May 14, 2025 • 29 mins
Episode 98 Sustainable Advantage: Lee Stewart on Outpacing Competitors with Purpose Frederick Dudek (Freddy D) Copyright 2025 Prosperous Ventures, LLC
Lee Stewart, a bestselling author and visionary in the field of sustainability, joins us to discuss the critical intersection of sustainability and business strategy. With over two decades of global experience, Lee has transformed organizations by helping them turn their sustainability efforts from mere compliance into a competitive advantage. He emphasizes the importance of engaging all stakeholders in the process, fostering a culture of ownership that drives meaningful change.
Throughout our conversation, we explore how businesses can develop impactful sustainability strategies that resonate with their customers while also addressing pressing global issues like climate change and modern slavery. Get ready for a deep dive into the practical steps businesses can take to thrive sustainably in today's market.
Discover more with our detailed show notes and exclusive content by visiting: https://bit.ly/4j5htCL
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Engaging with Lee Stewart on the podcast reveals critical insights into the intersection of sustainability and business strategy. Lee, a seasoned expert in the field, discusses his journey from a childhood in New Zealand to becoming a leading figure in sustainability consulting. His experiences have shaped his understanding of how businesses can effectively embed sustainability into their operations, leading to both environmental and economic benefits. He emphasizes that sustainability should not be viewed merely as a compliance checkbox, but as a strategic advantage that can drive innovation and customer loyalty.
During our conversation, Lee outlines his methodology for developing impactful sustainability strategies. He highlights the importance of creating a clear framework that aligns sustainability initiatives with business objectives, ensuring that these efforts resonate with customers and stakeholders. Lee provides practical examples of how organizations like Qantas and Brisco Group have successfully implemented sustainability practices that not only address environmental concerns but also enhance their competitive positioning in the market. His approach encourages businesses to rethink how they view sustainability—moving it from being a burden to a key driver of growth.
As the discussion unfolds, we delve into Lee's book, which serves as a practical guide for business leaders looking to navigate the complexities of sustainability. He breaks down the essential components of a successful sustainability strategy, emphasizing the importance of collaboration and stakeholder engagement. By fostering a culture of accountability and shared responsibility, businesses can create a sustainable future that benefits both the environment and their bottom line. This episode serves as a powerful reminder of the role that sustainability plays in shaping successful business strategies in today's market.
This podcast is hosted by Captivate, try it yourself for free.
Takeaways:
- Lee Stewart emphasizes that sustainability is not just a compliance checkbox but a critical lever for gaining competitive advantage in the marketplace.
- The importance of engaging all stakeholders in the sustainability conversation ensures ownership and alignment with company goals, fostering a collaborative environment.
- Businesses can transform sustainability from a regulatory burden into a strategic advantage by integrating it into their...
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(01:41):
Hey Superfan superstar FreddieD. Here in this episode 98 we're
joined by Lee Stewart, a bestselling author, visionary sustainability
leader and the foundingdirector and CEO of ESG Strategy.
With over two decades ofglobal experience across Australia,
(02:02):
New Zealand, the UK and Japan,Lee has been at the forefront of
transformative initiativesfrom cutting edge AI driven sustainability
projects to shaping climatepolicy and modern slavery reporting.
Formerly the head ofsustainability at Fujitsu and Fonterra,
(02:22):
Lee now advises top tierboards and even the Tongan government,
all while championing the nextgeneration of sustainability leaders.
Get ready for an insightfulconversation on embedding sustainability
and business strategy anddriving meaningful impact across
the globe. Welcome Lee to theBusiness Superfans podcast.
(02:48):
Thank you. Great to be here.
So Lee, tell us a little bitabout your backstory. Where did you
come from, how did you get towhere you're at and come up with
this book called how to BuildSustainable Business Strategy.
I was very fortunate to growup in New Zealand, so I had a great
appreciation of theenvironment outdoors as part of growing
up as a kid, bare feet, schooltramping, just a great appreciation
(03:09):
for the outdoors. When I gotto travel overseas, how privileged
I was. Growing up in NewZealand. You start to see beaches
with lots of rubbish on themaround Asia. Just what we're doing
to the world got me reallyfocused on how can still have a good
career in business but try anddo good and help impact the world.
I didn't really fall into it.I crafted my way through into sustainability
(03:30):
from startups to becoming headof sustainability at Fujitsu, to
running consulting teams andthen head of sustainability at Fonterra
New Zealand. I helped manageto get weave into those things through
startups experience and goingto all these conferences, learning
great people and my first cutat corporate sustainability at Fujitsu
which was a great experienceof 8 years traveling around the world
(03:52):
as well. Big data centers, ewaste and a lot of energy efficiency
work going on there. So I feelvery privileged to have had that
grounding in New Zealand andto actually know what really great
pristine environments looklike. And then the exposure of travel
made me think hey, there's abetter way we could be doing things.
So that's a core driver for me.
(04:13):
Yeah, before we startedrecording I was mentioning that I
had just recently been to NewZealand and it's an incredibly beautiful
country from what I've seen.It's my third time there every time
I'm in awe of the places I seeand how things have been well planned
to maintain the natural beautythat the country has what you're
(04:35):
doing is really important inthe business world and in an environment
world, so that we can bearound here for another couple thousand
years.
Yes.
So let's go deeper into whatis it that actually you're doing
with these companies? How isit that you're transforming them
to maintain sustainability,both business wise and environmentally
(04:56):
wise? Because they've got toboth go hand in hand.
So what I do is I helpbusinesses leaders cut through the
noise. There's a lot ofambiguity around this and I help
them create a clear, impactfulsustainability strategy, turn what
they might see as a complianceburden into a competitive advantage.
We first look at what you doas a business, so you look inwardly.
I follow a methodology ofworking with people. You've got to
(05:18):
build confidence, know whatglobal issues, such as maybe climate
change, modern slavery, waste,diversity, inclusion, what do they
all really mean and how doesit impact your business? How does
that show up? Then we movedinto commitments. So what are you
actually going to stand for?How are you going to look at some
of your backyard issues, maybereduce waste or emissions? And then
(05:39):
the final bit is theconsistency, the governance around
it, where a lot of people fallover, where they don't think about
how they're going to maintainthat. Now, all along that process,
I'm usually eitherinterviewing internally, but ideally
I'm also interviewing theirkey customers and understanding what
matters most to your market,to your key stakeholders externally.
(05:59):
So how can that reflect backon what you deliver to those clients
as well? So a really goodexample was in my early career. I
was working with Qantas, majorairline in Australia. They had a
climate target and we weresupplying all their IT equipment.
What they didn't realize isthat when we were trying to bid and
win more work, they moved alltheir equipment, upgraded them. There
(06:20):
was a carbon savings, therewas an energy savings of moving to
our data centers as well. Imanaged to call out that difference
in working with us and helpthem align that towards meeting their
targets. Bringing the ChiefTechnology officer, Qantas and the
head of Environment togetherto say, here's our solution, here's
how it's helped meet yourtargets. Connecting those dots is
really important.
Yeah. Because what you'redoing there is you are helping them
(06:43):
with the environment aspect,but you're also saving them money
from the energy consumptionaspect. When I was selling manufacturing
software, I was asked to speakat the Mold Makers Association. I
couldn't talk about myproduct. You had to actually provide
value. So I'm thinking, whatam I going to talk about? What I
came up with was notsustainability, but it was still
(07:06):
in a similar aspect, and thatwas compute time. When you're doing
a lot of mathematicalequations to generate toolpaths for
milling machines, it takestime to put in the parameters and
let it run. It may take 10, 15minutes for it to generate the toolpath.
And when it's not exactlyright, you have to tweak it and start
(07:26):
over. While that's computing,what's the engineer doing? He's twiddling
his thumbs waiting for it tocalculate. If you consider 15 minutes
per hour is spent on computetime, per day, per week, per month,
and if you just would havespent a few thousand dollars to buy
(07:48):
a better, faster machine, youwould collapse that compute time
and you would actually improveyour profitability. And they didn't
even think of it from thatperspective. And so that's what you're
doing, you're making themthink of it from a different perspective.
And all of a sudden everybodywent, oh, man, we need to really
relook at that and payattention to that. Because that was
(08:11):
money that they were leavingon the table.
Yeah, exactly. And then I findin most businesses, especially manufacturing,
there's energy efficiencyopportunities everywhere that haven't
been relentlessly pursued. Andwe all know that energy prices are
going up and generally withenergy, there's a carbon element
to it, emissions element aswell. So, yeah, a huge savings there.
(08:31):
Yeah. And more important, time savings.
Yeah, absolutely. I'm surethese engineers aren't cheap, right?
No. And it was all of a suddenI had everybody coming up to me and
asking me more stuff and Iended up selling them software without
selling them software, nottalking about it. So it was kind
of fun. So let's go furtherinto, you know, let's share a story
(08:51):
of how you walked into asituation, you shared a little bit
with Qantas. But let's godeeper into what it is that you do
and how that evolved into youwriting the book.
Yeah. Throughout my career,I've been in large multinationals,
15 plus years, and you see alot of waste, a lot of time wasting
a lot of confusion around thetopic of sustainability. It's very
(09:13):
political as well. You canjust run down three rabbit holes.
I've been to so manyconferences where this guy got on
stage and spoke for one or twohours. They could have said what
they said in five minutes.Let's cut to the chase. Conferences
now are just clappingcommittees of their own. Echo chambers
in the boardrooms as well.Executives. Sustainability is new
to them. In most cases,there's a Lot of noise. Just pick
(09:34):
up the newspaper. You can geta point of view or an opinion piece.
I just said, it's time to cutthrough all that crap. It's a business
advantage. There's very fewbooks out there that talk about sustainability,
business advantage, and Ihaven't really found one. So I said,
there's a gap here in themarketplace. I was working with a
couple of COOs at the time whosuddenly had sustainably jumped on
their lap and said, you've gotto now run this. And they were like,
(09:57):
oh, I don't really know whatthis all means, Lee, come and work
with me and help me sort thisout. So I wrote the book as I was
working with a couple ofclients at the time and understanding
what do they really need toknow? There's a lot out there. You
can go away and do PhDs inclimate science or sustainability
and stuff. What do businessleaders need to know? How do they
make sense of that and how dothey focus on what matters the most?
(10:18):
You see so many sustainabilityprograms where they're going after
end poverty or hunger, whenthey probably just need to focus
on energy efficiency first andsome other things they could do quickly
and they try and save thewhole world. It's just not going
to happen. Linking it tobusiness outcomes, a sustainability
program that lasts and hasimpact is something that would resonate
(10:38):
with your customers or whereyour money comes in. That's the missing
link with sustainability. Andpart of. You know, I've been a part
of this problem in the pastwhere you run off too altruistic
and you go far ahead and yousay, we should be doing all this
where it's actually thebusiness isn't ready yet, the costs
aren't going to happen and theprogram's going to die in a few months.
Guess what? We've got a creditcrunch. We've got to consolidate
(10:59):
and save costs. Every businessgoes through that cycle. So how do
you make it sticky and stay.It's because you're sustainably.
Program is a competitiveadvantage. It helps you win revenue,
improve profit. That's reallywhere I'm going at here. And I think
that altruism is really nicein businesses, but it only goes so
far.
Well, yeah, you're playing thelong game, but in that long game,
(11:22):
there's some real quick winsthat start happening. And that's
the differentiator in yourapproach with working the businesses.
I've never heard of anybodylooking at it from that perspective.
So great to have you on theshow and share some of that knowledge
because I think a lot ofpeople need to get out of the noise.
Things have become tooopinionated versus the facts. And
(11:47):
the guy used to say, ma' am,just the facts, ma' am, just the
facts. Keep your opinion toyourself because nobody cares.
Yes. Could have used that lineon many board meetings.
But yes, I'm sure that was anadventure in itself. So share a little
bit about how you transform.We talked a little bit about some
of the companies but I'd liketo get more of a specific story where
(12:10):
they became what I would calla super fan that in turn promoted
you to other businesses forthe services that you provide.
Yeah, there's many examples.One is a large retailer in New Zealand
called Brisco Group. I've beenworking with them for the last two
and a half years. They're fromnot saying anything in their annual
report to now having about adozen pages on sustainability in
their report. We've helpedthem set their first net zero climate
(12:33):
targets. Now working on acircular economy strategy and being
a large retailer, there's alot of end of life products I need
to look at. Working with otherpartners around modern slavery across
all their factories, many ofthem in China, Southeast Asia and
around the world, vetting themfor making sure their labour practices
are okay. It's been acomprehensive program as part of
(12:54):
a materiality assessment. Weask key customers and suppliers.
Through that process I'vepicked up other work in their supply
chain. They've encouraged meto work with their key suppliers
and it's introduced me tonumerous opportunities saying we're
all in this together, wehaven't set our climate targets.
I suggest you have a chat toLee as well. He can probably help
you out. Sort of have thatsort of contact in has been really,
(13:17):
really makes that sort ofsales process or introductions as
like gold.
It collapses the sales cycle.I mean there is no sales cycle.
Totally. Really, it's a conversation.
It's a conversation. There isno sales cycle. You need to talk
to Lee and that's it, it'sdone. What do we got to do to get
this thing going? Theconversation is no longer about whether
you're the right person. Theconversation is what do we need to
(13:39):
do to start it's a done dealright off the bat by creating super
fans of the people that you'redealing with. That's your salesforce.
You can't buy that kind of cr.
Yeah, exactly. Another greatexample I've got is where I've picked
up a client I've known for 20odd years. He's at A large investment
(14:00):
firm and they've bought thisnew business. It's a billion dollar
business and they need asustainability strategy. He just
said, give Lee a call.Normally you'd write a proposal,
say, oh, it could be sixweeks, eight weeks. It was a very
collapse. It was a week. It'sa conversation. Lee told to talk
to you. Can you come in andhelp us out?
That's it. Yeah. It's funbecause I remember selling manufacturing
(14:22):
software and my customers weremy referral sources. I would get
phone calls saying, hey, Jacksaid, I need to get this stuff. What's
it going to cost me? How fastcan you get it in here? And that
was the conversation. I spentmore time putting together the configuration
of the technology that theywere going to get than anything else.
Perfect.
(14:42):
And those are fun scenariosbecause like you just said, it's
completely collapsed.
Yeah, yeah.
So let's go deeper into thebook. What does the book talk about
and how does that help guidebusinesses to manage their sustainability
as a competitive advantage?
Yeah. So the book has threesignificant components, three parts.
(15:05):
There's the confidence piece,understanding the basic foundations
of what are these global macroissues and what do they mean to your
business. So that's reallyimportant. I'd say not too onerous,
but I look at case studies ofterrible things that have happened
like the BP oil spill, thebreakdown in governance of the Rana
plaza incident in 2013 where athousand factory workers died and
how that reverberated throughsupply chain across the world. Absolute
(15:26):
things like modern slavery andso forth. So there's real life examples
of when governance has fallenover. The real guts of that book
is the commitment phase andwhat you stand for and make sure
that's meaningful. I think alot of companies let themselves down
as they set a target withoutasking people what they want from
us. This is a real opportunitywhere you get to engage with your
(15:46):
customers. Most customerscollaborate on sustainability with
you. If you're a medium sizedenterprise supplying a large customer
a published sustainabilityreport, you will see their targets
and what they're trying toachieve and you're part of that supply
chain. There's the opportunityhere where you can reach out and
say, we're designing our newsustainability strategy. We'd love
to have a chat about whatyou'd like to see from us. And it's
not a sales call, just aconversation. I went out for clients,
(16:08):
I bring the client with me tolisten on a call and it's just gold.
You get insights into yourproducts and what you service. But
if you could do Tweak this andthis. Or you could give us assurances
around the carbon element.You'd become a preferred supplier.
You know, these are questionsthat come out. So that's the real
gold there. And then you cango back and design your sustainability
(16:29):
strategy with your customer inmind, which is really key. You can
ask your people, do surveysacross all your staff. It's a very
simple survey that could goout and you can get some good ideas
from the factory floor andothers around that. The part where
people let themselves down isthe consistency piece. And it's the
setting up of a governancemodel and making sure that doesn't
rely on one person in theorganization. It's across multiple
(16:53):
teams that's brought together.And if you have a board, try to make
sustainably a standard boardagenda item so it keeps the focus
on. And that's it in anutshell. I designed the book. You
can read it in the weekend,ask questions on a Monday, Tuesday
on your business, and maybe byFriday you've actually done something
to make an impact. Justencourage you to get started.
Well, you said an importantthing there. And that's a couple
(17:15):
of things. One is I want torecap, make sure I understand it,
maybe clarify for listeners.You're really talking to all the
stakeholders, involving allthe stakeholders into the equation.
And by doing that, everybody'sgot ownership in it. And so that's
really the big difference.It's not just management pushing
it down, it's pulling it fromthe team up to management. So now
(17:39):
it's a collaborativeconversation. And now everybody's
got an ownership into it. Sonow everybody is on the same page.
You know, a racing, rowingboat, you got the eight people in
the boat, but you got to geteverybody in the synchronization.
Otherwise you ain't going toofar too fast. But you get everybody
in that sync, then all of asudden, that boat's flying down the
(18:00):
water, it's almost airborne.When they get that, it's magical.
What you're doing is veryimportant because you're the coordinator,
you're the quarterback.
Yeah. And you've got tocoordinate that traffic and bring
them together. But ideally,when I work with organizations, I
would go in there for threemonths, train that person up to run
it, and then step back, seeabout building capability. It's not
(18:23):
about throwing a consultingreport at your client. You develop
it with them. The strategy.For my previous customers at Briscoe
Group, I used to sit in anddrive the sustainability working
group meetings. Now I'm hardlysaying anything. I'm Just observing
as it's running itself, whichis great. And they've got, they've
started, they're on.
Their way, they got ownership.When I was selling manufacturing
software, a lot of times Iwould sit down and work with the
(18:47):
engineering manufacturingmanager. We would put the strategy
together and the return oninvestment and all that stuff. But
it was them doing it, theyowned it. I was just a coach when
they went and presented it.Because a lot of times from a sales
perspective, if I share withsomebody and then they try to tell
it to somebody else, themessage gets diluted. Yeah, but if
(19:10):
they have complete ownershipbecause it's them that put it together,
the message isn't diluted.You've just helped enhance their
message and then they carry itforward. And that's why you're able
to, you know, like you justsaid, you step back and now you're
just part of the meeting.They're running the meeting and you
may pop in for a couplequestions and stuff like that, but
(19:31):
otherwise it's theirs. Theyown it.
Yep. And that ownershipstructure, governance structure,
nothing gets people morefocused to say, next month it's your
turn to do the board report onyour section of area. So you've got
the environment, so you're upto give the update. So that it's
not the sustainability personor the one person managing it, it's
the team collective.
(19:52):
And that's really the bigdifference is it's a collective effort
and so everybody's part of itand everybody's helping everybody
else to accomplish the goals.Very cool. So where can people find
the book?
Yeah, it's on Amazon. How toBuild Sustainability Business Strategy
and authors Lee Stewart L E ES T E W A R T Can Find it on Amazon.
(20:15):
That was the bestseller for awhile in that category.
And see, before we talked, youmentioned that you've been to different
countries working with them.Where have you found the biggest
welcome for what you're doing?What country? Just curious.
Oh yeah, Japan has been somereally good conversations. When I
was head of sustainability atFujitsu for this region, going to
Japan, I found the Japaneseway of doing business is long term
(20:39):
thinking. They have a target ahundred years in the future. So sustainability
is ingrained in what they do.Even when they built a Factory in
the 1930s, they've replacedthe parkland next door and it's still
there today. It's veryhumbling to be a part of that. So
it comes down to the cultureas well. It's very different to what
we think about. We think aboutQuarterly reports or annual and stuff.
(21:00):
Where they're thinking about5, 10 year, 50 year in the future
is not a big ask for them.Where I think it's some of the conversation
I have here locally. It'squite hard for people to conceptualize
that.
I completely agree and I canback that up because I've dealt with
the Japanese in my days on theglobal stage and you're absolutely
(21:20):
correct, they play the longgame and they're very focused on
that. It's very important andthat's why you see things going on
for such a long time and verysuccessful because they're not after
the short win, they're afterthe long play completely. It's also
very important aboutrelationships with that culture because
I was trying to make a salethere to get a master distributor
(21:44):
for one of my products and Iwas going no place with them. I mean
we talked about thetechnology, the marketing and everything
else and you know, they wereall nice, we like it. But we never
passed go. And I was down withmy reseller in Australia and we were
at DY beach having dinner andI'm going, what am I doing wrong?
(22:05):
He goes, what are you talkingabout? He says, well, I'm talking
about the businessopportunity, the contract, the product
and everything else. He goes,shut up about that stuff. Start asking
them about things, about theirculture and their things. And yeah,
so when I went back, I changedthe whole conversation to tell me
a little bit more about Japan.And then when they came to the States
to meet with us, we had a twohour meeting and then I spent time
(22:27):
driving around all over thevalley in Arizona and about two months
later I got a $200,000 order.They signed the agreement and everything
else because it was all aboutbuilding a relationship, building
that trust. And I think thatwhen you're dealing on an international
stage, that's very important.
(22:50):
Definitely.
Unfortunately, there's a lotof businesses today that have a transactional
mindset versus building thatlong term relationships. I'm glad
you brought that up becausethe transactions for the moment,
but it doesn't buy youanything afterward.
Correct.
So let's go into looking atwhat type of businesses can really
(23:14):
benefit from looking at theirsustainability strategy. Besides
manufacturing companies.
Yeah, I suppose think abouthome improvement.
Or some of the small to midsized businesses, not necessarily
the big conglomerate guys.
Yeah, I think the key driversfor people wanting my help, they
supply a larger company andthey've asked them for information.
(23:35):
What's your embodied carbon?Do you have a climate roadmap? What's
your waste life Cycle. Do youhave a modern slavery statement?
The bigger guys are forced tolook in their supply chain. Some
climate targets and targetsaround modern slavery that involve
the suppliers coming on board,working in that area has come on.
I've won a couple of newclients recently going after capital
(23:56):
funding or access to capitaland they've got what's known as a
green bond or sustainabilitylinked loan. So part of their debt
facility is to have asustainability strategy and targets
and that enables them to getlower cost of capital. Even when
I was working at the largestbusiness in New Zealand, Fonterra,
they got a sustainable financeframework, not because they needed
capital, but a futureinsurance policy to make sure if
(24:19):
they did need capital, theycould access some of these other
loans or debt facilities thathad sustainably linked attributes.
So that's two of the main onesthat come through. The key one is
when a customer asked and itcould take you by surprise and you
know the answer to it. I'vedone this working for larger companies,
had to send out a survey toall the suppliers and we're measuring
(24:39):
you on your ability to set aclimate target in the next couple
of years that supports mycustomers climate target. So instantly
you're identifying who areyour likely future partners of choice
in the coming years who aregoing to get there quicker, who are
going to need a hand, who areprobably never going to get there.
So you might want to thinkabout the big companies now. Think
(24:59):
about, well, am I going tohave to move that contract or move
that supplier on if they can'thelp me with these other targets?
So these are some of thequestions going on now. Those are
the main issues that I'mfacing at the moment.
So, okay, so you're reallytalking about some of the suppliers
to larger companies and forthem to really get themselves in
(25:22):
a position to become a preferred.
Supplier or even keep them asa supplier in some cases, because
that decisions are going to bemade in the future. Definitely.
Right. Especially with some ofthe different governments and their
goals, like you justmentioned, that's going to become
an important aspect becauseotherwise they're not meeting it,
(25:42):
they're not going to be partof the equation and they may be out
of business.
Yeah. And on the flip side, ifyou got a new product that has more
environmental attributes thanyour competitors, you could win that
market share in the futurebecause you'll help them hit their
targets and so forth. Sothere's the opportunity there.
(26:03):
Right. That goes back to theJapanese playing the long game.
Yeah, great.
Well, Lee's been comingtowards the end of the show. How
can people find you?
Yeah. So LeeStewart.com L E ST E W A R T.com is the website for
the book. Feel free to lob aquestion or look at on LinkedIn as
(26:23):
well. You can order the bookfrom there if you're interested or
on Amazon. I look forward tohaving a conversation with any of
your listeners. Happy to keepit going. Okay.
If they're looking for yourservices, LinkedIn would be the best
place.
LinkedIn's the best place. Theother website I'd have is esgstrategy.com
you can find me on LinkedIn as well.
Okay. So we'll make sure allthat's in the show notes for our
(26:44):
listeners.
Yeah.
Lee's been a pleasure. Greatinsight, great conversation about
sustainability. I thinkeverybody needs to take a deep look
at it and we look forward tohaving you on the show down the road
and continuing the conversation.
Yeah, absolutely. It's been apleasure. Thanks so much.
Thanks. Hey, superfansuperstar Freddie D. Here before
(27:08):
we wrap, here's your three aplaybook power move to attract ideal
clients, turn them intoadvocates and accelerate your business
success. Here's your topinsight from today's episode. Sustainability
isn't the compliance checkbox.It's your hidden lever for competitive
advantage, strong clientloyalty and superfan referrals. Here's
(27:28):
your business growth actionstep. Schedule 5 Customer Interviews
this week to ask whatsustainability practices matter most
to them. Then align yourstrategy to become the preferred
value aligned supplier. Iftoday's conversation sparked an idea
for you or you know of afellow business leader who could
(27:49):
benefit, share it with themand grab the full breakdown in the
show notes. Let's acceleratetogether and start creating superfans
who champion your brand.
Hey Superfan superstar FreddieD. Here in this episode 98 we're
joined by Lee Stewart, a bestselling author, visionary sustainability
leader and the foundingdirector and CEO of ESG Strategy.
With over two decades ofglobal experience across Australia,
(02:02):
New Zealand, the UK and Japan,Lee has been at the forefront of
transformative initiativesfrom cutting edge AI driven sustainability
projects to shaping climatepolicy and modern slavery reporting.
Formerly the head ofsustainability at Fujitsu and Fonterra,
(02:22):
Lee now advises top tierboards and even the Tongan government,
all while championing the nextgeneration of sustainability leaders.
Get ready for an insightfulconversation on embedding sustainability
and business strategy anddriving meaningful impact across
the globe. Welcome Lee to theBusiness Superfans podcast.
(02:48):
Thank you. Great to be here.
So Lee, tell us a little bitabout your backstory. Where did you
come from, how did you get towhere you're at and come up with
this book called how to BuildSustainable Business Strategy.
I was very fortunate to growup in New Zealand, so I had a great
appreciation of theenvironment outdoors as part of growing
up as a kid, bare feet, schooltramping, just a great appreciation
(03:09):
for the outdoors. When I gotto travel overseas, how privileged
I was. Growing up in NewZealand. You start to see beaches
with lots of rubbish on themaround Asia. Just what we're doing
to the world got me reallyfocused on how can still have a good
career in business but try anddo good and help impact the world.
I didn't really fall into it.I crafted my way through into sustainability
(03:30):
from startups to becoming headof sustainability at Fujitsu, to
running consulting teams andthen head of sustainability at Fonterra
New Zealand. I helped manageto get weave into those things through
startups experience and goingto all these conferences, learning
great people and my first cutat corporate sustainability at Fujitsu
which was a great experienceof 8 years traveling around the world
(03:52):
as well. Big data centers, ewaste and a lot of energy efficiency
work going on there. So I feelvery privileged to have had that
grounding in New Zealand andto actually know what really great
pristine environments looklike. And then the exposure of travel
made me think hey, there's abetter way we could be doing things.
So that's a core driver for me.
(04:13):
Yeah, before we startedrecording I was mentioning that I
had just recently been to NewZealand and it's an incredibly beautiful
country from what I've seen.It's my third time there every time
I'm in awe of the places I seeand how things have been well planned
to maintain the natural beautythat the country has what you're
(04:35):
doing is really important inthe business world and in an environment
world, so that we can bearound here for another couple thousand
years.
Yes.
So let's go deeper into whatis it that actually you're doing
with these companies? How isit that you're transforming them
to maintain sustainability,both business wise and environmentally
(04:56):
wise? Because they've got toboth go hand in hand.
So what I do is I helpbusinesses leaders cut through the
noise. There's a lot ofambiguity around this and I help
them create a clear, impactfulsustainability strategy, turn what
they might see as a complianceburden into a competitive advantage.
We first look at what you doas a business, so you look inwardly.
I follow a methodology ofworking with people. You've got to
(05:18):
build confidence, know whatglobal issues, such as maybe climate
change, modern slavery, waste,diversity, inclusion, what do they
all really mean and how doesit impact your business? How does
that show up? Then we movedinto commitments. So what are you
actually going to stand for?How are you going to look at some
of your backyard issues, maybereduce waste or emissions? And then
(05:39):
the final bit is theconsistency, the governance around
it, where a lot of people fallover, where they don't think about
how they're going to maintainthat. Now, all along that process,
I'm usually eitherinterviewing internally, but ideally
I'm also interviewing theirkey customers and understanding what
matters most to your market,to your key stakeholders externally.
(05:59):
So how can that reflect backon what you deliver to those clients
as well? So a really goodexample was in my early career. I
was working with Qantas, majorairline in Australia. They had a
climate target and we weresupplying all their IT equipment.
What they didn't realize isthat when we were trying to bid and
win more work, they moved alltheir equipment, upgraded them. There
(06:20):
was a carbon savings, therewas an energy savings of moving to
our data centers as well. Imanaged to call out that difference
in working with us and helpthem align that towards meeting their
targets. Bringing the ChiefTechnology officer, Qantas and the
head of Environment togetherto say, here's our solution, here's
how it's helped meet yourtargets. Connecting those dots is
really important.
Yeah. Because what you'redoing there is you are helping them
(06:43):
with the environment aspect,but you're also saving them money
from the energy consumptionaspect. When I was selling manufacturing
software, I was asked to speakat the Mold Makers Association. I
couldn't talk about myproduct. You had to actually provide
value. So I'm thinking, whatam I going to talk about? What I
came up with was notsustainability, but it was still
(07:06):
in a similar aspect, and thatwas compute time. When you're doing
a lot of mathematicalequations to generate toolpaths for
milling machines, it takestime to put in the parameters and
let it run. It may take 10, 15minutes for it to generate the toolpath.
And when it's not exactlyright, you have to tweak it and start
(07:26):
over. While that's computing,what's the engineer doing? He's twiddling
his thumbs waiting for it tocalculate. If you consider 15 minutes
per hour is spent on computetime, per day, per week, per month,
and if you just would havespent a few thousand dollars to buy
(07:48):
a better, faster machine, youwould collapse that compute time
and you would actually improveyour profitability. And they didn't
even think of it from thatperspective. And so that's what you're
doing, you're making themthink of it from a different perspective.
And all of a sudden everybodywent, oh, man, we need to really
relook at that and payattention to that. Because that was
(08:11):
money that they were leavingon the table.
Yeah, exactly. And then I findin most businesses, especially manufacturing,
there's energy efficiencyopportunities everywhere that haven't
been relentlessly pursued. Andwe all know that energy prices are
going up and generally withenergy, there's a carbon element
to it, emissions element aswell. So, yeah, a huge savings there.
(08:31):
Yeah. And more important, time savings.
Yeah, absolutely. I'm surethese engineers aren't cheap, right?
No. And it was all of a suddenI had everybody coming up to me and
asking me more stuff and Iended up selling them software without
selling them software, nottalking about it. So it was kind
of fun. So let's go furtherinto, you know, let's share a story
(08:51):
of how you walked into asituation, you shared a little bit
with Qantas. But let's godeeper into what it is that you do
and how that evolved into youwriting the book.
Yeah. Throughout my career,I've been in large multinationals,
15 plus years, and you see alot of waste, a lot of time wasting
a lot of confusion around thetopic of sustainability. It's very
(09:13):
political as well. You canjust run down three rabbit holes.
I've been to so manyconferences where this guy got on
stage and spoke for one or twohours. They could have said what
they said in five minutes.Let's cut to the chase. Conferences
now are just clappingcommittees of their own. Echo chambers
in the boardrooms as well.Executives. Sustainability is new
to them. In most cases,there's a Lot of noise. Just pick
(09:34):
up the newspaper. You can geta point of view or an opinion piece.
I just said, it's time to cutthrough all that crap. It's a business
advantage. There's very fewbooks out there that talk about sustainability,
business advantage, and Ihaven't really found one. So I said,
there's a gap here in themarketplace. I was working with a
couple of COOs at the time whosuddenly had sustainably jumped on
their lap and said, you've gotto now run this. And they were like,
(09:57):
oh, I don't really know whatthis all means, Lee, come and work
with me and help me sort thisout. So I wrote the book as I was
working with a couple ofclients at the time and understanding
what do they really need toknow? There's a lot out there. You
can go away and do PhDs inclimate science or sustainability
and stuff. What do businessleaders need to know? How do they
make sense of that and how dothey focus on what matters the most?
(10:18):
You see so many sustainabilityprograms where they're going after
end poverty or hunger, whenthey probably just need to focus
on energy efficiency first andsome other things they could do quickly
and they try and save thewhole world. It's just not going
to happen. Linking it tobusiness outcomes, a sustainability
program that lasts and hasimpact is something that would resonate
(10:38):
with your customers or whereyour money comes in. That's the missing
link with sustainability. Andpart of. You know, I've been a part
of this problem in the pastwhere you run off too altruistic
and you go far ahead and yousay, we should be doing all this
where it's actually thebusiness isn't ready yet, the costs
aren't going to happen and theprogram's going to die in a few months.
Guess what? We've got a creditcrunch. We've got to consolidate
(10:59):
and save costs. Every businessgoes through that cycle. So how do
you make it sticky and stay.It's because you're sustainably.
Program is a competitiveadvantage. It helps you win revenue,
improve profit. That's reallywhere I'm going at here. And I think
that altruism is really nicein businesses, but it only goes so
far.
Well, yeah, you're playing thelong game, but in that long game,
(11:22):
there's some real quick winsthat start happening. And that's
the differentiator in yourapproach with working the businesses.
I've never heard of anybodylooking at it from that perspective.
So great to have you on theshow and share some of that knowledge
because I think a lot ofpeople need to get out of the noise.
Things have become tooopinionated versus the facts. And
(11:47):
the guy used to say, ma' am,just the facts, ma' am, just the
facts. Keep your opinion toyourself because nobody cares.
Yes. Could have used that lineon many board meetings.
But yes, I'm sure that was anadventure in itself. So share a little
bit about how you transform.We talked a little bit about some
of the companies but I'd liketo get more of a specific story where
(12:10):
they became what I would calla super fan that in turn promoted
you to other businesses forthe services that you provide.
Yeah, there's many examples.One is a large retailer in New Zealand
called Brisco Group. I've beenworking with them for the last two
and a half years. They're fromnot saying anything in their annual
report to now having about adozen pages on sustainability in
their report. We've helpedthem set their first net zero climate
(12:33):
targets. Now working on acircular economy strategy and being
a large retailer, there's alot of end of life products I need
to look at. Working with otherpartners around modern slavery across
all their factories, many ofthem in China, Southeast Asia and
around the world, vetting themfor making sure their labour practices
are okay. It's been acomprehensive program as part of
(12:54):
a materiality assessment. Weask key customers and suppliers.
Through that process I'vepicked up other work in their supply
chain. They've encouraged meto work with their key suppliers
and it's introduced me tonumerous opportunities saying we're
all in this together, wehaven't set our climate targets.
I suggest you have a chat toLee as well. He can probably help
you out. Sort of have thatsort of contact in has been really,
(13:17):
really makes that sort ofsales process or introductions as
like gold.
It collapses the sales cycle.I mean there is no sales cycle.
Totally. Really, it's a conversation.
It's a conversation. There isno sales cycle. You need to talk
to Lee and that's it, it'sdone. What do we got to do to get
this thing going? Theconversation is no longer about whether
you're the right person. Theconversation is what do we need to
(13:39):
do to start it's a done dealright off the bat by creating super
fans of the people that you'redealing with. That's your salesforce.
You can't buy that kind of cr.
Yeah, exactly. Another greatexample I've got is where I've picked
up a client I've known for 20odd years. He's at A large investment
(14:00):
firm and they've bought thisnew business. It's a billion dollar
business and they need asustainability strategy. He just
said, give Lee a call.Normally you'd write a proposal,
say, oh, it could be sixweeks, eight weeks. It was a very
collapse. It was a week. It'sa conversation. Lee told to talk
to you. Can you come in andhelp us out?
That's it. Yeah. It's funbecause I remember selling manufacturing
(14:22):
software and my customers weremy referral sources. I would get
phone calls saying, hey, Jacksaid, I need to get this stuff. What's
it going to cost me? How fastcan you get it in here? And that
was the conversation. I spentmore time putting together the configuration
of the technology that theywere going to get than anything else.
Perfect.
(14:42):
And those are fun scenariosbecause like you just said, it's
completely collapsed.
Yeah, yeah.
So let's go deeper into thebook. What does the book talk about
and how does that help guidebusinesses to manage their sustainability
as a competitive advantage?
Yeah. So the book has threesignificant components, three parts.
(15:05):
There's the confidence piece,understanding the basic foundations
of what are these global macroissues and what do they mean to your
business. So that's reallyimportant. I'd say not too onerous,
but I look at case studies ofterrible things that have happened
like the BP oil spill, thebreakdown in governance of the Rana
plaza incident in 2013 where athousand factory workers died and
how that reverberated throughsupply chain across the world. Absolute
(15:26):
things like modern slavery andso forth. So there's real life examples
of when governance has fallenover. The real guts of that book
is the commitment phase andwhat you stand for and make sure
that's meaningful. I think alot of companies let themselves down
as they set a target withoutasking people what they want from
us. This is a real opportunitywhere you get to engage with your
(15:46):
customers. Most customerscollaborate on sustainability with
you. If you're a medium sizedenterprise supplying a large customer
a published sustainabilityreport, you will see their targets
and what they're trying toachieve and you're part of that supply
chain. There's the opportunityhere where you can reach out and
say, we're designing our newsustainability strategy. We'd love
to have a chat about whatyou'd like to see from us. And it's
not a sales call, just aconversation. I went out for clients,
(16:08):
I bring the client with me tolisten on a call and it's just gold.
You get insights into yourproducts and what you service. But
if you could do Tweak this andthis. Or you could give us assurances
around the carbon element.You'd become a preferred supplier.
You know, these are questionsthat come out. So that's the real
gold there. And then you cango back and design your sustainability
(16:29):
strategy with your customer inmind, which is really key. You can
ask your people, do surveysacross all your staff. It's a very
simple survey that could goout and you can get some good ideas
from the factory floor andothers around that. The part where
people let themselves down isthe consistency piece. And it's the
setting up of a governancemodel and making sure that doesn't
rely on one person in theorganization. It's across multiple
(16:53):
teams that's brought together.And if you have a board, try to make
sustainably a standard boardagenda item so it keeps the focus
on. And that's it in anutshell. I designed the book. You
can read it in the weekend,ask questions on a Monday, Tuesday
on your business, and maybe byFriday you've actually done something
to make an impact. Justencourage you to get started.
Well, you said an importantthing there. And that's a couple
(17:15):
of things. One is I want torecap, make sure I understand it,
maybe clarify for listeners.You're really talking to all the
stakeholders, involving allthe stakeholders into the equation.
And by doing that, everybody'sgot ownership in it. And so that's
really the big difference.It's not just management pushing
it down, it's pulling it fromthe team up to management. So now
(17:39):
it's a collaborativeconversation. And now everybody's
got an ownership into it. Sonow everybody is on the same page.
You know, a racing, rowingboat, you got the eight people in
the boat, but you got to geteverybody in the synchronization.
Otherwise you ain't going toofar too fast. But you get everybody
in that sync, then all of asudden, that boat's flying down the
(18:00):
water, it's almost airborne.When they get that, it's magical.
What you're doing is veryimportant because you're the coordinator,
you're the quarterback.
Yeah. And you've got tocoordinate that traffic and bring
them together. But ideally,when I work with organizations, I
would go in there for threemonths, train that person up to run
it, and then step back, seeabout building capability. It's not
(18:23):
about throwing a consultingreport at your client. You develop
it with them. The strategy.For my previous customers at Briscoe
Group, I used to sit in anddrive the sustainability working
group meetings. Now I'm hardlysaying anything. I'm Just observing
as it's running itself, whichis great. And they've got, they've
started, they're on.
Their way, they got ownership.When I was selling manufacturing
software, a lot of times Iwould sit down and work with the
(18:47):
engineering manufacturingmanager. We would put the strategy
together and the return oninvestment and all that stuff. But
it was them doing it, theyowned it. I was just a coach when
they went and presented it.Because a lot of times from a sales
perspective, if I share withsomebody and then they try to tell
it to somebody else, themessage gets diluted. Yeah, but if
(19:10):
they have complete ownershipbecause it's them that put it together,
the message isn't diluted.You've just helped enhance their
message and then they carry itforward. And that's why you're able
to, you know, like you justsaid, you step back and now you're
just part of the meeting.They're running the meeting and you
may pop in for a couplequestions and stuff like that, but
(19:31):
otherwise it's theirs. Theyown it.
Yep. And that ownershipstructure, governance structure,
nothing gets people morefocused to say, next month it's your
turn to do the board report onyour section of area. So you've got
the environment, so you're upto give the update. So that it's
not the sustainability personor the one person managing it, it's
the team collective.
(19:52):
And that's really the bigdifference is it's a collective effort
and so everybody's part of itand everybody's helping everybody
else to accomplish the goals.Very cool. So where can people find
the book?
Yeah, it's on Amazon. How toBuild Sustainability Business Strategy
and authors Lee Stewart L E ES T E W A R T Can Find it on Amazon.
(20:15):
That was the bestseller for awhile in that category.
And see, before we talked, youmentioned that you've been to different
countries working with them.Where have you found the biggest
welcome for what you're doing?What country? Just curious.
Oh yeah, Japan has been somereally good conversations. When I
was head of sustainability atFujitsu for this region, going to
Japan, I found the Japaneseway of doing business is long term
(20:39):
thinking. They have a target ahundred years in the future. So sustainability
is ingrained in what they do.Even when they built a Factory in
the 1930s, they've replacedthe parkland next door and it's still
there today. It's veryhumbling to be a part of that. So
it comes down to the cultureas well. It's very different to what
we think about. We think aboutQuarterly reports or annual and stuff.
(21:00):
Where they're thinking about5, 10 year, 50 year in the future
is not a big ask for them.Where I think it's some of the conversation
I have here locally. It'squite hard for people to conceptualize
that.
I completely agree and I canback that up because I've dealt with
the Japanese in my days on theglobal stage and you're absolutely
(21:20):
correct, they play the longgame and they're very focused on
that. It's very important andthat's why you see things going on
for such a long time and verysuccessful because they're not after
the short win, they're afterthe long play completely. It's also
very important aboutrelationships with that culture because
I was trying to make a salethere to get a master distributor
(21:44):
for one of my products and Iwas going no place with them. I mean
we talked about thetechnology, the marketing and everything
else and you know, they wereall nice, we like it. But we never
passed go. And I was down withmy reseller in Australia and we were
at DY beach having dinner andI'm going, what am I doing wrong?
(22:05):
He goes, what are you talkingabout? He says, well, I'm talking
about the businessopportunity, the contract, the product
and everything else. He goes,shut up about that stuff. Start asking
them about things, about theirculture and their things. And yeah,
so when I went back, I changedthe whole conversation to tell me
a little bit more about Japan.And then when they came to the States
to meet with us, we had a twohour meeting and then I spent time
(22:27):
driving around all over thevalley in Arizona and about two months
later I got a $200,000 order.They signed the agreement and everything
else because it was all aboutbuilding a relationship, building
that trust. And I think thatwhen you're dealing on an international
stage, that's very important.
(22:50):
Definitely.
Unfortunately, there's a lotof businesses today that have a transactional
mindset versus building thatlong term relationships. I'm glad
you brought that up becausethe transactions for the moment,
but it doesn't buy youanything afterward.
Correct.
So let's go into looking atwhat type of businesses can really
(23:14):
benefit from looking at theirsustainability strategy. Besides
manufacturing companies.
Yeah, I suppose think abouthome improvement.
Or some of the small to midsized businesses, not necessarily
the big conglomerate guys.
Yeah, I think the key driversfor people wanting my help, they
supply a larger company andthey've asked them for information.
(23:35):
What's your embodied carbon?Do you have a climate roadmap? What's
your waste life Cycle. Do youhave a modern slavery statement?
The bigger guys are forced tolook in their supply chain. Some
climate targets and targetsaround modern slavery that involve
the suppliers coming on board,working in that area has come on.
I've won a couple of newclients recently going after capital
(23:56):
funding or access to capitaland they've got what's known as a
green bond or sustainabilitylinked loan. So part of their debt
facility is to have asustainability strategy and targets
and that enables them to getlower cost of capital. Even when
I was working at the largestbusiness in New Zealand, Fonterra,
they got a sustainable financeframework, not because they needed
capital, but a futureinsurance policy to make sure if
(24:19):
they did need capital, theycould access some of these other
loans or debt facilities thathad sustainably linked attributes.
So that's two of the main onesthat come through. The key one is
when a customer asked and itcould take you by surprise and you
know the answer to it. I'vedone this working for larger companies,
had to send out a survey toall the suppliers and we're measuring
(24:39):
you on your ability to set aclimate target in the next couple
of years that supports mycustomers climate target. So instantly
you're identifying who areyour likely future partners of choice
in the coming years who aregoing to get there quicker, who are
going to need a hand, who areprobably never going to get there.
So you might want to thinkabout the big companies now. Think
(24:59):
about, well, am I going tohave to move that contract or move
that supplier on if they can'thelp me with these other targets?
So these are some of thequestions going on now. Those are
the main issues that I'mfacing at the moment.
So, okay, so you're reallytalking about some of the suppliers
to larger companies and forthem to really get themselves in
(25:22):
a position to become a preferred.
Supplier or even keep them asa supplier in some cases, because
that decisions are going to bemade in the future. Definitely.
Right. Especially with some ofthe different governments and their
goals, like you justmentioned, that's going to become
an important aspect becauseotherwise they're not meeting it,
(25:42):
they're not going to be partof the equation and they may be out
of business.
Yeah. And on the flip side, ifyou got a new product that has more
environmental attributes thanyour competitors, you could win that
market share in the futurebecause you'll help them hit their
targets and so forth. Sothere's the opportunity there.
(26:03):
Right. That goes back to theJapanese playing the long game.
Yeah, great.
Well, Lee's been comingtowards the end of the show. How
can people find you?
Yeah. So LeeStewart.com L E ST E W A R T.com is the website for
the book. Feel free to lob aquestion or look at on LinkedIn as
(26:23):
well. You can order the bookfrom there if you're interested or
on Amazon. I look forward tohaving a conversation with any of
your listeners. Happy to keepit going. Okay.
If they're looking for yourservices, LinkedIn would be the best
place.
LinkedIn's the best place. Theother website I'd have is esgstrategy.com
you can find me on LinkedIn as well.
Okay. So we'll make sure allthat's in the show notes for our
(26:44):
listeners.
Yeah.
Lee's been a pleasure. Greatinsight, great conversation about
sustainability. I thinkeverybody needs to take a deep look
at it and we look forward tohaving you on the show down the road
and continuing the conversation.
Yeah, absolutely. It's been apleasure. Thanks so much.
Thanks. Hey, superfansuperstar Freddie D. Here before
(27:08):
we wrap, here's your three aplaybook power move to attract ideal
clients, turn them intoadvocates and accelerate your business
success. Here's your topinsight from today's episode. Sustainability
isn't the compliance checkbox.It's your hidden lever for competitive
advantage, strong clientloyalty and superfan referrals. Here's
(27:28):
your business growth actionstep. Schedule 5 Customer Interviews
this week to ask whatsustainability practices matter most
to them. Then align yourstrategy to become the preferred
value aligned supplier. Iftoday's conversation sparked an idea
for you or you know of afellow business leader who could
(27:49):
benefit, share it with themand grab the full breakdown in the
show notes. Let's acceleratetogether and start creating superfans
who champion your brand.
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