Interview with Michael Green, CEO of Social Progress

We talk with Michael Green, the CEO of the Social Progress. We discuss the role of sustainability and purposeful business and how companies can help create a more positive society.

00;00;10;06 – 00;00;30;04
Simran: Hi. My name is Simran, and today we are joined by Michael Green, Chief Executive Officer at Social Progress Imperative. Today, we will be discussing about the role of sustainable and purposeful businesses and whether businesses can make more money when they are compassionate and not driven by capitalism. So, Michael, I was wondering can you tell us more about what the Social Progressive Imperative does?

00;00;30;22 – 00;00;52;21
Michael: My name is Michael Green. I’m the CEO of the Social Progress Imperative, which is a global nonprofit working on measuring better the way our societies progress, putting people and planet in the center of all our calculations. We produce what’s called the Social Progress Index, which has become a leading benchmark for the performance of countries and regions around the world.

00;00;53;06 – 00;01;19;20
Simran: Fantastic. First thing I wanted to ask you about was today’s societal forces and modern business. So really, where does a business change towards a more positive society that is driven by the ESG and CSR, potentially some of the investor concerns or the stakeholder concerns, or whether we might actually be seeing a more truly compassionate side to business coming up that isn’t necessarily driven by the finance? So I’d really be intrigued hearing your perspective on this.

00;01;20;16 – 00;02;07;25
Michael: I don’t want to be cynical, and I’m a great believer in ethics and compassion, but what really interests me is self-interest. I mean, I think Adam Smith got it right with “It is not from benevolence of the butcher or the baker”. So I think we have to look, if we really want to see a change in the world happening quickly, we’ve got to think, how do we align the incentives to self-interest to get people to behave in ways that are more socially, environmentally sustainable and thoughtful. And I actually think the incentives are there. And this is why I’m optimistic, because I think what we’ve got a problem in the world at the moment is the incentives are actually aligned against our self-interest. And if we can align our incentives and our self-interest, that actually is a potential for a very rapid change, even without a deep moral renewal.

00;02;08;12 – 00;02;11;22
Simran: That’s really interesting. Can you elaborate on what you mean by self-interest for me?

00;02;12;06 – 00;03;01;29
Michael: Well, I think one of the classic example is here is us as individuals, we’re, you know, shoveling money into our pensions, our retirement savings, and that is being invested in an incredibly short term way. And that’s not blaming the pension funds. They are required to by fiduciary duty to maximize the current value of their funds. But in so doing, if they are destroying the planet though climate change, that’s going to be a disastrous investment strategy for us thinking to our retirement and our future and our children’s lives in the future. So we’ve got these sort of incentives toward short termism that we’ve created in the system that are contrary to our self-interest. So if we can realign those incentives towards our self-interest, I think we would start investing our money in rather different ways. It would be more interested in sustainability in a social and environmental sense.

00;03;02;25 – 00;03;45;25
Simran: Yeah, I think that’s really interesting. It reminds me of something I was working on the other day, a term that’s been called regenerative sustainability. I’m not sure familiar with this yourself, but I think there’s a similar element about what we’re talking about in terms of self-interest and actually looking at sustainability rather than being an outlook for businesses and saying, you know, let’s just look at this from a ESG or CSR perspective, essentially saying, well, hang on, if you embed this properly at the core of what you do, you’re going to have a trillion in the bank in ten years time. But then in 20 years time, you got a massive impact of the climate change deal with everything else. Perhaps your 20 trillion is not going to be so valuable if half of London is underwater, for example.

00;03;46;08 – 00;04;52;24
Michael: We are doing things at the moment that are contrary to our self-interest. And I think this applies also in the social space. I mean, you know, we’ve built this tool, the Social Progress Index, in partnership with Michael Porter at Harvard Business School this year, the world’s leading guru on competitiveness and one of the reasons he got involved was he, as he says, you know, he all his work on competitiveness has shown him that economic growth doesn’t always lead to better lives. And I think sometimes if we look at countries that do really well socially, say some of the Nordic countries, we can sort of see as if they’ve always got the luxury of being socially responsible because they’re so rich. But actually, we should probably look at it the other way round. They are so rich and so competitive because they’ve invested in their social progress. You know, investing in gender, gender equity unlocks the potential of a huge section of your population, investing in inclusiveness and diversity, unlock the potential of your society when it’s really an investment in our competitiveness and capability. And I think if we can change the equation that way, we start looking at a social big difference.

00;04;53;12 – 00;05;07;10
Simran: Fantastic. Maybe you can outline some of what you consider to be society’s central challenges today. You mentioned diversity and inclusivity there, and perhaps do businesses have any implicit responsibilities to act to change things for the better?

00;05;07;15 – 00;06;50;04
Michael: So with the Social Progress Index, we measure 163 different countries so we measure that across a whole range of things, from nutrition through to human rights, and we can aggregate that up for the world as a whole. You know, what we see is that the the good news is actually the world is getting better. Often the bad things in the world get the headlines, but slowly over time, things like the expansion of mobile telephony, there’s been a huge contribution to human progress and that’s been driven by business. We also see that the levels of up to now at least levels of hunger have been declining. More people are going to go to school, et cetera around the world, there’s real progress happening. What’s not happening is, it’s not happening fast enough. By our calculations, it looks like the UN Sustainable Development Goals with the target date of 2030 are not going to be delivered until 2080 or 2090. So the world is way off track on those goals. It’s still going fast enough. Why? Well, we’ve got a few countries are actually being going backwards, places like Brazil, Hungary and actually the United States is gone backwards over the last ten years in the social progress, what we’ve also seen is that the world as a whole and indeed a majority of the countries of the world in the last ten years have gone backwards on issues around rights. That’s a really big issue that sort of the rise of authoritarian populism has really set back the rights agenda over the last ten years. And so there’s then obviously on top of that, there’s the whole climate emergency as well. But the world’s got plenty of areas of challenges, but also lots of areas where there’s been progress. So that’s something we try and do with our work is highlight where progress is happening and show that actually the world could be a lot better than it is, the solutions actually are out there.

00;06;50;09 – 00;07;19;06
Simran: Fantastic. I wonder if you could talk to me today about the role of data in work, and perhaps the transparency of data. I’ve done quite a lot of metrics on these kinds of elements and what I tended to find was very often businesses in particular. They would tend to pick out the parts of the data that suit their arguments, rather than looking at the transparent picture of the data and tend to hide the parts of the data that show the negative impact. I guess I’d just be fascinated to hear what you what your take on this and how data might paint the truth through the business landscape in the future.

00;07;19;26 – 00;08;33;05
Michael: Yeah, cherry picking data, also, to be quite frank, there’s a lot of problems out there with people producing indices that are quite frankly, rubbish, and they’ve just been created for PR purposes. So for us that was a key thing about building an index. We had to have first of all full methodological rigor. So, you know, what we do is we take secondary data from places like the UN, et cetera, and pull that together to produce a social progress index. There’s a lot of work goes into building a tool like ours. The second piece is transparency. We’re fully transparent about the methodology and all the underlying data, and I think sometimes you see products out there that are just a black box. And I think if you if it’s a black box, you really can’t trust it. We’ve also benefited hugely from transparency because people can say, hey, that’s wrong. Well, I don’t like that and we can have a conversation about that. So I think it’s we’ve got to be sort of intelligent consumers of data. I think we’ve got to be careful to be wary when people are cherry picking why we chosen these data points rather than others. What’s your process for doing that? What’s your methodology and are you willing to be transparent about it? But ultimately, I think you know, accreditation or whatever, maybe one path, but another path is around. We’ve got to be smart consumers of data.

00;08;33;16 – 00;08;42;27
Simran: Hmm. That’s really fascinating. Is there any data to illustrate how COVID-19 and indeed today’s geopolitical impacts are affecting people and hence the necessary business response?

00;08;43;02 – 00;10;56;12
Michael: So we very much focused on sort of outcome based datas, data, which, you know, we’re trying to measure the the real quality of life of people, not what policies we’re implementing. So we measure life expectancy or educational attainment not about how much money is being spent. So those may not move so quickly over time. What we’ve seen, first of all, on COVID is that, you know, a society’s response to COVID, society’s resilience to COVID is a lot related to wage equity before COVID. You know, what we see very clearly with COVID in terms of mortality and morbidity is it feeds on poverty and inequality. So societies that were better at maintaining quality of life for every every member of society, delivering good services for every member of society actually did better in the COVID crisis. So COVID isn’t just about the virus. It’s about the social context in which it fits. We’ve actually developed tools to help in responses because you might find, for example, that it’s actually more vulnerable communities have greater risk from COVID. Because if I’m living in a poorer household where I’ve got members of my household working in service level jobs, if I’m living in a multiple occupancy household, if I also, it goes up if I’m poorer, I’m more likely to have morbidities that are going to be linked with COVID, I’m at greater risk. So actually understanding the differential risks for different communities has been what we’ve used it all that’s worked in Costa Rica and the UK and various other countries to help the government responses to those and COVID I think has been particularly hard because of it’s the speed and uncertainty in which it came on. I think Governments really struggled to respond in the initial instance and had to improvising. It’s the same if we look at the energy crisis and the emerging global food crisis, these are very rapid onset crises. And in that sense, governments are going to need to be very nimble. They going to be responsive and they’ve got to be thinking about the equity aspects of this. And it’s got to be about how do we focus our resources, not just on those who shout loudest, but where the greatest need is. And that’s why governments really need, you know, reliable data and also granular data to understand different communities, different geographies, to be able to allocate the resources most effectively.

00;10;56;19 – 00;11;22;10
Simran: So you’ve seen massive massively different impacts across different parts of the world, purely dependent on essentially the resource and capital equity that’s built into the society that’s suffering from particular issues, and so I think recovery has a lot to teach us about globalism and the role business and all these kinds of elements as well, and perhaps how we develop more transparent more, I guess, equitable societies across the planet.

00;11;22;28 – 00;12;02;08
Michael: I mean, ultimately, with COVID it is a bit of a wake up call for the fans of authoritarian populism I think in an open society you may have found such an unsustainable policy being actually challenged and amended sooner rather than later. So I think we all think we are seeing through COVID, loking at what happened in Brazil as well and to some degree in the United States in the first phase of this, that actually we are seeing how some of those authoritarian populist societies have actually been less effective in responding to COVID, which may be a good sign in actually recognizing the benefits of perhaps slightly more boring but more reliable rights based, less populist societies.

00;12;02;14 – 00;12;26;20
Simran: I was going to ask you about consciousness between businesses and government that potentially to drive people based solutions which perhaps touched on what we’re speaking about within today’s society. Clearly, capitalism is probably better than some of the points we’re referencing perhaps in China. But evidently it’s been driven for profit rather than people down year. So I wonder if there’s much to say about how partnerships works in business in today’s capitalist west.

00;12;27;11 – 00;14;05;17
Michael: I think there are two. I mean, obviously, partnership between government and business is a great idea. I think there were two problems with it. One is I think people often take a kind of punitive frame to business. I mean, even the whole ESG framing is always saying, are you not doing these bad things? Rather than actually asking ourselves, what’s the total contribution of business to our societies? And I think we have to think in a more holistic sense. And it also takes us away just from eliminating bads to actually asking what can business contribute. I think the second problem we have is around this is the data, the lack of a common language. And so often businesses. I think one of the big problems we’ve seen with Sustainable Development Goals is businesses have sort of cherry picked, you know, media friendly issues that they can hang their hat on rather than actually having a discussion about where they can make the strongest contribution. And this is what we’ve tried to do with the Social Progress Index, in a way is create a common language by which governments and businesses can talk to each other about where business can make its the most important contribution, move away from a kind of a compliance framework where government is trying to beat businesses to do certain things, to actually a framework of collaboration, where businesses can actually say, hey, this is how we can really contribute most effectively. But also have a dialog saying, government, this is what we need from you, because business is often these things like infrastructure and a well-educated workforce. And, you know, eliminating barriers to opportunity the government needs to deliver. So actually there’s a real win win there. If we can create the right framework for dialog.

00;14;06;03 – 00;14;17;17
Simran: Fascinating. I was also keen in that context to ask you about what you consider to be a compassionately successful business, perhaps in five or ten years time, and any ways we might measure that with any new metrics or similar arguments you’re familiarized with?

00;14;18;03 – 00;14;57;04
Michael: I mean, I would rather focus on a rationally successful business that is having to use a phrase we used earlier is regenerative in terms of its society and the environment. And if we have businesses doing that, you know, I care less about what they say or what they say their motivations are, than what they actually do. I think it’s the outcomes, it’s the impacts, the things by which we should be judging businesses in all organizations, not the language in which they dress it up. And so having real metrics and we can say, look, this business actually is making a big contribution and this ones making a lesser contribution. I think that’s a good way to look at it.

00;14;57;18 – 00;15;14;11
Simran: I was looking to close our conversation to talk about the future of societies and where we might see societies evolving in a decade or so. Whether we might find those more compassionate places, perhaps with businesses and governments and societies might intersect to benefit all so I’d be fascinated to hear your thoughts on that.

00;15;14;15 – 00;16;20;07
Michael: Yes, I think they were yeah. Let’s be clear. There were some problems that are very much sold that we haven’t scaled. So things like, you know, getting everyone fed, getting everyone vaccinated, giving everyone access to water and sanitation. I know there are problems in delivering of those to everyone, but those really are essentially scaling problems that we’ve got to move towards. There are other ones where I think we are looking more towards trying to find new solutions, which is a harder problem. Climate change is one of them. But again, what our data shows very clearly is there actually isn’t a trade off between progress and sustainability that actually what we see, if we look at the countries that have been most effective in trying to address the climate crisis, they actually could achieve very high levels of social progress with quite relatively low levels of greenhouse gas emissions. And of example, Australia and Sweden have very similar levels of social progress. But Australia is off the charts in terms of its greenhouse gas emissions per capita, whereas Sweden is actually getting quite close to a sustainable level of greenhouse gas emissions. It’s not there yet.

00;16;20;20 – 00;16;28;28
Simran: That’s fascinating. Can I just ask, is that down to technology choice or is that down to the approaches they use to climate change? I’m wondering what drives that differentiation?

00;16;29;27 – 00;17;02;03
Michael: What is driven a bit by how they’ve decided to develop their economy, how they how well they’re turning their GDP into social progress within their own right? And then some of the technology, some questions about endowments, you might say there might be a endowment of hydroelectric power in Sweden, but there again, Australia has plenty of endowment, something like solar, etc. So I think there are there are choices, there are possibilities out there. So sustainability and social progress are two sides of the same coin. And they’re both, we’ve got to advance on both, if we’re going to tackle the climate crisis.

00;17;02;13 – 00;17;13;19
Simran: Fantastic. Thank you. So much. I wonder if anything you’d like to close our conversation with? If you guys have any future projects going on, any work coming up in the pipeline and anything exciting that we might be seeing from you guys in the future?

00;17;13;28 – 00;18;17;17
Michael: So we’re really responding to the people we serve in government and in business and investment community. People have been saying, you know, what we want is really kind of localized, granular data. So later this year we’re going to be producing Social Progress Index, covering the 500 largest cities in the US and within those cities, individual neighborhoods So that’s going to be a massive dataset. 28,000 observations I think is going to be very powerful for policymakers, but also for investors and businesses thinking about location decisions. We’re doing the same thing in England, probably end of this year we’ll have a social progress index coming out for the whole of England, and we’ve got other work in in India and in Europe that’s also scaling out there. So what we’re really trying to do is create as much of this robust data that make it available as granularly as possible for the different users in government and business.