubble’ to understanding themselves more as others saw them.  This was from authentic dialog, starting with Lee Scott and with many others engaging with more than 100 NGOs.”  As quoted in a recent Harvard Business Review article, then-Executive VP of Corporate Affairs Leslie Dach recalls, “We started by encouraging the organization to get out of its defensive crouch and listen to its critics.  It wasn’t easy to open up to the outside, but the learning opportunity was clear.”  One outcome of the dialogues was big goals in the areas of sustainability, women’s economic empowerment, and healthier food.

This makes sense for a corporate giant that needed a turn-around, but what about a company that relies upon extracting and burning fossil fuels as its primary income?  When asked how flourishing might apply to a company in the oil and gas sector, Dave replies, “Flourishing practices are about opening people up to multiple perspectives and deepest values that are always aligned with a world that is healthy and prosperous for their children and grandchildren.  I could see the oil industry engaging in real learning around the issues and opportunities surrounding fracking, for example, by using effective dialog and engagement processes.  Flourishing practices only enhance the capacity for doing this.”

Stay tuned for part two of this post, which details specific practices and tools for flourishing.

Previous Women in CSR: Lynelle Cameron (Haas MBA ’01), Autodesk Next The Flourishing Leader: Practices and Tips for Catalyzing Change From the Inside Out