From Paul French, China editor, in Shanghai:
The China Column – The Supporting Evidence
Without a doubt the editors of Ethical Corporation are very nice to me.
They do, after all, give me a page of their magazine every month to comment on China – anything I like (within reason).
However, as General De Gaulle once infamously commented (and was then promptly paraphrased by a million quoters): 'China is a large country with a lot of people'.
This means that trying to deal with any issue about China in 750 or so words and include all sides of the argument with supporting evidence is a wee bit tricky.
So I’m going to start using this blog to put up some ‘supporting evidence’ for various columns that hopefully back up the points made.
For the end of the year December issue (forthcoming very soon) I decided to consult some experts of China and the environment about whether or not 2009 was the year China “got” green.
They all thought that 2009 was in many ways a watershed year.
You’ll be able to read the article soon when the issue is published but deadlines meant that since I wrote the column President Obama has been and gone to Shanghai and Beijing.
Many in the media seemed to think the trip was a waste of time – the usual rush to judgement by a media obsessed with speed of reporting more than quality.
However, it now emerges that quite important things may have happened and, as far as the environment is concerned, progress made.
And so to add to the article forthcoming in Ethical Corporation I enter the following two pieces of evidence as part of the argument as to why 2009 was a watershed year in China in terms of the Chinese state getting the environment issue – two pieces of evidence from two very different sources:
1) The New York Times reporting that China has, shortly after Obama’s departure, set a new greenhouse gas emissions reduction target (carbon intensity) by 40-45% of 2005 levels by 2020.
2) Xinhuanet – the website of the Chinese state run media agency reporting exactly the same targets and details just to make sure we are all on the same side – it’s in Chinese but you can see the numbers are all the same.
This makes 2009 a watershed moment for the environment in China. No doubt about it.
Monday, November 30, 2009
Thursday, November 26, 2009
Ten lessons from our reporting conference this week
Today I attended the second day of our annual reporting conference in London.
It was one of the best yet, and we've been holding them for five years or more.
I'm trying to consider the really important bits that I remember, and make sense of them.
Here's ten:
1) Investors such as Aviva (£300 billion under management) are not that interested in what level of GRI you have. Although using it is a useful indicator for them.
2) The push by Bloomberg to put ESG-related information on their terminals will be very significant over time, although it doesn't work so well right now.
3) The UK election may be quite significant, given the more hands-off approach the Conservatives may seek to take to business generally. But their Responsibility Deals mechanism may play an important role (I should note here that I was partly responsible for the creation of these, although not responsible for how they are being used right now).
4) GRI still has little traction in the US. But the SEC is planning some moves to encourage better reporting. Watch this space, slowly, is the messsage I heard.
5) Reports are only really useful as a management tool. As a communications device they don't work. But CR teams lack the budget and wherewithal to take them to the next level of segmented communication.
6) The traditional formats for consumer communication make it very hard to do this for that particular audience, i.e. customers. But focused communications utilising new communications methods present an excellent low cost way to engage some groups.
7) Reporting to 'opinion formers' is best done in the form of issue briefs, with credible stakeholder comments on specific issues. But hardly anyone does it consistently, or at all. Working with the comms department is seen as very tough.
8) The GRI needs to reform, and help make reports shorter, and more readable. But their long term future is by no means assured, given potential integration of some information into annual reports and other, segmented communication formats.
9) The role of assurance is constantly up for debate. Companies are unhappy with what assurance achieves for them, and the costs of it, but are not sure what else to do. Stakeholder panels are seen as one solution. Both may be required in future. But for many companies resources for both are just not available.
10) Companies are becoming more comfortable with giving critics a voice in their reporting, but given no-one reads reports, are confused about the value of this, and have to fight internal battles as a result.
Overall, I'd say despite the challenges above, I've seen reporting improve drastically in the last few years. It's what you do AFTER you publish your report that will soon count for a lot more than the fact you produced a report itself.
That's the real challenge, and opportunity, for business to win trust from stakeholders.
It was one of the best yet, and we've been holding them for five years or more.
I'm trying to consider the really important bits that I remember, and make sense of them.
Here's ten:
1) Investors such as Aviva (£300 billion under management) are not that interested in what level of GRI you have. Although using it is a useful indicator for them.
2) The push by Bloomberg to put ESG-related information on their terminals will be very significant over time, although it doesn't work so well right now.
3) The UK election may be quite significant, given the more hands-off approach the Conservatives may seek to take to business generally. But their Responsibility Deals mechanism may play an important role (I should note here that I was partly responsible for the creation of these, although not responsible for how they are being used right now).
4) GRI still has little traction in the US. But the SEC is planning some moves to encourage better reporting. Watch this space, slowly, is the messsage I heard.
5) Reports are only really useful as a management tool. As a communications device they don't work. But CR teams lack the budget and wherewithal to take them to the next level of segmented communication.
6) The traditional formats for consumer communication make it very hard to do this for that particular audience, i.e. customers. But focused communications utilising new communications methods present an excellent low cost way to engage some groups.
7) Reporting to 'opinion formers' is best done in the form of issue briefs, with credible stakeholder comments on specific issues. But hardly anyone does it consistently, or at all. Working with the comms department is seen as very tough.
8) The GRI needs to reform, and help make reports shorter, and more readable. But their long term future is by no means assured, given potential integration of some information into annual reports and other, segmented communication formats.
9) The role of assurance is constantly up for debate. Companies are unhappy with what assurance achieves for them, and the costs of it, but are not sure what else to do. Stakeholder panels are seen as one solution. Both may be required in future. But for many companies resources for both are just not available.
10) Companies are becoming more comfortable with giving critics a voice in their reporting, but given no-one reads reports, are confused about the value of this, and have to fight internal battles as a result.
Overall, I'd say despite the challenges above, I've seen reporting improve drastically in the last few years. It's what you do AFTER you publish your report that will soon count for a lot more than the fact you produced a report itself.
That's the real challenge, and opportunity, for business to win trust from stakeholders.
Will we ever have a big CSR brand?
I spent a bit of time this week talking with a fascinating branding consultant, who was presenting at a conference on how some big brands, like Coke, are using sustainability to try and re-define how they will produce and market products in the future.
One conversation I had with a colleague of his was around big brands and CSR.
Over dinner at the second annual Hungarian CSR awards in Budapest, we debated whether it's possible for a big brand to be as closely associated with responsible business as it is for smaller ones.
Smaller firm examples, like Innocent Drinks, jump to mind fairly easily. Coke bought a non-controlling stake in them recently.
But what about larger companies? Given all their growing and inherent sustainability liabilities, is it possible that in the future, one or more of them will be associated obviously with sustainability in the minds of consumers?
My picks are Unilever (for their lead on certification and others areas) and Marks and Spencer (for Plan A). I'd also throw Timberland in there, for various reasons.
But I'm not yet convinced it is possible.
Big companies, with diverse products appealing to so many different groups, and so many ever-broadening issues to deal with, will largely find it very hard to become eminently associated with ethics first in the mind of their customers.
We all know that companies can be great at many issues, whilst falling down on others.
We live in an imperfect world, after all, and mistakes will always be made, and limits will always be in place. And emerging issues can always jump up and bite you.
If I had to put money on it. I'd go with M&S though.
My question to you, readers, is twofold:
Do you agree?
And do you think I missed any likely candidates?
One conversation I had with a colleague of his was around big brands and CSR.
Over dinner at the second annual Hungarian CSR awards in Budapest, we debated whether it's possible for a big brand to be as closely associated with responsible business as it is for smaller ones.
Smaller firm examples, like Innocent Drinks, jump to mind fairly easily. Coke bought a non-controlling stake in them recently.
But what about larger companies? Given all their growing and inherent sustainability liabilities, is it possible that in the future, one or more of them will be associated obviously with sustainability in the minds of consumers?
My picks are Unilever (for their lead on certification and others areas) and Marks and Spencer (for Plan A). I'd also throw Timberland in there, for various reasons.
But I'm not yet convinced it is possible.
Big companies, with diverse products appealing to so many different groups, and so many ever-broadening issues to deal with, will largely find it very hard to become eminently associated with ethics first in the mind of their customers.
We all know that companies can be great at many issues, whilst falling down on others.
We live in an imperfect world, after all, and mistakes will always be made, and limits will always be in place. And emerging issues can always jump up and bite you.
If I had to put money on it. I'd go with M&S though.
My question to you, readers, is twofold:
Do you agree?
And do you think I missed any likely candidates?
CSR in Hungary: On the rise
After my recent Bulgaria trip to talk about embedding CSR, this week I ventured to Budapest to meet some Hungarian companies and talk about excellence in CSR.
The conference was organised by the impressive consultancy Braun and Partners. I found Robert Braun and his colleagues to be a very interesting bunch of well informed CSR experts.
The conference was a step change from my Sofia visit. I spent some time hearing about companies aiming at advanced GRI reporting, which surprised me.
I spent some time arguing the case for not spending too much time on 'standards' and box ticking over taking meaningful action.
The attendees were well informed and knowledgeable, and we had some great discussion about the future of anti-corruption enforcement in Europe (slow but picking up), stakeholder engagement techniques, and how companies manage key CR issues.
Overall I was impressed with the level of debate. Hungarian companies seem up there with the best in Poland, at least. And I met a couple of interesting Romanian companies too, who are also getting more traction with their CEOs on CSR.
So whilst being a wonderful city to stroll around, I can also recommend Hungary for its emerging debate on responsible business. Braun and Partners likely deserve much of the credit for this.
I left hopeful about the future of corporate responsibility in Hungary. If 100 business people can pay for a conference in these tough times, that bodes well for the future.
My friend and colleague Mallen Baker told me today he is off to Kiev shortly to do some CSR workshops.
If CSR can survive and appear to thrive in these tough times in countries hit much harder by the downturn than Western Europe, we should really celebrate the fact.
The tidal wave has been building for many years. We're not close to the crest of it yet, but its rise and momentum is now clearly inexorable.
The conference was organised by the impressive consultancy Braun and Partners. I found Robert Braun and his colleagues to be a very interesting bunch of well informed CSR experts.
The conference was a step change from my Sofia visit. I spent some time hearing about companies aiming at advanced GRI reporting, which surprised me.
I spent some time arguing the case for not spending too much time on 'standards' and box ticking over taking meaningful action.
The attendees were well informed and knowledgeable, and we had some great discussion about the future of anti-corruption enforcement in Europe (slow but picking up), stakeholder engagement techniques, and how companies manage key CR issues.
Overall I was impressed with the level of debate. Hungarian companies seem up there with the best in Poland, at least. And I met a couple of interesting Romanian companies too, who are also getting more traction with their CEOs on CSR.
So whilst being a wonderful city to stroll around, I can also recommend Hungary for its emerging debate on responsible business. Braun and Partners likely deserve much of the credit for this.
I left hopeful about the future of corporate responsibility in Hungary. If 100 business people can pay for a conference in these tough times, that bodes well for the future.
My friend and colleague Mallen Baker told me today he is off to Kiev shortly to do some CSR workshops.
If CSR can survive and appear to thrive in these tough times in countries hit much harder by the downturn than Western Europe, we should really celebrate the fact.
The tidal wave has been building for many years. We're not close to the crest of it yet, but its rise and momentum is now clearly inexorable.
CSR in Bulgaria: Likely to accelerate
Last week I spoke about embedding CSR at the first annual CSR forum in Sofia, Bulgaria.
Aside from seeing the inside of the atmospheric cathedral in Sofia, I attempted to work out how CSR is progressing in the country.
The presentation I gave is here.
What did I learn?
Well, despite the recession, the organisers, Capital Weekly, a Bulgarian business paper, were able to bring in 150 odd business people and NGOs. So that's a good sign for CR in tough times. It is still spreading strongly.
What else? That partnerships with NGOs are becoming important in Bulgaria.
Again, a good sign.
Consultants trying to establish a business in the country told me that most of the focus in the country is about philanthropy and sponsorship, quite common in Central and Eastern Europe.
I sensed they were right. Many of the questions I had from the audience were about my assertion that CSR is NOT philanthropy.
But that's how it starts in every country. What's really interesting about CR in places such as Bulgaria is how fast the paradigm is changing.
It took the UK a long time to make the shift. My bet is that it will be an awful lot quicker in Bulgaria.
Multi-national companies, UNDP and the Global Compact can take a lot of credit for this.
But there are also some interesting emerging examples of local firms engaging in environmental and social issues. As these develop, they will have as least as much, if not more influence, on others.
Aside from seeing the inside of the atmospheric cathedral in Sofia, I attempted to work out how CSR is progressing in the country.
The presentation I gave is here.
What did I learn?
Well, despite the recession, the organisers, Capital Weekly, a Bulgarian business paper, were able to bring in 150 odd business people and NGOs. So that's a good sign for CR in tough times. It is still spreading strongly.
What else? That partnerships with NGOs are becoming important in Bulgaria.
Again, a good sign.
Consultants trying to establish a business in the country told me that most of the focus in the country is about philanthropy and sponsorship, quite common in Central and Eastern Europe.
I sensed they were right. Many of the questions I had from the audience were about my assertion that CSR is NOT philanthropy.
But that's how it starts in every country. What's really interesting about CR in places such as Bulgaria is how fast the paradigm is changing.
It took the UK a long time to make the shift. My bet is that it will be an awful lot quicker in Bulgaria.
Multi-national companies, UNDP and the Global Compact can take a lot of credit for this.
But there are also some interesting emerging examples of local firms engaging in environmental and social issues. As these develop, they will have as least as much, if not more influence, on others.
China vs. US on Climate Change
By Paul French, China editor for Ethical Corporation, in Shanghai.
In my upcoming China Column for Ethical Corporation I talk to two long time commentators on China's environment about whether 2009 was the year China 'got' green both at a Party-state and individual Zhou Public level.
Both Jonathan Watts, the Guardian's East Asia Environment Correspondent and Isabel Hilton of the English-Chinese bilingual environment website China Dialogue, were positive but cautious over the progress made in 2009 and the possibilities for further advances in 2010.
It seems the Economist also had the same idea...sort of.
Economist Debates has raised the question 'This House believes that China is showing more leadership than America in the fight against climate change.'
As you might expect both the speakers for an against have their own agendas - JUCCE is wedded to China so has a stake in arguing for the motion while the Manhattan Institute's Center for Energy Policy and the Environment has a clearly defined 'free markets' agenda on climate change.
Still, it's all part of the debate and interesting reading all the same. It's certainly true that the Economist at least manages to attract a better and more literate responder in their comments section that most web sites! - you can read all the arguments and comments here.
In my upcoming China Column for Ethical Corporation I talk to two long time commentators on China's environment about whether 2009 was the year China 'got' green both at a Party-state and individual Zhou Public level.
Both Jonathan Watts, the Guardian's East Asia Environment Correspondent and Isabel Hilton of the English-Chinese bilingual environment website China Dialogue, were positive but cautious over the progress made in 2009 and the possibilities for further advances in 2010.
It seems the Economist also had the same idea...sort of.
Economist Debates has raised the question 'This House believes that China is showing more leadership than America in the fight against climate change.'
As you might expect both the speakers for an against have their own agendas - JUCCE is wedded to China so has a stake in arguing for the motion while the Manhattan Institute's Center for Energy Policy and the Environment has a clearly defined 'free markets' agenda on climate change.
Still, it's all part of the debate and interesting reading all the same. It's certainly true that the Economist at least manages to attract a better and more literate responder in their comments section that most web sites! - you can read all the arguments and comments here.
Sunday, November 22, 2009
The Responsible Business Summit and Ethical Corporation Awards 2010
My colleague Nick Johnson has spent some considerable time putting together what could be our biggest and best ever conference.
It's the Responsible Business Summit 2010. Take a look at it here.
The brochure is uploaded to slideshare so check it out.
There's a stellar speaker line up for May 4-5 2010.
Last year Ikea's CEO spoke. Here's a link to his slides and here's a podcast with him.
Ethical Corporation is also hosting our first-ever awards ceremony at the conference on May 4th in London. The website is open for entries right now. Details are here.
It's the Responsible Business Summit 2010. Take a look at it here.
The brochure is uploaded to slideshare so check it out.
There's a stellar speaker line up for May 4-5 2010.
Last year Ikea's CEO spoke. Here's a link to his slides and here's a podcast with him.
Ethical Corporation is also hosting our first-ever awards ceremony at the conference on May 4th in London. The website is open for entries right now. Details are here.
Excellence in CR presentation
I've put together a short presentation, based largely on a previous post and some reader comments, on excellence in CSR.
You can view it by going here on slideshare.
The slides are in advance of a talk I am giving to 100 or so corporate managers in Budapest on Tuesday.
All reader comments will of course help with refinements...
(And if you haven't been to Budapest, you should visit, a wonderful city)
You can view it by going here on slideshare.
The slides are in advance of a talk I am giving to 100 or so corporate managers in Budapest on Tuesday.
All reader comments will of course help with refinements...
(And if you haven't been to Budapest, you should visit, a wonderful city)
Do you worry too much about ethical and ‘sustainable’ rankings?
I would argue that, if you work in corporate responsibility for a large company, you probably do.
Before I explain why I think this, there is a legitimate question to ask here.
What should be the role of the sector or overall business benchmark in corporate responsibility strategy?
Not easy to answer.
The Dow Jones Sustainability Indexes have done much to encourage progress in the field. Of that there’s no doubt.
The BITC CR Index and FTSE4Good one can look at with a similar view.
But there surely will come a time, and I hope soon, when we will look at companies by issue, not by industry or worse, by turnover/net profit/employee numbers.
An example of misleading, yet also slightly useful benchmarking, comes in the form of the recent green rankings by Newsweek, the struggling US weekly.
Let’s start with the positive points.
The Newsweek ranking, published a couple of months ago, does provide a useful list, in its upper echelons, of companies doing good work on the environment.
Anyone sensible would struggle to argue with, say, the top ten or even thirty companies being highlighted as environment leaders.
By that I mean these companies mentioned by Newsweek deserve to be praised. Just not in specific order.
Many, including particularly HP, the winner, have done great work over many years.
But that’s really where the usefulness of the list ends.
It’s a list of companies, the top ten to thirty of which deserve considerable praise.
But that doesn’t mean you can compare them, which the list implicitly tries to do.
Comparing HP with a company outside its sector (or even within it) on overall CR is pointless.
Why? Because the issues companies in different sectors tackle are so varied and company specific. Even in the same sector, it's pretty hard to do.
How can one even compare an HP supplier in Mexico with a Dell one in Malaysia? You can’t. The operating environment and issues are different.
You also can’t compare companies OVERALL, accurately, because CR is such a young disciple, covering so many complex issues.
We just don’t know how to do this yet, if ever we will.
Attempts to do so may satisfy some innate human desire to make simple sense of complexity.
But that doesn’t make doing so in any way accurate, useful or desirable.
Other rankings suffer the same problem.
Even comparing companies by sector is only useful in listing some companies doing good, or better, work, as the DJSI list does.
What WOULD be useful, and where rankings need to move towards, is comparison by progress on specific issue, highly relevant to all firms included.
What do I mean by this? Well, how about on palm oil, or fish, or carbon, for example? Progress on a specific, complex issue on its own is much more interesting, and likely to drive progress.
WWF recently compared companies with palm oil liability, and ranked them on their responses to the issue.
Not perfect by any means (I am still trying to find out their methodology, whether it was by policy or survey response, both, or what) but better.
Or how about by carbon emissions and how much they have reduced them by compared with output?
The Carbon Reduction Committment, coming into force in the UK right now, plans to do that in about a year’s time. Not perfect I agree, but better.
The best way to do such a comparison right now, I think, is by health and safety data.
Why? Because it’s where we do have more historic data, and because some UK investors have worked out a mechanism (again not perfect, but useful) by which companies can submit data, and be ranked on it for comparable and historic performance.
If better utilised, this particular mechanism can be expanded upon, particularly as access to data internally on other, specific issues, increases in big companies.
The issue-specific example I refer to is called the UK Corporate Health & Safety Performance Index.
It was created by investors such as Morley Fund Management and Insight Investment, and designed to create useful, comparable data for investors on corporate liability risk.
The idea of course, was to both educate the investment community on non-financial risk, (or risk that may only be financial later, when cases are tried or fines issues, and reputations besmirched) and companies on relatively comparable performance.
The Corporate Health & Safety Performance Index (detailed here in this downloadable policy report I co-authored in 2008) was never pushed properly by the UK government. The take-up remains disappointing. But the model is potentially sound. And it’s been, and is being copied, on issues such as palm oil or carbon.
These are the future of comparison related rankings. While they are being tested and developed, as a manager you should support them, and get your company involved early.
As the leading companies in CR will tell you, early adoption is eminently useful later on.
And in the meantime, perhaps spend a little less time on the dying breed of all-encompassing rankings, and your place in them.
Their days are surely numbered.
Before I explain why I think this, there is a legitimate question to ask here.
What should be the role of the sector or overall business benchmark in corporate responsibility strategy?
Not easy to answer.
The Dow Jones Sustainability Indexes have done much to encourage progress in the field. Of that there’s no doubt.
The BITC CR Index and FTSE4Good one can look at with a similar view.
But there surely will come a time, and I hope soon, when we will look at companies by issue, not by industry or worse, by turnover/net profit/employee numbers.
An example of misleading, yet also slightly useful benchmarking, comes in the form of the recent green rankings by Newsweek, the struggling US weekly.
Let’s start with the positive points.
The Newsweek ranking, published a couple of months ago, does provide a useful list, in its upper echelons, of companies doing good work on the environment.
Anyone sensible would struggle to argue with, say, the top ten or even thirty companies being highlighted as environment leaders.
By that I mean these companies mentioned by Newsweek deserve to be praised. Just not in specific order.
Many, including particularly HP, the winner, have done great work over many years.
But that’s really where the usefulness of the list ends.
It’s a list of companies, the top ten to thirty of which deserve considerable praise.
But that doesn’t mean you can compare them, which the list implicitly tries to do.
Comparing HP with a company outside its sector (or even within it) on overall CR is pointless.
Why? Because the issues companies in different sectors tackle are so varied and company specific. Even in the same sector, it's pretty hard to do.
How can one even compare an HP supplier in Mexico with a Dell one in Malaysia? You can’t. The operating environment and issues are different.
You also can’t compare companies OVERALL, accurately, because CR is such a young disciple, covering so many complex issues.
We just don’t know how to do this yet, if ever we will.
Attempts to do so may satisfy some innate human desire to make simple sense of complexity.
But that doesn’t make doing so in any way accurate, useful or desirable.
Other rankings suffer the same problem.
Even comparing companies by sector is only useful in listing some companies doing good, or better, work, as the DJSI list does.
What WOULD be useful, and where rankings need to move towards, is comparison by progress on specific issue, highly relevant to all firms included.
What do I mean by this? Well, how about on palm oil, or fish, or carbon, for example? Progress on a specific, complex issue on its own is much more interesting, and likely to drive progress.
WWF recently compared companies with palm oil liability, and ranked them on their responses to the issue.
Not perfect by any means (I am still trying to find out their methodology, whether it was by policy or survey response, both, or what) but better.
Or how about by carbon emissions and how much they have reduced them by compared with output?
The Carbon Reduction Committment, coming into force in the UK right now, plans to do that in about a year’s time. Not perfect I agree, but better.
The best way to do such a comparison right now, I think, is by health and safety data.
Why? Because it’s where we do have more historic data, and because some UK investors have worked out a mechanism (again not perfect, but useful) by which companies can submit data, and be ranked on it for comparable and historic performance.
If better utilised, this particular mechanism can be expanded upon, particularly as access to data internally on other, specific issues, increases in big companies.
The issue-specific example I refer to is called the UK Corporate Health & Safety Performance Index.
It was created by investors such as Morley Fund Management and Insight Investment, and designed to create useful, comparable data for investors on corporate liability risk.
The idea of course, was to both educate the investment community on non-financial risk, (or risk that may only be financial later, when cases are tried or fines issues, and reputations besmirched) and companies on relatively comparable performance.
The Corporate Health & Safety Performance Index (detailed here in this downloadable policy report I co-authored in 2008) was never pushed properly by the UK government. The take-up remains disappointing. But the model is potentially sound. And it’s been, and is being copied, on issues such as palm oil or carbon.
These are the future of comparison related rankings. While they are being tested and developed, as a manager you should support them, and get your company involved early.
As the leading companies in CR will tell you, early adoption is eminently useful later on.
And in the meantime, perhaps spend a little less time on the dying breed of all-encompassing rankings, and your place in them.
Their days are surely numbered.
Five reasons I WILL read your corporate responsibility messages
A friend of mine I saw on Friday told me he thought my last posting "Twelve reasons why I won't read your corporate responsibility report", was a little negative.
I admit I wanted to employ a bit of shock factor and encourage some comments on the blog.
But I was also hinting at a serious point, which my colleague Mallen Baker has been making eloquently for years.
CR reporting is simply the basis for communication, it is not communication itself.
What do I mean by this? Simply that your report is your starting point, not your end point.
Too many CR managers I know finish their report, and then breathe a huge sigh of relief when it’s signed off by the lawyers, communications director and relevant board members.
They then take a brief respite before starting all over again and doing the rest of their job.
This is perfectly understandable, given how poorly resourced the CR function remains in many companies.
Tiny teams, grappling with complex and expanding issues, with small budgets, can only do so much.
But as many of us know, the key is getting other departments on board, and then controlling what they do with the information in your report.
IF you can get communications and external affairs on board, (and we published a report recently that talks about how you can do that) then you can start really conveying the good work your company has done, and the progress made. Provided, that is, you use real, proven communications methods.
Here are my top five tips on doing just that. And why, when you use these methods, I’ll read your communications (at least, the relevant ones to me, as a so-called opinion former).
1) Embed communications in ALL employee messaging. Your newsletter, your health and safety notices, your financial results communication, even your retrenchment plans. Yes, it can be done, so go get on with it.
2) Link your work with your financial reporting. Too many times I see financial results where no mention of sustainability or CR is made.
Put your key non-financials into your statements wherever you can.
If you believe better training and engagement lead to improved efficiency or better EH&S numbers, then say so. Don’t be scared.
Investors need educating on why these matter to them, so take the bull by the horns, even in a bear market.
3) Sell your messages. Get your report properly copy-written. And no, you are not a copywriter, and neither is your communications director or his/her team. Get a professional in.
Trust me, it works. I spend tens of thousands a year on copywriting the marketing Ethical Corporation sends out. And we are an SME!
I do this because it works. So follow the conventions of decent communication.
4) Format your messages. Employee communications need to be tailored to suit your culture and what staff are used to. Embed messages in that, but also think about what the so-called ‘opinion former’ community needs from you.
We need to be engaged in brief, interesting, industry-leading discussion notes and papers.
Unilever have used these in the past. They really work.
Call them issue briefs, something like that. 4-8 pages will do it. Make it look sober and serious, put your numbers in, and talk about what you don’t know.
Encourage the debate, and the debate will take you seriously.
5) Be authentic. This links from my last point. But to take it further, give your tone humility, give us warts and all.
Tell the truth, or others will tell it for you in ways you have less influence over. Think Twitter, and Google’s Sidewiki.
Put critical voices into your tailored stakeholder communications. ‘Opinion formers’ want to read each other’s voices, those they respect for their independence.
An accountancy firm’s statement is not tough. Neither is a tame NGO you donate to. Think bigger, think challenging.
Do these things, and people like me (and more importantly your employees and investors) will read your corporate responsibility communications. That doesn't mean they will, or should, read your report. That’s mainly for you and your boss, department heads, and the board.
So if you work in CR reporting, yes, perhaps you do need to work a bit harder to get HR, IR and Comms on board.
But you knew that anyway.
Maybe spend a bit less time on rankings no-one important cares about (and don’t reflect relative performance accurately) and focus more on real messages, that can make a real difference.
As John Ruggie said recently, “the era of declaratory CSR is over”.
So show us what you’ve done, in formats we can understand, and actually read.
I admit I wanted to employ a bit of shock factor and encourage some comments on the blog.
But I was also hinting at a serious point, which my colleague Mallen Baker has been making eloquently for years.
CR reporting is simply the basis for communication, it is not communication itself.
What do I mean by this? Simply that your report is your starting point, not your end point.
Too many CR managers I know finish their report, and then breathe a huge sigh of relief when it’s signed off by the lawyers, communications director and relevant board members.
They then take a brief respite before starting all over again and doing the rest of their job.
This is perfectly understandable, given how poorly resourced the CR function remains in many companies.
Tiny teams, grappling with complex and expanding issues, with small budgets, can only do so much.
But as many of us know, the key is getting other departments on board, and then controlling what they do with the information in your report.
IF you can get communications and external affairs on board, (and we published a report recently that talks about how you can do that) then you can start really conveying the good work your company has done, and the progress made. Provided, that is, you use real, proven communications methods.
Here are my top five tips on doing just that. And why, when you use these methods, I’ll read your communications (at least, the relevant ones to me, as a so-called opinion former).
1) Embed communications in ALL employee messaging. Your newsletter, your health and safety notices, your financial results communication, even your retrenchment plans. Yes, it can be done, so go get on with it.
2) Link your work with your financial reporting. Too many times I see financial results where no mention of sustainability or CR is made.
Put your key non-financials into your statements wherever you can.
If you believe better training and engagement lead to improved efficiency or better EH&S numbers, then say so. Don’t be scared.
Investors need educating on why these matter to them, so take the bull by the horns, even in a bear market.
3) Sell your messages. Get your report properly copy-written. And no, you are not a copywriter, and neither is your communications director or his/her team. Get a professional in.
Trust me, it works. I spend tens of thousands a year on copywriting the marketing Ethical Corporation sends out. And we are an SME!
I do this because it works. So follow the conventions of decent communication.
4) Format your messages. Employee communications need to be tailored to suit your culture and what staff are used to. Embed messages in that, but also think about what the so-called ‘opinion former’ community needs from you.
We need to be engaged in brief, interesting, industry-leading discussion notes and papers.
Unilever have used these in the past. They really work.
Call them issue briefs, something like that. 4-8 pages will do it. Make it look sober and serious, put your numbers in, and talk about what you don’t know.
Encourage the debate, and the debate will take you seriously.
5) Be authentic. This links from my last point. But to take it further, give your tone humility, give us warts and all.
Tell the truth, or others will tell it for you in ways you have less influence over. Think Twitter, and Google’s Sidewiki.
Put critical voices into your tailored stakeholder communications. ‘Opinion formers’ want to read each other’s voices, those they respect for their independence.
An accountancy firm’s statement is not tough. Neither is a tame NGO you donate to. Think bigger, think challenging.
Do these things, and people like me (and more importantly your employees and investors) will read your corporate responsibility communications. That doesn't mean they will, or should, read your report. That’s mainly for you and your boss, department heads, and the board.
So if you work in CR reporting, yes, perhaps you do need to work a bit harder to get HR, IR and Comms on board.
But you knew that anyway.
Maybe spend a bit less time on rankings no-one important cares about (and don’t reflect relative performance accurately) and focus more on real messages, that can make a real difference.
As John Ruggie said recently, “the era of declaratory CSR is over”.
So show us what you’ve done, in formats we can understand, and actually read.
Thursday, November 19, 2009
Twelve reasons why I won't read your corporate responsibility report
1) It's badly designed
2) It's too long
3) It's not aimed at me
4) Worse, I can't see who it is aimed at
5) It's not properly copy written, so I can't understand a lot of it
6) I don't really trust your assurance company
7) You don't have credible voices in your report
8) You don't show me progress at a glance clearly
9) You don't show me really clearly your best wins
10) Your failings are hidden in corporate-speak
11) I can't see the context of your targets
12) I can't see how sustainability links to your business strategy
Change the above, and I'll read your report.
2) It's too long
3) It's not aimed at me
4) Worse, I can't see who it is aimed at
5) It's not properly copy written, so I can't understand a lot of it
6) I don't really trust your assurance company
7) You don't have credible voices in your report
8) You don't show me progress at a glance clearly
9) You don't show me really clearly your best wins
10) Your failings are hidden in corporate-speak
11) I can't see the context of your targets
12) I can't see how sustainability links to your business strategy
Change the above, and I'll read your report.
Enron, the musical
Yes, it sounds like the Mel Brooks film we've all been waiting for.
But it's real, and it's in London. Enron, the musical.
I would hope some McKinsey executives will buy tickets.
It was they that essentially created Enron's management strategy, after all.
They made a fortune from it, and essentially got away scot free. Nice work if you can get it, they might say.
But it's real, and it's in London. Enron, the musical.
I would hope some McKinsey executives will buy tickets.
It was they that essentially created Enron's management strategy, after all.
They made a fortune from it, and essentially got away scot free. Nice work if you can get it, they might say.
Tuesday, November 17, 2009
Embedding corporate responsibility, again
I know I have posted blogs on this area a few times recently.
But, its important. And we have a report out on the topic too, the sales of which help fund this blog.
Here's a link to a presentation I am giving today on how companies embed CSR, in Sofia, Bulgaria.
I'd be interested in your comments.
While we're on the topic of presentations, here's another link to a presentation I did in May this year on drivers for greater corporate ethics in Europe.
Hope some of this is useful.
But, its important. And we have a report out on the topic too, the sales of which help fund this blog.
Here's a link to a presentation I am giving today on how companies embed CSR, in Sofia, Bulgaria.
I'd be interested in your comments.
While we're on the topic of presentations, here's another link to a presentation I did in May this year on drivers for greater corporate ethics in Europe.
Hope some of this is useful.
Sunday, November 15, 2009
What will come out of Copenhagen?
According to Yvo de Boer, executive secretary of the United Nations Framework Convention on Climate Change, it will be:
"...a list of targets from the industrialised countries, a list of commitments from the developing countries, and a list of financial contributions".
In an interview with Handelsblad, a dutch newspaper, he says that:
"Yes, there are still too many texts on the table. There is not enough time left to turn all that into a treaty. But Copenhagen is not all or nothing. I still believe we will reach a strong agreement in Copenhagen. I still believe we will have targets from the industrialised countries, transparency from the developing countries and clear rules about how to finance it all."
His comments about the CDM and the European Emissions Trading System are interesting, if predictable. He saves the best bit until last:
""I believe Obama will come up with a figure. And if he's smart it will not be higher than what is currently being discussed in the Senate. Otherwise you will get the same stand-off between the government and the parliament that proved fatal for Kyoto. I got a call just last week from [Democratic] senator John Kerry. He said he is sticking to the 20 percent reduction in the legislation currently being debated. So if Obama goes for that 20 percent he has political support. If he goes for more he will be on his own.""
Something is clearly better than nothing. Is it enough to avoid a two degree temperature rise? If the science is right, probably not. But we might just avoid four degrees, after which it all gets very messy indeed. One hopes so.
For anyone interested in some of the technology that might help business do their bit, check out this report we published last year called "Green technology that works". You have to fill in a form to get it, but it's worth it.
And for further reading and a summary of some of the science up until March 2009, here's a link to my lecture on the topic of business and climate change, given to my MSC class at Birkbeck College, University of London, earlier this year.
"...a list of targets from the industrialised countries, a list of commitments from the developing countries, and a list of financial contributions".
In an interview with Handelsblad, a dutch newspaper, he says that:
"Yes, there are still too many texts on the table. There is not enough time left to turn all that into a treaty. But Copenhagen is not all or nothing. I still believe we will reach a strong agreement in Copenhagen. I still believe we will have targets from the industrialised countries, transparency from the developing countries and clear rules about how to finance it all."
His comments about the CDM and the European Emissions Trading System are interesting, if predictable. He saves the best bit until last:
""I believe Obama will come up with a figure. And if he's smart it will not be higher than what is currently being discussed in the Senate. Otherwise you will get the same stand-off between the government and the parliament that proved fatal for Kyoto. I got a call just last week from [Democratic] senator John Kerry. He said he is sticking to the 20 percent reduction in the legislation currently being debated. So if Obama goes for that 20 percent he has political support. If he goes for more he will be on his own.""
Something is clearly better than nothing. Is it enough to avoid a two degree temperature rise? If the science is right, probably not. But we might just avoid four degrees, after which it all gets very messy indeed. One hopes so.
For anyone interested in some of the technology that might help business do their bit, check out this report we published last year called "Green technology that works". You have to fill in a form to get it, but it's worth it.
And for further reading and a summary of some of the science up until March 2009, here's a link to my lecture on the topic of business and climate change, given to my MSC class at Birkbeck College, University of London, earlier this year.
Saturday, November 14, 2009
Useful quotes from GE's Jeff Immelt on trends
"In 1982, the year I joined GE, about 10% of the earnings of the S&P 500 were in financial services. The US was a net exporter. R&D as a percentage of GDP was in the mid single digits. GE revenues were 80% in the U.S., 20% out of U.S.”
By 2007, financial services earnings as a percentage of the S&P were about 45%. The U.S. was a net importer…R&D as a percentage of GDP had slipped to about 2%.
By 2007, financial services earnings as a percentage of the S&P were about 45%. The U.S. was a net importer…R&D as a percentage of GDP had slipped to about 2%.
EU plans to maintain emphasis on CSR in 2010
The European Union has put out a new statement on business and human rights and CSR.
Or at least the the Swedish Presidency of the European Union and the incoming Spanish Presidency have.
If we are so bold to suggest that the other states won't block this being implemented (and I would suggest they are unlikely to), it means that even with the Commission being changed in January, the emphasis on encouraging CSR and taking more interest in business and human rights is unlikely to go away.
With regard to companies, the statement tersely says that the EU will:
– Raise business awareness of its responsibility to respect human rights and exercise due diligence, notably through active implementation of the framework, effective incentives and other relevant means; (they mean the John Ruggie framework)
– Ensure that businesses respect human rights wherever they are operating;
– Continue, deepen and further improve the dialogue on CSR across Europe and beyond.
I hear from my sources in Brussels that the plan for CSR in Europe is to do less projects/initiatives around CSR (however you define them), but be much more focused and therefore make them better resourced.
I also heard at a conference of largely left-wing academics at LSE a few weeks ago that the International Criminal Court is considering the issue of companies and human rights. Given the likely US opposition to that idea though, the emphasis right now may be rightly greater on the word 'considering', than any other.
Meanwhile influential lobby/membership group CSR Europe has produced a guide to CSR in the region. You can download it here.
Or at least the the Swedish Presidency of the European Union and the incoming Spanish Presidency have.
If we are so bold to suggest that the other states won't block this being implemented (and I would suggest they are unlikely to), it means that even with the Commission being changed in January, the emphasis on encouraging CSR and taking more interest in business and human rights is unlikely to go away.
With regard to companies, the statement tersely says that the EU will:
– Raise business awareness of its responsibility to respect human rights and exercise due diligence, notably through active implementation of the framework, effective incentives and other relevant means; (they mean the John Ruggie framework)
– Ensure that businesses respect human rights wherever they are operating;
– Continue, deepen and further improve the dialogue on CSR across Europe and beyond.
I hear from my sources in Brussels that the plan for CSR in Europe is to do less projects/initiatives around CSR (however you define them), but be much more focused and therefore make them better resourced.
I also heard at a conference of largely left-wing academics at LSE a few weeks ago that the International Criminal Court is considering the issue of companies and human rights. Given the likely US opposition to that idea though, the emphasis right now may be rightly greater on the word 'considering', than any other.
Meanwhile influential lobby/membership group CSR Europe has produced a guide to CSR in the region. You can download it here.
The rise of China, global business and the end of the Western world
Paul French in Shanghai talks with Martin Jacques, the author of the recently published book "When China Rules the World", about how China has become part of the world's 'global mind'.
Paul and Martin also discuss the implications of growing Chinese investment and business in Africa, the Middle East and internationally, the future of Sino-US relations and what a rising and more powerful China means to all of us in our everyday lives.
Here's a link to the podcast.
Paul and Martin also discuss the implications of growing Chinese investment and business in Africa, the Middle East and internationally, the future of Sino-US relations and what a rising and more powerful China means to all of us in our everyday lives.
Here's a link to the podcast.
Friday, November 13, 2009
Podcast interview with Ray Anderson
Here's a link to a podcast I taped last week with Ray Anderson, chairman and founder of Interface, the industrial flooring company.
Ray is someone we should all pay attention to.
He's been attempting to make his company not just environmentally neutral, but positive, by 2020.
It's been his mission since 1994. Interface, he reckons, is about 60% of the way there, utilising lots of recycling and innovation on the way.
Here's a link to the podcast. We also have an iTunes channel and an RSS feed you can sign up to.
Ray is someone we should all pay attention to.
He's been attempting to make his company not just environmentally neutral, but positive, by 2020.
It's been his mission since 1994. Interface, he reckons, is about 60% of the way there, utilising lots of recycling and innovation on the way.
Here's a link to the podcast. We also have an iTunes channel and an RSS feed you can sign up to.
Mark Twain and US business sustainability research
"There are lies, damned lies and statistics", Mark Twain once said.
The more ethical business and green related surveys I get sent and survey results I see, (particularly by consulting firms wanting to make the case for companies to er, buy more of their services) the more sceptical I am.
But one should be careful here. Some quantitative research is useful, if the methodology is carefully considered. One cannot judge fully without looking at that, whilst bearing in mind the motivation of those producing their 'research' reports based on surveys and sometimes psuedo 'in-depth' stakeholder interviews (I've been on the end of more moronic ones than I care to recall, though they do seem to be getting better in recent times).
William S. Becker, who is executive director of the Presidential Climate Action Project, provides in the Huffington Post an interesting summary of some latest 'macro' research on US companies and sustainability.
Make of it what you will, bearing in mind the limitations and problems of senior executive surveys (ever met a CEO who fills them in?) and that old Guinness ad quote that 66.66% of statistics are made up on the spot...
Here's an excerpt from the piece, including the key recent survey findings on US business and sustainability:
"...after interviewing more than 200 corporations that represent 75 percent of the $36 trillion equities market in the United States, Siemens and McGraw-Hill Construction concluded that "corporate America's embrace of sustainability has more than doubled in strength in the past three years with 76 percent of the largest U.S. firms reporting efforts and commitments that exceed those required by law."
After surveying nearly 1,600 business leaders around the world, the Boston Consulting Group (BCG) reported this fall that 92 percent of the respondents said their companies are addressing sustainability in some way.
Corporate interest in sustainability has remained strong even during the recession, BCG found, and there was a strong consensus among the business leaders it interviewed that companies "will play a key role in solving the long-term global issues related to sustainability."
McKinsey & Company reports that in its annual survey of business leaders last year, "executives for the first time were more likely to view addressing social and political issues as an opportunity than as a risk."
Despite the positive news from the business sector, corporations have a long way to go.
The majority of respondents in the BCG survey said "their companies were not acting decisively to fully exploit the opportunities and mitigate the risks that sustainability presents." More than 70 percent said their companies have not developed a clear business case for sustainability.
Contradicting the Siemens' survey, BCG found that among the companies it surveyed, most sustainability actions are the minimum required by law.
TIME's poll found that 40 percent of the 1,000 largest companies in the United States have not created publicly available environmental policies; fewer than 8 percent use third parties to verify progress on their corporate social responsibility policies."
The problem with a lot of these surveys like the BCG one and some of the questions they ask is very simple.
Who would say "no, we're not doing sustainability this year, we don't care about the environment".
That's got to affect survey results as opposed to an independent body conducting the research. The Time poll sounds more accurate to me.
Still, if you choose to believe them, (and some of them are likely somewhat credible) then a portion of the stats above represent cheering news.
The more ethical business and green related surveys I get sent and survey results I see, (particularly by consulting firms wanting to make the case for companies to er, buy more of their services) the more sceptical I am.
But one should be careful here. Some quantitative research is useful, if the methodology is carefully considered. One cannot judge fully without looking at that, whilst bearing in mind the motivation of those producing their 'research' reports based on surveys and sometimes psuedo 'in-depth' stakeholder interviews (I've been on the end of more moronic ones than I care to recall, though they do seem to be getting better in recent times).
William S. Becker, who is executive director of the Presidential Climate Action Project, provides in the Huffington Post an interesting summary of some latest 'macro' research on US companies and sustainability.
Make of it what you will, bearing in mind the limitations and problems of senior executive surveys (ever met a CEO who fills them in?) and that old Guinness ad quote that 66.66% of statistics are made up on the spot...
Here's an excerpt from the piece, including the key recent survey findings on US business and sustainability:
"...after interviewing more than 200 corporations that represent 75 percent of the $36 trillion equities market in the United States, Siemens and McGraw-Hill Construction concluded that "corporate America's embrace of sustainability has more than doubled in strength in the past three years with 76 percent of the largest U.S. firms reporting efforts and commitments that exceed those required by law."
After surveying nearly 1,600 business leaders around the world, the Boston Consulting Group (BCG) reported this fall that 92 percent of the respondents said their companies are addressing sustainability in some way.
Corporate interest in sustainability has remained strong even during the recession, BCG found, and there was a strong consensus among the business leaders it interviewed that companies "will play a key role in solving the long-term global issues related to sustainability."
McKinsey & Company reports that in its annual survey of business leaders last year, "executives for the first time were more likely to view addressing social and political issues as an opportunity than as a risk."
Despite the positive news from the business sector, corporations have a long way to go.
The majority of respondents in the BCG survey said "their companies were not acting decisively to fully exploit the opportunities and mitigate the risks that sustainability presents." More than 70 percent said their companies have not developed a clear business case for sustainability.
Contradicting the Siemens' survey, BCG found that among the companies it surveyed, most sustainability actions are the minimum required by law.
TIME's poll found that 40 percent of the 1,000 largest companies in the United States have not created publicly available environmental policies; fewer than 8 percent use third parties to verify progress on their corporate social responsibility policies."
The problem with a lot of these surveys like the BCG one and some of the questions they ask is very simple.
Who would say "no, we're not doing sustainability this year, we don't care about the environment".
That's got to affect survey results as opposed to an independent body conducting the research. The Time poll sounds more accurate to me.
Still, if you choose to believe them, (and some of them are likely somewhat credible) then a portion of the stats above represent cheering news.
Wednesday, November 11, 2009
Cadbury vs. Kraft: Would a takeover be better for sustainability?
I've just been out to dinner with a friend of mine who has worked in this field of sustainability for over a decade.
Over dinner, we had a good discussion about Cadbury and Kraft.
As all readers will know, Kraft, accused of being a "low growth conglomerate" is currently going hostile in its takeover bid of Cadbury, seen in the UK as a venerable ethical instutition, particularly given its recent conversion to buying large volumes of fair trade cocoa for its chocolate.
My friend, who shall remain nameless, made some interesting points. Namely, that:
1) Because Kraft is American, and seen as a 'low quality cheese company' here in the UK, the media and commentators are getting all nostalgic about the loss of what is being pitched as a UK company. Cadbury, a major multi-national company, is being presented as a national institution that should remain 'British'. But the company is a huge multi-national, and should be seen as such.
2) Many of those who decry the sale of the firm to Kraft by shareholders were those who decried the sale of Green & Black's, the ethical chocolate company, to Cadbury a few years ago. The line of 'smaller ethical company sells to big MNC' is now being applied by some people to the very company they called the 'big MNC' a couple of years ago. In short, hypocrisy.
3) More importantly, he asserted, Kraft has been into sustainable sourcing (with the Rainforest Alliance) for years, whereas Cadbury's conversion to fair trade is relatively recent in a meaningful sense (i.e. volume).
4) Lastly, that Kraft takes sustainability very seriously itself, and the joining of the two would create one of the largest, if not the largest, food companies in the world, offering some competition to Nestle, a laggard. And, that such a takeover would present to the world (and NGOs) a company that utilises both Rainforest Alliance and Fairtrade certification, providing lessons in both standards diversification (one standard not being the answer to all issues) to other companies, And leading the market.
He pointed out that the commitment of Mars, a giant US company, to sustainable cocoa sourcing recently, is much greater in terms of volume than Cadbury is capable of.
So overall, he argued, a giant food company going seriously sustainable, (in significant part) would be a good thing all round. Or at least, Kraft's takeover of Cadbury would not be as 'bad' for ethical business, as many UK commentators are suggesting.
He made a compelling case.
My beef with his argument is one of diversity. Much as I like Kraft, (Here's a podcast I did with the MD of UK and Ireland two years ago) for the moves they have made on sustainability, I also like choice.
As a Briton, I've seen what the rise of the big supermarkets, particularly Tesco, can and has done, albeit accidentally, to smaller businesses in their vicinity. My friend and I both agreed on this concern.
Despite the opportunity for giant companies to drive sustainability into their supply chains and lead their customers (Wal-Mart deserves some credit here, along with particularly Marks and Spencer and Sainsbury's, and in part, Tesco) along the path, competition must also be valued, I suggested.
My friend agreed. And there we left it.
Despite the Pinot Noir, the debate was unresolved, as it is so often in the complex, contradictory world of sustainability and business.
It's all about trade-offs, and the trade off between corporate size and market diversity is still in its infancy.
Look at the banks post crisis, for example.
Oligopolies, their power, benefits and impacts, are a debate which has barely begun.
Let us hope in sectors outside finance, that we can learn to handle it a bit better than our governments have in the banking sector so far.
Over dinner, we had a good discussion about Cadbury and Kraft.
As all readers will know, Kraft, accused of being a "low growth conglomerate" is currently going hostile in its takeover bid of Cadbury, seen in the UK as a venerable ethical instutition, particularly given its recent conversion to buying large volumes of fair trade cocoa for its chocolate.
My friend, who shall remain nameless, made some interesting points. Namely, that:
1) Because Kraft is American, and seen as a 'low quality cheese company' here in the UK, the media and commentators are getting all nostalgic about the loss of what is being pitched as a UK company. Cadbury, a major multi-national company, is being presented as a national institution that should remain 'British'. But the company is a huge multi-national, and should be seen as such.
2) Many of those who decry the sale of the firm to Kraft by shareholders were those who decried the sale of Green & Black's, the ethical chocolate company, to Cadbury a few years ago. The line of 'smaller ethical company sells to big MNC' is now being applied by some people to the very company they called the 'big MNC' a couple of years ago. In short, hypocrisy.
3) More importantly, he asserted, Kraft has been into sustainable sourcing (with the Rainforest Alliance) for years, whereas Cadbury's conversion to fair trade is relatively recent in a meaningful sense (i.e. volume).
4) Lastly, that Kraft takes sustainability very seriously itself, and the joining of the two would create one of the largest, if not the largest, food companies in the world, offering some competition to Nestle, a laggard. And, that such a takeover would present to the world (and NGOs) a company that utilises both Rainforest Alliance and Fairtrade certification, providing lessons in both standards diversification (one standard not being the answer to all issues) to other companies, And leading the market.
He pointed out that the commitment of Mars, a giant US company, to sustainable cocoa sourcing recently, is much greater in terms of volume than Cadbury is capable of.
So overall, he argued, a giant food company going seriously sustainable, (in significant part) would be a good thing all round. Or at least, Kraft's takeover of Cadbury would not be as 'bad' for ethical business, as many UK commentators are suggesting.
He made a compelling case.
My beef with his argument is one of diversity. Much as I like Kraft, (Here's a podcast I did with the MD of UK and Ireland two years ago) for the moves they have made on sustainability, I also like choice.
As a Briton, I've seen what the rise of the big supermarkets, particularly Tesco, can and has done, albeit accidentally, to smaller businesses in their vicinity. My friend and I both agreed on this concern.
Despite the opportunity for giant companies to drive sustainability into their supply chains and lead their customers (Wal-Mart deserves some credit here, along with particularly Marks and Spencer and Sainsbury's, and in part, Tesco) along the path, competition must also be valued, I suggested.
My friend agreed. And there we left it.
Despite the Pinot Noir, the debate was unresolved, as it is so often in the complex, contradictory world of sustainability and business.
It's all about trade-offs, and the trade off between corporate size and market diversity is still in its infancy.
Look at the banks post crisis, for example.
Oligopolies, their power, benefits and impacts, are a debate which has barely begun.
Let us hope in sectors outside finance, that we can learn to handle it a bit better than our governments have in the banking sector so far.
Interesting speech about greenwash, ethical certification, spin and substance
Here's a link to an interesting speech by Brendan May, MD of Planet 2050, a consultancy that's part of Weber Shandwick.
Brendan is not the usual PR guy though. He was formerly founding CEO of the Marine Stewardship Council from 1999-2004.
In the speech he covers a brief history of business and sustainability, and offers some thoughts on effective communication.
On certification, being something of an expect in the area, he offers some useful thoughts in this excerpt below, on the characteristics of an independent ethical label:
"First - that there has been wide and thorough consultation on where the bar should be set and what criteria must be met in order to achieve the certification or stamp of approval.
Second, any auditing must be undertaken at arms length with no prospect of the farm, fishery, company or forest in question being able to influence its outcome.
Third - there must be full transparency in the result of the certification review and people must have the right to object to a positive result.
Fourth, there must be very strict requirements on how any label such as a Rainforest Alliance logo is used, for example on product packaging.
Fifth, products that meet the required criteria must throughout the supply chain be clearly segregated from products that don't.
For example a seafood processing company may receive different sources of cod, which it then turns into fish fingers or fish pies. If only some of that seafood is from an MSC approved fishery, there must be no risk of mixing it up with non-certified fish in the factory leading to an incorrect use of the MSC logo on a product containing unsustainable catch.
And sixth, there must be regular re-inspections to make sure the requirements of certification and agreed improvements are being met. The potential loss of certification must be a constant incentive to anyone marketing their product as green or ethical."
Useful stuff. The whole speech is well worth a read.
Brendan is not the usual PR guy though. He was formerly founding CEO of the Marine Stewardship Council from 1999-2004.
In the speech he covers a brief history of business and sustainability, and offers some thoughts on effective communication.
On certification, being something of an expect in the area, he offers some useful thoughts in this excerpt below, on the characteristics of an independent ethical label:
"First - that there has been wide and thorough consultation on where the bar should be set and what criteria must be met in order to achieve the certification or stamp of approval.
Second, any auditing must be undertaken at arms length with no prospect of the farm, fishery, company or forest in question being able to influence its outcome.
Third - there must be full transparency in the result of the certification review and people must have the right to object to a positive result.
Fourth, there must be very strict requirements on how any label such as a Rainforest Alliance logo is used, for example on product packaging.
Fifth, products that meet the required criteria must throughout the supply chain be clearly segregated from products that don't.
For example a seafood processing company may receive different sources of cod, which it then turns into fish fingers or fish pies. If only some of that seafood is from an MSC approved fishery, there must be no risk of mixing it up with non-certified fish in the factory leading to an incorrect use of the MSC logo on a product containing unsustainable catch.
And sixth, there must be regular re-inspections to make sure the requirements of certification and agreed improvements are being met. The potential loss of certification must be a constant incentive to anyone marketing their product as green or ethical."
Useful stuff. The whole speech is well worth a read.
Tuesday, November 10, 2009
Ethics, the last great differentiator for brands?
One of the first interviews I did in the world of CSR, back in 2001, was with Wally Olins. Here's a link to it.
He gave us a memorable quote. "Ethics will be the last great commodity differentiator" he said. Pointing out that if products are similar in price and quality, and if service is equal, then brands will have little else to compete with each other on in the future.
It's a quote that always stuck in my mind. Tonight I was watching TV and an advert for Kenco coffee came on. The entire advertisement was about how using their coffee refill packs cuts waste by 98%. Nothing else, just that. Not a word on quality or taste.
Kenco must be assuming that we all realise the quality of instant coffee is pretty much the same, and that ethics are now more important than a couple of pennies in price. At least for this campaign anyhow.
This is not the only example of course, of advertising which is entirely ethics-based.
But usually it's niche brands promoting themselves, or oil companies greenwashing, or premium brands like M&S pitching the right message to their demanding audience.
Instant coffee is a bit more low-end, which makes it all the more interesting.
It makes me wonder if Olin's prediction is now starting to come true.
I hope he was right. I think we all do.
He gave us a memorable quote. "Ethics will be the last great commodity differentiator" he said. Pointing out that if products are similar in price and quality, and if service is equal, then brands will have little else to compete with each other on in the future.
It's a quote that always stuck in my mind. Tonight I was watching TV and an advert for Kenco coffee came on. The entire advertisement was about how using their coffee refill packs cuts waste by 98%. Nothing else, just that. Not a word on quality or taste.
Kenco must be assuming that we all realise the quality of instant coffee is pretty much the same, and that ethics are now more important than a couple of pennies in price. At least for this campaign anyhow.
This is not the only example of course, of advertising which is entirely ethics-based.
But usually it's niche brands promoting themselves, or oil companies greenwashing, or premium brands like M&S pitching the right message to their demanding audience.
Instant coffee is a bit more low-end, which makes it all the more interesting.
It makes me wonder if Olin's prediction is now starting to come true.
I hope he was right. I think we all do.
Some thoughts on where CSR came from and who leads...
I was asked by a Hungarian newspaper, in advance of a trip to Budapest to speak at a conference, to answer a few questions for an article they are doing on the topic.
So here's what I wrote. I'd be interested in any reader comments on what I might have missed.
Where do the roots of CSR lie? What is CSR by the most simple, yet universal description?
CSR has its roots in several eras of history. Firstly, the concept of Victorian philanthropy. This was created by the actions of 19th Century UK family companies such as Cadbury and Lever Brothers. A Quaker influence was clear in early philanthropy, which quickly spread to the US in the late 19th Century and early 20th Century.
In the 1950’s a debate began about the role of the businessman in post war affluent society, and academics, particularly in the US, began to take an interest, as did CEOs of large companies and theorists such as Peter Drucker.
Then, the third push for CSR came from the environmental and political movements of the 60’s, 70’s and 80’s. Growing in the 1960s in Europe and the US, and gaining impetus from the anti-Vietnam protests in the 1970s, the notion of responsible business became much more mainstream in the 1980s. There were many protests around companies seen to be supporting the pro-apartheid regime in South Africa, and about the tragedy of the Bhopal Union Carbide industrial accident. Nuclear disarmament campaigns also lead to a rise in the number people deeply concerned about the environment.
In the 1990s information technology and globalization of supply chains, pollution and sourcing collided to create an anti-sweatshop and anti-corporate movement, also partly based on ethics-related incidents involving Shell in both Nigeria and the North Sea.
Since the zenith of the anti-globalisation movements of the late 1990s, we’ve seen social and environmental issues become really mainstream for large companies.
Training and developing employees, anti-corruption, health and safety, creating ethical supply chains and paying the correct amount of tax have all become important corporate responsibility issues, among many others.
For a definition, you could use the most well known one, that corporate responsibility is the contribution of business towards sustainable development.
Which country is the leading force in the field of CSR?
This is a difficult question to answer. Many people say the UK is ahead of many countries but it does depend upon the issues.
For example in terms of volunteering and community work US companies are often better. It is true that many of the companies leading on CSR are headquartered in the UK or have significant operations here. Companies such as Marks and Spencer and Unilever, for example.
But in the US there are companies such as Nike and Timberland who are really good at CSR too. Norway, Denmark and Sweden also have some very interesting companies who do some excellent work on CSR. Companies like StatoilHydro, Novo Nordisk and Ikea, for example.
What shows if a company is really doing good CSR, or if it is doing something just to use it for PR or to be able to say we have done something?
The real ‘acid test’ of corporate responsibility is whether it is something the company does when no-one is watching.
Companies who really believe in the notion of corporate responsibility are working hard to embed it into their business, or ideally already have.
For the best companies, it is simply what they do every day. It is normal business.
The companies that really believe in corporate responsibility are the ones where the CEO is totally comfortable talking about the different and difficult issues that corporate responsibility presents for the company.
Increasingly companies that use CSR just for PR are being discovered much more quickly as more and more people understand what’s real and what is not.
Could you mention some good examples for really good goals, projects etc which were the results of a really responsible company?
The Baku-Tbilisi-Ceyhan oil pipeline, when it was built in 2000-2003, had a goal of not creating conflict in Turkey. Thanks to BP’s responsible planning work, the pipeline has not caused problems either environmentally or socially.
Marks and Spencer in the UK has created a strategy called Plan A that is 100 steps towards sustainability. So far the plan and associated marketing campaigns have been the most successful in the history of the company and M&S has an excellent reputation. Interface, the carpet company, has a goal of being completely sustainable by 2020 and has saved $500 million dollars by being more environmentally efficient. Interface says it is now 60% of the way towards its goal.
Starbucks has recently shifted to fair trade for more than 90% of its coffee sold in the UK. The company is currently promoting fair trade in all its stores in the UK but has not put up prices.
Another example would be Unilever. The company has committed to source all tea and palm oil sold from sustainable sources in the near future.
Are there national characteristics of CSR in your opinion?
Yes. There are global values of course, like the Ten Commandments in Christianity. But implementation of CSR should be very tailored to local needs, whilst bearing in mind the global principles the company operates under.
CSR should be based on both these, and the needs of local people and the environment. So not based on what the CEO wants to do with some spare budget, but on real research on what customers, employees and society believe are the areas where a company can contribute socially and environmentally.
What do you plan to talk about at the conference?
Excellence in CSR. What makes a company excellent at CSR? Here is a link to something I already wrote in advance of the conference: http://ethicalcorp.blogspot.com/2009/10/what-do-we-mean-by-excellence-in-csr.html
So here's what I wrote. I'd be interested in any reader comments on what I might have missed.
Where do the roots of CSR lie? What is CSR by the most simple, yet universal description?
CSR has its roots in several eras of history. Firstly, the concept of Victorian philanthropy. This was created by the actions of 19th Century UK family companies such as Cadbury and Lever Brothers. A Quaker influence was clear in early philanthropy, which quickly spread to the US in the late 19th Century and early 20th Century.
In the 1950’s a debate began about the role of the businessman in post war affluent society, and academics, particularly in the US, began to take an interest, as did CEOs of large companies and theorists such as Peter Drucker.
Then, the third push for CSR came from the environmental and political movements of the 60’s, 70’s and 80’s. Growing in the 1960s in Europe and the US, and gaining impetus from the anti-Vietnam protests in the 1970s, the notion of responsible business became much more mainstream in the 1980s. There were many protests around companies seen to be supporting the pro-apartheid regime in South Africa, and about the tragedy of the Bhopal Union Carbide industrial accident. Nuclear disarmament campaigns also lead to a rise in the number people deeply concerned about the environment.
In the 1990s information technology and globalization of supply chains, pollution and sourcing collided to create an anti-sweatshop and anti-corporate movement, also partly based on ethics-related incidents involving Shell in both Nigeria and the North Sea.
Since the zenith of the anti-globalisation movements of the late 1990s, we’ve seen social and environmental issues become really mainstream for large companies.
Training and developing employees, anti-corruption, health and safety, creating ethical supply chains and paying the correct amount of tax have all become important corporate responsibility issues, among many others.
For a definition, you could use the most well known one, that corporate responsibility is the contribution of business towards sustainable development.
Which country is the leading force in the field of CSR?
This is a difficult question to answer. Many people say the UK is ahead of many countries but it does depend upon the issues.
For example in terms of volunteering and community work US companies are often better. It is true that many of the companies leading on CSR are headquartered in the UK or have significant operations here. Companies such as Marks and Spencer and Unilever, for example.
But in the US there are companies such as Nike and Timberland who are really good at CSR too. Norway, Denmark and Sweden also have some very interesting companies who do some excellent work on CSR. Companies like StatoilHydro, Novo Nordisk and Ikea, for example.
What shows if a company is really doing good CSR, or if it is doing something just to use it for PR or to be able to say we have done something?
The real ‘acid test’ of corporate responsibility is whether it is something the company does when no-one is watching.
Companies who really believe in the notion of corporate responsibility are working hard to embed it into their business, or ideally already have.
For the best companies, it is simply what they do every day. It is normal business.
The companies that really believe in corporate responsibility are the ones where the CEO is totally comfortable talking about the different and difficult issues that corporate responsibility presents for the company.
Increasingly companies that use CSR just for PR are being discovered much more quickly as more and more people understand what’s real and what is not.
Could you mention some good examples for really good goals, projects etc which were the results of a really responsible company?
The Baku-Tbilisi-Ceyhan oil pipeline, when it was built in 2000-2003, had a goal of not creating conflict in Turkey. Thanks to BP’s responsible planning work, the pipeline has not caused problems either environmentally or socially.
Marks and Spencer in the UK has created a strategy called Plan A that is 100 steps towards sustainability. So far the plan and associated marketing campaigns have been the most successful in the history of the company and M&S has an excellent reputation. Interface, the carpet company, has a goal of being completely sustainable by 2020 and has saved $500 million dollars by being more environmentally efficient. Interface says it is now 60% of the way towards its goal.
Starbucks has recently shifted to fair trade for more than 90% of its coffee sold in the UK. The company is currently promoting fair trade in all its stores in the UK but has not put up prices.
Another example would be Unilever. The company has committed to source all tea and palm oil sold from sustainable sources in the near future.
Are there national characteristics of CSR in your opinion?
Yes. There are global values of course, like the Ten Commandments in Christianity. But implementation of CSR should be very tailored to local needs, whilst bearing in mind the global principles the company operates under.
CSR should be based on both these, and the needs of local people and the environment. So not based on what the CEO wants to do with some spare budget, but on real research on what customers, employees and society believe are the areas where a company can contribute socially and environmentally.
What do you plan to talk about at the conference?
Excellence in CSR. What makes a company excellent at CSR? Here is a link to something I already wrote in advance of the conference: http://ethicalcorp.blogspot.com/2009/10/what-do-we-mean-by-excellence-in-csr.html
Twenty years after Communism, what opportunities does corporate responsibility offer stakeholders in Central and Eastern Europe?
In a week’s time I’ll be in Bulgaria speaking at a conference on corporate responsibility. Then just over a week later in Budapest at a similar gig.
It seems an appropriate time, exactly twenty years on from the fall of the Berlin Wall and the Soviet Union, to consider what role responsible business can play in what we now call Central and Eastern Europe.
In the last couple of years I’ve been in Moscow, Warsaw, Kiev, Prague and Bratislava meeting business executives, NGOs and government figures and discussing corporate responsibility.
It’s been hard to know what to say at some events. The operating environment for large companies is so dramatically different from the UK that I sometimes wonder what I, with my focus on the big western MNCs and UK companies, can bring to the party.
So at events in Central and Eastern Europe I generally try and focus on two areas: Best practice and lessons from the experience of big western firms, and an overview of EU trends that might impact the Central and Eastern European region.
Looking at the stats 20 years after the fall of the Berlin wall, it seems corporate responsibility does indeed have an important role of play in many eastern European nations.
In a recent Pew Research Center survey, when they asked 1000 Hungarians 720 said life was better under communism.
That 72% is highest in the region, by quite a long way, but in other countries 50% or even a little more thought the same when asked the question about what capitalism had done for them.
So trust in business, and markets, is low in places, and struggling for a majority vote in many other countries in the region.
One common refrain I have heard, from Hungary and Ukraine to Poland to Russia, is that there is a deep societal suspicion of anyone with money.
This is not so much envy, it seems, as a lack of belief that anyone rich could have became so in an honest fashion.
This makes it harder for business folks who got rich in the 90’s to legitimise themselves through philanthropy, even if they have the best intentions.
Victor Pinchuk in Ukraine and Roman Abramovich in Russia are two examples of billionaires who have gone beyond the actions of many of their peers in philantrophy. Pinchuk largely in Kiev and Abramovich in Chukotka, the province in Siberia where he was governor until 2008. Have these actions improved their reputations? Perhaps in the west, but at home it’s hard to say, given the above. Did they do all this just for better reputations? Actually I think it goes deeper than that, but there may be some that disagree.
To consider what CR can do for companies in the region, I think you have to break it down into what both domestic and international companies can do, since they are different.
International firms can bring overseas expertise, technology and knowledge transfer, secondments abroad, big global community values, strategies and budgets, and where appropriate lobby for things in the interest of local stakeholders, such as better education or healthcare systems. They can fund the spreading of international standards and best practice, in a variety of ways.
Domestic firms, on the other hand, have a more intrinsic connection with the country.
They know the challenges of growth and success more than anyone, and can help, for example, local entrepreneurs and smaller businesses gain capital, credibility and capacity.
They can help governments pinpoint specific problems that hold back people from realising their potential, without having to necessarily take on the problem themselves with a small philanthropic programme, as happens currently.
Clearly, bearing in the mind the Pew center’s numbers, there is a huge opportunity for companies to contribute to convincing local stakeholders that capitalism can bring greater benefits than communism.
Companies that get involved, like Orange in Slovakia, Interpipe and TetraPak in Ukraine, and Danone in Poland, will surely benefit in the medium to long term. (I offer these names as examples of companies undertaking interesting CSR work in the region in the last few years)
As the global recession eases at some point in the future, job creation in the region will come first.
But being seen to actively contribute to tackling key social and environmental problems (by supporting institutions, for example) will be incredibly important for companies in Central and Eastern Europe in future.
Companies can also lead the way in cleaner manufacturing, retailing and distribution. They can help raise levels of environmental awareness in consumers, which is badly needed. Environmental expectations and standards are only going one way in Europe, after all.
The era of CSR as philanthropy, which didn’t work anyhow (particularly in Central and Eastern Europe), is over. The paradigm of giving back because you ‘took’ in the first place, is defunct.
The new expectations are that you act ethically all the time, including when people are not watching.
Because sooner or later, they will be, in both western and eastern Europe, along with most other places.
And as a race, we’re getting better at spotting corporate frauds, and rewarding authenticity.
I'm looking forward to adding some further posts after my upcoming trips to Sofia and Budapest.
It seems an appropriate time, exactly twenty years on from the fall of the Berlin Wall and the Soviet Union, to consider what role responsible business can play in what we now call Central and Eastern Europe.
In the last couple of years I’ve been in Moscow, Warsaw, Kiev, Prague and Bratislava meeting business executives, NGOs and government figures and discussing corporate responsibility.
It’s been hard to know what to say at some events. The operating environment for large companies is so dramatically different from the UK that I sometimes wonder what I, with my focus on the big western MNCs and UK companies, can bring to the party.
So at events in Central and Eastern Europe I generally try and focus on two areas: Best practice and lessons from the experience of big western firms, and an overview of EU trends that might impact the Central and Eastern European region.
Looking at the stats 20 years after the fall of the Berlin wall, it seems corporate responsibility does indeed have an important role of play in many eastern European nations.
In a recent Pew Research Center survey, when they asked 1000 Hungarians 720 said life was better under communism.
That 72% is highest in the region, by quite a long way, but in other countries 50% or even a little more thought the same when asked the question about what capitalism had done for them.
So trust in business, and markets, is low in places, and struggling for a majority vote in many other countries in the region.
One common refrain I have heard, from Hungary and Ukraine to Poland to Russia, is that there is a deep societal suspicion of anyone with money.
This is not so much envy, it seems, as a lack of belief that anyone rich could have became so in an honest fashion.
This makes it harder for business folks who got rich in the 90’s to legitimise themselves through philanthropy, even if they have the best intentions.
Victor Pinchuk in Ukraine and Roman Abramovich in Russia are two examples of billionaires who have gone beyond the actions of many of their peers in philantrophy. Pinchuk largely in Kiev and Abramovich in Chukotka, the province in Siberia where he was governor until 2008. Have these actions improved their reputations? Perhaps in the west, but at home it’s hard to say, given the above. Did they do all this just for better reputations? Actually I think it goes deeper than that, but there may be some that disagree.
To consider what CR can do for companies in the region, I think you have to break it down into what both domestic and international companies can do, since they are different.
International firms can bring overseas expertise, technology and knowledge transfer, secondments abroad, big global community values, strategies and budgets, and where appropriate lobby for things in the interest of local stakeholders, such as better education or healthcare systems. They can fund the spreading of international standards and best practice, in a variety of ways.
Domestic firms, on the other hand, have a more intrinsic connection with the country.
They know the challenges of growth and success more than anyone, and can help, for example, local entrepreneurs and smaller businesses gain capital, credibility and capacity.
They can help governments pinpoint specific problems that hold back people from realising their potential, without having to necessarily take on the problem themselves with a small philanthropic programme, as happens currently.
Clearly, bearing in the mind the Pew center’s numbers, there is a huge opportunity for companies to contribute to convincing local stakeholders that capitalism can bring greater benefits than communism.
Companies that get involved, like Orange in Slovakia, Interpipe and TetraPak in Ukraine, and Danone in Poland, will surely benefit in the medium to long term. (I offer these names as examples of companies undertaking interesting CSR work in the region in the last few years)
As the global recession eases at some point in the future, job creation in the region will come first.
But being seen to actively contribute to tackling key social and environmental problems (by supporting institutions, for example) will be incredibly important for companies in Central and Eastern Europe in future.
Companies can also lead the way in cleaner manufacturing, retailing and distribution. They can help raise levels of environmental awareness in consumers, which is badly needed. Environmental expectations and standards are only going one way in Europe, after all.
The era of CSR as philanthropy, which didn’t work anyhow (particularly in Central and Eastern Europe), is over. The paradigm of giving back because you ‘took’ in the first place, is defunct.
The new expectations are that you act ethically all the time, including when people are not watching.
Because sooner or later, they will be, in both western and eastern Europe, along with most other places.
And as a race, we’re getting better at spotting corporate frauds, and rewarding authenticity.
I'm looking forward to adding some further posts after my upcoming trips to Sofia and Budapest.
CSR in Canada: Some brands to keep an eye on
Last week I was at the CBSR conference in Toronto before enjoying a relaxing weekend in Montreal.
The conference was excellent, with a huge amount packed into one day.
I had a beer with Matthew Kiernan, founder of Innovest afterwards, and we both agreed that it had been on the best either of us had been to for a while.
For a one day, lift-the-spirits style conference (rather than a process/management event, for example), it really was excellent.
Thinking about why, I think there were two reasons.
One, there were a couple of founder/chairman of major ethical brands speaking who spoke with complete freedom and are acknowledged success stories in their different areas of business. This second part is important I think.
The two in question were Ray Anderson of Interface (podcast forthcoming) and Jeffrey Hollender of Seventh Generation. Having two opening speakers who don’t worry about what they have to say, and have been successful for many years, makes a big difference.
Secondly, many of the other really interesting speakers were CEOs from companies that you might call ‘ethical brands’.
Having CEOs, rather than VP’s of public affairs, is important, and hard to do, as I know from personal experience. My colleague has just put together our big annual event with CEOs speaking, so I know how hard it is to do. Kudos to CBSR for that.
The brand CEOs, niche ethical as they are, were great to hear from at the Toronto conference.
Companies such as Mountain Equipment Co-op, Canada Goose and Bullfrog Power.
These are probably not companies you’ve heard of, but I’d urge you to take a look at them, and how they operate.
We interviewed Mountain Equipment Co-op’s previous CEO here.
GE’s Canadian CEO, Elyse Allan, also spoke. GE's approach is clearly very different from that of the smaller ethical brands, and rightly so. As with Siemens, for them sustainability is just simply about retooling the world in a much more efficient, and thereby greener, way.
That aside, I do often wonder what big companies can really learn from smaller ethical brands.
And as we know, it’s big companies the CSR agenda is really aimed at.
Perhaps it’s working out what inspires innovation that’s the best lesson for big companies from much smaller ones. Elyse Allan of GE mentioned at the conference to Ray Anderson that she had read his books and was inspired by his story.
That aside, it was great hearing progressive views from CEOs all day, and I taped interviews with Ray Anderson, John Ruggie, Tom Heintzman of Bullfrog Power and Adine Mees of CBSR which will all be on the website soon at this link.
The conference was excellent, with a huge amount packed into one day.
I had a beer with Matthew Kiernan, founder of Innovest afterwards, and we both agreed that it had been on the best either of us had been to for a while.
For a one day, lift-the-spirits style conference (rather than a process/management event, for example), it really was excellent.
Thinking about why, I think there were two reasons.
One, there were a couple of founder/chairman of major ethical brands speaking who spoke with complete freedom and are acknowledged success stories in their different areas of business. This second part is important I think.
The two in question were Ray Anderson of Interface (podcast forthcoming) and Jeffrey Hollender of Seventh Generation. Having two opening speakers who don’t worry about what they have to say, and have been successful for many years, makes a big difference.
Secondly, many of the other really interesting speakers were CEOs from companies that you might call ‘ethical brands’.
Having CEOs, rather than VP’s of public affairs, is important, and hard to do, as I know from personal experience. My colleague has just put together our big annual event with CEOs speaking, so I know how hard it is to do. Kudos to CBSR for that.
The brand CEOs, niche ethical as they are, were great to hear from at the Toronto conference.
Companies such as Mountain Equipment Co-op, Canada Goose and Bullfrog Power.
These are probably not companies you’ve heard of, but I’d urge you to take a look at them, and how they operate.
We interviewed Mountain Equipment Co-op’s previous CEO here.
GE’s Canadian CEO, Elyse Allan, also spoke. GE's approach is clearly very different from that of the smaller ethical brands, and rightly so. As with Siemens, for them sustainability is just simply about retooling the world in a much more efficient, and thereby greener, way.
That aside, I do often wonder what big companies can really learn from smaller ethical brands.
And as we know, it’s big companies the CSR agenda is really aimed at.
Perhaps it’s working out what inspires innovation that’s the best lesson for big companies from much smaller ones. Elyse Allan of GE mentioned at the conference to Ray Anderson that she had read his books and was inspired by his story.
That aside, it was great hearing progressive views from CEOs all day, and I taped interviews with Ray Anderson, John Ruggie, Tom Heintzman of Bullfrog Power and Adine Mees of CBSR which will all be on the website soon at this link.
Wednesday, November 04, 2009
Upcoming interviews with Ray Anderson and John Ruggie
I'm writing this from a hotel in Toronto.
I've been offered the chance to share my views on how CR is progressing in the UK and Europe on a panel session tomorrow with a bunch of Canadian CEOs and CR big-wigs.
It's an impressive speaker list pulled together by the friendly, humble and effective folks at CBSR, Canadian Business for Social Responsibility. They've done a great job over the years.
Take a look at the agenda here. Some excellent speakers.
Tomorrow I have privilege of interviewing Ray Anderson of Interface and John Ruggie of Harvard, who is leading the UN's work on business and human rights.
I'll also be speaking with a number of other CEOs and leaders in Canadian CSR. I'm looking forward to it.
I'm always impressed when I meet Canadian business leaders and others from the country who work in CSR.
There's a humility about their attitude, usually matched by an impressive grasp of the issues and a keen desire to get things done in a practical, no-nonsense way.
I've interviewed/met the CEOs of BC Hydro, Molson Coors, Wayne Dunn of Clark Sustainable Development Resources (a very cool mining/logging firm) and also Joe Clark, the former prime minister here, over the last few years. I've been deeply impressed by them all.
They were a refreshing change from the relentless PR of UK and American business.
I'm looking forward to the conference tomorrow.
Podcasts with Ray Anderson and John Ruggie, at least, will be posted on the Ethical Corporation podcasts page next week.
Bookmark it, or sign up for the RSS feed or Itunes channel. (Search for Ethical Corporation on iTunes, we have two channels, one of them is up to date, the other is an older one).
I've been offered the chance to share my views on how CR is progressing in the UK and Europe on a panel session tomorrow with a bunch of Canadian CEOs and CR big-wigs.
It's an impressive speaker list pulled together by the friendly, humble and effective folks at CBSR, Canadian Business for Social Responsibility. They've done a great job over the years.
Take a look at the agenda here. Some excellent speakers.
Tomorrow I have privilege of interviewing Ray Anderson of Interface and John Ruggie of Harvard, who is leading the UN's work on business and human rights.
I'll also be speaking with a number of other CEOs and leaders in Canadian CSR. I'm looking forward to it.
I'm always impressed when I meet Canadian business leaders and others from the country who work in CSR.
There's a humility about their attitude, usually matched by an impressive grasp of the issues and a keen desire to get things done in a practical, no-nonsense way.
I've interviewed/met the CEOs of BC Hydro, Molson Coors, Wayne Dunn of Clark Sustainable Development Resources (a very cool mining/logging firm) and also Joe Clark, the former prime minister here, over the last few years. I've been deeply impressed by them all.
They were a refreshing change from the relentless PR of UK and American business.
I'm looking forward to the conference tomorrow.
Podcasts with Ray Anderson and John Ruggie, at least, will be posted on the Ethical Corporation podcasts page next week.
Bookmark it, or sign up for the RSS feed or Itunes channel. (Search for Ethical Corporation on iTunes, we have two channels, one of them is up to date, the other is an older one).
Big business and corporate responsibility: Have confidence in what you do
If you work in corporate responsibility, it's a safe bet that you could probably be both more bold and more confident in your communications as a company.
Why?
Because if you organisation has someone with that job title, or close to it, you are already streets ahead of most other organisations in your community, sector or city.
I meet a lot of companies, some CEOs, many CR people. One thing that strikes me is, along with communications that are generally not that good, is a lack of confidence.
I should be clear: I don't think most companies (99.9%) are doing all they can on corporate responsibility.
Stakeholder engagement, transparency and honesty are a long way from where they could be.
BUT, and this is a big but, hence the caps, we need to keep this in perspective, for two reasons:
1) I'd wager almost every company with someone in a CR role has done way more now, than they had five or ten years ago. And should be proud of that. Degrees differ, but progress counts.
2) Whatever you've done, while it's not enough, it's very likely to be a lot more than your local government, competitors and equivalent (in head count) public sector organisations have done.
So have more confidence. Get your CEO and senior managers out there talking more about what you've done on community work, on the environment, on supply chains.
So what if it's not perfect, so what if your bosses screw up whilst talking about it.
Even if they do, that way they will learn. If the media wants to slam you, they'll do it anyway. If you are honest about progress and challenges, you'll gain credibility. Your stakeholders are not dumb, even if large tranches of the media think that they are.
So be bold. Really, what have you got to lose?
Why?
Because if you organisation has someone with that job title, or close to it, you are already streets ahead of most other organisations in your community, sector or city.
I meet a lot of companies, some CEOs, many CR people. One thing that strikes me is, along with communications that are generally not that good, is a lack of confidence.
I should be clear: I don't think most companies (99.9%) are doing all they can on corporate responsibility.
Stakeholder engagement, transparency and honesty are a long way from where they could be.
BUT, and this is a big but, hence the caps, we need to keep this in perspective, for two reasons:
1) I'd wager almost every company with someone in a CR role has done way more now, than they had five or ten years ago. And should be proud of that. Degrees differ, but progress counts.
2) Whatever you've done, while it's not enough, it's very likely to be a lot more than your local government, competitors and equivalent (in head count) public sector organisations have done.
So have more confidence. Get your CEO and senior managers out there talking more about what you've done on community work, on the environment, on supply chains.
So what if it's not perfect, so what if your bosses screw up whilst talking about it.
Even if they do, that way they will learn. If the media wants to slam you, they'll do it anyway. If you are honest about progress and challenges, you'll gain credibility. Your stakeholders are not dumb, even if large tranches of the media think that they are.
So be bold. Really, what have you got to lose?
Sunday, November 01, 2009
What do Timberland, Cadbury, Seventh Generation, Newmont mining, Adidas, Guardian Media Group and Marks and Spencer all have in common?
They all do better online communications than most about ethics, in different ways.
When I write "better", I mean better than many others, and better than they used to be at communicating on this difficult and complex topic.
I'm not saying perfect. 15 years or so after it began, CR reporting is still a toddler, or at best, a gangly teenager, all oversized feet and bad hair.
Here's who I pick out and a brief explanation as to why:
Newmont mining. The company's external affairs manager in Ghana, Chris Anderson, regularly emails updates to stakeholders on issues affecting the company and their responses. His emails are warts-and-all in style, outlining critics, their views and Newmont's responses. It's low-tech, but authentic, honest and simple. A great transparency and pro-active engagement technique.
Timberland. Where to start? Regular reporting, honesty, transparency and yes, real authenticity, lead by CEO Jeff Swartz. The company sends HTML emails, holds frank conference calls, has a great website and is totally upfront about dilemmas. Communications leadership in action. If only the others in the sector could get up to this kind of speed.
Adidas. I like their website on sustainability. The language can be a little faceless and corporate, but they host critical voices on their homepage, which is unusual and commendable. The design is innovative, the quotes are engaging. Worth a look.
Guardian Media Group. The Guardian is trying to hold a constant online debate on CR related issues on their Guardian/sustainability website. It's a commendable effort, and mixes up reporting and ongoing assurance with article links to important but relevant issues. The site needs to focus more on core media issues than it does, and is not linked off the main homepage, but is an innovative idea that is a great fit with the business itself. (Note: Ethical Corporation blogs on media and sustainability on the site and is paid to do so. If anything, that makes me inclined to more, not less, critical.)
Marks & Spencer. Their site is excellent, even if it's nowhere near obvious enough on their main homepage, which is very surprising.
M&S runs consumer campaigns and compelling advertising on the sites of UK newspapers around what they do on corporate responsibility. Clearly they are committed to spending money on engaging consumers. And this is important. A company can spend 25K on a site, have video etc, but it's what they then do to promote it that also counts for a lot.
Most just leave the site and wait until they are contacted to do something. M&S's new campaign for consumers/stakeholders to help with their latest campaign around Copenhagen is an interesting idea.
Seventh Generation. The blog alone of Jeffrey Hollender, their president, is worth spending some time on. The company has led the way for years. His frank blog and twitter feed are ample evidence of this. Clear, honest and forthright. Great online communications from the heart. Here's an example.
Cadbury have put up a website called Dear Cadbury.com which has an engaging interface once you realise where to click on the bottom right (not that obvious). The site is not linked at all off the main site, and is hard to find unless you search for it, which is rather odd. But once you find it and are in there, you see a good simple story, well told, and with NGO logos for added credibility.
All the above examples are just some of the improving communications I've seen from companies in the last few years. I'm sure there are more out there, and some I've missed or forgotten. I'd love it if readers posted their own examples.
Communicating on corporate responsibility is very hard to do. The issues are complex, senior management is risk-averse and lawyers hovver. Consumers are very hard to engage, time-poor and deeply sceptical about big companies. So more power to those that give it a try.
From my point of view, as an independent 'commentator' (of sorts), one thing they could all do is bring in more credible external voices to their reporting.
This is hard to do. It's difficult to find informed NGOs, academics and others who can lend credibility to your efforts. It's not always possible. I've been to enough stakeholder meetings to know that.
But it can be done sometimes, particularly on big issues, and the more one sees respected peers, public figures and organisations adding considered, rounded, and yes, critical views to corporate communications, the more convincing they are.
When I write "better", I mean better than many others, and better than they used to be at communicating on this difficult and complex topic.
I'm not saying perfect. 15 years or so after it began, CR reporting is still a toddler, or at best, a gangly teenager, all oversized feet and bad hair.
Here's who I pick out and a brief explanation as to why:
Newmont mining. The company's external affairs manager in Ghana, Chris Anderson, regularly emails updates to stakeholders on issues affecting the company and their responses. His emails are warts-and-all in style, outlining critics, their views and Newmont's responses. It's low-tech, but authentic, honest and simple. A great transparency and pro-active engagement technique.
Timberland. Where to start? Regular reporting, honesty, transparency and yes, real authenticity, lead by CEO Jeff Swartz. The company sends HTML emails, holds frank conference calls, has a great website and is totally upfront about dilemmas. Communications leadership in action. If only the others in the sector could get up to this kind of speed.
Adidas. I like their website on sustainability. The language can be a little faceless and corporate, but they host critical voices on their homepage, which is unusual and commendable. The design is innovative, the quotes are engaging. Worth a look.
Guardian Media Group. The Guardian is trying to hold a constant online debate on CR related issues on their Guardian/sustainability website. It's a commendable effort, and mixes up reporting and ongoing assurance with article links to important but relevant issues. The site needs to focus more on core media issues than it does, and is not linked off the main homepage, but is an innovative idea that is a great fit with the business itself. (Note: Ethical Corporation blogs on media and sustainability on the site and is paid to do so. If anything, that makes me inclined to more, not less, critical.)
Marks & Spencer. Their site is excellent, even if it's nowhere near obvious enough on their main homepage, which is very surprising.
M&S runs consumer campaigns and compelling advertising on the sites of UK newspapers around what they do on corporate responsibility. Clearly they are committed to spending money on engaging consumers. And this is important. A company can spend 25K on a site, have video etc, but it's what they then do to promote it that also counts for a lot.
Most just leave the site and wait until they are contacted to do something. M&S's new campaign for consumers/stakeholders to help with their latest campaign around Copenhagen is an interesting idea.
Seventh Generation. The blog alone of Jeffrey Hollender, their president, is worth spending some time on. The company has led the way for years. His frank blog and twitter feed are ample evidence of this. Clear, honest and forthright. Great online communications from the heart. Here's an example.
Cadbury have put up a website called Dear Cadbury.com which has an engaging interface once you realise where to click on the bottom right (not that obvious). The site is not linked at all off the main site, and is hard to find unless you search for it, which is rather odd. But once you find it and are in there, you see a good simple story, well told, and with NGO logos for added credibility.
All the above examples are just some of the improving communications I've seen from companies in the last few years. I'm sure there are more out there, and some I've missed or forgotten. I'd love it if readers posted their own examples.
Communicating on corporate responsibility is very hard to do. The issues are complex, senior management is risk-averse and lawyers hovver. Consumers are very hard to engage, time-poor and deeply sceptical about big companies. So more power to those that give it a try.
From my point of view, as an independent 'commentator' (of sorts), one thing they could all do is bring in more credible external voices to their reporting.
This is hard to do. It's difficult to find informed NGOs, academics and others who can lend credibility to your efforts. It's not always possible. I've been to enough stakeholder meetings to know that.
But it can be done sometimes, particularly on big issues, and the more one sees respected peers, public figures and organisations adding considered, rounded, and yes, critical views to corporate communications, the more convincing they are.
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