Making Sustainability Strategic: Leadership Lessons Across Industries

Discussion with Giuseppe Cavalli

Giuseppe Cavalli’s professional journey spans decades and industries, from white goods to steel, demonstrating his ability to adapt, lead, and innovate in the most complex environments. With over 30 years of experience as a General Manager and board member in both public and private companies across consumer goods, raw materials, steel, and components, Cavalli has a proven track record of navigating industries through periods of growth and transformation. In this article, he shares insights into the evolving landscape of global business, emphasizing the importance of sustainability, the challenges of aligning global standards with local operations, and the transformative potential of innovation.

Redefining Sustainability in a Global Context

For Cavalli, sustainability is not just about reducing environmental impact; it’s about fostering trust and alignment among all stakeholders. Having worked extensively in industries traditionally seen as environmentally intensive, Cavalli emphasizes the need for businesses to exceed mere compliance. “Sustainability means being trusted by the people around you—customers, employees, and the communities you operate in. It’s not just about pollution control but creating a culture where stakeholders see you as a positive force”, he shares.

In the steel industry, for example, Cavalli led initiatives to establish voluntary agreements that set emissions standards far below regulatory requirements. This proactive approach not only improved environmental performance but also strengthened relationships with local communities and governments. He points out that moving beyond compliance fosters goodwill and creates a competitive advantage, particularly in regions like Europe where sustainability expectations are high.

Cavalli also highlights the shift from a linear to a circular economy. “In Europe, we now have more scrap than steel consumption. The challenge is to use this excess responsibly, adopting circular economy principles where waste becomes a resource”, he explains. By innovating within this framework, companies can reduce their environmental footprint while creating new value streams.

However, sustainability is a complex, multi-dimensional challenge. Cavalli notes that achieving it requires not only technological innovation but also cultural and organizational shifts. He argues, “True sustainability comes from embedding it into every aspect of your business, from operations to strategy”.

Balancing Global Standards with Local Realities

Having managed both national and international operations, Cavalli is acutely aware of the challenges in aligning global sustainability standards with local practices. “Each market has its unique dynamics, and understanding these is key to implementing consistent standards,” he says.

Drawing from his experience, Cavalli outlines a three-step approach:

1. Study and Learn: “When entering a new market, the first step is to study it extensively. Each region has its own rules, culture, and operational nuances, and you must understand these deeply to succeed”, he advises.

2. Bridge Local and Global Perspectives: Cavalli emphasizes the importance of creating dialogue between local teams and global leadership. “You need to help local teams see the broader picture while ensuring that global strategies are adaptable to local realities”, he explains.

3. Collaborate Without Dominance: A key to success, according to Cavalli, is fostering collaboration without imposing a dominant culture. “Being Italian, I’ve learned that we are not a dominant culture. This has taught me to listen and adapt, creating solutions that are inclusive and effective,” he shares. However, Cavalli also stresses the importance of taking a clear stance when necessary. “Not being dominant doesn’t mean avoiding responsibility. Non-dominant cultures, must assert their vision and values while respecting others. This balance allows you to contribute meaningfully and gain the trust of local teams,” he explains. 

Cavalli’s approach is particularly evident in his work in diverse markets like China, Russia, and Europe. By fostering mutual understanding and respect, he has been able to align diverse stakeholders around common goals, ensuring consistent progress across geographies.

Innovation as the Game-Changer for Sustainability

Innovation is at the heart of Cavalli’s approach to driving sustainability. He believes that businesses must rethink traditional practices to unlock new opportunities. “The next game-changer won’t just be a new technology but a new way of interpreting business”, he asserts.

In the steel industry, Cavalli sees potential in leveraging renewable energy and hydrogen to transform production processes. “Imagine producing steel in regions with abundant renewable energy, like Australia or Brazil, and then reshaping the global value chain. This could redefine the industry”, he explains.

He emphasizes that the essence of innovation lies in recombining existing technologies in novel ways. “Innovation is about recombining existing technologies in new ways to solve problems and create dreams”, he shares. For instance, integrating software and hardware in white goods not only elevated functionality but also broadened their appeal, making them aspirational products rather than mere household tools.

However, Cavalli is adamant that innovation must be underpinned by a strong strategic framework and an organization equipped to adapt. “To innovate effectively, you need a culture that encourages experimentation and a leadership team that can connect the dots between different ideas and technologies”, he asserts. This means creating an environment where risk-taking is celebrated, failures are seen as learning opportunities, and cross-functional teams collaborate to push the boundaries of what’s possible.

Building Consensus in Complex Transformations

Leading large-scale transformations often involves navigating complex stakeholder dynamics. Cavalli’s approach is deeply rooted in transparency, collaboration, and fostering a shared vision. "First, you need a clear idea of where you want to go. Then, you must engage your team in shaping that vision, making it their own", he advises. This philosophy underscores the importance of collective ownership in driving change.

One of his most challenging experiences was managing a steel company in deep crisis—an organization that had been struggling due to outdated business models and mounting external pressures. Cavalli recalls, "When I joined, I told the team we were like a ship after a storm. Our goal was to find a safe harbor where we could rebuild". He likened the situation to a collaborative effort in navigating treacherous waters, requiring every crew member’s dedication and expertise. By involving employees in decision-making and fostering a sense of shared purpose, Cavalli turned a fragmented workforce into a unified team capable of tackling significant challenges in a short period.

Cavalli also emphasizes the pivotal role of trust in these efforts. "You need to show people that you trust them to rise to the challenge. This empowers them to give their best and contributes to a culture of accountability", he explains. Through consistent communication, clear expectations, and recognition of efforts, Cavalli created an environment where employees felt valued and motivated to perform at their peak. His success in transforming such complex organizations underscores the power of a people-first leadership approach.

Actionable Insights for Today’s Executives

Cavalli’s experiences offer valuable lessons for executives navigating today’s complex business landscape:

1. Embed Sustainability Beyond Compliance: Make sustainability a core part of your business strategy, exceeding regulatory requirements to build trust and create long-term value.

2. Balance Local and Global Dynamics: Develop a deep understanding of local markets while aligning them with global standards to drive consistent progress.

3. Innovate Strategically: Focus on reimagining business models and leveraging existing technologies in new ways to stay ahead of the curve.

Cavalli’s journey highlights the practical application of adaptability, collaboration, and strategic vision in overcoming complex business challenges. Reflecting on his approach, he remarks, “The complexity of the world requires adaptable strategies and clear vision. When you have a game plan, you can face unexpected challenges head-on, learning and adjusting as you go. Without a plan, there is only chaos, and no opportunity to grow or improve”.