Feeds:
Posts
Comments

Archive for the ‘communications’ Category

Books

The changes experienced in sustainability over the last ten years or so have been nothing but phenomenal. More and more companies have embraced the need to act more responsibly and manage their impacts. What started as ‘doing less harm’ has turned into bottom line benefits as companies have found new ways to match managing the triple bottom line with shaving costs off the business bottom line. But you don’t cut yourself into growth and growth is the bread and butter of companies. And it’s the holy grail of sustainability – growing the business top line. That’s why we need consumers to come and join the party – they already do, just look at TOMS, Patagonia, Method, Seventh Generation, Dove and many more. What is missing isn’t the consumer but a better grip on what makes them tick – a sustainable brand they can trust, buy and advocate. In my new book I cut through the myths and noise to create a sustainable brand model, a fusion of product and branding. It’s when these two dance that we create consumer breakthrough and the magic happens. But let’s not get ahead of ourselves. Let’s simply create more sustainable brands – and this is the ‘how to’ guide that will help you get there.

Use the code Campher15 in the voucher section to get 15% discount!

Link to the book here - Creating a Sustainable Brand: A Guide to Growing the Sustainability Top Line

Read Full Post »

I wasn’t planning on writing a blog today but this piece in my favorite newspaper, The Guardian (yes, I am the typical lefty reader), made me roll my eyes. The piece is very well intended and generally pretty good advice for charities – Charity funding: How to approach business for help.

I agree that charities or NGOs should be more strategic in their approach to businesses for help. But when I read about the need for NGOs to have more “business realism” in their approach I couldn’t but help think of the need for business to have some “activist realism” in their thinking. It’s easy to ask the other side to be more like you but how about you being a little bit more like the other side too? Like any relationship, it’s about give and take – not just take.

Too often business think that charities should support them more and be more of their “voice”. Sorry, that’s not how it works. It’s a partnership. If you want NGOs to be more of a voice  then you need to be more of a voice as well. No more hiding behind industry associations to do your dirty work or hide you from criticism on key challenges. If you want Greenpeace to slap you on the back instead of on the head then you need to speak up against other businesses who don’t act responsibly. You can’t expect a progressive NGO to support you if you also back regressive policies via another NGO or a business association or lobby group. Or if you keep quiet while other businesses lobby and push for, and argue against, positions held dearly by NGOs - climate change, clean energy, waste, pollution, labour conditions, conflict etc. NGOs expect you to share their world view and not only on one specific issue. This is the “activist realism” they live and work in. This is their “business”.

And how about business in general showing more social conscious? It’s fine to ask NGOs to be more business like but for some reason too many businesses argue that their focus is on the “business bottom line” only and that their only responsibility is towards shareholders. Bah to other stakeholders and society in general. Sounds like double standards to me.

Business needs “activist realism” to realise that their responsibility lies not only with shareholder but to this world they live and operate in. If you see your value as purely making more money for shareholders then you should expect flack from those who are not shareholders. They receive no benefit in their relationship with you except for some products they might or might not really need – so why should they care about your “realism”? Your “realism” might be in direct conflict with their real world. You pollute and they breathe it in. You accelerate climate change and they fry or freeze. You waste and they drown in the plastic bags. You pay peanuts to farmers and they get products that are second rated. You get the picture.

Some “activist realism” will hopefully make companies realize that they have a role to play as citizens of this world. That they have a responsibility towards others through their actions and words. That this responsibility is directly tied to their own long-term sustainability. You kill this world and you kill your business. Easy economics. “Activism realism” will make you sit up and say “no more”. Say it and do it because it is good for your business. Be an “activist” because your company needs to stand up for its own future – one that is tied to the well-being of society. Don’t huddle with those businesses and associations who do not share your world view. Do not care about shareholders who do not care about your business. Shareholder who only care about the next quarter and maximum profits come hell or high water do not care about your business. Only about how your business can line their pockets. They’ll drop you like a hot potato if a better offer comes up.

They are like a bad relationship. They promise you the world but they’ll drop you if someone with more money shows them some shiny object and promise them a better date. Would you take that from a date? Sucker if you will…

Show some “activist realism” by caring about your company’s future. Show some “activist realism” by speaking out against those who threaten your business in hard and soft ways. Show some “activism realist” by being serious about serious investors. Show some “activism realist” when you engage with your stakeholders. Show some “activist realism” when you give us a reason to believe in your worth to society.

Until then – you really don’t have much of a leg to stand on by asking NGOs to show more “business realism”. As my mom used to say, “What’s good for the goose is good for the gander.”

That’s my “activist realism”. A world where business care about business as part of society and contributing to society. That’s the “business realism” I want to live in.

Read Full Post »

Everything seems to be turning green. And there is nothing wrong with that – companies creating new, innovative products and services that are good for them and good for the environment. But consumers haven’t completely bought into this yet. A number of green products aren’t flying off the shelves the way companies anticipated. Why is it that the green revolution has taken companies by storm, but not consumers? With the environment at the forefront of consumer concerns, it makes one wonder, why consumers aren’t dropping the bad stuff and buying the good stuff. We build it, but they just won’t come.Why? 

Some products are a big hit with consumers – the Prius and CFL light bulbs are taking off in a big way. So why aren’t they buying green shoes, food, computers, etc.? 

There are many reasons why people buy certain products and not others – price, functionality, “coolness,” brand loyalty, etc. One often overlooked factor is: how do the environmental aspects of the product help the consumer? 

Let’s first look at why the Prius and the CFL light bulb are so popular. They allow consumers to feel better about themselves when they use these products. A person starts their Prius and immediately feels “greener” than their neighbor with the gas-guzzling SUV. They feel better and more environmentally responsible with every mile they drive. It is the action of driving that makes them “green.” The same goes for a CFL light bulb. They feel better about themselves each and every time they turn on the lights. The simple action of switching on the light enables them to feel like an environmental “activist” – that they are making a difference.  

You said you wanted a green car...
You said you wanted a green car…

The environmental benefit doesn’t come from the company making the Prius or the CFL light bulb. The “goodness” comes from the consumer using the product instead of an alternative product. A Prius isn’t a car – it is an environmental tool for the consumer. The CFL light bulb doesn’t just provide light – it provides the consumer with an opportunity to make a difference through the simple action of flipping the switch. 

The success of these “green” products lies in enabling the consumer to take action. The act of making a difference through using these products makes them successful. So many green failures can be traced back to lacking this fundamental element – allowing consumers to feel “green” each time they use a product. When all the “goodness” is in the making of the product and not in the using of the product, no other action is expected from the consumer. The only action the consumer needs to take is buying the product. But the act of buying is not perceived as an act of environmental activism. This doesn’t allow the consumer to feel that they are taking environmental action. 

Buying a green product, that’s green qualities are all in the production phase, leaves the consumer with a very basic question: what about me? 

You want to sell a green product? Then let your consumer be part of the “greenness.” Give them something that they can do apart from just buying the product. Give them a way to take action. Let it be easy – like starting a Prius or flipping a light switch. Give consumers simple actions that make them feel like they are making a difference each and every time they use your product. Let them be part of the change.

But what about those products that can’t make consumers feel that they are part of the green actions – that don’t turn them into “green activists” purely through the use of the product? Here companies need to be a little more subtle in their approach…

David Connor made me think of the role between a company and its consumers. David is one of a handful of people I admire for their thinking and pushing Sustainability/CSR forward. A true leader in the field. It helps that he is a fellow Liverpool supporter as well… You must follow him on Twitter (@davidcoethica) and bookmark his blog for regular reading – David Coethica’s Blog. Great guy and great CSR/Sustainability strategist.

In a recent blog he explores the relationship between a company and the consumer. What role should the company play in promoting sustainable products to consumers? Should a company put sustainability at the front and center of their communications to consumers? Should companies educate consumers about their impact and sustainability?

Well, if you are selling a Prius or a CFL lightbulb it might help. But even then you have to be very, very careful. The Prius struggled initially to get a foothold in the UK market. Why? Because they tried to sell it as the environmental car. So a few environmentalist bought the car but not too many others. They changed tactics and sold the car as a cool car for the younger crowd with some fuel efficiency thrown in to seal the deal. Bang – they were up and running. See the difference? They didn’t try to sell a green car as the primary reason the second time around.

Once you move away from the Prius example it gets even more complicated.

David argues that companies should do more to provide consumers with more information and education. The problem is that most consumers are very specific about what they want, why they want it and when they want it. Now remember, neither David or I are the average consumer. We work in sustainability and tend to be more sensitive to these issues. The average consumer shows no or little interest. They’ll tell us they will buy a green product and they may pay a premium. The truth is more complicated than that. We just don’t see them flocking in huge numbers to buy green products. (More on this in a future blog – consumer behaviour and movement towards sustainable products are evolutionary and not revolutionary. They move slow but steady in that direction in most cases.)

But the average consumer want their coffee when they go to Starbucks, boots when they go to Timberland etc. They don’t want you to complicate their need and want by telling them about all the “other stuff” when their need and want is clear. That’s the quickest way to alienate the average consumer.

Let me show you a funnel I created to try to make the point:

When you talk to the group on the left you can be as detailed as you want. They know the stuff and they are interested in it. However, when talking to the group on the far right you need to know that the majority of people fall in this area and are not interested in the “added baggage” of sustainability. They just want their “stuff”.

Companies must be careful to balance their engagement with consumers to both the topic that is relevant and the place where it is relevant. This is at the heart of “shared value” (there, I said it!) – don’t preach and don’t oversell, rather empower subtly. Companies must remember to keep the “act” part of what they do separate from the “talking” part. Do what you have to do as a company to be sustainable and have it embedded in the business – but don’t confuse that with what you talk about when engaging consumers. They don’t care about all the detail – only “what can I do and keep it simple”. And… “Give me my stuff!”

The easiest and most effective way to empower consumers is to not actually tell them they are being more sustainable. Be so subtle that they don’t even know they are becoming more sustainable. You can tell them later and give them a nice surprise. Draw them down the funnel from “I just want my stuff” on the right to “what’s your sustainability strategy” on the left.

This way the company can focus on their sustainability as it benefits the company and society (and the environment) – the doing part – and help consumers become more sustainable without them knowing it. An example – Starbucks can tell the consumer about where they get their coffee and how they source it all they want but the average consumer just want their cup of Starbucks. So Starbucks have great sourcing practices but sell the consumer their coffee and sometimes tell them subtly that it’s a damn fine cup of coffee on more than just taste level. It confirms the purchasing decision already made instead of driving new sales. It builds customer loyalty instead of new customers. That’s how most consumers think and act.

Keeping with the Starbucks example – what consumer do care about is the place where they share an impact with Starbucks. In their case it is the cup. They don’t really care how the coffee was sourced or if the building is LEED certified or not. They care about what to do about the cup once they’ve had their coffee. So Starbucks helps them recycle and encourages them to use tumblers. They can try to educate the consumer about sustainability and how the consumer can be more sustainable but the reaction from the majority of consumers will be, “What are you on about, dude? Just give me my damn coffee!”

The lesson from this is for companies to focus on that area where they have a “shared value” with the consumer. Where they have a mutual responsibility or an impact they share. For the electronics industry this is about “what the heck do I do with my old stuff?” This is especially true in a world where electronics are becoming another commodity for consumers to replace and dispose with ease. The “shared value” (said it again!) is companies empowering the consumer to dispose of the product in an easy way at the point of purchase. Their key consumer focus should therefore be about making recycling as easy as possible.

Recycling might not be the sexiest sustainability topic but it is, in most cases, still the most relevant one from a consumer experience perspective. Boring for those on the left of the funnel but actionable and empowering for those on the right of the funnel. It’s one of few places where you share an impact and a responsibility with the consumer.

The next step is helping consumers make the right choice. There are so many gadgets out there today – how do you choose the right one? By going to a store and asking the person behind the counter what is the best choice for them. What product fit their specific need. This can’t be done online as there are just too many factors and too many different products. Trying it online will alienate the consumer quickly. Even those companies who have sustainability as part of their brand knows that you can’t do it online. The rule of online commerce is “keep the clicks to a minimum”. Comapnies such as Timberland, Starbucks, M&S etc keep the purchasing easy and uncomplicated. It’s a different ballgame when they are in your store nthough. By empowering your employees you can help the consumer become more sustainable by matching their need with the right product. How is this more sustainable? By helping them make the right choice you ensure that they won’t replace it as easilyor quickly because the product match their need. You don’t sell them a car if they really only wanted a t-shirt…

Note, in neither of these cases do we even need to mention the word sustainability or CSR. “Hey Mr Consumer, let me help you pick the right product to match your need.” It’s sustainability disguised as good customer service! Don’t “educate” your consumer. This feels like preaching to them and they smell through the bull pretty easy. Or they will get alienated by the overload of information when all they wanted was their “stuff”. Educating consumers about sustainability is overrated in my eyes. (So much is going on in educating the consumer that we’re in danger of creating white noise where no one hears anything anymore.) Focus on the relationship you have with them and focus on your mutual responsibility. Don’t use big word. Make it easy. Once they are in the habit of expecting these then you can tell them what you two just did jointly and pull them down the funnel into a new world of sustainable opportunities.

In conclusion – the most effective way to share sustainability with the average consumer is by making it easy for them and not always telling them (or preaching to them) that they are involved in any form of sustainability. It should just become part of their daily purchasing actions without them even knowing it. That’s the one side of the funnel – the consumer side. When talking to people on the other side – the influencers – then it is okay to show how these play out and how the company thinks. But influencers (me included) are not the average consumer and need a different approach.

This is not what David fear – “Am I the only person that is scared that far too many retailers are waiting for consumers to dictate the sustainability revolution?” It is being smart in how you pull them into sustainability. It’s talking their language, understanding their purchasing habit and making sustainability part of their decisions without knocking them over the head with it. It’s subtle but effective. It changes habits and expectations without them knowing it. It’s like teaching a baby to speak or walk. They can’t remember who did helped them and no one said “walk or talk” to them. We taught them these new skills without them knowing we were doing it. And they haven’t dropped these taught behaviours and actions – it becamse part of their lives. And they will teach others to do the same one day.

I don’t think David will necessarily disagree with me. But I think we need to be very careful when we talk to consumers about sustainability. The last thing you want is them to say you are greenwashing or alienate them because of the overload of information. Remember why they come to you in the first place – to get their “stuff”. Help them pick the right stuff to fit their needs and help them dispose of it responsibly. And they don’t even need to know you are doing it to be sustainable or help them be more sustainable. It changes the way they act without them even knowing it. They will become more sustainable without even knowing it. Now that is sustainability.

Read Full Post »

I have been trying really hard. Really, really hard. You know. To be a treehugger. I think the whole concept of being a treehugger is really cool. You get to have the beard, the nice lean and muscled body, tanned and tough as nails. With my sunglasses and Bermuda shorts. Sandals and a knowing look in my eyes. Man. I am so cool. Me, the treehugger. But first, let me find a treehugging job…

The rebel of the forest. Defending the last natural old forests of our precious earth. These beautiful beasts whose breath gives us our precious clean air. The green jungles that hides the therapy for the soul and body. It’s there and we must protect it. And that’s what I do. I live in the forest. Patrolling every inch to make sure these wise old trees stay safe. Safe from the loggers. I am the phantom. I live in the trees at night and run like a tiger during the day. Stopping and smelling the air to see who is here. Who will feel the wrath of the rebel. But… Eww! What is that? What is that smell? It smells like something rotten – must be the dead carcasses. And those creepy crawlies! Worms and bugs all over the place. And the bloody ants crawl up my pants the whole time. And the food stink – fruits day in and day out. I need a BigMac now! And just water and water and water. If it isn’t drinking this foul stuff then it is raining and raining and raining. I now get why they call it the rainforest. It’s always bloody-well raining. Gotta get outta here. I need some fresh air, a warm bath, a beer and a braai (barbecue).

The activist of the seas. I can see myself. Standing at the bow of the boat. Scanning the horizon for those whale-hunters. Now I am the hunter. Like a pirate of old. Ready. Just ready to take them down. They don’t know my rage. My fury. I am the king of the high seas. I have seen things on these seas of mine. Corpses of people. And corpses of animals. Those dead whales we try and save. But not anymore. Not on my watch. I will… Pthu! Bloody seawater sprays everywhere. Standing on the bow wasn’t such a good idea after all. The water sprays everywhere. Salty water in my mouth. My body feels sticky all the time. And all we get to eat is bloody fish and more fish. And crap desalinated water. The boat stinks man. Like dead fish and men who haven’t had a proper wash in months. My hair is a permanent mess. And my hands. My poor hands. Cut to pieces by working the lines and ship each day. Oh, man. It doesn’t help that I get seasick from watching fish-tanks either. Gotta get of this ship. Now! I need some clean linen, a warm bath, a beer and a braai.

Okay. So I can’t be an active treehugger. That’s fine. I’ll just be a greenie. I’ll just live green then…

It’s a good start. I use public transport. Okay, I don’t use it because of any green reasons. I am just too bloody lazy to drive to work myself. I have too short a temper to sit in the traffic all day. And I am too stingy to pay for parking and tolls. But still. It is a good start. Oh, wait. I also have a refillable mug for my daily Starbucks fix. I am saving a few rainforests that way. No cup for me. No sirree, Bob! Not for me. Except when I forget my cup at home. Or when I am too lazy to clean my cup for a refil. Still. It’s the idea that counts though. Doesn’t it?

My problem is that I want cool stuff. The jobs look cool. But it isn’t really. It’s only cool if people can see you do it. And there is no camera following me. Treehugging just isn’t cool enough for me. Me fighting global warming? No problem. Just make it a bit cooler dude. Global warming just isn’t that cool.

I mean really. The iPad is cool. A red Ferrari is cool. The Kinect is cool. So many companies make cool stuff. Not green stuff. But that’s cool. As long as it is cool dude. That’s the problem with treehugging. The stuff that make us want to hug trees just aren’t cool man. And at my age I need to have cool stuff. Because I am not cool enough by just my little older almost middle-aged self.

So gadgets don’t work for me trying to be cool and a greenie. Let’s try something else. Something that says cool and green in a big way.

Let’s buy a Prius! Okay, let’s not. The Prius is just not cool. It’s a lunchbox on wheels. An ugly lunchbox. Come on. The Dodge Challenger. Now that is cool. The Toyota FJ Cruiser. Now that is cool. I can see myself behind the wheel of a brand new red Challenger. Sunglasses and all. Revving the motor while eyeing the guy at the traffic lights. Ready to smell my tires dude? Bye-bye. Oh, and the surfboard on the roof of the FJ Cruiser as I sit on the bumper looking at the waves through my cool Ray-Ban glasses. Now that’s cool. The Prius? Nah. Not so cool. I’ll look like the man I am – on the older side of the surfer group. All I can fit into the Prius is my neat little suitcase and a clean shirt for work.

The problem is that most stuff that makes treehugging easier just isn’t cool. Oh, there is a few cool stuff out there. Wind-farms. That’s cool. Neat Apple-like designs. That’s way cool. One small problem though. I can’t carry it around with me to show it off. And you need to show it off if you want to be cool. Oh, and it will take up the whole bloody backyard. Kids won’t like that I think.

Global warming is even more difficult. I can’t point to it. I can’t go, “See, there it is. There are those damn CO2′s”. Just too little these things. These stupid little molecules. Wind-farm to big and CO2 too little. That just ain’t cool. That’s so way not cool.

But those kids of mine. I sometimes wonder. Just wonder how cool it will be when they grow up. Will it be too warm when they are my age? Might be a bit too warm for them. A little bit too warm to live? And that is so way not cool…

Maybe it is time for a change. Climate change. Now that is way cool!

Read Full Post »

This post was originally posted on Vault’s CSR Blog - a great resources and a huge thank you to Aman Singh! It was part of a discussion between Alberto Andreu (Chief Reputation & Sustainability Officer at Telefónica)  and I on CSR and Sustainability. He countered with a great post. Great guy and great thinker. It was an honor to have such a constructive discussion with someone like him.

________________________

I am afraid Alberto and I violently agree with each other on the most important aspects of CSR: Where it comes from and where we are today. Where we might not agree as much is whether this is still CSR.

In my view, CSR is not a revolutionary process but one that continues to go through many changes—an evolutionary process. The graphic below is my first attempt to describe this evolutionary process.

Phase 1: Philanthropy

In its initial phase back in the 1970s, CSR was all about philanthropy and what business should do with some of its profits. Small shifts in thinking pushed this early form of CSR forward. Companies became more strategic with philanthropic initiatives and tended to focus on projects in their local communities. This eventually grew into Corporate Social Investment that brought a business sense to philanthropy – focusing on results and outcomes.

 

Phase 2: Globalization Forces Standards

Slowly, globalization started shaping our world more and the impact of business in this globalized world became an increasing focus for activists. From a narrow focus on philanthropy we moved into an era of citizenship. Companies became business players in a globalized world, or, as it became known, Corporate Citizenship.

They started developing standards to manage their risks. This led to the need for global standards – from extractive companies and human rights to how we report on CSR today.

Phase 3: Citizenship-led Cause Marketing

When the term cause marketing was initially floated, CSR became something business could benefit from for the first time. It was a huge shift in how we perceived CSR,– not just risk management. This benefit-based approach brought operations back on the table leading to the development of CSR as a business strategy.

Now, CSR was suddenly not about cutting costs but about increasing profits.

Phase 4: CSR & Sustainability Tied with Future Business Growth

The latest evolution of CSR, or sustainability, has taken this concept of business benefit even further and started looking into the future of business and society—the heart of CSR. Sustainability today looks at finding mutually-beneficial solutions to the challenges we face as society as well as future challenges.

But CSR, even today, is  still about how business can operate profitably within this role as a responsible citizen toward society.

From Reactionary to Risk Management

We have moved from a reactionary model of philanthropy to a crisis-led model in the early stages of globalization to a risk-based model in citizenship to a mutually-beneficial business model in sustainability.

We might have seen our understanding of CSR deepen throughout this evolution but the definition of CSR hasn’t changed much over time—CSR is the way a company manages and communicates its impact on society and the environment.

Many of the individual parts of this evolution (Philanthropy, standards, etc.) remain with us today but these are not the only parts of CSR anymore. We’ve adapted and moved on – keeping the good stuff, improving on them and adding to it.

The world of CSR is very, very different today. But it is still CSR.

An Argument for Terminology: Corporate Social Responsibility Fits Best

While this might be somewhat semantic in nature, it is still an important part of the debate: We should look at the description of CSR itself. Why do we use these very specific three words to describe what we do?

I would argue that the concept is actually a very good description of what we do today. Here’s why:

Corporate implies that this is about business.

  • It not only describes that we are busy with a discipline involving business but goes deeper.
  • It is about profits – how we make them and how we can make more of them today and tomorrow.
  • It is not about charity.
  • It is about building a sustainable business model that will continue to deliver business results for stakeholders – especially shareholders.

Social tells us this is about society.

It is about the impact business has on society and how we can manage this impact to ensure both business and societal benefit.

Even the environmental part of CSR is about society – how we can minimize environmental impact to benefit society in the end of the day.

The new developments in CSR – sustainability – further continue to prove that CSR is about a mutually beneficial relationship between product and service development, and societal value chains.

Responsibility reveals that business does carry a responsibility in this world – to do business in a way that benefits both business and society. Further, this responsibility gives business the opportunity to create new solutions to the needs of society. I would even argue that it is their responsibility to develop these new solutions and benefit by capturing new avenues of sustainable profit.

All three concepts—Corporate, Social and Responsibility—tell us exactly what we do today. CSR is also the perfect reminder of the relationship between business and society, and the responsibility they have towards each other. None of the other concepts proposed today actually tell us what we are doing and what we should be doing.

I say, long live CSR, and may it continue to evolve and change our business world for the better.

Read Full Post »

Can you remember the first time the two of you got together. The stolen looks, the uncomfortable moments of silence, the tripping over your sentences, the sweaty palms, the he-likes-me-he-likes-me-not thoughts, the private meetings when no one was looking, the uncomfortable first meal together. Yes, I am talking about stakeholder engagement. Just as with any relationship in the early wooing and courting stage, stakeholder engagement is never easy at the start.

Most companies just don’t know how to talk to activists and campaigners. Hey, make no mistake, activist hardly knows how to talk to companies either. But they don’t need companies to like them as much as what companies need them to like them. Or at least leave them alone and not target them.

Don’t feel bad when they target you. It happens to the best of companies. Sometimes it makes sense and sometimes not. I remember seeing an anarchist kicking a Nike sign at the battle of Seattle in ’99 – while wearing his Nike shoes and top…

But there are a few tips you should follow if you decide to engage and start courting. This is not an exhaustive list. Just a few tips to get you through those first uncomfortable early stages of stakeholder dating.

Firstly, do your homework and find out a bit more about the NGO and what it regards as its ‘bottom line’ – it is unlikely to be financial! I was invited to speak to the global affairs team of a very large pharmaceutical while I was at Oxfam (I headed up the Access to Medicine Campaign for a while). I was shocked to hear that the majority of people at the company thought that Oxfam only worked on health issues. And this happened when Oxfam was in the middle of their Coffee Campaign! Dig around a bit first and find out what the NGO does and what is their mandate. Most of them are registered with a constitution that states what they should focus on and how they should work. This will help you understand whether there is any potential for a longer term constructive relationship – or just a one night stand. Also a good tip when you start dating – know who you are dating. Except if you like blind dates.

Secondly, respect the differences between NGOs by not lumping them all together in the same room for a consultation exercise – NGOs are proud and competitive too. You wouldn’t want them to call a whole bunch of companies together and still expect special treatment just aimed at you. You should respect their differences and treat each one differently. Rather meet each one separately in an environment that works best to put them at ease. Meet them where they feel most comfortable – maybe at their place. Especially if you want to build the foundation for a long-term relationship. And even this should work best for real dates – don’t bring all your prospective dates together in the same room. They might just start sizing each other and you will be left with no date at all.

Thirdly, don’t make the mistake of thinking that you are the only company that is the target of the NGOs campaigning efforts, or that the NGO hasn’t other programs and projects that may have nothing to do with business. Just as with the large pharmaceutical company I mentioned, most NGOs have numerous focus areas and different programs and projects to try and achieve their overall goals. And most large campaigning NGOs have various campaigns going at the same time. They might have one single broad focus, but it plays out in different campaigns and programs. For instance, Greenpeace might be about the environment, but they focus on climate change, oceans, forests, genetic engineering and nuclear issues. So your company might only be a small part of their focus and interest. Same with real life dating. A friendly smile does not mean they want to date. It might just be a friendly smile.

Fourthly, start by talking, learning about each other and building trust rather than starting by expecting ground-breaking strategic partnerships. There might be a few obstacles to overcome – perceptions of what ‘big business’ is all about and a feeling that you want to ‘clean’ yourself by associating with them. Take it easy and just talk. Let them get to know you. Don’t create expectations. Just listen and learn and see where this might take you. Again a good tip for real life dating as well. Don’t ask them to marry you or expect ‘the commitment’ on the first date – it might just scare them off.

Lastly, remember that cash does not necessarily have the same currency as it does when buying products or services from other companies. First and foremost NGOs want to affect change. But they don’t always see money as the way to achieve change. Yes, some of them have huge budgets and operate like multinationals. But they generally have strict guidelines on receiving money from companies. For instance, Oxfam will not accept money from companies that fall within an industry they target in their campaigning. They might not even accept money for travel – never mind for a program. They would rather see you ‘do the right thing’ than pay them to do something. Okay, this one is less relevant for real life dating. Money generally impress prospective dates!

Okay, one more tip. Don’t expect them to agree with you on everything. And don’t make this a prerequisite for your potential relationship. I love my wife to bits. But we only agree 80% of the time. But we don’t let the 20% of the time we disagree define our relationship. No. Focus the relationship on what you have in common and don’t get stuck on the differences. It’s part of being human – we are all different. And the same for companies and NGOs – we are all different. And I learned that I am wrong 20% of the time in any case. Just ask my wife.

Read Full Post »

It feels like 1990 all over again. How many times do we go through these arguments that CSR is dead or CSR isn’t a very good description or that CSR is so yesterday. It seems as if we are back at the drawing board again. First we had Aneel Karnani make his Case Against Corporate Social Responsibility in the WSJ last year. Then we had Michael Porter and Mark Kramer argue in the Harvard Business Review that CSR is an old concept and that the new way forward is CSV – Creating Shared Value. And now we have Alberto Andreau arguing that Shifting From CSR To CSV Isn’t The Solution and that the truth and future lies in Corporate Sustainability. Oh boy, here we go again…

I won’t go into detail into Dr Karnani’s argument. It has been dealt with from all angles and most agree that he missed the point a bit. What he perceives to be CSR isn’t CSR but only what some companies claim to be CSR. He was working with the concept of CSR as practiced maybe 20 odd years ago but CSR and CSR practices today have changed dramatically. His definition and understanding of CSR was wrong and his argument therefore based on the wrong assumption. But what about Porter and Kramer, and Andreau? I would argue that they are making the exact same mistake as Dr Karnani. They are using a definition of CSR that is outdated and their understanding of CSR is based on what CSR was 20 years ago – or maybe even closer to 5 or so years ago.

Let me first say that it is an excellent piece. They capture the latest thinking and practices of CSR very well. Unfortunately they then argue that this is CSV and not CSR. It’s not, it’s still CSR. And what they propose isn’t completely new either. Those of us who have been working at the sharp end of CSR have been working on a similar concept and approach for a few years already but we didn’t call it shared value – we coined mutual or co-responsibility. The idea of mutual or co-responsibility is that (leading) companies should focus their CSR on those areas where they share an impact and opportunity with key stakeholders. Starbucks can focus on the cup when they deal with consumers and on sourcing when they work with farmers – helping consumer have a better impact and helping farmers increase yields, get better prices, be more sustainable etc. Levi’s helping consumer limit the impact of their jeans and working with farmers in farming cotton. Best Buy recycling or even buying back older technology. And many more leading companies share this approach to CSR.

Furthermore, we’ve focused more specifically on key stakeholders and not society as whole. There is a reason why – society is too broad a concept for a company to focus on. Break society into the various stakeholder groups and be specific in who you target – key stakeholders such as consumers or suppliers or investors or regulators or your local communities or even distant communities. The more targeted you are the better the chance of success. Of course you should always target more than one stakeholder but try to be as targeted as possible to know exactly where the shared value or mutual responsibility/opportunity might be. CSR works best when it is targeted.

Back to the meaning of CSR…

CSR has changed it’s meaning and how it is used substantially since the 1970s. It started off as all about compliance and pressure from activists for expand on their philanthropic commitments. But today it is as diverse as the concept of business. Business isn’t a singular description anymore. It describes anything from a large multinational company with a diverse set of products to an informal trader working in the streets of a township in Africa. It’s a bit like pornography – we know it when we see it.

Let’s define CSR quickly to provide some clarity. This isn’t a perfect science as we don’t have a single agreed definition. Mine is simple and I don’t claim this to be the final definition of CSR: CSR is the way an organization manages and communicates its impact on society and the environment. Simple. But it is this simplicity that hides the complexity and diversity of how we practice and implement CSR.

Porter and Kramer make the same mistake that Dr Karnani did by not recognizing the diversity within the CSR field. Some practice CSR in the risk management, compliance and/or philanthropy way they explain it and other practice CSR in the shared value way they explain CSV. It’s the nature of the beast – CSR is not a single discipline that covers every single company in the same way. Each company and industry focus on it in a different way. For example, for pharma it makes sense to focus on philanthropy because it is in the nature of the product(s) they offer. It makes sense to donate products to people who can’t afford it – or else they die. As simple as that. It doesn’t mean they don’t focus on other areas but their priority focus will most likely be around philanthropy – and at the core of their business: finding new drugs to help us deal with our health challenges. For companies such as Starbucks it is very different because they focus on consumers and farmers. They help farmers improve their practices and pay a premium price and help consumers improve their impact by offering recycling and encouraging them to use tumblers. Companies and industries are diverse in how they practice CSR. At best it focuses on those areas where their products or service intersects with society – and where the greatest societal needs intersects with business opportunities (or responsibilities).

(Of course we learn from different practices and improve on it but it is always unique for each company – or should be – as it should focus on the specific value the company offers through it’s unique products and/or services and brand and corporate identity.)

Some companies just do not have a shared value with society – or they have a very difficult case to make. For example, tobacco companies can build a solid case of shared value in their sourcing practices (and some do) but they will have a difficult case to make for shared value with the broader society. And the same goes for arms dealers/manufacturers, some military contractors etc.

Shared value is also limited by the timeframe and current knowledge. If we look at societal needs and shared value today then it makes perfect sense to provide a society suffering economically the cheapest fuel and energy. But we know that this will have a negative long-term impact. Shared value shifts and moves with time. What might be a shared value today is another issue to deal with tomorrow.

The idea of renaming CSR to CSV because of the perceived new way is futile. The debate continues each and every day and was at a height 5-7 years ago when some CSR practitioners (like me) argued that CSR has changed from compliance to differentiator and should therefore be renamed because it is now about business opportunities and not compliance-led responsibility. I was wrong back then. I confused the definition of CSR with the practice of CSR. And this is the fundamental mistake of Porter and Kramer. And Karnani and Andreau. They confuse the definition of CSR with the practice of CSR. The practice of CSR is complex and diverse – adapted to the needs of the complexity of business and flexible enough to continue to adapt and change with time and knowledge.

CSV isn’t the new CSR. It is a way of practicing CSR. I would even go so far as to say that it is the ideal way of practicing CSR – finding the shared value with society (or specific stakeholder groups). But it isn’t something different from CSR. It is how some practice CSR. And a damn good way to implement CSR if it makes sense for a company to do so.

As for Andreau – the same argument holds. Corporate Sustainability is just another way of practicing CSR.

Of course a major flaw of Anfreau’s argument is his argument that we need to widen the meaning of sustainability to ensure it covers everything he wants sustainability to stand for. Why is it acceptable to adapt the meaning of sustainability but somehow not acceptable to do the same with CSR? Actually, I am not asking for a change in the meaning of CSR but only a recognition of its complexity. I agree with his call for simplicity but I don’t think that changing the name will help. The simplicity lies in the earlier definition of CSR I gave and the complexity in the execution.

All the points made by Andreau is as true of CSR as of Corporate Sustainability: It’s a business approach; it seeks to create long-term value; it embraces opportunity; and it helps manage risk. Thank you Alberto, you described CSR very well – it’s all of the above. Simple but complex at the same time.

To quote Alberto and change it just a little: “This is where the future lies: A unified return to CSR. Not CSR only in terms of philanthropy or compliance only but a sense of CSR related to value, opportunities and risk management.”

In conclusion, what is described as CSV and Corporate Sustainability are not new but captures some of the latest developments of how we practice CSR. And they do an excellent job of expanding the thinking of how we (should) practice CSR. But there is a limit to their contribution. Let’s not get distracted by shiny objects and new names – let’s stop this arguing about what we call it as it doesn’t help us do the work we are doing and distract us with discussions about terminology. The value of Porter and Kramer, and Andreau, gets lost in the discussion of terminology. We argue about what we should call it instead of expanding the discipline and practice of CSR. The value of Porter and Kramer lies not in calling it CSV but in strengthening the practice of CSR – shared value, co-responsibility, mutual responsibility etc. I think their description of mutual responsibility is a much better description of my own – shared value describes it better than my idea of mutual or co-responsibility.

By focusing on what we call it we lose the value of Porter and Kramer’s work when they describe the roots of shared value – taking on Friedman, showing how shared value is a traditional part of the best companies, show how reconceiving products and markets can bring new value to business and society, highlight local cluster development as a driver to create shared value, and so much more. None of this is new – Starbucks have been sourcing this way for over 10 years; cluster development is a natural phenomenon and the modern version was started by a history prof and a garage owner in Chihuahua, Mexico; most companies started with a shared value offer – from Walmart bringing cheap food to the poorest Americans as close to their homes as possible to the mom-and-pop shops offering locally produced good. The beauty does not lie in the fact that they create the concept of CSV but rather in their ability bring the latest thinking and practices of CSR into one single place – and drive us further forward in the implementation and practice of CSR. It is a powerful piece and one that should be used to defend CSR and show how CSR has grown instead of using it to divide us even more because of a debate on terminology. Let’s stop arguing what we call it and focus on what we practice and do each and every single day. Let’s advance the discipline of CSR instead of creating more divisions through renaming it. Let’s focus on improving the impact of business on society and identify mutually beneficial opportunities instead of looking at the impact of what we call it. Let’s just do it instead of calling it…

CSR is dead! Long live CSR!

(Disclosure: As promised, I think it is only ethical and right for me to mention when I have worked or work with a company I mention in my post. It’s called transparency. All of the companies mentioned above – Starbucks, Levi’s and Best Buy are clients.)

Read Full Post »

The UK and Europe is so far ahead of the US when it comes to CSR. If I only had a penny for everyone who said this. I hear this almost every single day. And not just from those in England who have a slightly superior attitude when it comes to CSR. I hear it from people here in the US just as often, if not more often. The truth is that we are comparing apples and oranges. Is cricket better than baseball? Only if you are from England. Although you wouldn’t know that from recent results – excluding the Ashes. And you would only like cricket more if you enjoy sitting in the sun and rain for five days and still not get a result. But I digress. They are both ball sports but they are vastly different. They might even share a common history, but that is where it stops.

I’ve noticed small differences as well. In the US companies focus often on what they do in the community – their communities. How you interact and how you support them. Europe tend to focus more on how you run your business in a responsible way – it’s about operations and how you work. The impact is important to both, but in the US you look at your community and their needs first and the way you work in your community might have something to do with the way you operate, but does not have to. In Europe you focus on your role in society through your operations and the impact you have, and then you improve on these. Through these operational changes you will have a more positive impact on society. Both benefits society, but they have slightly different points of departure.

The reason why the community focus is so central in the US is because there is less of a safety net in the US than in most of Europe. People do not expect government to solve their problems or protect them from every single little thing in life. No, people do that themselves and they tend to look after themselves and sometimes after each other. They expect to solve issues themselves. Americans like the idea of less interference by government and more control by themselves in taking responsibility of their own lives. It might have something to do with the open spaces, but Americans do not like people telling them what to do. They want to be masters of their own destiny. Less government and more power to the people.

In the UK and much of Europe there are much more of a reliance on government to interfere in daily life. People expect government to take more control of their daily lives and maintain the rules of how society engage and organize themselves. The rules of engagement. And they want government to identify the common areas of good that will help improve society. Government will tell you what is bad and help you to become better. All that is left for companies to do is ensure they do their best through operations and compliance to government regulations.

That brings me to a second and more important point of difference – regulations and compliance. Corporate behavior is managed through regulations and compliance in the UK and Europe. Everything you do is regulated and not left to the company to try to innovate on their side. Any leadership position you develop is very quickly turned into a government requirement. (Your window of opportunity to show true leadership will stay open for a very short period in this environment). Yes, European companies do some amazingly innovative stuff but just notice carefully how much of that innovation actually takes place outside of their own borders – where they source from or manufacture.

It helps that there is a strong central government in Europe. It makes it easy to push through new regulations. And it is even easier in Europe where the European Commission is hardly held responsible by ‘the people’ and have an almost free ride in bringing in new regulations. No wonder that Europe brought out regulations to define what a banana is – up to the curve needed to be defined as a banana. And I am not joking…

And it is also easy to bring in new regulations in the UK. It is a small island with a central government that runs the rule over everyone. Yes, Scotland and Wales have some autonomy, but the UK is still pretty much ruled from London. It is easy to understand the drive towards more regulations with so much power in the hands of a central government. It is in the nature of government to try to rule their own way. And each new government want to leave behind some kind of legacy. And what is easier than to bring in new regulations that can be sold as ‘for the good of everyone’.

One dynamic that makes this possible in the UK is the level of stakeholder engagement by the government. I was amazed to see how little joint constructive meetings between business, government and NGOs take place in the US. When I lived and worked in the UK it was so different. Regular meetings with all these key stakeholders together – and working together to fight and find solutions. Not over here in the US. It’s about lobbying and individual actions – and at best a few partnerships that will include the usual suspects of progressive companies and engaging NGOs. But not in the same was as over in the UK.

But the regulatory approach is different in the US. States control their own destiny much more than any regional authority in the UK. The federal government does not have the power to control everything. Even taxes are different from state to state. And some states like Massachusetts might regulate more towards the protection of people than those in say Texas, but it is up to each state to decide what is most relevant for their state. Federal government can provide guidelines and try to push through federal laws, but this is generally fought tooth and nail by states. The art of the federal government is to try and keep a balance between inching forward on the regulatory front and encouraging states to take control at a local level. But change happens at state level and not federal level.

This approach allows for companies to take more risk in trying out new practices and to develop a leadership position. They know they can bring in these practices without the danger of it being regulated to death. Yes, it is a fine balance. They still have to tell the truth in advertising and not make claims that can’t be backed, but they can be more risky in taking chances. Over in Europe it is slightly different. The aim of regulations is not to bring best practice into law, but to rather identify the lowest common denominator that could be passed as acceptable behavior by companies. I know, both have a place – best practice and lowest common denominator. In the US they lean more towards the former and in Europe more to the latter. It fits their societal and political needs.

Of course the US does have one thing that ensures that the lowest common denominator is ‘self regulated’. The I-will-sue-you culture. You make one mistake and the consumer will take you to the cleaners. Yes, it is out of control, but it creates an incentive for business to not do something that can harm the public. There are enough lawyers here to ensure that you will get sued. Businesses in Europe can hide behind compliance of law and it is much more difficult to sue someone if they haven’t broken the law instead of suing because they didn’t look after the public interest.

And some of the regulations make the way companies act very different. For instance, both the UK and US have regulations regarding how foundations are run. And these are very, very different. US corporate foundations are not allowed to do any work that can directly benefit the company. This was put in place to ensure that companies do not see this as a way to hide money, and to ensure they spend their foundation money on what is good for society as a whole. Very different in the UK. Much more freedom to be strategic in the way they spend their foundation money. They can spend the money on helping suppliers of the company and still write it off under foundation rules. The unbelievable work the Shell Foundation (UK) has done in development in poorer countries would not be allowed under US rules.

This difference in regulations and the community/operations dynamics also impacts key aspects of CSR – such as stakeholder engagement and CSR reporting. GRI is flourishing in Europe but struggling to find a solid foothold in the US. But it makes perfect sense. Europe is more driven by regulations and compliance and standards such as GRI makes sense. Everyone reports in a structured way following a specific methodology. It makes less sense in the US where there is less regulatory pressure and a greater need to engage their communities and consumers. They target their communications according to the needs of the receiving audience and not the regulatory and NGO audience. And CSR reporting GRI style is not the easiest thing to use when communicating to consumers and communities.

The US also likes rock stars and celebrities more than anything else. Man, their news are pathetic over here – give me the BBC and Guardian please. Every second story is about some celeb and their latest escapade. And that plays out in the way company CEO’s act as well – not empty celebs but the need for visible champions. The CEO and Chairman tend to play a major role in the public view of the company. Bill Gates is Microsoft. Jeff Swartz is Timberland. Howard Schultz is Starbucks. Steve Jobs is Apple. And each one have to make their mark in this world. Not because they want to, but because people expect them to lead from the front – lead the way in how and what they give and the way they run their company. They are the people others look up to and aspire to become. These leaders drive change across all businesses and are needed in a less regulated business environment. They are by default the people who drive real change through their own commitment to making business and society better. Thank God for them.

Less so in Europe. Companies are seen as more important that the individual. A few has made it to the front – Richard Branson as one. But they stand out because they are so different from the rest. The focus tends to be on the company and not the individual who runs it. Yes, they play a role, but the company is seen as less dependent on the CEO and/or Chairman than in the US. Another reason why the UK at least loves splitting this role while the US wants the same person in charge. Two big personalities would be difficult to control in the US.

One area where the US is way ahead of Europe is in communicating their CSR. They tend to focus on the communications part more while Europe tend to focus more on the operational changes. Maybe it is because the European (UK at least) society is more reserved than the US, but it means that Ben and Jerry’s is more respected in the US than Unilever. But in the UK it is the other way around. Of course this can be exploited and can confuse the consumer. A classic example is the current discussions in Washington about ‘green’ advertising and marketing. But the best tend to rise to the top and consumers do know to take things with a pinch of salt.

In short, the US is different because it fits in with the way their society organizes itself compared to Europe. Both approaches have real value. Both approaches will improve the world little by little. Both approaches will have failures and successes. But the one is not better than the other. Just different. Dealing with their own little peculiarities in their society and political systems. Both work. And both fails. But the US is not in any way behind Europe when it comes to the role of business in society. No. They are just different. An US approach won’t last a second in Europe. And a European approach won’t survive a second in the US. The real challenge for them both is to adapt when they are outside their own borders, culture and comfort zone. For example, neither will last long in China or South Africa if they just try to continue working the way they do in their country of origin. New rules and new ways of operating is needed. They have to bring the best of their world and merge it with the societal and political expectation in these new countries. And that won’t be better either. Just better for that specific country.

But the discipline of business in society benefits from this dynamics – bringing different approaches to the table. And it is when these merge and mingle that we move further ahead in this CSR world of ours. Of course there is one approach that works no matter where you are. The South African approach. But I won’t be giving away our secrets just yet. No, I am way to responsible to do something like that.

And don’t get me started on Europe. I use the term loosely. Although they tend to have regulations that cut across the business sector, each country will have its own little peculiarities. Not in my wildest dream will I ever tell an Englishman that he (or she) is similar to the French. Or German. Or Italians. Or any combination of the above. Each to their own. No one is better. Just different and it is up to us to learn a bit from everyone to help us all be a bit better. That’s how we make CSR work – by making it targeted to the needs of each society and their particular needs and the way they organize themselves.

Read Full Post »

We can all breathe a sigh of relief - the recession is over! Oops… Actually the recession was over in June 2009 already. So let’s get this party started!

But for some reason the public party hasn’t stated yet. The recession is over but the pain remains for the Average Joe in the street. No jobs being created and a drop in the average wealth of Americans just to rub salt in the wounds. But it’s been bad for everyone, no doubt. And we all did our fair share of suffering during the recession – some more than others. More importantly, companies practiced their responsibility during the recession, right?

A few things have really bugged me during this recession – or whatever you want to call it. It comes down to a simple question of how would a responsible company act during a recession. I’m not convinced that all companies acted as responsible as they should have during these tough economic times.

Firstly, it’s been reported that corporate cash in America is at a record high. The Fed estimated $1.8 trillion in total corporate cash balances in both absolute numbers and as a percent of total corporate revenue. A nice pile of money. And of course there are rational thinking behind it. They have good reasons for keeping the cash. But having a rational reason doesn’t mean it is the right reason. I feel uncomfortable knowing that it was the public money that bailed out so many companies. And that it is public money going into the stimulus that targets businesses of all sizes to benefit. And that people expect the public to start spending to get the economy going again. People are paying for this recession through job losses and rising public debt. My question – what should a company that believes it has a responsibility towards the public do during these times? Should it keep record cash stashed away for when the economy picks up or should it use that money to also help stimulate the economy? It just feels as if all expectations are on the average Joe in the street and the government to lead the recovery while too many businesses sit and wait it out until the economy has recovered. Doesn’t make sense when they always promote the idea that they are the heart of the economy. Really? And when the blood doesn’t flow as fast as you like you decide to stop beating for a while?

I believe a responsible company would acknowledge that they are as much of the problem as all of us – and do as much as the rest of us when trying to dig ourselves out of it. They expect us to start spending to get this economy going. We expect them to start spending as well. You don’t want us to put all our money in the bank right now. You want us to buy new cars, build new houses, buy more clothes, speculate on the market – make the little we have work for the economy. Ditto… We want you to invest in new fleets, upgrade your facilities, keep your workers… Make your money work and make it work now. I’ll do it when you do it. Don’t ask the public to do something you aren’t willing to do yourself. Stop giving us reasons why you are holding the cash. You might have good reasoning but not as good as the reasons why you should make that cash work now. It’s always easier to say why you won’t do something than doing the right thing. And remember, the quicker we get out of this the better it will be for all of us.

Secondly, this thing about those jobs not being created… I am always amazed how companies consistently tell me that their employees are their greatest assets. Really? But you don’t hesitate to “downsize” when the bad times roll? If employees are really the greatest asset that a company might have – how about keeping those crown jewels during tough times? Of course I understand that companies will have to fire workers during really tough times. And we’ve had really tough times. But let’s put these tough times into a bit of perspective.

Of course it makes 100% sense to let workers go when a company is making a loss. Companies cannot exist when not making money. But here is the catch. Many companies didn’t let workers go because of the losses the companies were making but because of lower profits. Many of them weren’t making losses, they were just making lower profits than before. That’s a huge difference. Making a loss means that you might have to close your doors and one of the only ways to save the company is to let a few people go – cut costs. But what if you are still making a profit but just lower than expected? Do you cut your workforce or define a new strategy to you can keep your “greatest asset” and be ready for when the good times kick in?

Maybe you should devise a strategy where you retrain those workers, maybe cut some hours off some of their time, maybe cut the bonuses and pay increases for all workers (including senior staff), invest in strengthening relationships with key customers etc – show your innovative spirit you brag about by finding new ways to keep your workers and stay profitable during tough times. Instead of laying people off you invest in them to be better placed than your competitors when the economy turns for the better? Your workforce will be better, sharper and your relationships stronger. I know a company who did exactly this and guess what? They actually grew at a higher rate than their competitors during the tough times and moved from number 3 in their industry to number 1. I’m just damn glad I work for that company… It helps when you have visionary leadership, your “greatest assets” believe in you as much as you believe in them, and we all work extra hard to make all of us better. Simple strategy? Yes. But it takes leadership to know that.

Maybe that is what a responsible company should be doing during a “slow growth” period. Instead of taking the easy option and letting people go you invest in them and grow your market share. Show you believe in your “greatest asset” as much as what you want them to believe in you. Leadership is defined not by what you do during the good times but what you do during the bad times. Relationships, loyalty, responsibility etc are defined in the same way – by what you do during the bad times and not the good times. The good times are easy but the bad times needs leadership, vision and balls.

But it goes beyond pure leadership. I think trade unions and employees were soft during these the recession as well. Too often they allowed the business side to frame the debate. They allowed business to panic and let workers go without a thoughtful strategy. Also, some companies used the opportunity to streamline their workforce that might not have been possible during other times. Cut human resources costs during the bad times always makes more sense from a risk and reputation perspective than doing it during the good times. Actually, it still comes back to leadership – what it takes to gear a company for the long-term and build a true culture of “great assets”.

You might not be able to create new jobs but you can show your responsibility as a company by not letting workers go during “slow growth” periods. It’s bad for all of us – every business suffered. But keeping your greatest assets intact and polishing them a bit will put you ahead of your competitors when the time comes. And now? Now you will be playing catch-up.

As a third point – the investor excuse. Of course many companies cut their workforce because investors demanded it. Those darn investors… They always want their 20% return each year. Actually, the 20% per year types aren’t really the problem. It’s those 1% week guys that are the problem – they want their money to go in-and-out and have no commitment to any specific business in the long run. So companies are under short-term pressure to show constant growth in returns. And if you can’t do it with growth then you do it by cutting costs. Talk about cutting off your nose…

Investor responsibility has been at the sidelines of CSR for far too long. We just can’t seem to get a grip on them. Maybe it is because we don’t know how to “sell” responsibility to them. Or maybe it is because many of them just don’t care. That’s for another day as Enron, BP etc have made a solid case on why CSR is important for investors… Here is a note for companies – how about you focusing on those who actually do care about you? We do. Us consumers and those workers of yours. We want you to succeed. Investors? The speculators amongst them don’t care about you one dime. What they do care about is the return they get from you in the next week or month. If they see someone better looking? They move on. They act like a 16-year-old who promises you the world as long as they can get what they want – untill they find the next hot one and move on. I’m 40-ish. I’ll stick with you if you promise to stick with me…

Last point on a responsible recession – patriotism. I was in a meeting a few weeks back with some of the best minds around. All of them geared towards helping a great company break through the clutter – they do so much that they create white noise instead of a clear position when it comes to CSR. Anyway, all these values were written on the board that reflected what the company stood for. And then someone said the “A” word – America… They argued that the company should show more pride in them being an American company with American values. Of course my first reaction was … WTF? I did point out that those values written on the board were no different from the corporate values practiced in my country of birth South Africa or the UK – or Europe. Or Japan. Or… The point was that most values are shared by various different cultures and that the differences are marginal not matter how much we like to tell ourselves something different.

But it did make me think about patriotism. The reason why the idea of American values were raised in the meeting was because the people in the room were pretty patriotic – and rightly so, be proud of who you are and where you come from even when you are more or less the same when compared to others. But what does corporate patriotism mean during a recession? Patriotism isn’t something CSR takes seriously but it is something we should look into when a company claims certain values and make claims of patriotism through advertising, lobbying etc. So the question was – what would a patriotic and responsible company do during a recession? Will they fire their fellow Americans? If yes, what does that tell you about their patriotism? Are they “fair weather” patriots who will say the right thing to get attention but then not back it up by action?

If you claim patriotism in some form then your actions should reflect that. Not only should you not downsize when you aren’t making a loss but you should go out of your way to help rebuild your country with the record cash you have in hand. Isn’t that what a responsible patriot will do? Use their resources to help their fellow Americans? Or does patriotism stop at getting people to buy a product made by an American company? Of course “made in” is a completely different story – and so are taxes. But that we’ll leave for another day.

Do I think companies acted responsibly during the recession? Some did and some didn’t. Those who let workers go when they weren’t making a loss lost their right to make the “greatest asset” claim. Don’t expect the same level of loyalty and commitment because you didn’t show it. Those who kept their cash when it could be used more effectively to rebuild the economy weren’t responsible citizens because they expected their fellow citizens to pick up most of the slack. Those who did everything to keep speculators, I mean short-term investors, happy weren’t looking at their long-term responsibility to their own company. Those who beat the drum to get consumer to buy their American products but didn’t put their own money into the game weren’t very patriotic or responsible.

The recession showed, and continues to show, us those companies who truly practice responsibility to themselves and society. Some were caught out while others shared the burden with the rest of us. The recession was good for CSR because it helped us define success of CSR in the toughest of conditions. Some failed and some helped us build a more responsible and profitable corporate world. At the very least the recession showed us the true CSR colors of companies. A good spin or substance…

So tell me – Were you a responsible corporate citizen during the recession? Really?

Read Full Post »

Partnership anyone?

 

The oil spill seems to have more than just an environmental and political impact. It’s starting to impact how partnerships are formed between companies and NGOs. Some environmental NGOs are being tarnished - thanks to their relationship with BP. The Washington Post wrote an article about how the Nature Conservancy (and Conservation International and EDF) is facing a potential backlash because of their ties to BP. It has sparked a lively debate amongst Nature Conservancy members as the Nature Conservancy defended it’s position in a piece called “Why We Engage With the Energy Industry: It’s For Nature“. I’m less interested whether environmental NGOs should partner with energy companies as that is for each one to decide according to their principles and what they are trying to achieve in their own unique way. What I am interested in are the lessons we can take from the controversy – for NGOs and companies. 

Of course NGOs will have to be more discriminating when it comes to their partnerships. Or maybe a bit more transparent and proactive with their members on how they partner and who they partner with. The complaints from the Nature Conservancy members are legitimate but it is mostly because they just did not know about the Nature Conservancy and BP relationship. They based their support for the Nature Conservancy on what they thought the Nature Conservancy should do when it comes to partnering and not what the Nature Conservancy actually does. We live in an increasingly transparent world where no information is hidden anymore. That’s not to say that the Nature Conservancy (or any of the other NGOs) hid what they did. It was just not seen as a priority communication to members. Their argument will be that the information has always been there for anyone looking – or asking. 

However, the information overload in the world we live in also means that people can’t research all the facts – there are just too much information. What we’ve seen more and more is that people rely on their friends, blogs and other social media to get their information. They trust these sources – why would my friend lie? The problem is that none of these new sources of trusted information tend to have all the facts. Your friend tells you that the Nature Conservancy is cool because they have always supported them or they’ve read something that they liked etc. But the detail tend to be missing. The sources people trust do not always have all the details – just soundbites. It works most of the time as most things tend not to be such a huge issue. Until a major oil spill hits you… 

NGOs need to be more transparent on who they partner with, how they partner and why they partners. More importantly, they need to get to those places where people find their information – friends, blogs and social networks. It’s not enough to have a Facebook page or a nice blog telling people what you think and why they should support you. You should use these tools to engage not only new and potential members but also your existing members. Engage them and inform them of those areas you (and them) would see as potential risk areas – your corporate partnerships… Be open and transparent about who you are, what you do and who you work with. We ask companies to be transparent and proactive about these issues – and so should those who defend the rights of civil society and the environment. Go out and engage in a transparent and open way. The more people know the more likely you will have members who know what they are getting into and the more loyal they will be. It’s like any relationship - you want to know everything before making a commitment. Don’t be like so many who marry based on a gut feeling instead of digging deeper to see if you will really stick together in “sickness and in health.” 

People also make assumptions based on names. The Nature Conservancy. It’s about conserving nature, right? And the elevator speech tells me that. Most people don’t read further than that because the name and soundbites gave them what they think they were looking for. However, the devil is in the details – the fine print. Encourage supporters to be diligent in doing their research before the time. Give them a “Term & Conditions” document to “agree to” before they can become a member. Spell out what you do and who you do it with. The same way we want companies to tell us who they partner with. Don’t assume people will know what you do – they don’t. 

Don’t try to be everything for everyone. There are so many causes nowadays – I’ve written about this here. Competition amongst NGOs are growing as each one tries to carve out a bigger part of the “market share”. The number of NGOs are exploding because each individual is trying to match their “unique” view with a charity to match. It becomes increasingly difficult for large NGOs to attract new members. One way they try to address this is by becoming everything. You care about turtles? We’ve got just the right program for you. Oh, you like trees a bit more? Step right this way for your own huggable tree. 

You can’t be everything. Pick what you want to address and be the best at that. Less of a Jock of all trades – more a master of one. This way you know what you are and, more importantly, your members know exactly what you are and it’s easier for them to see what you do and how you do it – and who you do it with. Starbucks sells coffee not cars. Microsoft doesn’t sell houses. Timberland doesn’t drill for oil. They know who they are and what they are good at. I don’t have to guess what they do when I go and buy my coffee, software or boots. Furthermore, knowing who they are and what they offer makes it so much easier for me to dig around to see how they do what they do – the CSR and sustainability bits. And, of course, who they partner with. 

Lastly, some NGOs like Oxfam GB, WWF and Greenpeace have very strict rules that govern their behaviour and partnerships. I’ve worked for Oxfam GB and they don’t rule out partnerships with companies but have very strict guidelines. For example, they will not accept any funding from companies remotely linked to any issue or campaign they work on. It hasn’t always been a popular position but it made it easy and very clear on how you manage relationships and expectation – and engagement with supporters and companies. Oxfam GB can work with a company to help them on the ground as long as it helps them achieve their primary goals – addressing poverty – but no money can be exchanged. NGOs should be clear on this – when do or don’t you accept corporate cash or goods. I’m not saying that those being targeted because of the oil spill and their partnership with BP don’t, but it is clear from the concerns by members that the members did not know the rules. During my days at Oxfam we used to make that a key part of all communications – large public meetings with supporters or closed meetings with companies. Everyone knew the rules and had to live by those rules. Make it, know it and talk about it. 

Last point on how the oil spill could be redefining partnership… This time on the corporate side. 

Companies should also become more discriminating about their partnerships. The partner of your partner now becomes your partner. True progressive companies, or at least those who claim CSR and sustainability leadership, will have to become more careful who they pick as their NGO partner. Do you really want to partner with an organization that might be perceived as “sleeping with the enemy” because of other relationships they have? Their reputation is your reputation. It works beautifully when they can help tell your story but it can come back to haunt you if they become tainted. Pick your NGO partner carefully – using the same rules I mentioned above for NGOs. 

But progressive partnerships go further than your partnerships with NGOs. Who are you partnering with on the corporate side? It is becoming increasingly unacceptable to have a “lager” mentality where you can keep quiet about what other businesses are doing. Not every business out there is your friend just because they are a business. Think about it this way… 

Say you are dependent on milk from a very specific area for that unique cheese you have to offer. And then they find oil there. This could mean the end of your business or at least your competitive edge. Do you keep quiet or do you tackle the business that threatens your business? 

Let’s try another example… 

Let’s say that as a company you stand for the environment. Your brand is something that stands out in its advocacy for the environment. You might even be in the line of making clothes or boots for outdoor use. You champion this and you build your brand on your environmental credentials and progressive advocacy. What do you do when a mining company mines off the top of a mountain? Do you keep quiet because it is another business or do you speak out because it threatens your business or at least devalues your brand. 

The same goes for Climate Change. Why keep quiet if you truly believe that it can have a material impact on your business? Should you not defend your business interests and long-term survival? Should you not tackle those who threaten your business or who advocates against your interest? Why even closely associate yourself with businesses whose practices threatens your business? Just because they are a business? We don’t even do that as humans… 

Your partnerships and allies will be a key way to communicate what you stand for. Traditional business associations are becoming more irrelevant by the day – new broader stakeholder partnerships based on shared values are increasing. Why? Because people see who you are through the relationships that you have. Associate with businesses that are against what they believe in will make them question you. And threaten your business. The question for you – what does this mean for your business and how can you stay ahead of the pack? Redefine your partnerships with NGOs and other businesses. Find the right match and build on that. 

Partnerships are being redefined and you will either fall behind or you can be part of defining the new way of partnering. You decide.

Read Full Post »

Older Posts »

Follow

Get every new post delivered to your Inbox.

Join 43 other followers