
Can you TWINT it?Â
TWINT, Switzerland's digital payment app, has more than five million users and is a household name, but the path to profitability has been extremely difficult. In the second IMD Nordic Executive Dialogue,...
by Julia Binder Published 21 January 2025 in Sustainability • 8 min read
A classic psychological experiment asked volunteers to count basketball passes while watching a video. During the task, someone in a gorilla costume strolls across the court – yet remarkably, many participants completely miss this obvious intrusion. This phenomenon, known as “inattentional blindness,” demonstrates how intense focus on one task can render us oblivious to other significant events unfolding before our eyes.
This ‘invisible gorilla’ experiment, highlighted by environmentalist and former US Vice President Al Gore during a rousing address at the opening dinner of the SDG Tent, serves as a powerful metaphor for capitalism’s shortcomings. Like the volunteers fixated on counting passes, our economic system’s relentless focus on short-term profits has left us blind to the erosion of other vital forms of capital – natural, human, and social – that are crucial for a sustainable future.
“If you are focused on short-term profit and returns and that is your whole reason for being in life, that is like the gorilla. Los Angeles can burn down, and you are still focused on what the next quarterly report is going to be,” Gore said at the event co-hosted by IMD and Thinkers 50 and themed, “Why We Need a New Nature of Business: Charting a Path to Sustainable Prosperity.“
Speaking on the day of Donald Trump’s inauguration for a second term as US President, Gore’s words carried particular weight. On his first day in office, Trump signed a flurry of executive orders, including to withdraw the United States from the 2015 Paris Climate accords once again – even as wildfires continue to rage through Los Angeles. In response to Trump’s promised reversal of environmental policies, which he characterizes as part of a ‘woke’ agenda, numerous financial institutions and industry groups have begun retreating from their Net Zero commitments.
AndrĂ© Hoffmann, Vice Chair of Roche and co-author of The New Nature of Business, urged business leaders to maintain their environmental commitments. “The reality of the science is still there. Climate is changing, planetary boundaries are being broken every day,” he emphasized in a discussion with his co-author journalist Peter Vanham.
We are traveling blind because we're taking decisions based on financial accounting and financial accounting is very short term. If we want to allocate resources and manage risk in a proper way, we need to have a better understanding of what the data points are.André Hoffmann, co-author of The New Nature of Business
The heart of the issue lies in our narrow definition of value creation, exemplified by metrics like GDP. “At the moment we are traveling blind because we are taking decisions based on financial accounting and financial accounting is very short term,” Hoffmann explained. “If we really want to allocate resources and manage risk in a proper way, we need to have a better understanding of what the data points are.”
Hoffmann commended the International Sustainability Standards Board (ISSB) for implementing IFRS S1 and IFRS S2, which establish frameworks for sustainability-related and climate-related financial disclosures. In his opening remarks, ISSB Chair and former Danone CEO Emmanuel Faber noted that the previous proliferation of voluntary, non-comparable standards had created confusion for companies pursuing sustainable transformation. The new standards – already adopted by 30 countries representing two-thirds of global GDP – require organizations to quantify current and anticipated effects on their financial statements, with particular emphasis on mapping entire value chains and assessing long-term risks like water scarcity. “It’s not rocket science but it’s a completely different way of looking at businesses,” Faber said.
These standards aim to create tangible market advantages. “What we are basically doing is offering a tool that if a company does regenerative agriculture better than the other one, it should get a premium on its cost of capital,” he explained. While governments can establish policies and incentives, Faber emphasized that companies will ultimately fund the transition. The impact could be substantial: if these new standards redirect just 1% of total company capitalization toward sustainable transition over the next decade, it would generate $4tn in funding.
A fundamental challenge, according to Hoffmann, is humanity’s growing disconnection from nature. “Most of our city dwellers spend more time in cars, in concrete, creating the distance between nature and themselves. And that has led, I think collectively, humanity to start thinking that perhaps nature is not our problem,” he explained. “So, it’s not surprising that businesses think the same way. The fact that all business activity on the planet is dependent on nature is something we need to define, reinstate, and repeat because a lot of people don’t believe it.”
Hoffmann drove his point home with stark examples: “Ask the people in Los Angeles. Ask the people in Valencia. We had concrete, we had canals, we had everything we needed. The car is still blown away by water. So this notion that we are reaching planetary limits concerns us all and is coming back to bite us.”
“Ask the people in Los Angeles. Ask the people in Valencia. We had concrete, we had canals, we had everything we needed. The car is still blown away by water. So this notion that we are reaching planetary limits concerns us all and is coming back to bite us.”
Too many companies still treat sustainability as peripheral initiatives rather than core business drivers, creating an illusion of progress.
During a panel discussion moderated by Des Dearlove, Co-founder of Thinkers50, Jesper Brodin, CEO of Swedish furniture giant IKEA, demonstrated that environmental stewardship and business success can go hand in hand. Since the 2015 Paris Climate Treaty, IKEA has achieved 24% growth, reaching annual sales of around €40bn, while simultaneously reducing carbon emissions across its value chains. The company has set an ambitious target to halve emissions from its supply chain by 2030. “Climate smart is business smart and resources smart,” he said, mentioning that a concrete path to reconcile business growth and environmental impact are circular business models.
IKEA exemplifies how sustainability can be woven into the fabric of corporate strategy. Too many companies still treat sustainability as peripheral initiatives rather than core business drivers, creating an illusion of progress. We are very good at launching $20,000 initiatives, but we are not so good at $20m initiatives. If we want to drive meaningful change, we need to think and act at scale.
Kiki Del Valle, Division President, North LAC, Mastercard, showcased a different dimension of sustainability: inclusive growth. She outlined Mastercard’s commitment to bring one billion individuals and 50 million SMEs into the digital economy by 2025. “We are in very advantageous positions because we do have a big network of partners […] so the power that we can bring at scale really makes us a little bit unique,” she explained.
Any business that stands still, will not be successful. We take risks as CEOs; we bet on the future. The worst thing you can lose is your job. But rather that than losing your self-respectability.
When asked whether capitalism needed evolution or revolution to become fit for purpose, Hoffmann emphasized the urgency of action. “Let’s take the existing system and change it. If you use the whole entrepreneurial genius that has destroyed the planet to rebuild it, now you have a tool,” he argued.
The panelists converged on the critical need for leaders who combine courage with humility and maintain flexible mindsets. IKEA’s Brodin put it bluntly: “Any business that stands still, will not be successful. We take risks as CEOs; we bet on the future. The worst thing you can lose is your job. But rather that than losing your self-respectability.”
Effective leadership in sustainability isn’t about one person owning the entire agenda. Instead, great leaders inspire change and empower others to drive the agenda forward. The conversation needs to move beyond sustainability as a singular concept to recognize its many interconnected dimensions, with different leaders championing various aspects of the transformation.
Gore delivered a powerful critique of leaders who display moral indifference to the impact of climate change on future generations, encapsulating their attitude in a pointed acronym: IBG, YBG (I’ll Be Gone, You’ll Be Gone). He emphasized that today’s leadership challenge lies in engaging these short-term thinkers and demonstrating how a holistic business approach – one that values natural, human, and social capital – ultimately delivers superior results.
The evening concluded with Gore’s stirring message of hope. “I’ve often said the antidote to climate despair is climate action,” he declared. “We have everything that we need to do what is necessary to do: all the technologies, proven deployment models, experience that can guide us. The one thing that people doubt we have in sufficient quantity is the political will to do the right thing. Well, it’s true that political will is itself a renewable resource. Let’s renew it.”
Read more about how businesses are transforming in the name of sustainability.
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Professor of Sustainable innovation and Business Transformation at IMD
Julia Binder, Professor of Sustainable Innovation and Business Transformation, is a renowned thought leader recognized on the 2022 Thinkers50 Radar list for her work at the intersection of sustainability and innovation. As Director of IMD’s Center for Sustainable and Inclusive Business, Binder is dedicated to leveraging IMD’s diverse expertise on sustainability topics to guide business leaders in discovering innovative solutions to contemporary challenges. At IMD, Binder serves as Program Director for Creating Value in the Circular Economy and teaches in key open programs including the Advanced Management Program (AMP), Transition to Business Leadership (TBL), TransformTech (TT), and Leading Sustainable Business Transformation (LSBT). She is involved in the school’s EMBA and MBA programs, and contributes to IMD’s custom programs, crafting transformative learning journeys for clients globally.
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