Sustainability, Partnerships and the Racing Driver Part 2

Partners are looking for purpose driven relationships

To echo Part 1, potential partners in the Motorsports industry are not immune to climate change pressures and we are seeing increased commercial partnerships include ‘purpose’ as an important pillar when selecting who to do business with as organizations are asked to take a larger role in solving such societal issues.

A good example, in a recent panel discussion where Puma, who partner with elite teams across motorsport, stated that they ‘certainly consider sustainability’ when choosing to partner with rights holders or teams, even if it is not yet part of a formal decision-making criteria.

How long this will continue to be the case will be informed by the increased pressure exerted from the market and the continued choices made by fans entering into the sport (and of course, participants).

Sustainability will not only become more formalized as a decision-making criteria but there is also an opportunity now, to demonstrate your commitment to lessening your environmental impact and partner with organizations who already find this an attractive proposition.

What follows, is how to identify these partners who are driven by purpose and how you can approach them and identify those that may be ready to join forces with those who are operating with reduced environmental impact. This is especially timely now, as the pandemic is accelerating these companies to act, with government stimulus across Europe incentivizing an improved response to climate change response.

The idea is to create lasting commercial and social impact

The role of partnerships can now play a key role in bringing authentic sustainability and business together. Here are 4 areas to look at when searching for a partner and some well-known cases of where it has worked.

1. External Influences

Community

Businesses increasingly need to mirror the world they operate in. This includes being value driven and representing the community in which they exist and in so doing, gaining their social license to operate.

The social perception of organization’s needs to be authentically addressed with strategies that answer this demand. Partnerships are likely to tackle environmental and social concerns which are now seen by customers as an organizations responsibility, as much as a government.

Social Media

Social Media is a constantly evolving landscape and a vehicle for those wishing to publicly call out or ‘eco-shame’ companies who are not living up to the required standards. The increased presence of customers who deeply care and people willing to speak out about sustainability is an immediate way to understand the external sentiment towards an organization’s activity and more importantly, their response.

Regulation

From a regulatory standpoint the focus is mainly on stopping organizations from polluting; however, COVID-19’s impact is bringing to the forefront the requirement of organizations needing to consider more closely the impact they have on the environment.

Global shocks

The pressure from governments to ‘Build Back Better’ from COVID-19 and with financial incentives made available, could be a tipping point for organizations to exert influence through every avenue open to them, including partnerships to show themselves to be acting in accordance with guidelines, regulations and the conditions of stimulus.

2. Motivation & Leadership

Looking more closely at organizations that demonstrate a mix of values and a commitment to excellence. Those who can create alignment and clear messages which become simple enough to communicate clearly, often can form the most powerful partnerships.

Case: IKEA
IKEA, an SBTi member, is the Swedish furniture manufacturer and seller and is often seen as an organization whose leaders put its culture at the forefront of its operating model. IKEA values each employee and empowers them to come up with solutions to their own problems.
It would not be any surprise that it has been able to pivot quickly to sustainable operations throughout its entire business, procuring 100% of its cotton from ‘Better Cotton’ certified farms and employs over 700,000 solar panels to power stores. IKEA partners with the WWF, UNICEF and Adidas in incorporating wellness into the home.
A useful case of showing how the leadership motivators can bring about synergies in outcomes with partners.

Consider those stakeholders in organizations who see the value in community action and protecting the environment,  these companies are ahead of the curve right now and are continuously earning their social license to operate.

Certification

For those in leadership who have committed to reducing their business’s impact, certification may have been attained to acknowledge this commitment. Common certification standards are:

• ISO14001:assures an environmental management system is in place
• Green Resources Institute (GRI) & Global Sustainability Assessment System (GSAS)
• Science Based Targets (SBTi): a global commitment to keeping Greenhouse Gas emissions from company operations consistent to keeping global warming below 1.5°

A company’s commitment to these standards is a marker of a company’s intentions to operate sustainably and who would value the same in a partner.

3. Organizational Characteristics

Inspired by the leadership and internal company motivators, identifying the organization’s characteristics will tell you a lot about the potential to build a strong long-lasting partnership. The company’s long-term strategy, transparency around areas of Improvement and how its agenda is informed by external factors and includes goals related to sustainable development are among the most useful factors to review.

Strategy

The strategic areas the company wishes to move into will cite or relate clearly to reasons for change and subsequent plans to do so. Formula 1’s 2030 sustainability agenda, for example, clearly references their desire to change, which is driven by fan engagement, partner attraction and because it is the socially responsible course of action.

Case: Patagonia
The outdoor clothing manufacturer, Patagonia’s characteristics have been described as ‘anti-growth’, in response to their rebellion against over-consumption. Prompting people not to buy things they don’t need, including their own products and encouraging people to repair them instead of replacing them.
Using renewable materials and recycled plastic bottles in their manufacture, Patagonia is a privately held company and able to steer their own course this is seen where they partner based on shared values such as ‘regenerative organic farming and environmental activism’.
The ability to understand your own values and reference those in potential partners can open up more innovative and atypical partners in motorsport.

Linking these honest and credible reasons for change to the goal, enables the spectator to believe the intent is real and more than simple marketing talk. This kind of authenticity can make a compelling reason to partner, knowing the motivators and how they are to be achieved with a transparent plan of action.

Innovation

As a characteristic, Sustainability and Innovation generally go together as core principles. Organizations that are capable of innovating readily and building capability, as seen with IKEA, also demonstrate strong cultures of ownership and change. This means they are embracing the challenge that comes with change, like pivoting to sustainable business operations. These organizations are also likely to see the benefit in atypical partnerships and are willing to invest based more on shared values.

4. Outcomes

Defining credible success measures, that you can contribute to and that will support your own outcomes are a sure way to a partnership with longevity.

Partnership measures can take on many forms; however, when evaluating partnerships and those with environmental-centric outcomes, you are looking at outcomes that go beyond the commercial and traditional partnership measures.

Focus on organizations, who through external factors, internal motivation and their developed characteristics will look for partnerships that can support reputational improvement, new markets, employee engagement and a commitment to doing the right thing is key

Case: Unilever
Unilever, another SBTi member, make green investments, and brought sustainability into its corporate identity. Their Sustainable Living Plan ensures organizational supply chain and production guidelines including energy & water consumption, supplier management and participation in the communities where they operate. Unilever’s non-hazardous does not end up in landfill and their sustainable agricultural suppliers have increased by 300%.
The outcomes driven by the leadership have shaped Unilever’s partnerships with NGO’s empowering women, reducing waste and fighting deforestation.

Motorsport can offer exposure to all of these, where the partnering entity of the organization is matching the values and desired outcomes.

In conclusion

The case studies demonstrate the kind of values you can look for to form atypical partnerships in motorsport. While the case studies have focused on large companies, these same values can be found in smaller companies too.

Looking at a potential partner’s external and internal drivers, their characteristics as an organization and desired outcomes will give you a rounded picture of who will be motivated to partner, now that you have committed to being sustainable.

For all of the points raised here, the annual reports of organizations are great places to gain some insight to each of these factors as sustainability now forms an important part of many organizations’ results and reporting requirements. However, you doing your own research or working with a facilitator to help you find partners is recommended.

Finally, to maintain the authenticity of what matters to your own values, consider partnership with NGOs or a charitable body, to gain exposure for their work. Commercial opportunities will come along with your development, in the meantime you may consider, how can you can make a difference?

For more information on Niesslein Sustainability Partners LTD. (NSP) please visit our Motorsport Prospects directory listing here.