Seeing the whole picture: Why perspective-taking is a powerful tool for sustainable decision-making

 In today’s corporate world, sustainability is no longer a superficial makeover; it has evolved into a profound redefinition of core values and practices. This transformation spans various dimensions, encompassing everything from reshaping cultures and leadership styles, to reimagining governance structures and skills. Amid this transformation, one challenge looms largest: rethinking decision-making.   

Historically, decision-making rules and criteria have been skewed towards profit maximization, often sidelining the interests of other stakeholders, such as employees, suppliers, society, and the environment. This deeply ingrained approach hampers the transition towards a multi-stakeholder perspective, even among conscious leaders. The absence of stakeholders during decisions complicates matters further. Inviting them to every decision is impractical. 

This dilemma raises a crucial question: how can decision-makers compensate for the absence of stakeholders? A seemingly straightforward solution is replacing them with internal experts who can act as proxies. Tempting, yet dangerous, this approach risks mirroring the trap of equating a salesperson’s view with that of the customer.  

A solution for sustainable decision-making 

A practical alternative is to systematically wear the hats of multiple stakeholders when making decisions. By doing so, decision-makers are forced to think from different perspectives. This approach, what psychologists call “perspective-taking”, is already applied in management fields such as negotiation, innovation, and DE&I. Extending the application to the increasingly relevant domain of sustainability can help managers ponder how each stakeholder may benefit from the decision (or be affected by it), how to balance trade-offs, and mitigate negative externalities.  

To facilitate this approach, we developed the Perspective Circle. This tool visually divides decision-making into sectors, each corresponding to a specific stakeholder group, such as customers, suppliers/partners, employees, shareholders, society (including communities, governments, NGOs, and environmentalists), and the environment itself. In a team-based setting, decision-makers don the “perspective hat” of each stakeholder, role-playing to identify key benefits and concerns, all while considering trade-offs and externalities.  

There are five steps to sustainable decision-making with the Perspective Circle:  

1. Hypothesis:

Start by outlining the hypothesis to be stress-tested and align the team around it. The initial statement describing the hypothetical decision is placed at the top of the Perspective Circle. 

2. Stakeholders:

On the outer layer of the Perspective Circle, identify specific stakeholders for each sector, adding context to the scenario with precise stakeholder names.  

3. Hats:

Next, wear the hats of each stakeholder to identify and map their unique benefits and concerns. This can be done through rounds, following the circular sectors, or by splitting participants into sub-teams, each representing one stakeholder. 

4. Trade-offs:

In the middle layer of the Perspective Circle, evaluate the main shared concerns and conflicting benefits, and discuss possible trade-offs. 

5. Sustainable decision:

Finally, synthesize the perspectives to revise the initial decision statement. Write a new statement, in the center of the Perspective Circle, that encapsulates the multiplicity of perspectives and serves as the outcome of this exercise.