Typically, companies focus on economic prosperity (return on investment and growth); but society has begun to redefine “prosperity” to include sustainability. In this context, “sustainability” means meeting present business imperatives without compromising the future needs of people, planet, and profits.
While a company may sincerely aspire to social and environmental responsibility, it must nevertheless function and succeed in a ‘business as usual’ marketplace. The challenge is how to turn aspiration into reality, how to integrate sustainability into business practices and outcomes while continuing to measure up to the rubric of conventional business imperatives. Investors’ financial goals can strongly impact a company’s ability to maintain environmentally sustainable practices. Supply chain partners may not share the company’s sustainability values or may be subject to their own countervailing pressures. Retailers may resist accommodating the unique rhythms and seasons of sustainably sourced products.
Current systems evolved to serve and support the conventional understanding of prosperity; among these is the legal system. Unfortunately, the legal system tends to privilege financial imperatives over the aspirational intentions of socially/environmentally conscious companies. How can a conscious business prevent the legal system from undermining its best intentions and aspirations?  Businesses can wield such power via their contracts which establish the structures and systems for how relationships with suppliers, investors, customers, employees and others will be conducted.
Many people believe that contracts fall within the exclusive domain of the legal system. Consequently, the key document that provides the map for how they’ll conduct their relationship is essentially “owned” by someone other than the business people who must live it. When problems arise, business people look to their contracts to help them resolve disputes, make decisions, solve problems. Lawyers are consulted. Legal precedent is applied to dictate actions that often seem to defy common sense; and these dictates are imposed upon the business people by the power of the law.
The surprising truth is, it doesn’t have to be this way. The legal system sees contracts as the “private law” of the parties. What many business people do not realize (and lawyers often forget) is how much leeway the parties have to use their contracts to design their own, private legal system for how their relationship will work–choosing for themselves, the criteria by which will they’ll evaluate actions and options, and establishing customized processes for engaging disagreement and solving problems.
It is possible–even practical–to create contracts based on a company’s core values and mission, contracts grounded in common sense. Businesses can create contracts that defuse tension and that evoke side-by-side problem solving when disagreement or crisis erupts. Yes, legal expertise is needed–to ensure that the language of the contract will be supported by the legal system and is not vulnerable to subversion due to arcane legal precedent or statutes. But business people can function as lead designers of the structures and systems that will govern their relationships (as described in their contracts).
This approach to contract formation and enforcement is known by many names, among them are: Conscious Contracts, Discovering Agreement, and Values-based Contracts. Business people and lawyers across the globe are adopting this approach to harness the creative potential in disruption and disagreement. Using their own, customized problem-solving systems, they are able to engage crisis and rapidly return to productivity while remaining aligned with their key sustainability values and vision. What is more, their contracts are no longer rigid straightjackets imposing less than optimum outcomes. Instead, their contracts learn with their business as it evolves and responds to the ever changing, digital-speed, global marketplace, enabling key business relationships to endure and grow stronger.
Upcoming Training –
Conscious Contracts for Conscious Business
October 11-12, 2016; Las Vegas, NV