Sustainable finance is a relatively new enough concept that it can encompass everything from climate change solutions and infrastructure development to better healthcare systems, improved education and the overall well-being of communities. But as often is the case, each of these purposeful challenges begins with the task of gathering enough partners – some with opposing viewpoints — to identify a common cause, or commitment where participants can create a potent and lasting impact. At the heart of any effective campaign is the “meeting of minds,” so to speak, which brings us to an examination of the Art of Negotiation.
To begin, negotiations are about understanding interdependencies, and leveraging them as a point of strength. Savvy negotiators use these connections to create alignment on building value now, and for the long-term. Many think a great negotiator is the loudest person in the room, setting hard lines and demanding others to comply. Sometimes the loudest person in the room is the most effective and sometimes they’re not. Volume is irrelevant, it is technique and strategy that translate into outcomes- from the board room, to the family dinner table.
Negotiating is about strategy, and fundamentally it is about understanding interests: the core needs that lie below the bluster, those surface positions about what is “necessary”. But these deeper needs must be met now and in the long-term. A great negotiator creates new value by understanding their own interests, their counterparts’ and the space in between.
Preparation is possibly one of the least sexy elements of negotiations, and yet it is also the most powerful.
A great negotiator comes to the proverbial negotiating table having clearly mapped out both their own interests and those of the other party. Savvy negotiators think about what they really want now, and in the long-term. Then they methodically map those same needs for each of their counterparts. Charting what is driving your own behavior and those you are negotiating with illuminates murky parameters.
Savvy negotiators do another thing: they ask penetrating questions – and take the time to listen to answers. Testing assumptions and digging out new data focuses the lens of opportunity. Simple questions can yield telling information. By mapping mutual interests, you’ve created the space to brainstorm and invent possible solutions without committing to their execution. In this way, all parties can pool ideas about what might meet their needs. And in the process relevant information rises to the surface.
Another essential element in negotiations is knowing when to walk away. This need not mean severing a relationship, but rather defining a line when the status quo better meets short and long-term needs than a new agreement. The great negotiator can chart the long-term consequences and walk away with confidence.
What distinguishes a great negotiator is their understanding of the big picture. Great negotiators are long-term thinkers. They know what they want and need now, and understand the essentials expressed by their counterparts. And they typically look far enough down the line to see how such factors may evolve over time.
It’s about knowing when tweaking plans now yields more desirable long-term performance. Presumably the greatest negotiators have the long-term in mind the whole time. But the process of preparation, of inquiry, of dialogue, and inventing, creates a clear picture of the playing field that exists now and what will evolve in the longer-term.
Finally, a great negotiator is a great collaborator. Great negotiators are acutely aware that you can’t prepare effectively alone, nor can you execute. Two of the most effective diplomatic negotiators in recent memory, Richard Holbrooke and George Mitchell, are considered diametrically opposite characters. Yet both give tremendous credit to the teams who helped them think through steps, options, personalities and people.
The great negotiators in business, in politics and in families all understand the need to balance the short and the long term. Negotiators understand interconnections, interdependencies and how to find points of connection to create lasting value. It sounds exactly like sustainable finance. It’s about meeting present needs, with future needs in mind.Katrina Stanislaw holds a Masters of Arts in Law and Diplomacy from The Fletcher School at Tufts University, where she focused on sustainability and negotiations. She is a Manager in the Corporate Program at Ceres, where she advises financial services companies on sustainable business strategies, including performance, disclosure and stakeholder engagement processes.