More on corporate responsibility communications

My previous post "Why people don't read your corporate responsibility reports" generated a couple of comments from readers which are worth a look.

So it was with great interest I attended a stakeholder meeting for a major media company on Tuesday, to talk about their report.

I held forth my views that CSR/Sustainability reports are no use as a communication method, and that communications needs to be tailored to different groups, just as marketing is.

I also contributed, grumpily (since I didn't think the report we were reviewing was very good), that the report was headlined with jargon that turned me off as a reader and didn't appear to know why it existed.

I chatted with a CSR executive at the company afterwards and said that I thought much more honest messaging about challenges and progress are much more compelling for readers.

That's why, for example, everyone raves about how Innocent Drinks communicate. They write it as you'd say it. Not rocket science really.

It's true that I am a little jaded when it comes to CSR communications.

Editing business 'trade' magazines for the last nine years means a lot of poor copy writing has come my way!

So it was refreshing to get this message this morning, sent in an accessible email, from the CEO of ANZ Bank in Australia.

I can't link directly to the email, but this link shows how it looks, almost.

This is not great communications, the company clearly hasn't spent much on it. The PDF is not particularly professional, to say the least.

But the copy from the CEO is a bit more honest and compelling than the usual corporate speak junk one gets sent.

Here's the opening line from ANZ's CEO, Michael Smith:

"“This is a time when we have to exceed community expectations by providing flexible, fast and helpful assistance to individual and small business customers facing hardship, while playing our role in encouraging and supporting economic growth".

A good start to a CSR report. The short 'interim' report only lists one area the company would like to have made progress on, but didn't.

There must be more, and they should have listed them. But this is not bad, compared with others.

While we are on the subject, Nike do online communications on ethics quite well too. And of course, then there's Patagonia.

You have to like their "The Good, the Bad, approach to transparency.

An old 'un but a good 'un

This brilliant piece by John Kay really stands the test of time.

It's an article about the role of business in society.

He penned it back in 1998.

It's really really really worth reading several times.

Email it to everyone you know.

Here's a quote from it:

"Business which is selfish in motivation, narrow in outlook, and instrumental in behaviour is rarely successful business".

Why people don't read your corporate responsibility reports

People don't read corporate sustainability reports because they are not a good communications mechanism.

That much should be obvious by now.

We all know this to be true.

CSR/Sustainability reports are for internal purposes almost exclusively.

They should sit on the web as an accountability tool, open to everyone.

But mailing them to stakeholders is pointless.

Because we have newspapers, real reports and books to read.

We don't have time to be engaged in 25-50 pages of PR.

So why do companies still mail them out?

Laziness. Lack of resources, lack of innovation.

Why else?

Today I threw another three reports in the recycling bin without even opening them.

If companies can't be bothered to engage us as intelligent, time-poor readers, then why should we even open the envelopes?

The future is not mailing out CSR reports.

The future is tailoring clever, credible communications to different stakeholder groups.

This has been discussed for years, so why do only a few companies actually do it?

Did I miss a meeting?

No-one in charge of sustainability at Barclays

Ethical Corporation's Greenwasher column wonders just what's going on at Barclays these days.

The bank that refused government help and stayed 'independent' doesn't have much of a responsible business strategy in place.

At least not at group level.

Barclays does much to be a responsible company, let's be clear.

The firm helped lead the way on the Equator Principles, and has done some excellent work on diversity and financial inclusion in the UK.

But Barclays has been a revolving door for sustainability/CSR executives for years, as the Greenwasher article details.

According to Barclays, CEO John Varley is in charge of corporate responsibiliy, with just a handful of junior managers to support him.

That might be fine in a smaller firm.

But for a giant bank such a structure just cannot work. A big firm such as Barclays needs a senior director to focus and co-ordinate work on responsible business, that much should be clear to anyone.

But Barclays decries this. But cannot say why.

A shame that a bank that was once poised to lead the way in its sector has fallen behind for the sake of 150K a year for a CR director's salary.

Particularly when they are so profitable, under intense public scrutiny and facing greater regulatory pressures.

It doesn't make any sense.

Two innovative non-profits that you should support

A call from a friend at a major bank looking to source charities for corporate donations made me recall two favourite non-profits that I'd like to recommend to readers.

Both are very different, but both amazing.

If you are looking for a cause to support, then check these two out:

Advance Aid is a new charitable initiative that will enable emergency supplies for the world to be made in Africa and stored in strategic global locations - in advance of any emergency. This model for disaster relief will save thousands of lives when disaster strikes whilst also providing local jobs.

The London Boxing Academy Community Project (LBA) seeks to provide an alternative education for pupils aged between thirteen and sixteen who are at risk of social or educational exclusion and who are unable to adapt to a formal school environment. LBA has an excellent success rate. Have a look at it.

Both are run on minuscule budgets, with zero wastage, and are already set to make a major difference. I should add at this point that both are run by good friends of mine. Judge for yourself and take a look.

The point being, rather than give to one of the monster NGOs like Oxfam, why not try these guys next time? Or, even better, as well.

Greenwashing Dongtan is long dead in the water

Fred Pearce in the Guardian has turned his attention to Dongtan, the non-starter Eco-city much touted by Arup, the UK engineering firm who were supposed to be heavily involved.

Take a look at the story here.

Not wishing the blow the EC trumpet, but we've been covering this non-event for years.

Fred misses the point that Arup have been touting Dongtan around as a PR push for ages, long after it became clear it just wasn't going to happen.

In January, our China editor Paul French looked at successes and failures in Chinese eco towns here.

And we've been podcasting on it for a while, here and here.

The project won our Greenwasher of the year award in 2007, take a look at the article here.

As Paul put it recently: "...last time I went to Dongtan there was a farmer selling tickets to watch his pigs jump through hoops of fire in a field. But no eco-city".

Ethics training for the Mexican mafia

Reuters reports that Rafael Cedeno "a leader of "The Family" cartel based in the western state of Michoacan" in Mexico, has revealed to police that his Mexican gang is providing "courses they considered to be for personal improvement, values, ethical and moral principles of the criminal gang", according to the Mexican authorities.

The aim, apparently, is "for the subordinates to avoid drugs, hard drinking and maintain family unity".

Worthy aims, even if it is putting the cart several miles ahead of the horse!

The excellent US television series "The Wire", revealed for years the professionalism of the Baltimore drug dealing gangs. Looks like the Mexicans want to take things even further.

In light of this, does ANY company now have an excuse NOT to do ethics training?

Smart campaigners ought to have a field day with this one!

Now there would be a dilemma for a consultancy approached on the sly...And makes one wonder who has been doing the training for the gangs!

Anyone interested in a fascinating recent history of the global mafia should buy this excellent book, "McMafia".

Latest news on the business case for CSR

Michael Skapinker of the Financial Times has written a recent useful summary of the recent big business moves in the field of corporate social responsibility / sustainability.

Skapinker, in an article titled "Why corporate responsibility is a survivor", argues the business case is now clearer than ever, despite the odd dip in sales for some ethically-minded produce.

He writes that the key for companies is that: "They have worked out how to make it pay. Many of their initiatives help to cut costs or sustain supplies. They allow customers to continue to regard themselves as ethical during difficult times. They also help the companies to improve their public reputations at a time when business is widely held to be responsible for the downturn."

Nice pithy summary. Of course he doesn't address the elephant in the room: The lack of serious capital intensive investment in lower carbon technologies, products and supply chains. There's an area that still needs major work by Government.

Many companies are waiting for the incentive structures to be improved, or clear regulatory frameworks to be put in place that they can plan and/or raise capital against.

What kind of Government interest is there in CSR?

As Paul Hohnen reports on the Ethical Corporation website today, the Canadian government has just revealed a a series of measures to promote corporate social responsibility (CSR) in the extractive sector.

This comes hot on the heels of the G20's commitment: “to endorse and implement...tough new principles on pay and compensation and to support sustainable compensation schemes and the corporate social responsibility of all firms”.

And should been seen in light of Denmark's moves on 'mandatory' CSR reporting for some companies.

Not forgetting, of course, the Norwegian white paper which sets a new standard for government guidance on corporate social responsibility, published recently.

Interesting moves in light of all the more public debate about where business regulation is headed.

These shifts, combined with the ongoing work of John Ruggie, ought to provide useful guidance for other governments, once the immediate economic crisis has become less pressing.

Companies too, will want to keep a close eye on developments.

Anyone interested in the possible direction of future UK Government CSR policy may want to take a look at this report.

Collaborative governance, a dull name, but very important...

This term is not sexy, and not easy to grasp. But it's vitally important for anyone concerned about the role of business in society.

Particularly in developing/emerging economies, the role of business in working in an in-depth way to make a contribution to important societal issues is increasingly important.

If you don't know what I mean, and would like an easy(ish!) introduction to the topic, take a look here for a magazine article in Ethical Corporation which we published last year.

Just this last week, Cranfield University have published an interesting series of papers in the area.

Focusing on what CSR bods call "the governance gap" (where government struggles to respond to changing needs and society/business is figuring out where they can help take up the slack), the papers are well worth a read.

My colleague Pam Muckosy attended the recent Cranfield-convened conference on the topic and found it fascinating.

Papers from the event can be found here.

The Ethical Corporation Institute, our research arm, published a couple of papers on this last year, available free here.

For further reading, have a look at these excellent papers by Amiram Gill at Stanford and Jane Nelson at Harvard.

Why some people don't like the Pharma industry

An email with this subject line (above) just landed.

A must-open email you'll probably agree.

In the email is a link to the Pharma Marketing Blog, a blog on, er, marketing in, you guessed it, the Pharmaceutical industry.

The blogger, John Mack, ran a story recently headlined: ""Pharmacia instrumental in creating new disease" says Former VP".

Posting a presentation by an executive of Pharmacia, now owned by Pfizer, Mack points out that the speaker at an industry conference, back in 2002, outlined the strategies used to convert a "niche product into a Mass Marketing Opportunity.".

This is basically hyping (at best!) a proposed (and/or existing) medical condition to sell more drugs.

In this case the drug in question was Detrol, designed to tackle overactive bladder "problems".

Mack calls it "disease mongering", concluding that, reviewing the evidence in this instance, "in any case, the bigger issue for me is how some pharma marketers take pride in "inventing a disease.""

Ethically right? No. Bad PR? Yes. While this example may be some years old, practices such as this continue to this day, unfortunately.

Clearly it's not good for Big Pharma's image when the press or activists pick up on such blatant cynicism in marketing. Old stories always come back to haunt large companies, as this example shows.

UPDATE: April 20 2009. Re-reading this, I ought to give credit to the industry for producing dozens, probably more of life saving drugs over the years! The point is not to be anti-pharma, more to point out that in ethical business reputations can be destroyed very quickly. But so can they change with big moves that show leadership.

For example GSK's landmark recent moves deserve plaudits. We ran a cover story in our print edition on these recently, here, an editorial here, and a columnist took on the leadership angle, here.

Rainforest Alliance deals are worth watching

As anyone following sustainable business, even in passing, knows, ethical certification of increasingly well known commodities by credible outside groups is on the rise.

The most familiar of these are probably cocoa and coffee, with palm oil, soy and perhaps cotton also in the news in recent times.

But many of us also know how controversial the sourcing of some of these commodities is.

For example, much soy comes from Brazil, where farmers have been accused of fostering Amazon deforestation to grow more of it.

Accusations have been levelled at palm oil companies for the same reason, largely in Indonesia. We reported on this last year in Ethical Corporation's print edition.

And we all know about the rise of Fairtrade coffee around the world. Some large companies, such as Starbucks and Cadbury, are increasingly keen on it. Starbucks have said that all the espresso-based coffee sold in its outlets in the UK and Ireland will be Fairtrade certified by the end of the year.

So certification and the marketing of it is growing. For example,sales of Rainforest Alliance Certified cocoa reached an estimated $4.5 million in 2007 and jumped to an estimated $16.75 million in 2008.

In the recession, though, there is a growing debate about whether ethical products are suffering or not.

This makes the recent move by Mars into Rainforest Alliance certification all the more laudable.

The company says products will not cost more for consumers, despite the added costs of certifying cocoa to RA standards.

This is a brave move for which the company, long known to be secretive and less PR focused than many a multi-national company, deserves congratulation.

It comes not long after another major step forward for the Rainforest Alliance, which has also signed up Unilever for a major deal on tea and McDonald's on coffee.

RA is increasingly popular with large corporates these days, as the news shows us.

Why do PR companies lie needlessly?

Another day and another PR company calls up pretending to be their client.

You can always tell, somehow in their tone. When pressed, this person claimed they were from the client, then admitted they weren't later on.

I pointed out how unethical this practice is, but PR firms generally don't seem to care much. Shame. They should heed this article by the excellent Brendan May at Weber Shandwick, which we published a little while ago, as good general advice.

If you are in PR and work in CSR, the simple lesson is surely to try and practice what your client purports to preach!

Tesco, greenwash and "lights into flights"

Most greenwash is more cock-up than conspiracy.

Whilst campaigners would sometimes appear to have us believe that greenwash is a cynical corporate plot, most of it is just badly thought through marketing, like Tesco’s recent “turn lights into flights”ad.

Commentators on the Guardian’s blog slated the firm for its recent ad.

The idea was a simple customer marketing campaign. The small print on the ad offers 60 airmiles for each £2.50 clubcard voucher redeemed by customers.

The tagline for the ad, however, with an image of a renewable lightbulb, was deeply unfortunate, to say the least.

A friend has been telling me for months that Tesco does really get it on climate change, and is leading the way among the supermarkets in all sorts of ways.

The source, who has much inside information, makes some credible points, despite a slight conflict of interest. Personally, I'm prepared to take him at his word.

It would be nice, however, if Tesco vetted their ads better. Might help stop Guardian readers pounding them on the paper’s blog, too.

Two tales of Coke and ethics

Coke's been in the news again in the last few days. For 'good' and 'bad' reasons.

First, the company was censured by the Australian Competition & Consumer Commission, who took a pop at the world's biggest brand by saying some recent ads it has run, according to AP, "might have given consumers a misleading impression".

The Sydney Morning Herald took a more robust approach, leading with the headline: "Coca-Cola busted for big fat rotten lies".

In brief, last year Coke issued a "Motherhood & Myth-Busting" advertising campaign, which featured Aussie actor Kerry Armstrong. The ads purported to tackle 'myths' about Coke contributing to obesity, teeth rot and overly-caffeinated children.

The Australian Competition & Consumer Commission said it was "immediately concerned about the misleading messages" and pushed Coke to publish corrective advertisements across most of Australia's newspapers.

Coke said the whole thing was unintentional. But AP reported, rather damningly, that:

""Coke's messages were totally unacceptable, creating an impression which is likely to mislead that Coca-Cola cannot contribute to weight gain, obesity and tooth decay," the ACCC said in a statement."

Ouch.

Coke, meanwhile appears somewhat in denial about the whole thing, saying, according to AP that: "This process has reinforced in our minds that even where advertising messages are well-intentioned, it is important to consider the overall impression that the messages may convey".

Well-intentioned? That depends on whose intentions we are talking about!

Coke has also been in the news today for taking a long-mooted stake in eco and health friendly smoothie maker Innocent. Apparently the firm has bought a 10-20% stake in the business for £30 million, according to the Guardian.

This will help Innocent expand, and Coke diversify. I chatted with Richard Reed of Innocent about the seeming inevitability for ethical brands to sell out or sell stakes to big companies a few years ago. We discussed in particular how Stonyfield Farm had structured their deal with Danone, to avoid the situation Ben & Jerry's found themselves in with Unilever post-sale. Reed had some interesting ideas on how it could be done and retain integrity, it will be fascinating to watch how these turn out.

These two stories about Coke sum up the contradictions inherent in big companies in modern times. Big established firms with businesses rooted in the pre-sustainability era want to defend the "old practices" (flogging drinks bad for health in this case), whilst getting into the "new" areas of more sustainable products, such as smoothies.

The transition from increasingly-perceived "bad" products to "better" ones is inevitably going to have some big bumps in the road, as Coke is finding out.

Their Australian ads do seem unbelievably crass though. You would have thought Coke had been beaten up enough times by campaigners to be smarter than that.

Proposed shake-up to UK board practices bodes well

Paul Myners, long-standing advocate of better corporate governance and UK City Minister, is urging experts to put forward radical ideas for reforming the way corporate governance occurs in the UK.

Among the ideas being mooted in this FT article today are:

- Compulsory seminars on financial stability for bank board members
- Longer working weeks and enforced "devil's advocates" on boards
- Making non-executives go back to the classroom
- Giving non-executives their own staff to provide independent information
- Encouraging more experience of life outside financial markets for fund managers
- Supporting a more activist approach by fund managers (as Hermes undertakes)

Full article is here.

All this seems extremely sensible. Head of sustainability, risk and corporate responsibility that I know have long bemoaned the limits of current UK board structures. Dominant CEOs and non-execs who are too part time and under resourced to take a real interest in risk have definitely been part of the problem.

Elsewhere, a couple of weeks ago Sir Richard Greenbury, an influential player in corporate governance in the 1990's, said he now favours a a two tier board system over the current approach.

The two tier system is well used in Europe, and has its benefits, as the Times piece points out.

All of this will be debated in print in the pages of our print magazine in the coming months.

There's a conference on the topic coming up soon too, more details are here.

Fast food companies and missed leadership chances

At least four ears ago, I sat in a room in Brussels with some other 'stakeholders' and talked to a major fast food company about obesity, customers, ethics and marketing.

Towards the end of the discussion, in which sat some very senior executives, we made the suggestion: "put calorie content on your menus".

The rationale was twofold: One, transparency. People have a right to know what they are eating.

Two, there's always a lot of mis-information out there about what is in food, and how many calories there are say, in a hamburger vs. a chicken 'nugget'. So let us know.

Just give people the information, we said. There are in your premises anyway. They are hungry. They know it's not gourmet food. What do you have to lose? Except an opportunity to lead and experiment.

The company executives look bemused by our suggestion. "Nutritional information is on the other side of the piece of paper on the tray that you put your food on", they said.

They didn't take up our advice.

Years later, fast food is doing quite well in the recession, but the obesity headlines are still coming.

And now this headline, all over the UK media: "Menus to display calorie counts". This is a voluntary initiative set up by a Government agency.

Finally its happening. More information on what we eat. Better information.

It's a shame that this didn't come from a company taking the lead, and others copying.

A big company could have kicked it off themselves and started a really serious debate, by going it alone, or working with others. Where were the industry associations here? Nowhere of course, as usual.

This voluntary plan came from the Food Standards Agency, who found that, unsurprisingly, 85% of consumers are "in favour of catering outlets displaying nutritional data". No, really?

This is obvious. Yet no fast food company seemed prepared to lead on this. A lost chance to use brand, resources and reach to highlight an important issue, and build trust.

Will point 15 of the G20 statement on CSR mean anything?

Last week the G20 statement named "The Global Plan for Recovery and Reform" seemed to go down rather well, at least in the media and in the markets.

Interesting for business ethics folks is the quote from point 15, that the Financial Stability Forum( now called a Board) made suggestions about

"...tough new principles on pay and compensation", which will be taken seriously.

The G20 statement also pledges to "support sustainable compensation schemes and the corporate social responsibility of all firms."

It will be interesting to see what traction this part of the statement achieves over time.

Clearly with less public money around in the next few years, CSR is going to be higher on the agenda for government as it looks for "partners" to deliver services or help fill in the gaps.

The Norwegians recently published a paper which can be seen to "set a new standard for government guidance on corporate social responsibility", or so the article says here. Judge for yourself.

Just over a year ago we published, with the UK Conservative Party, a report we wrote that discussed what they could do on responsible business, should they win the next election. It's available for free downoload here.

Is there anything companies can do about anti-capitalism? Well, yes

Mingling with the protesters at yesterday's G20 London protests in the City of London, I began to wonder if there was anything big companies might do to make citizens feel, well, a bit less angry right now.

Whilst most of the crowd, at least around Liverpool Street, were amused onlookers, with more cameras than banners in evidence, things were a bit tastier next to the bank of England.

Around 20 anarchists and associated folk smashed the windows of a branch of Royal Bank of Scotland (one with a computer monitor, what happened to bricks?).

A friend rang me from the scene, where slightly confused police trapped lots of innocent people between themselves and the protests and refused to let some leave the scene for a while.

Despite the low number of hard core activists (a good thing, I might add!) the protest show some serious discontent is really out there, a lot of aimed at big companies, whatever their business.

Whilst CSR or business ethics initiatives are never going to persuade groups such as this one , that global business brings some benefits, I was left wondering what engaged companies could do in this current climate to encourage a more meaningful debate on globalisation and capitalism, the ups and the downs.

Not much, you might argue at the moment. After all, it's the most brutal downturn since the 1930's (see all newspapers for that line) and people are feeling the pain all over.

But is now the time for big companies to be timid about the challenges?

I would say no.

Given that workers are occupying office complexes and facilities in protest at cutbacks in differing places all over Europe, what has a company to lose by taking the initiative?

So what might this look like?

Well, a start might be to host some public debates on the issues, and have a more rounded discussion.

The idea (not exactly revolutionary I know) made me think of a debate I reported on (badly) some six years ago.

BT hosted it in London. It was bravely called "What happens when responsible business doesn't pay?".

It was more of a "CSR industry" type meeting than a public one. But it was one of the most interesting I have been to in eight years working in this space. Because it was open and honest, and the company didn't pretend to have the answers. We all came away thinking seriously about important issues. But the mix of people there (journalists, some activists and business folks) was a very useful one.

I'm not suggesting debates such as these have to be hosted a corporate HQ's all over the world. That would be inappropriate I think.

But companies could use their resources (by which I mean money!) and convening power (brand) to work with others, such as think tanks or societies, to bring people together again now, as BT did six years ago, to debate the issues.

Surely this would be a helpful right now. Charities, media entities and others are too cash strapped right now to think of doing this kind of thing on their own. But a big company with a plan to reach out and be at the heart of the debate could really help here.

Something to consider, I would suggest.


P.S.

We published a free report a year or so ago that looks at how companies can contribute to what you could call "societal capacity building". If you are interested, it's here to download

What do the G20 protests mean for big companies worried about their reputations?

Passing through Liverpool Street station at nine this morning there was little sign of the impending protests that are planned for later today.

One character with a rucksack and hoodie was being idly watched by a lone "Community Support Officer" (fake police we have in the UK to scare kids). But apart from that, there wasn't much action.

Later on today, though, it will be a different story. The BBC reports on the plans here.

I met up with a CSR student, Emily, who takes the course I teach at Birkbeck last night. She described the scene at Saturday's march through London of 35,000 protestors as a bit confused. Some banners she wanted to be marching next to, some she did not.

The point is that the protestors are a real motley collection of folk, concerned about many different issues.

In the past few years protests have generally been a lot more focsed. Stop the War was the main mantra, since the anti-globalisation protests died down considerably since 9/11.

But now general protesting is back. This is not such a bad thing. While single issue campaigning can be, and often is, more effective, general protests can get bigger headlines.

And around the G20, they certainly are. All major news outlets are giving them considerable coverage.

Here is the City, an 'insiders' website on London's finance center, has some amusing stories too.

Big companies are less surprised by protests than they used to be. Back in 1999 it was more of a surprise when say, a McDonald's was trashed by a mob.

These days companies are more used to being targeted. But that doesn't mean they shouldn't be concerned. And I'm not just talking about the safety of employees.

The other, broader issue, is the reputation of big business. Here's a question for readers: Do you think 'big business' in general has suffered from the corporate governance meltdown in the banking sector?

It's obvious that those non-financial firms making big job cuts, such as 3M and Sony have had some major issues in places such as France.

But what about the wider 'big business' community? How bad is the reputational damage?

I suspect it's a lot worse than most executives think it is.

Many probably think that beyond the short term job cuts and clampdowns on spending, most of the anger is directed at the banks.

This is largely true. But I don't think other large companies are getting away scot free, at all.

I'm interested in what readers think about this. Just how bad is the reputational damage for others? Has some of the 'good work' done on reputations by community work and CSR become unravelled?


G20 PROTEST UPDATE: 10.50 am. A colleague has just come from Liverpool Street Station. 20 photographers and 50 police are surrounding about 20 protestors. It's a start...

The blog is back...

After a two year hiatus, when this blog was supposed to be moved to our main site and continue as it had been on here, we're back on blogger again.

Why? Mainly because the EthicalCorp.com site blog was never really as a blog should be. The postings ending up (and are still) a bit lost among our other content.

As a result there was less impetus behind maintaining it, so it became rather occasional.

Now though, given the times, and the new www.EthicalCorp.com website look and feel (which has even less content on the homepage than before to make it easier to read) I've decide to bring this blog back, but make it more about my thoughts on CSR, than the joint blogs we ran before.

First postings in two years to be added v soon.

Toby