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本书版权归Kogan Page所有
 i

PRAISE FOR RESPONSIBLE

BUSINESS DECISION MAKING

‘Responsible business decision making refers to the necessity for a workable

balance between people, planet and profit. This book mentions the European
Green Deal as an illustration of the European Commission’s ambitious plan
to invest in structural, sustainable solutions for all of society. The method of
data and dialogue underlying the Responsible Business Simulator is an
important instrument when formulating an innovative business case.’
Diederik Samsom, Head of Cabinet, Cabinet of Executive Vice-President
of the European Commission Frans Timmermans, European Green Deal

‘Facilitates decision making for systems change and sustainable practices by

applying a smart framework that allows businesses to deliver a better
balance between people, planet and profit.’
Lara van Druten, CEO, The Waste Transformers, and Member of the UN
Advisory Board on Zero Waste

‘Companies need practical instruments to keep their emissions at levels that

fit with a 1.5 degree global warming scenario. Responsible Business Decision
Making provides tools to the business community to make decisions
respecting the climate, and a safe and inclusive working culture, while
maintaining profits.’
As Tempelman, CEO, Eneco

‘Strategic decision making in portfolio investments requires a methodology.

You need data to measure both ESG and impact as well as the progress
you’re making. The methodology described in Responsible Business Decision
Making is very helpful when nudging decisions in a more impactful direction
and provides you with the insight on what variables to work towards for a
sustainable economy. This is why this book provides distinct value.’
Guus van Puijenbroek, Director, Strategic and Family Matters, VP Capital
ii

‘Data helps companies make sustainable decisions. However, greening

business is a challenge. The cases described in this book are important to
illustrate the positive impact of data and dialogue in decision making for
improved sustainability performance and the choice for more sustainable
alternatives.’
Debby Slofstra, Country President Netherlands, Schneider Electric

‘Measurable impact is what aligns consumers. The simulator described in

Responsible Business Decision Making is a method to bring focus to
sustainable decision making in value chains, giving insight on where to
invest with impact to help regenerate nature.’
Philipp Kauffmann, Chief Grower, Original Beans

‘This book shows how fact-based insights are key for understanding public
and private priorities and one’s impact on people, planet and prosperity.’
Steven Collet, Deputy Director-General International Development,
Dutch Ministry of Foreign Affairs

‘It is crucial to restore the balance between economy and ecology. We need
to make responsible choices in the best interests of society, including climate
change, diversity and labour participation. Stakeholder management as
stressed in Responsible Business Decision Making is key to addressing
challenges on these topics.’
Koen Eising, CSR Director, Alliander
 iii

Second Edition

Responsible
Business Decision
Making
Strategic impact through data
and dialogue

Annemieke Roobeek
Jacques de Swart
Myrthe van der Plas
iv

Publisher’s note
Every possible effort has been made to ensure that the information contained in this book is
accurate at the time of going to press, and the publishers and authors cannot accept respon-
sibility for any errors or omissions, however caused. No responsibility for loss or damage
occasioned to any person acting, or refraining from action, as a result of the material in this
publication can be accepted by the editor, the publisher or the authors.

First published in Great Britain and the United States in 2018 as Responsible Business by Kogan
Page Limited
Second edition published in 2023

Apart from any fair dealing for the purposes of research or private study, or criticism or review, as
permitted under the Copyright, Designs and Patents Act 1988, this publication may only be repro-
duced, stored or transmitted, in any form or by any means, with the prior permission in writing of
the publishers, or in the case of reprographic reproduction in accordance with the terms and li-
cences issued by the CLA. Enquiries concerning reproduction outside these terms should be sent
to the publishers at the undermentioned addresses:

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London New York, NY 10018 Daryaganj
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United Kingdom India

www.koganpage.com

Kogan Page books are printed on paper from sustainable forests.

© Annemieke Roobeek, Jacques de Swart and Myrthe van der Plas, 2018, 2023

The rights of Annemieke Roobeek, Jacques de Swart and Myrthe van der Plas to be identified as
the authors of this work has been asserted by them in accordance with the Copyright, Designs and
Patents Act 1988.

ISBNs
Hardback 978 1 3986 1230 3
Paperback 978 1 3986 1228 0
Ebook 978 1 3986 1229 7

British Library Cataloguing-in-Publication Data

A CIP record for this book is available from the British Library.

Library of Congress Control Number

2023938697

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Print production managed by Jellyfish
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 v

CONTENTS

List of figures and tables xi

About the authors xvi
Preface xvii
Acknowledgements xxiv

PA R T O N E Relevance and context

01 Working towards responsibility in business and

society 3
From awareness and evidence to systems change 3
The rise of the notion of sustainability 5
Sustainability reflected in the use of standards and indices 9
The circular economy as integrating approach 14
Circular economy examples in business practices 18
The Responsible Business Simulator and the circular
economy 22
References 24

02 Creating shared value as a framework for shaping

strategy 27
The concept of shared value 28
Balancing societal and economic objectives 30
Opting for sustainable business practices is a strategic
choice 35
Towards creating a shared value strategy 36
Rolling out shared value through the Responsible Business
Simulator 39
References 40
vi Contents

03 Innovation and sustainability as catalysts for

responsible growth 45
Innovation for sustainability is the way to go 46
Sustainability as an incentive for rethinking the economic
paradigm 47
The impact of sustainability on neoclassical business
models 50
Consequences of sustainability and innovation for a circular
and inclusive economy 52
References 57

PA R T T WO Concept and methodology

04 Dialogue and stakeholder engagement in decision

making 63
Integrating stakeholder engagement into the decision-
making process 64
Dialogues with stakeholders for understanding, co-creation
and acceptance 65
The importance of interactivity in decision-making
processes 66
Interactive adjustment and determination of key outputs 68
Complex issues require an interdisciplinary approach 69
Collaboration for new insights and actionable results 70
References 71

05 The Responsible Business Simulator: the heart of the

strategic decision-making process 75
Step 1: describing the strategic challenge that requires a
decision 77
Step 2: defining key outputs involving stakeholders 79
Step 3: determining decision maker’s options 81
Step 4: drawing up scenarios 82
Step 5: constructing the simulation model 84
Step 6: evaluating options by assessing strategic priorities 87
Step 7: evaluating options by assessing risk appetite 90
References 91
 Contents vii

06 Strategic decision making based on data and

dialogue 93
Action research as suitable method 94
Action research to unleash collective intelligence 96
Data science in strategic decision making 100
Avoiding the pitfalls of spreadsheet modelling 101
Strategic decision making via the Responsible Business
Simulator 104
The added value of combined research methodologies 106
References 107

07 Using the Responsible Business Simulator 111

Step 1: describing the strategic challenge that requires a
decision 115
Step 2: defining key outputs involving stakeholders 116
Step 3: determining decision maker’s options 121
Step 4: drawing up scenarios 124
Step 5: constructing the simulation model 125
Validating simulation model 133
Step 6: evaluating options by assessing strategic
priorities 138
Step 7: evaluating options by assessing risk appetite 139
References 141

PA R T T H R E E Practical applications

08 Using SDGs to develop and deliver professional

services 145
About PwC 146
Wicked problems and SDGs 147
The strategic decision-making process 149
Describing the strategic challenge that requires a decision 150
Defining key outputs involving stakeholders 151
Constructing the simulation model 156
Results 162
Reflections 164
References 165
viii Contents

09 Accommodating Ukrainian refugees 167

About the Ukrainian refugee influx 169
Finding the best allocation of budgets for integration of
refugees 172
The strategic decision-making process 173
Describing the strategic challenge that requires a
decision 174
Defining key outputs involving stakeholders 174
Determining decision maker’s options 176
Drawing up scenarios 178
Constructing the simulation model 180
Evaluating options by assessing strategic priorities 189
Evaluating options by assessing risk appetite 190
Evidence in practice for mixed allocations 191
Reflections 194
References 195

10 Increasing the social impact of banking 203

About de Volksbank 203
About quality of life and good housing 208
The strategic decision-making process 210
Describing the strategic challenge that requires a
decision 210
Defining key outputs involving stakeholders 211
Determining decision maker’s options 218
Drawing up scenarios 219
Constructing the simulation model 220
Evaluating options by assessing strategic priorities 222
Evaluating options by assessing risk appetite 222
Reflections 224
References 225

11 Creating a healthy and productive working

environment 227
About IZZ 228
Empowering employees 228
 Contents ix

The strategic decision-making process 230

Describing the strategic challenge that requires a
decision 230
Defining key outputs involving stakeholders 231
Determining decision maker’s options 234
Drawing up scenarios 237
Constructing the simulation model 238
Evaluating options by assessing strategic priorities 247
Evaluating options by assessing risk appetite 250
Reflections 251
References 253

12 Reducing greenhouse gas emissions 257

About DSM 258
About energy sourcing 259
The strategic decision-making process 263
Describing the strategic challenge that requires a
decision 264
Defining key outputs involving stakeholders 264
Determining decision maker’s options 266
Drawing up scenarios 269
Constructing the simulation model 269
Evaluating options by assessing strategic priorities 272
Evaluating options by assessing risk appetite 274
Reflections 275
References 276

13 Sustainable procurement decisions for waste collection

systems 279
About Rimetaal (now part of Kliko) 280
Sourcing waste collection systems 280
The strategic decision-making process 282
Defining key outputs involving stakeholders 283
Determining decision maker’s options 286
Drawing up scenarios 287
Constructing the simulation model 289
x Contents

Evaluating options by assessing strategic priorities 294

Evaluating options by assessing risk appetite 296
Reflections 298
References 301

14 Putting roof renovation in a strategic context 303

About NEMO 303
Renovating NEMO’s roof 304
The strategic decision-making process 306
Describing the strategic challenge that requires a
decision 307
Defining key outputs involving stakeholders 308
Determining decision maker’s options 308
Drawing up scenarios 313
Constructing the simulation model 314
Evaluating options by assessing strategic priorities 317
Evaluating options by assessing risk appetite 318
Reflections 320
References 322

15 Conclusions 323
Facilitating decision making for systems change and
sustainable practice 323
Overview of cases 327
Reflections – and looking forward 337
References 338

Glossary 339
Index 343

Readers can access the Responsible Business Simulator at

www.koganpage.com/product/responsible-business-decision-
making-9781398612280
 xi

LIST OF FIGURES
AND TABLES

Figures
Figure 1.1 Sustainability awareness and action timeline
1972–2015 6
Figure 1.2 The circular economy 16
Figure 3.1 Innovative technological scenarios 54
Figure 5.1 The decision-making process: three phases and seven
steps 78
Figure 5.2 Input of strategic priorities leads to scores per option
per scenario 89
Figure 5.3 Processing risk appetite leads to one score per
option 90
Figure 6.1 Many spreadsheets for decision making still follow
confirmative reasoning 104
Figure 7.1 The decision-making process: three phases and seven
steps 112
Figure 7.2 The tables in the database connected to the steps of
the decision-making process 113
Figure 7.3 Example of a non-linear (non-monetary), non-STB
appreciation function for Beerwiser example 120
Figure 7.4 Calculation flow within the Responsible Business
Simulator 126
Figure 7.5 Dependencies as displayed in Step 5 of the strategic
decision-making process for Beerwiser example 135
Figure 7.6 Sensitivity of ‘water consumption reduction’ to
changes in ‘invest in water recycling’ for Beerwiser
example 137
Figure 7.7 Comparison of decision maker’s options when more
focus is put on reduction of accidents in the base-case
scenario for Beerwiser example 139
Figure 7.8 Comparison of decision maker’s options when more
focus is put on reduction of accidents for all scenarios
for Beerwiser example 140
xii List of Figures and Tables

Figure 7.9 Comparison of decision maker’s options when all

scenarios have equal weights for Beerwiser
example 141
Figure 8.1 Three-step approach to establishing thresholds 158
Figure 8.2 Appreciation curve percentage of suppliers that have
science-based targets for emissions reduction 160
Figure 8.3 SDG impact measurement results 163
Figure 9.1 Sensitivity of ‘unemployment rate reduction refugees’
to changes in ‘employment and matching’ for
Refugees case 186
Figure 9.2 Comparison of decision maker’s options when all key
outputs have equal weights in base-case scenario for
province of Utrecht for Refugees case 189
Figure 9.3 Four decision maker’s options evaluated under three
scenarios for the province of Utrecht for Refugees
case – all weights equal 191
Figure 9.4 Four decision maker’s options evaluated under three
scenarios for the province of Utrecht for Refugees
case 192
Figure 10.1 Moving from reports based on multiple measurement
scales to strategic plans for shared value 206
Figure 10.2 Value tree for regional liveability 211
Figure 10.3 Neighbourliness monitor of RegioBank 214
Figure 10.4 Overview of target groups for Housing Accessibility
Monitor 215
Figure 10.5 Residential Accessibility Monitor of BLG Wonen 217
Figure 10.6 Example of dependency tree in simulation model for
RegioBank case 221
Figure 10.7 Comparison of interventions across key outputs for
RegioBank case 223
Figure 11.1 Comparison of decision maker’s options when all key
outputs have equal weights in neutral scenario for
IZZ case 248
Figure 11.2 Comparison of decision maker’s options when equal
weights are assigned to absenteeism and staff turnover
only in neutral scenario for IZZ case 249
Figure 11.3 Score per scenario for two specific decision maker’s
options when all key outputs have equal weights for
IZZ case 250
Figure 12.1 Decision tree for energy sourcing in DSM case 268
 List of Figures and Tables xiii

Figure 12.2 Comparison of decision maker’s options when all key

outputs have equal weights in the neutral scenario for
DSM case 273
Figure 12.3 Comparison of decision maker’s options when all key
outputs have equal weights for all scenarios for DSM
case 274
Figure 13.1 Comparison of decision maker’s options when weight
is assigned only to key output ‘TCO’ in the base-case
scenario for Rimetaal case 295
Figure 13.2 Comparison of decision maker’s options when all key
outputs have equal weights in the base-case scenario
for Rimetaal case 296
Figure 13.3 Comparison of decision maker’s options when all key
outputs have equal weights for all scenarios for
Rimetaal case 297
Figure 13.4 Comparison of decision maker’s options when weight
is assigned only to key output ‘TCO’ for all scenarios
for Rimetaal case 297
Figure 14.1 NEMO’s roof: the upper roof is the higher, rounded
section 309
Figure 14.2 Comparison of decision maker’s options when all
themes have equal weights in the base-case scenario
for NEMO case 318
Figure 14.3 Comparison of decision maker’s options when weight
is assigned only to theme ‘profit’ for all scenarios for
NEMO case 319

Tables
Table 1.1 Notable frontrunners in S&P Global’s The
Sustainability Yearbook 2022 10
Table 7.1 The two databases completed (1a and 1b) after Step 1
for Beerwiser example 116
Table 7.2 Database 2b (key outputs) completed for Beerwiser
example 118
Table 7.3 Database 3a (internal variable inputs) completed for
Beerwiser example 122
Table 7.4 Database 3c (decision maker’s options) completed for
Beerwiser example 123
Table 7.5 Database 4c (scenarios) completed for Beerwiser
example 126
xiv List of Figures and Tables

Table 7.6 Database 5a (fixed inputs) completed for Beerwiser

example 127
Table 7.7 Database 5d columns (model elements) for Beerwiser
example 132
Table 7.8 Database 5d columns completed for Beerwiser
example 134
Table 8.1 Overview of key outputs per SDG 152
Table 9.1 Key output definitions for Refugees case 175
Table 9.2 Internal variable input definitions for Refugees
case 177
Table 9.3 Specification of scenarios for Refugees case 179
Table 9.4 Specification of fixed inputs for the region of Utrecht
for Refugees case 181
Table 9.5 Definitions of fixed inputs related to direct effects for
Refugees case 182
Table 9.6 Values of fixed inputs related to direct effects for
Refugees case 182
Table 9.7 Specification of maximum possible effects of internal
variable inputs for Refugees case 184
Table 9.8 Specification of maximum indirect effects on
intermediates for Refugees case 187
Table 9.9 Specification of maximum indirect effects on key
outputs for Refugees case 188
Table 10.1 Results of the Dutch Banking Monitor on a scale
from 1–10 204
Table 10.2 Key outputs in theme ‘Neighbourliness’ for
RegioBank case 212
Table 11.1 Key output definitions for IZZ case 232
Table 11.2 Internal variable input definitions for IZZ case 235
Table 11.3 Specification of scenarios for IZZ case 238
Table 11.4 Specification of fixed inputs for imaginary Golden
Years elderly care home for IZZ case 239
Table 11.5 Fixed inputs definitions for direct effect calculations
for IZZ case 241
Table 11.6 Specification of fixed inputs for IZZ case 241
Table 11.7 Specification of maximum effects for IZZ case 242
Table 11.8 Key output values calculated for ‘Mix’ intervention in
neutral scenario for IZZ case 247
 List of Figures and Tables xv

Table 12.1 Key output definitions for DSM case 265

Table 12.2 Specification of decision maker’s options for DSM
case 267
Table 12.3 Specification of scenarios for DSM case 270
Table 12.4 Specification of (internal) fixed inputs for DSM
case 271
Table 12.5 Specification of (external) fixed inputs for DSM
case 271
Table 13.1 Key output definitions for Rimetaal case 284
Table 13.2 Internal variable input definitions for Rimetaal
case 286
Table 13.3 Specification of decision maker’s options for Rimetaal
case 287
Table 13.4 External variable input definitions for Rimetaal
case 288
Table 13.5 Specification of scenarios for Rimetaal case 289
Table 13.6 Specification of fixed inputs for Rimetaal case 290
Table 13.7 Definitions of intermediates for Rimetaal case 292
Table 14.1 Key output definitions for NEMO case 307
Table 14.2 Specification of decision maker’s options for NEMO
case 311
Table 14.3 Specification of external variable inputs for NEMO
case 314
xvi

ABOUT THE AUTHORS

Annemieke Roobeek is Professor of Strategy and Transformation

Management at Nyenrode Business University and CEO of
MeetingMoreMinds and GrwNxt.
Jacques de Swart is a Partner within PwC and a Professor of Applied
Mathematics at Nyenrode Business University.
Myrthe van der Plas is responsible for the Data Analytics Group
within PwC Consulting and is the founder of Lakisama Foundation.
 xvii

PREFACE

This is the Age of Transformation. We are on our way to a greater

understanding of Responsible Business in both strategy and daily
practice. In this age of transformation changes, and the opportunities
they offer, come along at the same time: disruptive technologies, cli-
mate change, values advocated by social movements, global tensions
and new orders in geopolitics. We are in the middle of a major sys-
tems change. How can we make the right decisions to take care of
People, Planet and Profit?
There is momentum for an innovative, combined quantitative and
qualitative approach to strategic decision making. There is a need to
move beyond the traditional spreadsheets for financially-based deci-
sion making, and to look beyond intuition and personal conviction
for including non-financial aspects. The combined forces of data sci-
ence and interactive strategy in the Responsible Business Simulator
(tRBS) unleash the collective intelligence of the boardroom, profes-
sionals, stakeholders and the wealth of public knowledge. This com-
bined approach provides a solid base for decisions and investments
shaping the future of companies and societies.
The tipping point draws nearer for new paradigms such as climate
neutral production, zero emissions, no waste and circular economy.
Similarly, more people want to leave the rat race and find a healthier
work–life balance. The historic Paris Agreement on climate change,
adopted by 192 countries in December 2015, was a clear signal to
stimulate renewable energy, cleaner technologies and massive invest-
ments in infrastructure. The rethinking of supply chains, the use and
reuse of materials, modes of transport and ways of working will have
a tremendous impact on reaching a better balance between people,
planet and profit. Add to this the implementation of a range of disrup-
tive technologies, ranging from ChatGPT, neuro-robotics, electrifica-
tion, genomics and personalized healthcare, and the conclusion is that
the world is changing at a rapid speed, and that c­ ompanies and gov-
ernmental institutions have to respond by making strategic decisions.
xviii Preface

Although the tipping point is being approached through a multi-

tude of developments, this does not mean that it is easy to implement
sustainable business practices. The frontrunners, still a relatively
small but rapidly growing group of companies, are leading the way,
but often pay a high price for their conviction that – in the long run –
they are doing the right thing for all concerned, including themselves.
Many businesses and organizations are struggling with the strategic
choice of structurally implementing sustainable and inclusive busi-
ness practices. It is exactly in this phase, when we are moving to-
wards the tipping point and when a turnaround in management
thinking is taking place in favour of sustainable operations, that it is
essential to be able to make rational decisions on the basis of facts
and figures, both for financial and non-financial reasons. This is
where tRBS comes into play.
Based on weighted Key Outputs, which have been identified as
keys for success by management and employees in an interactive
Strategic Dialogue process, tRBS can provide concrete forecasts
about the impact of sustainable investments on medium-term opera-
tional results. Those forecasts are presented in digital simulations
that can be fine-tuned to different conditions; hence the fact that the
model is referred to as a ‘simulator’.
The Responsible Business Simulator is innovative in more ways
than one. It is an advanced mathematical calculation model that
eliminates bias and objectifies the strategic decision-making process,
because it uses weighted key outputs. In addition, it attaches value –
in the form of Scenarios – to historical data about a company and to
the opinions of external experts. Using these scenarios, which blend
historical facts with impartial external expertise, the model is able to
estimate the probability that a particular option for a strategy based
on sustainability and social inclusivity will have a positive or less
positive impact on the company. It simulates the reactions of decision
makers and employees, presenting various probabilities in a compre-
hensible way. A strategic dialogue about key outputs for success is
combined with weighted fact-based scenarios, and the result is calcu-
lated statistically and presented visually. The results allow the Board,
management and employees to take decisions on the basis of hard
facts on financial and non-financial items.
 Preface xix

Finally, the model allows decision makers to tweak the results so

that they can determine their own timeline, along which all aspects of
the triple bottom line and the 3Ps of people, planet and profit can be
incorporated and calculated.
In the real world, however, strategic decisions are not always ra-
tional. Other considerations always creep in. We are of the opinion
that the added value of a rational model, such as tRBS, lies precisely
in the fact that it can clarify highly diffuse strategic considerations.
This can lead to greater insight on the part of decision makers, to
better prospects for investors and shareholders, and to more trans-
parency and accountability vis-à-vis the stakeholders – both within
the company, and in society as a whole.

Our vision for balanced decision making

The combination of interactive strategic decision making and ad-
vanced data analytics gives companies, organizations and govern-
mental agencies new insights for balanced investment decisions in the
era of sustainability and an inclusive society. The strategic dialogue in
an action research setting unleashes the informal and formal knowl-
edge underlying the long-term mission of the organization and its
potential to realize its goals. Data science techniques allow the com-
parison of large amounts of data for visualizing different scenarios.
The combination of qualitative and quantitative approaches is a
powerful tool for decision makers who have to meet financial and
non-financial objectives in a society on the brink of a new paradigm.
The combination of these forces is what distinguishes this book
from existing approaches. As authors with strategy and data analyt-
ics backgrounds we have a track record of proven results both in
academia and in advising international companies and the public sec-
tor. Our purpose in writing this book was to provide a practical
­description of the strategic decision-making tool that we have devel-
oped and its application in highly diverse settings in companies and
organizations. The book is also the gateway to an advanced software
tool that allows you as the reader to play around with the data for
strategic decision making.
xx Preface

We hope this book will inspire students at universities and busi-

ness schools, as well as being a practical guide for advisors, c­ onsultants,
investors and policymakers in developing a feasible sustainability
strategy for companies and organizations in the private and the pub-
lic sector. The book will appeal to a broad range of readers, from
those who are interested in finance, economics and modelling, to
those who are involved in strategy and broader sustainability and
inclusivity issues. The fact that the insights and software tools can be
used immediately makes it accessible to all: professionals, consult-
ants to the financial sector, as well as to students in the classroom for
reviewing the case studies. For strategists the advantage of using data
science will be an eye-opener, as it is for data-driven consultancies
and investors to learn from the process of strategic dialogue and the
added value of iterative, interactive decision making in highly diverse
teams. For all target groups the challenge is to understand the under-
lying complexity of factors that give evidence of the choices to be
made within the internal and external contexts of the company or
organization.
Strategy is no longer the exclusive domain of the boardroom,
­although major decisions are taken there. Both private- and public-
sector organizations have seen changes in attitudes, which are advo-
cating new ways of working, more prudent treatment of the planet,
and greater consideration of people’s health and wellbeing. The need
for interaction with internal and external experts, as well as stake-
holders and opinion leaders, has become pivotal to the successful
execution of strategies. The strategy concepts in this book are un-
derpinned by theories around multi-stakeholder management,
­strategic dialogue and unleashing knowledge potential by empower-
ment, as well as theoretical concepts underlying action research and
grounded theory.

How the book is organized

The book consists of three parts. Part One describes the transforma-
tive forces and paradigm changes that are under way. In Chapter 1 we
start with the rise of the concept of ­‘sustainability’ and how we are
 Preface xxi

moving from awareness to systems change in a circular economy and

an inclusive society. We offer examples of frontrunners in business
who are demonstrating this profound change in the economy. In sub-
sequent chapters we go on to describe concepts that try to achieve a
better balance between the interests of companies, shareholders and
stakeholders. We dig deeper into the concept of ‘shared value’ in
Chapter 2, and in Chapter 3 we argue that there is no alternative to
sustainability. In this chapter we describe the potential offered by in-
novations stemming from sustainability and give examples of disrup-
tive changes already taking place, alongside examples of role models
demonstrating sustainability and responsibility in practice. Part Two
explains the concept of ‘data and dialogue’ and intro­duces the
Responsible Business Simulator (tRBS). In Chapter 4 the importance
of stakeholder management and interactivity in strategic decision-
making processes is elucidated. We propose that collaboration is nec-
essary for new ­insights and actionable results.
Chapter 5 gives the reader a better idea of the combined forces of
the strategic dialogue based on action research and the application of
data science for neutralizing information and knowledge into facts
and figures. In Chapter 6 we describe the methodologies used, and
provide a user guide in Chapter 7.
Part Three elaborates on the application of the ‘strategic dialogue’
and the use of tRBS. These form the core and are illustrated in the
cases presented in Chapters 8 to 14. To explain the working of the
methodology and tRBS in practice we compiled a series of case stud-
ies. We applied the combined methodology of data and dialogue in
various companies, from a global science-based company to a health-
care organization, and from the use of sustainable development goals
in a global consultancy firm to creating a sustainable roof of a science
museum – and more. We chose these highly diverse companies and
organizations on purpose to investigate the usefulness of the simula-
tion model and our combined quantitative and qualitative approach.
Each of the case studies starts with a short introduction, some facts
about the company or organization, and the strategic issue at stake.
They show how the strategic dialogue triggers the conversation and
the search for solutions. The data process is illustrated by visualizing
xxii Preface

each of the steps in the decision-making process. Each of the cases

illustrates one of the 3Ps (people, planet and profit). For example, the
P of Planet is central to DSM, a globally operating company active in
health, nutrition and materials, and a frontrunner in balancing peo-
ple, planet and profit. For DSM the strategic issue is how to antici-
pate climate change by addressing their environmental and carbon
footprint and finding options to reduce greenhouse gas emissions.
The case study in Chapter 14, the NEMO Science Museum, discusses
the decision making surrounding how to repair the roof of its land-
mark building in Amsterdam. Should they go for a simple repair and
maintenance solution or is it possible to create a sustainable roof that
gives space to an outdoor exhibition area with even more attractions
for the public? In another case we shift the focus to a highly special-
ized metalworking company, Rimetaal, that does its utmost to score
high in all of the 3Ps, but has difficulties in selling its sustainable
waste collection systems to local municipalities and struggles to sur-
vive as a sustainable company. In this example we describe the sur-
prising outcome of the process, and how the company changed its
­business model based on the Responsible Business Simulator.
In other cases we focus more on the P of People. In the case of IZZ,
the strategic issue is one of creating a better working environment in
healthcare and reducing costs of health- and stress-related absentee-
ism. We created the inputs for the simulation model together with the
IZZ professionals. They were so eager to understand the model that
they learnt how to apply it themselves, and now support decision-
making processes at numerous healthcare institutions. Another ex-
ample of the application of the combined methodology is the case of
a global professional services firm who has applied tRBS to help them
use the UN’s Sustainable Development Goals (SDGs) as guidance in
their organizational practices. The plight of Ukrainian refugees pro-
vides another example of how tRBS can be used to get the facts on the
table while at the same time doing justice to the emotions expressed
by stakeholders. The application of strategic decision making towards
a ­sustainable economy and an inclusive society in this context has the
purpose of supporting policymakers in their decision making regard-
ing their response to the refugee crisis in a fact-based dialogue.
 Preface xxiii

In most cases all 3Ps of people, planet and profit come together in
different weights and balances. It is a nice illustration of clarifying
the options by assessing the risk appetite for the investors. With the
Responsible Business Simulator, policymakers, consultants, strate-
gists and executives in the boardroom are able to make better deci-
sions based on a better foundation, firmly grounded in facts, figures
and the outcomes of dialogues.
In our closing chapter we invite you to explore with us the world
of interdisciplinary research, collaboration and interactive strategy
combined with highly advanced data science for better strategic deci-
sion making in the age of transformation and systems change.
xxiv

ACKNOWLEDGEMENTS

Research is continuously developing and new theories are always

being formulated to give rise to new research. Much of this happens
in isolation and an interdisciplinary approach is rare rather than
common. However, being affiliated to Nyenrode Business Universiteit
and to advisory companies, we are used to collaborative research;
interdisciplinarity is essential to answer questions that are relevant to
society, the environment and organizations. We tested the resulting
concept via ‘action research’, an interactive and iterative research
process.
For the development of our strategic decision-making approach,
multiple disciplines have been brought together to facilitate scientific
cross-pollination, and we would like to thank everyone who has con-
tributed to the creation of this book.
For the cases: Feike Sijbesma from DSM; Roy Wolbrink from
KLIKO/Rimetaal; Agnes Kiers and Bernd Jan Sikken from de Volksbank;
Michiel Buchel from NEMO; Anouk ten Arve from the IZZ Foundation;
and Cees Jellema from the Provincie Utrecht for sharing his knowledge
on the refugees case.
Our Nyenrode guest lecturers: Carl Koopmans (SEO), Georgette
Lageman (de Volksbank) and Wouter Koerselman (Hines).
From MeetingMoreMinds: Coen Hilbrands for his insights and
critical review.
From PwC: Mila Harmelink, Jasper Kunst and Christian Vijfvinkel
from the Data Analytics Group for their part in improving the meth-
odology and the Responsible Business Simulator; Thom-Ivar van
Dijk, Mike Verdaasdonk and Kailey van Zomeren for their help in
improving the simulation model; Wineke Haagsma, Tom Kroes,
Laura van Liere, Nikki Molenaar and Paul Koster for their contribu-
tion to the SDG case; and Martine Koedijk, Oleksandra Prokopenko,
Inderdeep Singh, Beau Furnee, Eva de Bakker, Ankita Shrivastava
and Mylene Ingwersen for the refugees case. Our Nyenrode lecturers
 Acknowledgements xxv

Laura van Liere, Mylene Ingwersen, Manon Figee, Annabel de Goede,

Leidy Kupers and Stijn Ticheloven.
Last but not least Kees Ramselaar and Chris Kuip from AIMMS for
brainstorming with us on the practical implementation of the
Responsible Business Simulator as a software platform; Elke
Vergoossen from Boom Publishers for their support throughout the
process; and of course Nick Hoar, Susan Hodgson and Isabelle Cheng
from Kogan Page for their valuable input and enjoyable collaboration.
xxvi

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 1

PART ONE
Relevance
and context
2

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 3

Working 01
towards
responsibility
in business
and society
From awareness and evidence to systems
change
Let’s start by talking positively about systemic change. Change is ur-
gently needed, but to date resistance to these changes has been hard
to overcome. But now there are positive signs that resistance is weak-
ening. There is much greater awareness of the need for bold decisions
to contribute to the health, wellbeing and sustainability of our Planet,
its People and company Profits (the 3Ps) in a much more balanced
way. There is daily evidence of human impact on the world’s climate.
With the extreme weather events that have taken place all around the
globe in recent years, few deny climate change any longer. The images
of massive floods in Pakistan and Australia, bush fires in Southern
Europe and California, shrinking icefields on the Poles and in the
Alps, and the years of drought in the Horn of Africa show us the
devastating impact of climate change all around the globe.
At the same time, there couldn’t be a sharper contrast between the
recent disappointing COP27 events in Egypt in 2022 and the optimis-
tic mood after COP21 in 2015 in Paris, when 196 countries signed a
legally binding treaty to pursue efforts to limit temperature increase to
1.5°C. The message of the highly regarded Intergovernmental Panel
4 Relevance and Context

on Climate Change report (IPCC, 2022) was clear, and based solidly
on extensive international research. The cumulative scientific evidence
is unequivocal. Climate change is a threat to planetary health, human
wellbeing and indeed human existence in the hardest-hit parts of the
world. There is an urgency, and no time to waste. However, instead of
accelerating measures to counteract the dangers, some fear further
delays in reaching climate targets. There are still lobbying activities by
companies seeking short-term self-interest.
The immediate challenge posed by climate change goes beyond the
type of energy we are using. Fossil fuel-based energy is still dominant.
The shift from fossil fuel to renewable energies, green hydro and
clean technologies will certainly help to reduce the amount of green-
house gas emissions, but it won’t be enough. It will replace part of the
energy demand, but the demand for energy, materials, water, food,
cars, computers and data centres will continue to increase as long as
the paradigm of the current economic system remains the same.
Awareness of a need for systemic change started among scientists,
farmers and grassroots activists in the 1960s, when heavily polluted
rivers in industrial countries were endangering food production and
health. This seems a long way behind us now, with strict regulation
in place in Western countries, but it does not mean the problem is
solved. With the internationalization of production to developing
and emerging countries, the problem has become global. In today’s
global community, many products are manufactured in countries in
Asia, South America and parts of Africa; the mobile phone purchased
in London will have been manufactured in China with intricate sup-
ply chains of rare materials, energy streams and prescribed designs
that come from remote places of the world. As a consequence, the
challenge to safeguard the planet as well as the health of its people
with transparent governance has become even more urgent than be-
fore. At the same time, the many initiatives taken by global, regional
and national organizations to bring the world into a better ecological
balance show the complexity of the issues at stake.
But, notwithstanding setbacks and the powerful fossil fuel industry
lobbies, change is inevitable. We have entered the age of systems
change, circular economy and social inclusion, where companies, pol-
iticians, citizens, farmers, non-governmental organizations (NGOs)
 Working Towards Responsibility in Business and Society 5

and the academic community have to rethink the paradigm of the

economic system. Sustainable growth is perhaps one of the greatest
challenges humankind is facing. Systemic change requires profound
insight into the current economic system. The move towards a circular
economy and social inclusion requires more than redesigning prod-
ucts and recycling. It is about shaping a safe technical, social and psy-
chological working culture for everyone, a better work–life balance,
taking into account externalities in the pricing of products and ser-
vices, reducing inequality, and making the world a better place for all.

The rise of the notion of sustainability

The concept of sustainability has been around for more than 50
years. The notion of sustainability has been defined in the literature
in an almost infinite variety of ways (Elkington, 1997) – a timeline of
events is presented in Figure 1.1. When the Club of Rome, an inter-
disciplinary think tank, published its report titled ‘The Limits to
Growth’ in 1972, it was the first time that the possible long-term
consequences of economic actions on the climate had been presented
on a global scale (Meadows et al, 1972). The report caused a great
deal of concern and fuelled much debate. One of the early warnings
of the need for systems change came from the late Herman E Daly
(1938–2022) who worked on the topic of limits to growth even be-
fore the Club of Rome. Daly, a mathematician, laid the foundation
for the ecological economy. He made a plea for a steady-state econ-
omy that respects the carrying capacity of planet Earth. Decades after
his theory was derided by neoclassical economists his work gradually
got more attention and he began to collaborate with Dennis Meadows
of the Club of Rome, later going on to develop the ‘Index of
Sustainable Economic Welfare’ (ISEW) with John Cobb. In recent
years Daly became the inspiration for ‘degrowth’ economist Jason
Hickel, as well as for Kate Raworth’s Doughnut Economics, calling
for a balanced growth between social, environmental and economic
dimensions (Tielbeke, 2022).
The present-day activities of the Club of Rome focus less on the
end of growth and more on sustainability in a broad sense. At around
6 Relevance and Context

Figure 1.1 Sustainability awareness and action timeline 1972–2015

1972 1987 1994 2002

the same time as the Club of Rome’s report, the term ‘sustainable
development’ was receiving substantial attention following the
United Nations Conference on the Human Environment (1972),
which resulted – 15 years later – in the Brundtland Report of 1987.
That report was later published in book form, under the title Our
Common Future, by the World Commission on Environment and
Development (WCED, 1987), and in which the Commission defined
sustainable development as follows:

The development that meets the needs of the present without

compromising the ability of future generations to meet their own needs.

The Brundtland definition has been applied consistently during the

many UN conferences held on this subject, such as the UN Earth
Summit in Rio de Janeiro in 1992, the Kyoto Protocol of 1997, and
the Climate Conferences in Copenhagen in 2009, Dublin in 2011,
Paris in 2015, Marrakech in 2016, Bonn in 2017, Katowice in 2018,
Madrid in 2019, Glasgow in 2021, COP27 in Sharm El Sheikh in
2022, and UAE in 2023. The success of the UN-organized COP meet-
ings is mixed in terms of breakthroughs for climate change. Coming
closer to consensus is a prerequisite; however, regional differences,
economic opportunities and limited commitment to the goals are
more common nowadays.
 Working Towards Responsibility in Business and Society 7

According to Rogers and Hudson (2011), the following four core

elements can be identified from the Brundtland definition of sustain-
able development:

1 recognition of sustainability as a global problem, with global

responsibilities
2 recognition of the limits of growth, or at least of the necessity to
structure growth so as to take advantage of the options that are
least destructive for the natural environment
3 recognition of social equality as an important consideration,
especially in offering opportunities for economic and social
progress for less-developed countries
4 giving long-term planning over future generations a new priority,
and recognizing the fact that market economies tend to lean on
short-term interests and are often at risk of losing sight of long-
term goals

As can be seen from this explanation of the UN definition of sustain-

ability, it is a highly complex subject and one that can be approached
from a variety of directions.
With the awareness of the importance and impact of sustainability,
with the triple bottom line (TBL) that has people, planet and profit as
its pillars, the rise of corporate social responsibility (CSR) initiatives
in companies, consultancies and NGOs started during the 1990s
(Elkington, 1997). In the early 2000s the cradle to cradle (C2C) de-
sign concept became popular among companies that wanted to rede-
sign their products and supply chains to prevent waste. All material
inputs and outputs of this design concept are seen as ‘nutrients’ which
can be reused or recycled (McDonough and Braungart, 2002). With
this cradle to cradle concept a big leap forward was made towards
what was coined a decade later in 2012 by the Ellen MacArthur
Foundation as the circular economy. The Foundation advocated an
accelerated transition to a circular model with numerous business
and economic opportunities, within which the three pillars of the
TBL become integrated (Ellen MacArthur Foundation, 2012). This
integration of the people, planet and profit pillars builds on the earlier
8 Relevance and Context

concept of shared value creation, developed by Porter and Kramer

and adopted by many companies (Porter and Kramer, 2011).
The central premise of shared value is that there is a mutual de-
pendence between the competitiveness of a company and the health
of the communities around it. Recognition of these connections be-
tween people, planet and profit (the 3Ps) can lead to opportunities,
spurring on both societal and economic progress. In a short period of
time this framework has gained inroads into businesses worldwide,
although criticism from economists was expressed in numerous aca-
demic articles. (We will elaborate further on this in Chapter 2 where
we will dive deeper into the enhanced concept of shared value.) At a
societal level, the United Nations Development Programme (UNDP)
has worked on Sustainable Development Goals (SDGs). As succes-
sors of the Millennium Development Goals, these 17 SDGs cover
social, ecological and economic objectives, and engage both develop-
ing and developed countries to help achieve these goals. According to
the UN, businesses and companies worldwide have been and will be
at the forefront of creating this change. This UNDP intergovernmen-
tal platform has made positive inroads into boardrooms’ and govern-
ments’ agendas. It has proven to be a workable overview that serves
as an overall objective for a better world. For companies, organiza-
tions and NGOs it brings focus in defining their aspirational objec-
tives and subsequent strategies.
We are approaching the ‘tipping point’ of sustainable business opera-
tions. During the past two decades more and more enterprises and
­organizations, including governments, have used annual reports and
strategic policy papers to point out that sustainability has become a
crucial factor in the way in which they design their strategy and policies,
manufacture their products and deliver their services (Nidumolu et al,
2009). Many start-ups and impact-driven enterprises have sustainabil-
ity at the core of their mission. These kinds of companies develop many
innovative solutions that contribute to alternatives for non-sustainable
mainstream products. The increasing customer demand for sustainabil-
ity, the uncertainty and high cost of energy, the geopolitical shifts in
power, the finite nature of raw materials, and the negative ­impact that
 Working Towards Responsibility in Business and Society 9

present-day production methods have on the environment are all

prompting more inventive and sustainable alternatives.

Sustainability reflected in the use

of standards and indices
For many years international indices such as the Dow Jones
Sustainability Index (DJSI, started in 1999) were paid only scant at-
tention. Today this index is called the S&P Dow Jones Indices. A large
part of a company’s reputation and credibility on sustainability relies
on the fact that they have a good ranking in this and similar indices.
From 2020 the CSA (Corporate Sustainability Assessment) will be is-
sued by S&P Global. It has become the basis for numerous S&P eco-
nomic, social and governance (ESG) indices over the last two decades,
attracting billions of US dollars in assets. One change with the years
before 2021 is that, as the sustainability performance accelerates,
S&P Global sees more value in rewarding groups of top-performing
companies in sectors rather than focusing on individual company
rankings. Companies can be ranked in Gold, Silver or Bronze class, or
mentioned in the Yearbook as a member. The Gold class is for com-
panies whose score is within 1 per cent of the top-performing com-
pany’s score in their industry. There is also a category called Industry
Mover. Companies in the top 15 per cent of their industry that par-
ticipated in the CSA last year and the current year, who achieved an
improvement in their S&P ESG score of at least 5 per cent, and who
achieved the strongest improvement in their industry, are awarded an
Industry Mover Sustainability Award. The frontrunners in S&P
Global’s Sustainability Yearbook 2022 are listed in Table 1.1.
Stakeholders ask for more transparency into a company’s ESG
profile, which can be found on the S&P Global ESG Scores website.
Aside from the fact that investing in sustainability provides better
social and environmental conditions, companies are learning that it
can also lead to cost savings in the longer term. Sustainability has
become a mark of competitiveness. At the same time we must also
acknowledge that ‘greenwashing’ with ESGs is a serious issue raised
10 Relevance and Context

Table 1.1 Notable frontrunners in S&P Global’s The Sustainability Yearbook 2022

Company Sector Award(s)*

ABN Amro Banking Yearbook member

BMW Automobiles S&P Global Silver Class
Heineken Beverages Yearbook member
Shell Oil & Gas Upstream & Yearbook member
Integrated
Randstad Professional Services Yearbook member
ASML Semiconductors & Yearbook member
Semiconductor
Equipment
KPN Telecommunication Global Bronze Class
Services
Philips Healthcare Equipment & Global Silver Class
Supplies
Yamaha Motor Co. Automobiles Global Silver Class
ASR Insurance Global Bronze Class
Samsung Conglomerates Industrial Yearbook member
Ahold Delhaize Food & Staples Retailing Global Silver Class
Signify Electrical Components & Global Gold Class
Equipment
Siemens Industrial Conglomerates Global Gold Class
DSM Not included Not included
ING Not included Not included
Unilever Personal products Global Gold Class
Air France/KLM Airlines Yearbook member
*These companies are a selection of the many different S&P awards discussed above

by critics. According to Investico and Follow the Money (Change Inc,

2022) almost half of the most sustainable (dark green, article 9 under
SFDR – Sustainable Finance Disclosure Regulation) category invest-
ment funds is (still) being invested in shares and bonds of companies
in the fossil fuel industry or airlines. Both Actiam Blackrock and BNP
Paribas launched supposed ‘green’ funds which still invested in fossil
fuel companies. The dark green label should not be misused as a mar-
keting tool, but as a promise to the investors.
 Working Towards Responsibility in Business and Society 11

The triple bottom line standard uses a somewhat wider definition

of sustainability, and aims to measure the financial, social and envi-
ronmental performance of a company over time, rather than merely
the traditional measure of corporate profit. TBL is based on three
pillars: people, planet and profit (PPP or 3Ps). These pillars were for-
mulated by John Elkington in his book Cannibals with Forks: The
triple bottom line of 21st-century business (1997). Even then they
were not entirely new: the concept of people, planet and profit had
already been broached in the United Nations Brundtland report of
1987 (WCED, 1987).
What makes the triple bottom line – whether expressed as TBL or
as PPP – such an interesting framework is the fact that in 2007 it
became the UN standard for the full-cost accounting of the public
sector. It is used to calculate eco-footprint and goes beyond the scope
of the S&P Global indices in the sense that economic operating re-
sults are not considered solely in terms of sustainability, but are ap-
praised in conjunction with social aspects.
It ought to be noted that one difficulty posed by the TBL is the fact
that it is extremely difficult to capture environmental and social
standards in one single value. In order to ‘weigh’ the 3Ps against each
other, one must account for profit in the same terms as people and
planet. The Responsible Business Simulator (tRBS), which will be in-
troduced in Chapter 5, provides a solution to this problem.
Corporate social responsibility (CSR) is used as an umbrella term
derived from the TBL to describe entrepreneurial behaviour. In the
case of the TBL, it is explicitly clear that companies must not only
account for their performance to shareholders but also to other
stakeholders (Wheeler et al, 2003). The concept of profit has to be
‘weighted’ against the other two pillars. A stakeholder is anyone who
is or becomes directly or indirectly involved in or is affected by the
activities of a company or organization. The TBL puts a great deal of
emphasis on the reciprocity between a company, the community
within which it operates, the natural resources it uses and the people
who work for it (Rogers and Hudson, 2011). A company that oper-
ates according to the principles of the TBL/3Ps will not use toxic
substances, cause environmental pollution, trade in arms or weapons,
or use child labour.
12 Relevance and Context

Increasing awareness of the important role played by stakeholders

has led to positive results for companies who act upon it. For exam-
ple, Nike and Tesco received severely negative responses from their
customers around 2010 and were forced to reconsider some of their
practices in countries where social and environmental standards were
not regulated. Now they are more transparent about their supply
chains being aware of the importance of stakeholders increasing ap-
preciation of fair trade and good labour practice. A positive example
of a company that has increased awareness among its stakeholders of
its environmental impact is PUMA, the sportswear company based in
Germany. PUMA was the first to develop an environmental profit
and loss account in 2010, which revealed that the impact of the com-
pany’s activities on the environment was equivalent to almost 72 per
cent of its profit. It turned out that PUMA’s supply chain was respon-
sible for 94 per cent of this environmental impact. This information
helped PUMA to focus innovation on their supply chain and on de-
signing products with less environmental impact (Puma, 2011).
In the financial services industry standards are improving. In par-
ticular, the trend has been set by the leading pension funds that have
massive amounts to invest. The so-called ESG considerations include
environmental, social and governance aspects that can or should be
taken into account in assessing investments in countries, companies
or projects, and include the following:
●● Environmental considerations are, for example, sustainable
resources, clean technology, climate change and low carbon.
●● Social considerations include controversial weapons, repressive
regimes, adult entertainment, landmines, gambling, tobacco,
diversity and alcohol.
●● Considerations under governance are, for example, board
independence, majority ownership, financial planning, financial
reporting and executive pay.

In the meantime the increase in ESG assets has gone up to such an

extent that ‘greenwashing’ becomes a serious issue.
The UN Global Impact Assessment (2015) on the transformation
of business speaks of ‘a modern corporate sustainability movement’.
 Working Towards Responsibility in Business and Society 13

The assessment concludes that the UN Global Compact, as the

world’s largest corporate sustainability initiative, together with new
initiatives from the business community on sustainability as de-
scribed above, have had a significant impact on the development of
sustainability over the past 15 years. Business has become more stra-
tegic, systematic, integrated, transparent and collaborative regarding
sustainability.
In the last 15 years, space has been created for alternative ways of
running a business, based on concepts of social enterprises, B Corps
and shared value creation, described by Porter and Kramer (2011),
and which will be addressed extensively in Chapter 2 (Austin and
Reficco, 2009; Eggers and Macmillan, 2013; Mair et al, 2012; Short
et al, 2009). The enterprise or organization is not an isolated entity,
and its purpose should not only be to create value for shareholders.
It must continually assess the impact of its actions on the various par-
ties directly and indirectly involved: the stakeholders. Shell used to
call this a ‘licence to operate’, and businesses these days are increas-
ingly finding that they need some sort of social certificate of good
conduct to be able to continue their activities. Nowadays companies
who want to do good, also want to do better. The focus is not only
on a licence to operate, but also on social and environmental impact,
transparency and good governance.
This new attitude increases the complexity of strategic and invest-
ment decisions. When you add external factors such as limited re-
sources, energy transition, future demographics, hyper-transparency,
the growing wealth gap and an exponential increase in technology
into the mix, it becomes clear that data science is not a luxury to un-
ravel the different variables in a decision-making process. Recently,
interesting European initiatives have been announced, all focused on
speeding up the implementation of policies and company strategies
to reduce net greenhouse emissions, and measures to increase the re-
silience of the EU-wide energy system. The European Green Deal
(2019) is a five-year plan to adopt a set of climate proposals. These
include reducing net greenhouse emissions by at least 55 per cent by
2030. During COP27 in 2022 the EU increased the target to at least
57 per cent. Another target is no net emissions of greenhouse gases by
2050 and economic growth decoupled from resource use. From a
14 Relevance and Context

social perspective it is worthwhile to mention that in the European

Green Deal no person and no place should be left behind. In June
2021, the EU introduced the European Climate Law with a legally
binding target of net zero by 2050. An EU taxonomy for sustainabil-
ity in finance came into being in 2020, developed in close consulta-
tion with the EU financial institutions. In May 2022, the REPowerEU
plan was launched to rapidly reduce dependence on Russian fossil
fuels and fast-forward the green energy transition.
It will be clear that there are now many more factors and actors to
be taken into account than there were in the past. But what value
should you attach to them in relation to the strategic goals you are
trying to achieve? How can you translate those values into concrete
and manageable actions? How can you visualize the various options?
And which decision best suits your enterprise or organization? The
strategic decision-making process and the Responsible Business
Simulator help to reduce that complexity to manageable proportions
for decision makers and advisors in the world of business. Making
use of the results of data and dialogue is a powerful way of getting a
better oversight on decision making.

The circular economy as integrating

approach
Our current economy can largely be described as a linear one. From
resource extraction to production process to consumerism, it is a
one-way ticket. This take–make–dispose approach results in a highly
inefficient and, more importantly, unsustainable use of our resources.
Not only does this lead to an increasing scarcity of resources, it also
brings with it waste and pollution, which imposes enormous costs on
the public sector. Here we discuss the phenomenon of a circular econ-
omy, the inevitable perspective for an economy with limited re-
sources.
A circular economy, as defined by the Ellen MacArthur Foundation
(2012), is an economy that is restorative and regenerative by inten-
tion and design, and which aims to keep products, components and
 Working Towards Responsibility in Business and Society 15

materials at their highest utility and value at all times. So a circular

economy is very careful with resources, trying its best to ‘circulate’
them throughout the economy indefinitely without wasting any of
them.
There are six trends visible that move an economy towards becom-
ing a circular one. Although this list is not exhaustive, we see these as
the main drivers for a circular future:

1 Increasing demand for resources and energy. With an increasing

global population, coupled with a sharply increasing middle class,
the demand for resources and energy surges.
2 Innovative technologies. Using new technologies (e.g. Internet of
Things, Big Data, etc) enables producers to increase the value in
their production chain, to analyse the material life cycle and
employ new design and production methods.
3 Urbanization. The increase in urbanization makes it easier and
more cost-effective to track, gather, reclaim and share parts or
whole products and materials.
4 Government pressure. Governments and legislators are becoming
more aware of sustainability issues and are creating legislation to
contribute to these issues (e.g. Paris COP21).
5 More aware consumers. Consumers are becoming more critical of
their own consumption behaviour, being more conscious of their
impact. There is societal momentum directed towards sustainability.
6 Consumers get used to access over ownership. People are getting
used to having access to the performance of a product instead of
simply owning one (e.g. car sharing via Uber or house sharing via
Airbnb); this leads to an increased efficiency in the use of products.

Within a circular economy one can distinguish two ‘sub-circles’, based

on the ‘compostability’ of waste: a biological circle and a technological
one (Figure 1.2). A linear economy essentially leads to treating both
types of ‘waste’ the same, meaning they are being dumped in landfills
and incinerated, resulting in large amounts of toxins being released into
the environment. The first step towards a circular economy is making
the essential distinction between biological and ­technical ­materials.
16 Relevance and Context

Figure 1.2 The circular economy

SOURCE Ellen MacArthur Foundation, 2019

The difference lies in the return of biological nutrients to the food

chain, which is not possible with technical materials. The focus within
the technical realm is consequently on the reuse, remanufacturing or
recycling of these waste materials. Keeping soil at its highest possible
value is a crucial part of sustaining this biological circle. Through this
new circle process, the quality of all materials is optimized, which re-
sults in the pressure being taken off the manufacturing end of the
model, as well as the waste disposal end. As both ends of the model are
being ‘pushed down’, the first steps towards a circular economy are
taken. Last, but definitely not least, the energy necessary to fuel this
cycle should be renewable by nature, to decrease resource dependence
and increase system resilience (Ellen MacArthur Foundation, 2015).
Although the public in general values recycling highly, from a cir-
cular perspective it is the last resort when aiming to ‘close the loop’.
Recycling often reduces the quality of materials (‘downcycling’) which
limits their usability. While regaining raw material from used prod-
ucts in this way we lose valuable information related to these used
 Working Towards Responsibility in Business and Society 17

products, such as product idea, design and technical specifications.

The different sub-circles, as shown in Figure 1.2, are focused on max-
imizing the use and reuse of the materials and resources in the prod-
ucts, distinguishing them on the basis of their inherent characteristics.
Products that need the least change in order for them to be reused
are represented in the innermost circle. Typically, these products re-
quire maintenance and should be prevented from entering the outer
cycles of remanufacturing and recycling, in order to optimize potential
savings on the shares of material, labour, energy, capital, and the associ-
ated externalities (such as greenhouse gas emissions, water and toxic-
ity). The next circle, as one moves towards the outside, focuses on reuse
and redistribution. If, due to the specific characteristics of the product
this is not possible, remanufacturing, refurbishing and, last, recycling
are the options, in that order. Needless to say, the more products that
stay within the inner circle, the less the negative impact on the environ-
ment and the more positive impact on profit through potential saving
(such as material, labour, etc). Consequently, the leakage to landfill and
incineration is minimized (Ellen MacArthur Foundation, 2015).
Critics propagating the unsustainable character of a linear econ-
omy usually focus on how deeply consumerism is embedded in our
Western society. Instead of including every aspect of the take–make–
dispose approach, these critics limit their solution thinking to one
side of the coin. Consumerism might be the engine that keeps the
manufacturers manufacturing, the producers producing and waste
disposal at full throttle; nevertheless, changing the population’s atti-
tudes to consumerism has proven to be nearly impossible. By taking
the economy as a whole within the loop of circular economy, other
solutions come to mind. Stahel (1982) developed a new economic
model that helps to facilitate the changes necessary for a circular
economy. As he re-evaluates how we look at ownership, he intro-
duces ‘performance-based contracting’. In this model, ownership as
we know it today makes way for a fee that the user pays for the per-
formance of a product. Consumers do not pay for ownership of the
product, but instead pay for the performance the product delivers.
The producers keep ownership, which means, ideally, that the prod-
uct is returned to the producer after the consumer has enjoyed its
18 Relevance and Context

performance. Convincing consumers to recycle their products is

taken out of the equation by returning the control over the product
to the producers once the performance has been fulfilled. A recent
voice in the public debate is Kate Raworth, author of Doughnut
Economics. She writes that the traditional system of economics is
broken and that radical reframing of economics for a new generation
is necessary, given the challenges at stake (Raworth, 2017).

Circular economy examples in business

practices
Society is coming to regard the concept of circularity as increasingly
important. We see this reflected both in economic studies, and by cir-
cular thinking and acting in industry: materials passports in building
and construction; the recycling of electronics, where the shortage of
rare earth materials forces companies to reuse materials, and the circu-
lar use of materials inside electronic car batteries will become essential.
In September 2014, the European Commission adopted a zero-
waste programme, establishing a legal framework for an EU-wide
circular economy. Not only did the Commission predict that this new
framework will boost recycling and prevent the waste of valuable
materials, but that it would also create new jobs, economic growth,
new business models, and reduce greenhouse gas emissions. By 2030,
EU citizens can expect at least 7 per cent of their municipal waste to
be recycled and at least 80 per cent of all packaging materials. On top
of that, it is estimated that the circular economy can save European
businesses €600 billion (European Commission, 2014). With the
Green Deal in 2020 more ambitious goals have been set.
On McKinsey’s website the company states in a White Paper (Gatzer
et al, 2022) that it estimates that portfolio transformation, green busi-
ness building, green premiums, and green operations focused on circu-
larity can help European consumer goods companies shift to circular
value pools of more than €500 billion of annual revenues by 2030.
The primary driver will be a shift in consumer demand, with younger
generations in particular expressing their values in their purchasing
 Working Towards Responsibility in Business and Society 19

choices. McKinsey research shows that sustainability is ‘highly impor-

tant’ for about 40 per cent of European consumers, amid rising de-
mand for recycled, refurbished and reused products.
We give some examples here, drawn from the list of S&P Award
winners, of leading companies who practise circular economy princi-
ples. Most of the information is from the companies’ own websites,
from articles in trusted press, and the Ellen MacArthur Foundation,
who prepared some company case studies.

Patagonia
Patagonia is an example of a brand that sets environmental values and
circularity as key priorities, and has done so for decades. All Patagonia
products are specifically designed to have long economic life cycles.
Through ‘Worn Wear’ repair hubs, the company encourages its cus-
tomers to repair items instead of buying new ones. In September 2022,
the company went a step further to spread its missions and values; the
owning Chouinard’s family made ‘the planet’ their only shareholder
by donating 98 per cent of the company’s stock to the Holdfast
Collective, which is a non-profit organization aiming to fight the envi-
ronmental crisis, protect nature and biodiversity, and support thriving
communities as quickly as possible. The remaining 2 per cent of the
shares and all decision-making authority was donated to a trust, which
will oversee the company’s mission and values (The Guardian, 2022).

Royal Philips
Royal Philips has been a top-ranking company in the DSJI and S&P
rankings for many years. The healthcare technology company has
made major strides to integrate the circular economic principles into
their core business systems. As of 2020, all of their sites are fully
powered by renewable energy sources, and all emissions from pro-
duction, travel and logistics are CO2 compensated. The company is
already carbon neutral in its operations and aims to further reduce its
CO2 emissions to adhere to international global warming mitigation
targets. The company has set a number of ambitious economic objec-
tives, such as increasing its circular economy revenue to 25 per cent
20 Relevance and Context

of sales and ensuring that 100 per cent of products meet the compa-
ny’s EcoDesign principles (of which circularity is a key pillar) (Ellen
Macarthur Foundation, 2021a).

Heineken
Royal Heineken has been on a mission to enhance its circularity since
2010, when it presented its ‘Brewing a Better World’ ambition to re-
duce CO2 emissions and increase the use of renewable energy in pro-
duction (Heineken, 2016). Since 2020, all Heineken beer for the
Dutch market is produced using 100 per cent green energy. In 2021,
the company set new goals to become fully circular by 2030. Before
this year, Heineken aims to decarbonize its production, eliminate
waste disposal to landfills in production, accelerate the use of return-
able and recyclable packaging and significantly reduce water use in
production (Heineken, 2020).

IKEA
Circularity is one of three focus areas in IKEA’s sustainability strat-
egy. The company aims to become a climate-positive, circular busi-
ness by 2030 by giving products and materials a longer life. Today,
55.8 per cent of the materials sourced by IKEA are renewable, like
wood and cotton, and 17.3 per cent are recycled, and the company is
making efforts to increase these numbers. IKEA has started auditing
its products based on circular product design principles; products are
designed for easy assembly, disassembly and reassembly. Additionally,
the company has started a number of initiatives to go beyond the
simple sale of furniture. The company is experimenting with renting
options for their furniture, sale of refurbished products, and aims to
prolong the lifetime of products by providing customers with spare
parts (Ellen MacArthur Foundation, 2021b).

Unilever
Unilever is an example of a global company incorporating circular
principles in their corporate strategy. Under Paul Polman, one of
 Working Towards Responsibility in Business and Society 21

the former CEOs who supported the SDGs from the start, a new
awareness about the planet and Unilever’s contribution was devel-
oped. Through the Unilever Compass strategy, launched in 2020,
the company is committed to the transition to regenerative agricul-
ture practices and to use 100 per cent reusable, recyclable or com-
postable plastic packaging by 2025. Additionally, the company’s
Clean Future strategy sets out Unilever’s ambition to use 100 per
cent renewable or recycled carbon in the development, production
and processing of all their cleaning products before 2030. An exam-
ple of reusable packaging at Unilever is the Cif eco-refill. This refill
containing super-concentrated cleaning product can be attached to
used Power & Shine bottles filled with water. The refill is made
using 75 per cent less plastic than new bottles, is 100 per cent recy-
clable and saves 97 per cent water over new cleaning products.
According to Unilever, this innovation will remove 1.5 million plas-
tic bottles from UK supermarkets alone (Ellen MacArthur
Foundation, 2021c).
As we transition to a circular economy, disruption will be experi-
enced in many economic systems, affecting every sector imaginable.
We expect change in the following five sectors to be most influential,
and disruptive, in the near future:
●● Logistics: waste flows from one company will form the resources
for another. Logistics companies will have to connect companies
from different material chains in increasingly complex networks.
Trucks will probably never drive completely empty.
●● Retail and marketing: circular products and services will need
accompanying revenue models. To regain resources and efficiently
process them producers will probably remain owners of their
products or use buyback schemes.
●● Finance: a change from ownership to usage has many finance-
related consequences for producers and consumers alike. Risk
needs to be addressed and financial instruments, like mortgages,
need to be overhauled. Banks can also become important players
in connecting different chains.
●● Product design: products will have to be designed for circularity;
they should be reusable and modular, meaning they are easy to
22 Relevance and Context

take apart. These parts then need to be easy to replace or repair,

and the product as a whole needs to be easily refurbished.
●● Material design: materials should be made from resources that are
already reused without loss in value and that can be reused again.
Moreover, circular materials and parts should either consist of
only one material or be easily separable into single materials.

The Responsible Business Simulator

and the circular economy

Benefits of making strategic decisions based on data

and dialogue

1 Unleashes the combined power of explorative and strategic

dialogue with the art of advanced modelling.
2 Operationalizes circular economy-related issues.
3 Facilitates boardroom discussion with facts, figures and visuals that
are created on the spot.
4 Captures every element brought up in strategic dialogues.
5 Integrates the financial and non-financial objectives of strategic
decisions and clarifies potential trade-offs.
6 Stimulates out-of-the-box thinking.
7 Creates robust, sustainable decisions.
8 Provides many visual displays to explain complex
interdependencies.
9 Creates shared value for multiple stakeholders.
10 Creates transparency in business dynamics.
11 Documents all assumptions, steps and sources underlying a
strategic decision.
12 Allows users to incorporate new insight into existing models
without programming.
13 Extends the two-dimensional world of spreadsheets into a highly
multi-dimensional world.
 Working Towards Responsibility in Business and Society 23

14 Provides access to all types of data sources.

15 Discloses, combines and projects all available data on the strategic
decision at hand.
16 Supports any strategic decision.
17 Detects the vital few factors that influence the outcomes of
decisions the most.

The transition to a circular economy inevitably implies a paradigm

shift. The Responsible Business Simulator (tRBS) can be used as a
tool to accelerate that shift. Businesses working towards ameliorat-
ing social goals, such as shifting towards a circular economy, need
incentives. Sustainability for the environment and people has, how-
ever, traditionally been regarded as merely representing a corporate
philosophy; a charitable corporate strategy that is often seen as just a
burden and a necessity for marketing. As opposed to this, increase in
profit typically functions as the largest incentive for any business,
sometimes indeed at any cost when it comes to the environment and
people. Not surprisingly, the most important barriers to implementa-
tion of circular economy practices are high upfront investment costs
and risks for businesses (Preston, 2012). The Responsible Business
Simulator, however, combines these two seemingly contradicting doc-
trines – environmental/social and economic benefits – operating
within the framework of shared values (people, planet and profit). In
this respect, tRBS makes the complexity of the value chains in a cir-
cular economy more transparent. Sustainability in the long term is
more beneficial to a company’s profit than short-term destructive use
of resources and disregard for the social dimension.
The importance of shared values for the company’s long-term con-
tinuity is clearly demonstrated and confirmed through this strategic
decision-making process and the use of tRBS, in which profit is an
integral component. The Responsible Business Simulator actively
takes stakeholders’ interests into account in attaining strategic goals.
The stakeholders’ interests can be found in the 3Ps, which in turn
find their expression as performance indicators in the model. This
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nothing forces us to attach to these expressions any other meaning
than that we give to similar locutions which we find in Scripture, and
in some of the early Fathers; as, for instance, St. Paul, Coloss. i. 15,
who, speaking of the Word, says that “he is the image of the
invisible God, the first-born of every creature”; and Clement of
Alexandria, who declares that the Word is “the first created wisdom.”
Besides, it is probable that Philo had some idea of the personality of
the Word. We must not forget that he based all his philosophical
speculations upon revelation as found in the Old Testament, and that
he could not have been wholly ignorant of the teachings of
Christianity. When, therefore, he uses the expression “second God,”
or “the other God”—alter Deus—it is possible that he intends to
designate by it the Second Person of the Blessed Trinity.
Be this as it may, certain it is that Philo’s ideas are found permeating
Neo-Platonism in that phase of it into which it entered in his time,
and which is also denominated Neo-Pythagoreanism, because in that
school an attempt was made to revive the doctrines and method of
Pythagoras, as well as his mode of life. It will be sufficient here to
direct our attention to Apollonius of Tyana, the chief representative
of the Neo-Pythagoreans of that period. He was a contemporary of
Christ. His life, written by Philostratus in the third century, is a
philosophico-religious romance in which the Neo-Pythagorean ideal
is portrayed in the person of Apollonius. He had visited many
countries and sojourned with the sages of India, whom he admired,
and whose pantheistic notions he adopted. His doctrine is no more
that of the old Greek philosophers, who considered reason as the
only means of knowledge. He pretends to be in direct
communication with the Deity, from which he derives light and
strength; and in this immediate contact with Heaven his whole being
is purified and elevated to a degree of power which gives him, as he
pretends, the dominion over the forces of nature. And as the soul is,
according to him, a portion of the divine intelligence, and the source
of all good to man, so the body, which is regarded as the prison of
his higher nature, must be the source of the disordered affections
which gain mastery over his soul. All the ascetic life of Apollonius is
therefore directed to subdue this tyranny of the body. This he must
do first in himself and then in those around him.
There is no doubt that this tone of mind, which began to prevail at
the very time Christianity made its appearance in the world, was
favorable to it. Henceforth the several schools of philosophy shall be
brought in contact with Christian dogma and the contest carried on
in the same field. On the one hand, the Greek philosophers were in
search of a light which they did not possess; they were forced to
acknowledge in spite of themselves that the speculations and
systems had failed to give a solution to the most important problems
with which humanity is concerned; they had been made aware of
the insufficiency of reason to effect this purpose; they felt the need
of a special assistance from above as a check to the corruption of
nature. And, on the other hand, the champions of a new religion saw
the necessity of becoming thoroughly acquainted with the ideas of
their opponents, in order to meet them on their own ground and
gain admittance into the very heart of pagan learning. “In the truest
sense of the word,” says a writer in the Dublin Review, “Christianity
is a philosophy, and, what is more to the purpose, in the sense of
the philosophers of Alexandria it was a philosophy. The narrowed
meaning that in our days is assigned to philosophy, as distinguished
from religion, had no existence in those times. Wisdom was the
wisdom by excellence, the highest, the ultimate wisdom. It meant
the fruit of the highest speculation, and at the same time the
necessary ground of all important practice. A system of philosophy
was, therefore, at that period, tantamount to a religion. When the
Christian teachers then told the philosophers of Alexandria that they
could teach them true philosophy, they were saying not only what
was perfectly true but what was perfectly understood by their
hearers. The catechetical school was, and appeared to them, as truly
a philosophical lecture-room as the halls of the museum.” It was in
this light that the Neo-Platonics must have looked upon such men as
Clement, Origen, and other writers of the Christian school. They
listened with deep interest to the words of those teachers, who, with
a clearness and authority which they had not known before,
propounded doctrines that had already found an echo in their
hearts. “Your masters in philosophy,” they were told, “are great and
noble; but they did not go far enough, as you all acknowledge.
Come to us, then, and we will show you what is wanting in them.
Listen to these old Hebrews whose writings you have in your hands.
They treated of all your problems, and had solved the deepest of
them whilst your forefathers were groping in darkness. All their light,
and much more, is our inheritance. The truth which you seek we
possess. ‘What you worship without knowing it, that we preach to
you.’ God’s Word has been made flesh, has lived on earth, the
Perfect Man, the Absolute Man. Come to us, and we will show you
how you may know God through him, and how through him God
communicates himself to you. Asceticism and the subduing of the
flesh by mortification are good and commendable, but the end of it
all is God and the love of God, and this end can only be attained by
a Christian.” Thus those very matters of intellect and high ethics in
which they especially prided themselves were brought back to them
with an intensity of light that made visible the darkness which
surrounded the teachings of their old masters.
It does not matter that Christianity found its most bitter enemies in
the ranks of Neo-Platonism. It was a great advantage for it to be
brought hand-to-hand with all forms of error. The battle raged for
three hundred years; but from the very first Christianity proved itself
superior to its antagonist by the influence which it exerted even then
on heathen philosophy, whose tone and temper were completely
changed as early as the time of Plutarch—that is, about fifty years
after Philo. That influence is unmistakable, as Champagny clearly
shows in his Antonines. Philosophy has become more pious, more
worshipful. The idea of one supreme God is more definite; God is
spiritual, not material; he is the pattern of every virtue, and his
providence extends over the world and man. The principles of
morality are purer and in many cases recall the spirit of the Gospel.
“In the time of Severus,” says Allies, “all the thinking minds have
become ashamed of Olympus and its gods. The cross has wounded
them to death.” It is in vain that the later Neo-Platonics and court
philosophers strive to shelter retreating heathenism in a last fortress.
They only prepare the way for the Christian faith, which they
strenuously combat. When the Emperor Severus, regarding with the
eye of a statesman and a soldier that faith, contemplates its grasp
upon society, and decrees from the height of the throne a general
assault upon it; when his wife encourages Philostratus to draw an
ideal heathen portrait, that of Apollonius of Tyana, as a counterpart
to the character of Christ, tacitly subtracting from the Gospels an
imitation which is to supply the place of the reality, they confess by
the very fact the weakness of heathenism and the ascendency which
the religion of Christ had already obtained. Soon after Origen could
discern and prophesy the complete triumph of that religion. To
Celsus, who had objected that, were all to do as the Christians did,
the emperor would be deserted and his power fall into the hands of
the most savage and lawless barbarians, he replied: “If all did as I
do, men would honor the emperor as a divine command, and the
barbarians, drawing to the Word of God, would become most law-
loving and most civilized; their worship would be dissolved, and that
of the Christians alone prevail, as one day it will alone prevail, by
means of that Word gathering to itself more and more souls” (Orig.
contra Celsus, apud Allies).
Philo, therefore, in inaugurating the Neo-Platonic movement in
philosophy, was only fulfilling the mandate delivered to his people,
that of preparing the way of the Lord and disposing the nations for
the acceptance of the Gospel. The church succeeds the synagogue
as the divinely-accredited teacher of mankind; the long-cherished
hope of the Hebrews is realized, and the true kingdom of David, is
established upon earth to hold universal sway. The Gentile world,
through the instrumentality of the chosen people, had been made to
share in the great hope of a Redeemer, and within it aspirations had
been developed and longings were felt which philosophy was unable
to satisfy; and at the very time when its inanity appeared more
manifest Christ reveals himself to that world as “the Way, the Truth,
and the Life,” and presented to it in his own person that form of
virtue which Plato thirsted to see embodied. Under his influence the
face of the earth is renewed; what human genius, with all its efforts,
had failed to accomplish, what such men as Plato, Pythagoras, and
others could not accomplish, even among a small number of adepts
—this and infinitely more was realized, not merely within the narrow
circle of a few privileged disciples, but among the masses, among
the learned and the ignorant, the rich and the poor, the rulers and
the ruled, the powerful and the weak; not in one corner of the
globe, but all over the world, from north to south and from east to
west; not only in countries favored by great intellectual aptitudes,
where the arts and sciences flourished, where civilization with all its
refinements had reached the highest degree of perfection, but in
countries most abandoned, among savage tribes and barbarous
nations plunged in utter darkness. Surely a new principle of life has
taken possession of the earth—a divine principle which gives rise to
those heroic virtues which we see displayed in every rank of society
and in all climes, and by which the human race is transfigured. This
result was foretold centuries before; it is the new creation spoken of
by the Psalmist: “Thou shalt send forth thy spirit, and they shall be
created; and thou shalt renew the face of the earth” (Ps. ciii. 30). It
was preceded by a series of events so combined that it is impossible
not to see in them the supernatural action of divine Providence and
the profound wisdom of God, who makes use of apt means for the
furtherance of his end. Besides, there is a wonderful unity of truth
discernible from the very beginning, and which appears in an
unbroken chain throughout the course of ages. It is the same Word,
the same light, which was communicated to our first parents that we
see increasing in intensity until it reaches in Christ the splendor of
the full day. The first revelation of the Word to man is to be found in
his natural reason, which is pervaded with primary truths that are
axioms in the intelligence of mankind. “But on these,” says Cardinal
Manning (Temporal Mission of the Holy Ghost), “descended other
truths from the Father of light, as he saw fit to reveal them in
measure and in season, according to the successions of time
ordained in the divine purpose. The revelations of the patriarchs
elevated and enlarged the sphere of light in the intelligence of men
by their deeper, purer, and clearer insight into the divine mind,
character, and conduct in the world. The revelations to Moses and to
the prophets raised still higher the fabric of light, which was always
ascending towards the fuller revelation of God yet to come. But in all
these accessions and unfoldings of the light of God truth remained
still one, harmonious, indivisible; a structure in perfect symmetry,
the finite but true reflex of truth as it reposes in the divine
intelligence.” None of the much-boasted theories of our modern
rationalists gives us that unity which is the test of truth. The
restoration of our fallen race by the manifestation of the Word is the
leading principle of Schlegel’s Philosophy of History; and the greatest
minds, as St. Augustine and Bossuet, admitted no other in their
immortal works. How puerile, in comparison with their grand and
luminous conceptions, are all those systems which would fain explain
the destinies of man without God! To the dreamers who have
invented them can be applied the words of St. Paul: “They detain
the truth of God in injustice. They have become vain in their
thoughts, and their foolish heart has been darkened” (Rom. i. 18-
21).
 NEW PUBLICATIONS.

The Divine Sanctuary. A series of Meditations upon the Litany of

the Most Sacred Heart of Jesus. By the Very Rev. Thomas S.
Preston, V.G., Pastor of St. Ann’s Church, N. Y. New York: Robert
Coddington. 1878.

We welcome most gratefully this new book for the month of June.
We hope it will go a long way towards placing the observance of this
month on a level with that of the month of May; for the more the
devotion to the Sacred Heart increases among us the more
abundant will be the graces it always brings.
The book, however, is not intended for the month of June alone, but
can be used at any time, and particularly on the first Friday or
Sunday of every month. The author’s idea, in choosing the Litany of
the Sacred Heart and forming a meditation on each of the
invocations to this “divine sanctuary,” is a very happy one. He has
divided the whole into three parts, viz.: “The Glories of the Sacred
Heart,” as shown in the first thirteen invocations; “The Sorrows of
the Sacred Heart,” as contemplated in the next eight; and “The
Offices of the Sacred Heart,” as appealed to in the remaining nine.
At the head of each meditation is an appropriate passage of Holy
Scripture.
As to the excellence of the meditations themselves, there is no need
of our dwelling on it. It is enough to know, from his past efforts,
what Father Preston is capable of in dealing with devotional
subjects. This kind of book is his peculiar forte. We are sure the little
volume will be highly prized by all lovers of the Sacred Heart, who
will also find the Litany itself, together with a beautiful Act of
Consecration, immediately following the list of contents.

Good Things for Catholic Readers: A Miscellany of Catholic

Biography, History, Travels, etc. Containing Pictures and Sketches
of Eminent Persons, representing the Church and Cloister, State
and Home, etc., etc. With over two hundred Illustrations. Second
edition, with Additions. New York: The Catholic Publication
Society Company. 1878.

This large and very handsome volume is in every way a gem. It

contains more varied and interesting information—much of it of
positive and immediate value—than any work we know. It is called
“second edition,” but really it is a new volume, containing twice as
much matter as the original. Its sketches of Catholic biography, with
excellent portraits, are brought down to the present year. The last
face that looks at us from the pages is the beautiful one of the Rt.
Rev. M. M. de St. Palais, the lamented Bishop of Vincennes, who
died in June, 1877. Near him is the noble countenance of Bishop Von
Ketteler. Dear old Father McElroy looks out at us with his bright eyes,
his head leaning against his hand. Archbishops Bayley and Connolly
and Bishop Verot are there. There is also the leonine head of Dr.
Brownson, and an excellent sketch of his life. But it is dangerous to
begin the list of these Catholic heroes and holy men whose portraits
and biographies are here given us. One lingers by each one, for each
one is full of attraction. A good sketch and an excellent portrait of
our late Holy Father, Pope Pius IX., catch the eye as we open the
volume of 638 pages. Interspersed with these biographical sketches
and portraits is every kind of interesting matter with pleasing
illustrations. No book could make a more acceptable present; for it is
indeed an exhaustless mine of “good things”—things, too, which
young and old will find equally good.
We are in receipt of a number of volumes and pamphlets, many of
which have been noticed and the notices are already in type, but
owing to a variety of necessities have been regretfully held over
from month to month. We trust to satisfy everybody in our next
number. A word to publishers: They are very apt to send in what are
called “seasonable” books on the eve of The Catholic World’s going
to press, and appear to be surprised at not seeing a notice duly
appear “in season.” For instance, devotional works intended for the
month of May come to us by the dozen when the May number of The
Catholic World is already passing through the press. If all publishers
bore in mind, as some do, that the magazine is to all intents and
purposes prepared a month ahead of date, there would be no
surprise at the long delay which “seasonable” books that arrive out
of season have to endure.
 THE CATHOLIC WORLD.
VOL. XXVII., No. 161.—AUGUST, 1878.
DR. EWER ON THE QUESTION, WHAT IS TRUTH?[125]

Ten years ago Dr. Ewer produced an argument proving the failure of
Protestantism by some solid reasons, which he avers have been met
“not by argument, but by a gale of holy malediction and impotent
scorn,” on the part of those who were included in his indictment. Dr.
Ewer being an accredited minister of a society whose official
designation in its own ecclesiastical law and before the civil law of
the land is “the Protestant Episcopal Church in the United States,” it
was a very natural inquiry whether he had not indicted his own
church and himself as participants in this general failure or religious
bankruptcy, and was not morally bound to abandon an institution
denounced by himself as not only insolvent but fraudulent. The late
illustrious Dr. Brownson did the reverend gentleman the great honor
of reviewing the argument which he had put forth, in the pages of
this magazine. Not with malediction and scorn, but with sober logic,
he pointed out his inconsistent and self-contradictory position, as a
Protestant minister denouncing Protestantism, and proved that the
only possible logical alternative of Protestantism, for one who admits
the divine origin of the Christian religion, is the genuine and pure
Catholicism of the holy, Catholic, apostolic Roman Church. To the
many failures of Protestantism, not only to construct any real form of
Christian religion, but also to destroy the actual and historical
Christianity which it has renounced, Dr. Ewer added another in his
own person by failing to answer the arguments of Dr. Brownson.
Although strongly urged to undertake the task, he absolutely
declined to do so; and in presenting himself anew, after a lapse of
ten years, with the proffer of something which he is pleased to call
“Catholic Truth” as a substitute for Protestant error, he does so
under the great disadvantage of having failed to vindicate himself
from the charge of teaching what is only one of the Protean forms of
the very error which he so solemnly denounces as subversive of all
faith or even natural religion.
The present lecture, besides containing a renewal of the indictment
of Protestantism, and a restatement of the assertion that the truth
opposite to its errors is embodied in the infallible teaching of a
Catholic Church existing in his own imagination, has also what
purports to be a palmary refutation of the dogma of Catholic faith
defined by the Council of the Vatican respecting the infallibility of the
Roman Pontiff. Perhaps the lecturer considers that this is a sufficient
though late rejoinder to the arguments of Dr. Brownson in The
Catholic World. Not so. Dr. Ewer’s Catholic Church has been proved
to be an ens rationis, an abstraction, and its imaginary infallibility to
be mere moonshine of the fancy. The logical idea of organic unity, of
corporate, Catholic, unerring teaching and legislating and grace-
giving hierarchical authority, representing Christ on earth from his
ascension to his second coming, has been demonstrated to have no
counterpart and expression in the order of real and actual existence,
except in the one church over which Peter presides in his successors.
If it is proved that the successor of Peter, with the concurrence of
the bishops, clergy, and faithful who obey his supreme authority, has
committed an act of self-stultification, this lamentable catastrophe
affords no more ground to Dr. Ewer and his little party to claim a
gain of cause for their petite église than it does to the Rev. John
Jasper to maintain the triumph of his ancient and primitive doctrine
that “the sun do move.” Let us suppose that the utter failure of
Protestantism is demonstrated. Let us suppose, also, that the Church
of Rome has erred. Does it follow by any logical reduction that the
party of Dr. Ewer, however respectable in regard to learning and
intellectual ability, morality and religious zeal, is not also in error? By
no means. The only conclusion which does logically follow is that
two-thirds of those who are called Christians are very seriously in
error regarding the true and real nature of the Christian religion
which they profess. It is possible that the remainder may also have
erred. The Greek Church may have erred, the Church of England
may have erred, the Oriental sects may have erred. Some of them
must have erred, for they disagree among themselves in regard to
two important matters, one as to what pertains to the essence and
integrity of Catholic faith, the other as to what pertains to the
essence and integrity of Catholic order. There is a general
disagreement and disunion, without any external criterion or
legitimate tribunal of judgment by which their differences can be
adjudicated and terminated. The appeal which some of our Anglican
friends are wont to make to an œcumenical council of Christendom
is about as practical a method of constituting such a tribunal as an
appeal would be to Moses, to the twelve apostles, to the Council of
Nice, or to a special commission of archangels. Failing all possible
recourse to an actually existing and infallible tribunal, we are thrown
back upon the necessity of judging for ourselves between the
various systems and forms of doctrine professedly Christian, on their
intrinsic merits, and the rational evidence which each of them can
adduce in its own behalf. Whoever thinks that we are really in this
predicament will, if he holds firmly to Christianity and at the same
time follows the dictates of reason, conclude that the various forms
of Christianity are only differentiations of the same generic ratio, and
will seek for some rationalistic or broad-church basis of reconciliation
and union among Christians. If he does not hold by some kind of
strong, and dominant conviction to the Christian religion, he will
adopt the opinion of Mr. Froude and many other men of the
nineteenth century, that it is a religion destined to become obsolete
and be replaced by a new religion or by nihilism. So far from
liberating those who are “breast-deep in torrents of scepticism,” Dr.
Ewer plunges them with a stone to their feet to the bottom of the
sea of scepticism. He loudly proclaims that there is no remedy for
doubt, misery, and spiritual ruin except in the coming and the
remaining upon earth, in visible, audible form and presence, of God
made man, by his natural and mystical body, through whose organs
of human speech the truths of salvation are infallibly declared to
those men who are willing to hear. Yet he denies all the evidence
there is that any such mystical body of Christ, possessing and
exercising the requisite power of infallible speech, has continuously
existed, and does now exist, on the earth, giving to men an unerring
external criterion of judgment whereby they may discern Catholic
truth from Protestant errors. Having first swept away rational
theology and all certitude concerning revealed truth which can be
gained from the private study of the Scriptures, he annihilates the
living, teaching authority of the perennial church, and leaves nothing
whatever which can furnish a refuge from the universal sea of
doubt, not even a Noe’s ark. The land which he points out is a
mirage, the ark of safety is a phantom-ship. Man is justified,
according to the gospel of Dr. Ewer, not by faith alone, but by theory
alone; not by the works of the law, but by the plays of the
imagination. With very great pomp of language he exclaims: “In this
God embodied in the one church, in this God continuously visible
and audible, therefore, behold, gentlemen, the fountain of infallibility
which you seek; for God himself cannot err nor falsify.” This is an
encouraging and promising invitation. Surely, if we can find this
divine oracle, this sacred tabernacle over which a pillar of fire
reposes all through the hours of this present darkness as a token of
the abiding of the Spirit of Truth within its sacred enclosure, we may
be satisfied, and if this bright cloud precedes we may march with
confidence through the desert toward the promised land.
Let us be sure that the Son of God has come into the world, that he
has founded a church with sovereign and unerring authority to teach
his truth and his law, that we know with certainty which is this
church, and it is obvious that all reasonable cause for doubting in
regard to things necessary to our interior peace of mind and our
eternal salvation is removed. Dr. Ewer’s theory is right and consistent
so far. But he fails to verify his own conditions, and does not
designate any real and concrete body which fulfils the exigencies of
his theory. He asserts that whoever holds his theory is a Catholic,
and that there are three, and only three, churches which are parts of
the one body that, according to the theory which he calls Catholic,
must necessarily be identified and recognized as the mystical body
of Christ. He exhorts his hearers to listen, “as the one Holy Catholic
Church in all its parts, His own body, raises its voice,” which he says
is “the voice of God on earth, chanting aloud that all the people in all
time may hear, and be without excuse, the unaltering, irreformable
truth.” What is the sum and substance of this truth? It is, he informs
us, “the solemn, Catholic Creed of Nice, Constantinople, and
Athanasius.” This creed, moreover, he asserts, has been chanted “in
unison round and round the world in unbroken strain, following the
tireless sun, through the centuries and the millenniums,” by his
imaginary catholic church, a body existing in separate parts, without
any head or unity of organization. Dr. Brownson has demonstrated
that such a body cannot exist either in the realm of nature or in that
of grace, and we need not repeat his arguments. We simply affirm,
at present, that this unison of voices without discord or interruption,
chanting continuously from the apostolic age the three creeds above
mentioned, is a myth, and no historical fact. Dr. Ewer appears to rely
on it as the external criterion of Catholic truth, and if it vanishes, as
it must under the historical test, he is left to the mercy of the
torrents of scepticism, along with the other Protestants. The creeds,
in their external form, are a growth and a development from the
germ which first existed under a simpler form. The slightest
acquaintance with early church history suffices to show how long
and violent a warfare was necessary in order to establish the Nicene
Creed with its test-word of orthodoxy, “consubstantial with the
Father,” as the permanent, universal, and unchangeable formula of
faith, even among those who truly held and confessed the Catholic
faith itself in regard to the true and proper divinity of the Son. The
additions made by the First Council of Constantinople were not
universally adopted, or the council itself completely ratified and
recognized as œcumenical, until at least seventy years after its
celebration.
If the doctrine contained in the creeds is regarded in itself,
prescinding from its verbal expression, the case is much worse for
Dr. Ewer’s theory. The Arian heretics were numerous and powerful,
and they were able to persecute the Catholics and lay waste the
church in a fearful manner. They were nevertheless Catholics,
according to Dr. Ewer’s definition. They professed to have the
genuine, apostolical, and primitive faith, and accused the Catholics
of having altered and corrupted it. They recognized the visible
church, the apostolic succession, the hierarchical order, the sacrifice
and sacraments instituted by Christ, and continued the outward
show and appearance of conformity to established Catholic usage,
and even to the language of the Fathers respecting the mysteries of
faith. They were intruded into the possession of the titles, churches,
and other temporalities of many of the most important episcopal
sees, and sustained in their usurpation by the civil power.
After the extermination of the Arian heresy came the Nestorians.
They also professed to be orthodox and Catholic, anathematized the
Arians and all the previous heretics, confessed the Nicene Creed,
and, when they were condemned and cut off from the church, so far
from ceasing to exist, they increased and flourished in a remarkable
way for centuries, and still remain as a separate organization with
their bishops, who have succeeded in an unbroken line from those of
the fifth century.
The Eutychians or Monophysites received the decrees of the councils
of Nice and Ephesus, anathematized the Nestorians, and denounced
the Catholics as Nestorian heretics. After the Council of Chalcedon,
which condemned them, they persisted in maintaining their position
as being the genuine Catholics, and formed a new sect, which still
subsists in Egypt and the East. A century after the Council of
Chalcedon, out of six millions of Christians in the patriarchate of
Alexandria, there were only three hundred thousand Catholics, and
in Asia Minor the divisions and dissensions caused by the
Monophysite and Nestorian heresies were so great that the peace
and stability of the Eastern empire were seriously compromised. This
was the occasion of an effort at reconciliation made by the Emperor
Heraclius, in concert with Sergius of Constantinople and Cyrus of
Alexandria, which brought in a new heresy, the Monothelite, with
new disorders, new persecutions, and another violent struggle for
life on the part of the Catholic faith, that resulted after fifty years in
a sixth œcumenical council, where the Monothelite heresy was
condemned. What reason has Dr. Ewer for excluding these heretical
Eastern sects from his comprehensive Catholic Church? They have
always received the creeds of Nice and Constantinople. They hold
fewer heresies than those which are admitted by the Church of
England, and, apart from their special heretical tenets, are in close
conformity of doctrine and order with the Greek Church. They
always protested that they held the primitive, Catholic faith, and that
they were unjustly condemned because they resisted the effort to
impose new dogmas and additions to the creed as terms of Catholic
communion. The history of the whole period of the first six councils
completely falsifies and nullifies Dr. Ewer’s theory, and shows his
fanciful chant in unison to be as mythical a song as was ever sung in
the brain of a woman with a bee in her bonnet. It has a very nice
sound to appeal to the first six councils. Even the Presbyterian
General Assembly could vindicate their orthodoxy before Pius IX. by
loudly proclaiming their assent to all the dogmatic definitions of the
first six councils. But what do the majority of men know about these
councils? The same objections which Anglicans make against the
seventh, and Greeks and Anglicans alike make against the councils
of Lyons, Florence, Trent, and the Vatican, are of equal force against
those of Nice, Constantinople, Ephesus, and Chalcedon. The number
of bishops present in each of them varied from one hundred and
fifty to six hundred and thirty, out of a whole number of prelates
certainly much larger even in the beginning of the fourth century,
and estimated by the emperors themselves, who must have had
better means of information than any others at the time, as having
increased in the fifth century to a total of five or six thousand. The
church went on very well for three centuries without any
œcumenical councils. When the necessity arose, each council was
sufficient for the present emergency, but not sufficient for the new
ones which arose and demanded new councils and new decisions, of
equal authority with the preceding. Each one has met the violent
opposition of the rebellious, the schismatical, and the heretical
appellants from the present, actual authority of the church to some
ideal tribunal of their own imagination, in the past or in the future,
which they can call what they choose, the Catholic Church or the
Word of God. Their word of God is their own private interpretation of
Scripture, or of Scripture and tradition together; their Catholic
Church is themselves and their particular party, pretending to speak
in the name of the church and to be her interpreters. The whole is
worth as much as the œcumenical council forged by Photius, acts,
decrees, signatures, and all, and promulgated at large among the
Eastern bishops, in support of his usurpation of the see of
Constantinople. The council of Photius was Photius himself, and the
Catholic Church of Dr. Ewer is Dr. Ewer and the other members of his
party. There is no really existing and speaking society which says: “I
am the church, composed of three parts, Roman, Greek, and
Anglican.” This is the language of certain individuals put into the
mouth of an imaginary society. The principle of individualism, which
is the first principle of schism and heresy, is just as really at the
bottom of Dr. Ewer’s theory as it is at the bottom of Chillingworth’s.
It breeds the same discord and disunion, and leaves men exposed to
the same inroad of scepticism. Controversies concerning what the
church is, what her authority and infallibility are, which are the true
councils, which is the true Catholic communion, who are the lawful
pastors to whom obedience is due, confuse and disturb the mind
and conscience as much as controversies concerning the true sense
of Scripture, the true doctrine of the Person of Christ, or the
conditions of salvation in general. There must have been an external
criterion, a rule of determination, by which the orthodox faith and
Catholic communion could be discerned from Arian, Nestorian,
Monophysite, and Donatist counterfeits. That same rule must exist
now; it must be an infallible test of every kind of spurious
Christianity and spurious Catholicity. It is necessary that this rule, if
it be really sufficient, should determine not only between Caiphas or
Mohammed and Christ, between apocryphal and genuine Scriptures,
between Arius and Athanasius, Macedonius and Basil, Nestorius and
Cyril, Dioscorus and Leo, Pyrrhus and Maximus, but also between
Calvin and Bellarmine, Elizabeth and Pius V., Nicholas and Pius IX.,
Döllinger and Cardinal Manning, Dr. Ewer and Dr. Brownson. It must
determine not only between church and no-church, Bible alone and
Bible with apostolic tradition, priest and preacher, but between
bishop and bishop, the usurpation and the just right of ecclesiastical
jurisdiction, the pretence and the reality of infallible authority, the
minimum and the maximum of doctrine which must be accepted as
pertaining to Catholic faith. These are not non-essential matters or
questions of debate between theological schools. They relate to
obligations of conscience in which the salvation of the soul is
involved, and are eminently practical. The Spanish prince
Hermenegild had such a practical rule, and obeyed it by sacrificing
his life rather than to receive communion from an Arian bishop.
Marie Antoinette had the same, and died without the Viaticum rather
than to receive it from a constitutional priest. An Anglican living in
St. Petersburg, and in doubt whether he was bound to remain in his
own sect, to join the Russian national church, or to become a
Catholic, or was at liberty to choose between the three, would need
the same rule. Who could decide the doubt for him? His own clergy?
The Russian clergy? Catholic priests? The judgment of any of these,
as private individuals, is not infallible. They can only help him to find
some rule under which they are personally acting, and which
proceeds from an authority superior to themselves. According to Dr.
Ewer, neither of these authorities is supreme or infallible in itself; it
is only in so far as they agree in transmitting the judgments of an
authority in abeyance, that they can furnish an infallible rule. This is
no rule which meets his case. They agree only in telling him that he
must obey the rule recognized by the first six councils. Where is that
voice of God which is audible to all men who will hear? Where is the
embodied Christ who will take him by the hand? What has become
of the chant in unison of the one, Catholic Church, musically uttering
unalterable truth? Suppose that the Christians of the first seven
centuries had been left without any better rule than this, what
perplexity and unutterable confusion would have been the result—
quite as bad if not worse than that which exists among our modern
Protestant sects.
An extrinsic and infallible rule of faith must be one that in a self-
evident manner manifests itself as really extrinsic to those who
present it, and superior to their individual judgment, and it must be
universal. The teacher and the judge must speak in the name of a
really existing society which is actually one and universal, and in a
manifest identity with itself in the past, by unbroken continuity of life
and self-consciousness from the time of its origin in the divine
institution of Christ. The instructor of the one who seeks the truth
must teach him what the church thinks and commands, and give
him a criterion of certainty that she does think and command what
he ascribes to her, so that if he falsifies her teaching he will disclose
and betray his own deception in the very act of deceiving, like one
who hands over a package of money which had been entrusted to
him with a letter containing a description of its contents. Such a rule
of faith, with its criterion of certainty and of self-verification, without
any doubt the Catholics of the first seven centuries possessed. Their
living and immediate rule was a church really one and obviously one
with itself in its present and in its past. It declared itself to have
always held and meant just what it was now saying. The faithful
believed and obeyed it, because its continuity and identity from St.
Peter and the apostles were obvious by manifest signs and tokens
which could not deceive them. Heretics and schismatics could not
successfully mimic the voice of the true church. Their lack of
continuity, i.e., apostolicity, of unity, of Catholicity, and of sanctity as
well, was obvious. Their counterfeits were always put forth as the
genuine coin of ancient stamp, but as coin which had been hidden or
defaced until they had discovered it, or burnished it anew. The
lawful issues of new coin from the old mint they denounced as
counterfeit or adulterated. Their very pretence of returning to a kind
of old Catholic doctrine more ancient and more Catholic than that of
the present church, was a sure, detective test of their spuriousness.
Continuity could not be in them, or universality, or unity; because
their only claim to a hearing, and their only justification of their
rebellion, implied that the church had not preserved these notes
unimpaired. They were self-contradictory, and affirmed and denied
the Catholic Church in the same breath. So likewise their successors.
The so-called Greek Church is a contradiction to itself, in respect to
its schismatical position, and a concrete absurdity. The Anglican sect
is not on a par with the schismatical and heretical churches of the
East in any way, and deserves no consideration in the treatment of
the question of the actual extension of the Catholic Church. The
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