Understanding how people behave and make decisions holds untapped potential to transform the responsible business field. Behavioural science – drawing on insights from social psychology, economics and behavioural economics, neuroscience, judgment and decision-making - has been revolutionising public policy around the world through evidence-based interventions that improve peoples’ lives in cost-effective ways. This has been applied to education, healthcare, the environment, pensions and savings, unemployment, crime reduction and many other spheres. Much of this applied behavioural work has focused on how government can ‘nudge’ citizen behaviour. This blog series will focus on how the responsible business field (and how companies themselves) can use behavioural insights and approaches to encourage better business behaviour.
The responsible business field is trying to change the behaviour of companies to ensure that people (and their human rights) are not adversely impacted in the course of economic activity. We are trying to prevent the types of behaviours that lead to exploitative labour practices in the production of apparel and footwear, conflict with communities through the extraction of oil and gas, modern slavery in the construction of mega-sporting events, privacy violations in the fourth industrial revolution, or through any other type of commercial activity that can have an impact on workers, communities and consumers. These impacts are fundamentally driven by the behaviour of individuals and teams within companies (and others such as governments).
“These impacts are fundamentally driven by the behaviour of individuals and teams within companies (and others such as governments).”
The responsible business world has been trying to shift those behaviours through carrot and the stick approaches, as well as appealing to people’s good nature. The field has tried market incentives, encouraging a race to the top through benchmarking, rankings and ratings, mandatory disclosure and reporting ‘comply or explain’ requirements, naming and shaming through public campaigns. And practitioners within business are trying to influence and cascade behaviours throughout their companies by setting standards of acceptable practice, shifting the mindsets of operational managers, colleagues in diverse business units as well as senior leaders and Boards, building awareness and capacity to spot and respond to human rights issues, developing tools, resources and checklists to support action, aligning incentives and discouraging transgressions and collaborating with others to solve complex challenges.
“Can we build a rigorous, empirical, evidence-base for our actions?”
But are our interventions working? How do we know that positive changes are a result of our actions and not unrelated factors? What version of our interventions work best? Can we build a rigorous, empirical, evidence-base for our actions?
Behavioural insights and approaches can help answer these questions. Behavioural science is not without its critiques and it won’t serve as a panacea, but this blog will explore the potential applicability of behavioural science to responsible business. I have noticed three foundational concepts that behavioural science can contribute to our field:
We must squarely focus on our vision for what behaviours we want to see because awareness, attitudes and beliefs alone are unlikely to shift behaviour;
To unlock barriers and build solutions based on how people actually behave, we should apply user-centred methodologies and approaches; and
We must run experiments and trials to build scientific, robust evidence that our interventions work.
My first three blogs build on these three foundational concepts. Future blogs will continue explore how behavioural science is relevant to the responsible business field by:
Introducing key behavioural concepts - including social proof and social norms, framing, priming and anchoring, hyperbolic discounting, cognitive biases etc - and exploring how they apply in real-world contexts, drawing out relevant insights for the responsible business community;
Highlighting existing behaviourally-based work that is relevant to the responsible business field, including through interviews with behavioural scientists;
Connecting with others thinking about and exploring behavioural science in the responsible business field; and
Ultimately, in the long-term, suggesting and identifying experiments and trials that can be run.
You can begin the journey, applying behavioural insights to responsible business, with me by following this blog series. Subscribe to monthly emails by clicking the navigation button.