From geopolitical instability and rapid advances in artificial intelligence to climate change, biodiversity loss, and demographic shifts, organisations must be prepared to continually rework their business models as global risks accelerate and interact in unpredictable ways, a new CIMA report said.
Businesses are operating in an era of overlapping and interconnected crises — often described as a “polycrisis”. The report, Reframing Business Models for a Sustainable World, asserts that traditional, linear business models constructed through an inside-out, micro-stewardship approach are no longer sufficient to navigate this environment.
The report makes the case that sustainability is no longer a side activity or compliance exercise but a core business model issue. “Organisations that fail to connect financial performance with their impact on society and the environment risk undermining their own long-term viability,” a news release said.
“We have both the responsibility and the opportunity to help shape the future,” Andrew Harding, FCMA, CGMA, chief executive–Management Accounting at the Association of International Certified Professional Accountants, said in the release.
“This paper brings together a collection of approaches and perspectives that can help organisations evolve their business models to meet the challenges of the future,” Harding said. “The competencies and skillsets of management accountants, combined with the expanding mandate of the finance function, place the profession in a unique position to help reframe business models for long-term, sustainable value creation.”
According to the release, the report aims to help organisations:
- Build literacy in polycrisis concepts and stay attuned to emerging research and thinking.
- Understand how systemic risks such as climate change, nature loss, social inequality, and geopolitical instability are interconnected.
- Identify emerging patterns and feedback loops and assess how they affect businesses, society, and the biosphere.
- Apply a macro-stewardship lens and adopt a systemic risk management approach to inform future-focused scenarios, transition plans, and business model adaptation.
- Design solutions that address polycrisis factors while strengthening long-term resilience and enabling antifragile business models.
- Guide finance teams on how to drive insight into enterprisewide action and value creation.
The report outlines a timely message for finance leaders: Business models must recognise systemic risks, long-term impacts, and the reality that sustainability is now hard wired into how value is created, Jeremy Osborn, FCMA, CGMA, FCPA (Australia), global head of sustainability at the Association, said in the release.
“Moving away from linear thinking and anchoring decisions in the context of antifragile business models can help connect performance with purpose and create long-term value for investors and other stakeholders,” Osborn said.
— To comment on this article or to suggest an idea for another article, contact Steph Brown at Stephanie.Brown@aicpa-cima.com.