Vinod Khosla says the only way forward is radical innovation.
He's right. But what do we mean by this?
For large companies I guess it falls into these eight areas:
1) Power generation
2) Manufacturing
3) Site and office efficiency
4) Influencing suppliers and the supply chain
5) Transportation & logistics
6) Product materials, design and use
7) Product disposal/recycling/upcycling
8) Positively influencing stakeholders through policy and behaviour change
Let me know what I missed here. There's bound to be something.
Of these numbers 4, 6 and 8 seem to me the most powerful, at least for retail or FMCG firms.
Number four because that's where a lot of the carbon, social issues and pollutants are.
Number six because that's how you minimise them.
Number eight because behaviour change is so vital, and consumers, institutions and governments need help to think these things through.
The OECD seems to agree on number four. Here's a look at how. The UN too, considering John Ruggie's work.
Further posts will look at some of the above in more detail as I think it through, do more research and read your comments.
Wednesday, August 31, 2011
What smarter business comms and Goodfellas have in common
One of the most memorable characters in the movie Goodfellas is Jimmy "two-times". (40 seconds in on that link for you fans out there)
Mention his name to any fan of the film and they'll repeat his only line: "I'm gonna go get the papers, get the papers".
Why are those nine words in the memory of every fan of Goodfellas?
Because of what he says? No. Is it due to the way he says it? No again. They all speak similarly.
It's because he says the line twice in quick succession, and that's unusual.
So unusual in fact, that everyone remembers it.
Where's the lesson for communicators here? That the same thing, repeated, has traction.
That's not new in marketing, of course. Brands have been doing it for a century or more.
But for companies thinking about smarter business, about ethics, sustainability and CSR, simple message consistency is key, yet lacking.
Why is it, do you think, that Novo Nordisk is known for wanting to CURE diabetes, rather than treat it?
Why is Nike known for sustainability-driven innovation, Interface for zero impact aims, GAP for stakeholder engagement and transparency?
Why are Levi's known for waterless jeans, the Body Shop for campaigning, M&S for Plan A and Shell for dialogue?
It's because they keep talking about it. Repetition.
Becoming known for that one thing (amongst others of course) is extremely valuable.
Word association matters. In the world of 'opinion-formers', you want your company to be associated with something positive.
Find that one word that helps create the aura, and work it.
Do it before your competition does.
Mention his name to any fan of the film and they'll repeat his only line: "I'm gonna go get the papers, get the papers".
Why are those nine words in the memory of every fan of Goodfellas?
Because of what he says? No. Is it due to the way he says it? No again. They all speak similarly.
It's because he says the line twice in quick succession, and that's unusual.
So unusual in fact, that everyone remembers it.
Where's the lesson for communicators here? That the same thing, repeated, has traction.
That's not new in marketing, of course. Brands have been doing it for a century or more.
But for companies thinking about smarter business, about ethics, sustainability and CSR, simple message consistency is key, yet lacking.
Why is it, do you think, that Novo Nordisk is known for wanting to CURE diabetes, rather than treat it?
Why is Nike known for sustainability-driven innovation, Interface for zero impact aims, GAP for stakeholder engagement and transparency?
Why are Levi's known for waterless jeans, the Body Shop for campaigning, M&S for Plan A and Shell for dialogue?
It's because they keep talking about it. Repetition.
Becoming known for that one thing (amongst others of course) is extremely valuable.
Word association matters. In the world of 'opinion-formers', you want your company to be associated with something positive.
Find that one word that helps create the aura, and work it.
Do it before your competition does.
Why scenario planning matters, and should be re-named
Put "sustainability scenario planning" into Google and not much comes up.
Similarly, Google "corporate sustainability scenario planning" and ditto, there's not a lot there. The odd paper, the odd mini-section on a company website. Some vendors saying they can help.
The companies you'd expect show up on the first few pages: Shell, Nike, Ford, one or two others.
This quick search demonstrates why most corporate sustainability strategies are not yet smart business.
Largely, as we know, companies are still predominantly reactive on sustainability/corporate responsibility.
This is a major barrier to innovation and longer-term planning. It's something you should recognise in your company and try and fix.
Of course, I know different terms might be used, and that a lot of companies don't put their plans/thinking in the public domain.
I'm not suggesting that its only Shell, Nike and Ford that do this. But the search results show there's not much corporate-inspired public conversation on the area.
There should be a lot more. Big companies are weathering the economic slowdown better than any other large group in society.
And corporate sustainability advocates (including me), spend a lot time moaning about the short term nature of financial markets and systems as the primary reason for the short term corporate outlook. Systems and markets take the blame for our lack of business innovation and understanding of the future.
But they are only half the problem. The other half is down to corporate laziness and lack of clear thinking on behalf of the CR 'community' of academics, NGOs, service provicers, media firms and commentators. I'm as guilty of that as anyone.
A company can't present an investment opportunity to anyone without basic research, and some in-depth scenario development.
That's what classic business planning and analyst calls, press releases and corporate board meetings, etc, are all about.
"This is what we think will happen, if we do X or Y, and here's how we back that up", is how companies sell their strategies to the market.
How can we expect investors, or anyone else (partner companies, buyers, suppliers, governments) to get on board with longer-term planning if we don't show them what the results may look like?
Now, it's easy to say "we don't know, there are so many variables, look at energy futures" etc. And then NOT do scenario planning. (best renamed as "opportunity and risk planning I would suggest)
But that's simply not good enough. Investors understand that they take risks based on traditional forecasts and corporate planning every day, that's how it works.
If you as a company, show them you've looked long term, and provide viable, credible options for where your firm is going, based on research with independent organisations, you might find investors and everyone else, become a bit more amenable to rewarding you for it.
This is already happening in a few areas, such as water provision and carbon liabilities/opportunities.
But many more areas than not, the investment by companies in seriously understanding the pathways to the future is way behind.
I'm not saying you'll predict the 'next big thing' this way. But it's better than stumbling on blindly in hope, surely.
Time to catch up, and reap the rewards.
(If any readers want some help with this, let me know. If I can't help, I may know the people who can) UPDATE: 1/09/1: This research from Sweden is worth reading about if you are interested in this area.
Similarly, Google "corporate sustainability scenario planning" and ditto, there's not a lot there. The odd paper, the odd mini-section on a company website. Some vendors saying they can help.
The companies you'd expect show up on the first few pages: Shell, Nike, Ford, one or two others.
This quick search demonstrates why most corporate sustainability strategies are not yet smart business.
Largely, as we know, companies are still predominantly reactive on sustainability/corporate responsibility.
This is a major barrier to innovation and longer-term planning. It's something you should recognise in your company and try and fix.
Of course, I know different terms might be used, and that a lot of companies don't put their plans/thinking in the public domain.
I'm not suggesting that its only Shell, Nike and Ford that do this. But the search results show there's not much corporate-inspired public conversation on the area.
There should be a lot more. Big companies are weathering the economic slowdown better than any other large group in society.
And corporate sustainability advocates (including me), spend a lot time moaning about the short term nature of financial markets and systems as the primary reason for the short term corporate outlook. Systems and markets take the blame for our lack of business innovation and understanding of the future.
But they are only half the problem. The other half is down to corporate laziness and lack of clear thinking on behalf of the CR 'community' of academics, NGOs, service provicers, media firms and commentators. I'm as guilty of that as anyone.
A company can't present an investment opportunity to anyone without basic research, and some in-depth scenario development.
That's what classic business planning and analyst calls, press releases and corporate board meetings, etc, are all about.
"This is what we think will happen, if we do X or Y, and here's how we back that up", is how companies sell their strategies to the market.
How can we expect investors, or anyone else (partner companies, buyers, suppliers, governments) to get on board with longer-term planning if we don't show them what the results may look like?
Now, it's easy to say "we don't know, there are so many variables, look at energy futures" etc. And then NOT do scenario planning. (best renamed as "opportunity and risk planning I would suggest)
But that's simply not good enough. Investors understand that they take risks based on traditional forecasts and corporate planning every day, that's how it works.
If you as a company, show them you've looked long term, and provide viable, credible options for where your firm is going, based on research with independent organisations, you might find investors and everyone else, become a bit more amenable to rewarding you for it.
This is already happening in a few areas, such as water provision and carbon liabilities/opportunities.
But many more areas than not, the investment by companies in seriously understanding the pathways to the future is way behind.
I'm not saying you'll predict the 'next big thing' this way. But it's better than stumbling on blindly in hope, surely.
Time to catch up, and reap the rewards.
(If any readers want some help with this, let me know. If I can't help, I may know the people who can) UPDATE: 1/09/1: This research from Sweden is worth reading about if you are interested in this area.
Tuesday, August 30, 2011
The evolving role of NGOs in green and anti-corruption journalism
This video, if you are interested in how NGOs target business with investigations and campaigns, is well worth watching.
It starts slowly, with various ego-massaging autobiographical soliloquies.
That aside. If you skip the first 10-12 minutes, there's some insight into how the relationships between journalists and campaigning NGOs are evolving.
Then I'd skip to around 18-19 minutes in. There's some good insight into methodologies used by investigating campaigners.
As with most things, the relationships between the two groups are much more complex than you'd think.
It starts slowly, with various ego-massaging autobiographical soliloquies.
That aside. If you skip the first 10-12 minutes, there's some insight into how the relationships between journalists and campaigning NGOs are evolving.
Then I'd skip to around 18-19 minutes in. There's some good insight into methodologies used by investigating campaigners.
As with most things, the relationships between the two groups are much more complex than you'd think.
A look at tidal/wave power of the future
Here's some insight into what the next generation of marine energy generators may look like.
Most so far, in current form, will produce less than 1MW each. Giving you an idea of the challenges ahead considering their size.
But on the positive side, New Scientist reports that:
"A recent study by the Carbon Trust predicts that by 2050 wave energy could yield as much as 190 gigawatts of electricity or more than 3 times today’s total electric output in the UK".
Is there a role for collective groups of concerned companies to invest in these technologies to see them to scale? Someone has to. Or we're stuck with imported gas, coal, pricey nuclear, and 5 degrees plus of climate change.
For more tidal industry news, go here.
Most so far, in current form, will produce less than 1MW each. Giving you an idea of the challenges ahead considering their size.
But on the positive side, New Scientist reports that:
"A recent study by the Carbon Trust predicts that by 2050 wave energy could yield as much as 190 gigawatts of electricity or more than 3 times today’s total electric output in the UK".
Is there a role for collective groups of concerned companies to invest in these technologies to see them to scale? Someone has to. Or we're stuck with imported gas, coal, pricey nuclear, and 5 degrees plus of climate change.
For more tidal industry news, go here.
Friday, August 26, 2011
Smarter business in Sweden, the state of sustainability
Ethical Corporation has recently published our "Best of Europe" country briefings as one complete 63 page document. It's a corker.
Aside from covering the state of the sustainability nation in the UK, France, Germany, Spain, Switzerland, and the Netherlands, we've also produced a ten page country briefing, as part of the larger report, on Sweden.
In each country briefing, we look at the overall state of play, company actions, NGO and institutional activity and lastly, government policy and what's likely to happen in the next few years.
The Sweden briefing is free below for blog readers to download. Full details of the entire report are here. Quote "Toby's whimsical blog ramblings" when you buy for a 10% discount.
Back to Sweden, here's a few nuggets from the briefing: (note: Our survey sample is small, only 20 corporate responses, but may be of interest. The rest of the below comes from the briefing, which was written by experts who know their subject well)
Sweden sustainability leaders most mentioned:
Ikea
H&M
Electrolux
Foreign sustainability leader most mentioned:
GE
InterfaceFLOR
ABB (Swiss-Swedish)
Top three challenges and risks:
Climate change
Integrating sustainability into overall strategy
Social and labour supply chain issues
Top three opportunities:
Energy efficiency
Product innovation
Developing Swedish green issue leadership
- Edelman’s Trust Index 2010 concludes that companies headquartered in Sweden are among the top three most trusted globally.
- Swedish business has a long-standing appetite for management systems and standards and boasts the fourth highest ISO 14001 accreditation rate in the world.
- In a 2009 Globescan report, only 4% of Swedish consumers spontaneously brought up climate change and environmental issues as a top concern – well below Australians (22%) and Chinese (23%).
YET:
- After a long struggle to break through, sales of fair trade products increased 75% in 2009 alone.
- Sweden was the first country with a coordinated function for corporate social responsibility within government.
- Between 1990 and 2008, Sweden reduced its carbon emissions by 12% while its economy grew 50%.
BUT:
In 2009, 51% of electricity provider Vattenfall's power was generated through fossil fuels, while 49% of heating was based on hard coal. (This was corrected on 31/08/11)
Companies:
Here's a few of the smarter technologies and ideas being created out of sustainability thinking in Sweden:
Industrial engineering company Atlas Copco was the first to offer certified “net zero energy consumption” compressors under its Carbon Zero range
HiNation‘s mobile solar products for portable energy, HiLight, is a ROHS-compliant solar-powered combined lamp and charger that can produce 20 hours of light or three mobile phone charges from 10 hours of sunlight.
Solvatten produces a container that cleans contaminated water in a couple of hours using heat, UV and a built-in filter.
Ericsson is involved in the Millennium Villages Project, a bold, innovative model for helping rural African communities lift themselves out of extreme poverty. The project uses communication technology to close the digital divide and raise the standard of living by providing access to real-time market information, health services and educational resources.
Electrolux individually tailored employment opportunities for staff when
the vacuum cleaner factory closed down. A two year project was launched to help the 511 employees find work. Electrolux donated its factory facility and invested 20m kronor (€2.1m) into growing the regional economy and in Forward Västervik!, a development company jointly owned by government and business. The outcome was that a 2009 Confederation of Swedish Enterprise regional ranking of economic viability rated Västervik 92nd out of 290 communities in Sweden – compared to 242nd place in 2004.
SCA was a pioneer of forest certification. The company owns 2.6m hectares of forestland, of which 2m hectares are used for timber production. In January 1999, SCA’s Swedish forests were certified under the FSC scheme. It is now one of the world’s largest suppliers of FSC-certified products, ranging from solid wood and pulp, to toilet paper, kitchen rolls and newsprint.
Fast-growing Swedish burger chain Max Hamburgers saw poor reputation as a business opportunity. From 2007 the company switched all its restaurants to wind energy, bought low-carbon vehicles, and offset carbon throughout the supply chain via reforestation projects in Africa.
It also cut GMOs from its supply chain, upped its recycling rate, found FSC certified paper for wrappers, and began a programme to hire and train disabled workers – 100 and counting. It also put a CO2-equivalent tag on its burgers and sandwiches – a revolutionary move in the food business.
There was a 27% increase in customer loyalty [between 2007 and 2009] and the chief executive concludes that at least half of that comes from sustainability efforts
Areas to improve:
If Swedish companies have a corporate responsibility weakness, it might be in the area of philanthropy – a possible contributor to only four Swedish companies making it into the DJSI World index in 2010 – down from six in 2005.
Diversity, too, in both ethnicity and gender, is a recognised challenge in senior managerial and board positions. Currently, among companies listed on the Swedish stock exchange, 21% of board members are women.
WWF believes Sweden is in danger of losing its position as a frontrunner in sustainability because it hasn’t moved swiftly enough to scale the innovative products and solutions generated by NGOs and budding entrepreneurs.
That's enough cutting and pasting. Here's the full briefing. Don't say I never give you anything :)
And remember, you can get this kind of insight for another six key countries here.
Aside from covering the state of the sustainability nation in the UK, France, Germany, Spain, Switzerland, and the Netherlands, we've also produced a ten page country briefing, as part of the larger report, on Sweden.
In each country briefing, we look at the overall state of play, company actions, NGO and institutional activity and lastly, government policy and what's likely to happen in the next few years.
The Sweden briefing is free below for blog readers to download. Full details of the entire report are here. Quote "Toby's whimsical blog ramblings" when you buy for a 10% discount.
Back to Sweden, here's a few nuggets from the briefing: (note: Our survey sample is small, only 20 corporate responses, but may be of interest. The rest of the below comes from the briefing, which was written by experts who know their subject well)
Sweden sustainability leaders most mentioned:
Ikea
H&M
Electrolux
Foreign sustainability leader most mentioned:
GE
InterfaceFLOR
ABB (Swiss-Swedish)
Top three challenges and risks:
Climate change
Integrating sustainability into overall strategy
Social and labour supply chain issues
Top three opportunities:
Energy efficiency
Product innovation
Developing Swedish green issue leadership
- Edelman’s Trust Index 2010 concludes that companies headquartered in Sweden are among the top three most trusted globally.
- Swedish business has a long-standing appetite for management systems and standards and boasts the fourth highest ISO 14001 accreditation rate in the world.
- In a 2009 Globescan report, only 4% of Swedish consumers spontaneously brought up climate change and environmental issues as a top concern – well below Australians (22%) and Chinese (23%).
YET:
- After a long struggle to break through, sales of fair trade products increased 75% in 2009 alone.
- Sweden was the first country with a coordinated function for corporate social responsibility within government.
- Between 1990 and 2008, Sweden reduced its carbon emissions by 12% while its economy grew 50%.
BUT:
In 2009, 51% of electricity provider Vattenfall's power was generated through fossil fuels, while 49% of heating was based on hard coal. (This was corrected on 31/08/11)
Companies:
Here's a few of the smarter technologies and ideas being created out of sustainability thinking in Sweden:
Industrial engineering company Atlas Copco was the first to offer certified “net zero energy consumption” compressors under its Carbon Zero range
HiNation‘s mobile solar products for portable energy, HiLight, is a ROHS-compliant solar-powered combined lamp and charger that can produce 20 hours of light or three mobile phone charges from 10 hours of sunlight.
Solvatten produces a container that cleans contaminated water in a couple of hours using heat, UV and a built-in filter.
Ericsson is involved in the Millennium Villages Project, a bold, innovative model for helping rural African communities lift themselves out of extreme poverty. The project uses communication technology to close the digital divide and raise the standard of living by providing access to real-time market information, health services and educational resources.
Electrolux individually tailored employment opportunities for staff when
the vacuum cleaner factory closed down. A two year project was launched to help the 511 employees find work. Electrolux donated its factory facility and invested 20m kronor (€2.1m) into growing the regional economy and in Forward Västervik!, a development company jointly owned by government and business. The outcome was that a 2009 Confederation of Swedish Enterprise regional ranking of economic viability rated Västervik 92nd out of 290 communities in Sweden – compared to 242nd place in 2004.
SCA was a pioneer of forest certification. The company owns 2.6m hectares of forestland, of which 2m hectares are used for timber production. In January 1999, SCA’s Swedish forests were certified under the FSC scheme. It is now one of the world’s largest suppliers of FSC-certified products, ranging from solid wood and pulp, to toilet paper, kitchen rolls and newsprint.
Fast-growing Swedish burger chain Max Hamburgers saw poor reputation as a business opportunity. From 2007 the company switched all its restaurants to wind energy, bought low-carbon vehicles, and offset carbon throughout the supply chain via reforestation projects in Africa.
It also cut GMOs from its supply chain, upped its recycling rate, found FSC certified paper for wrappers, and began a programme to hire and train disabled workers – 100 and counting. It also put a CO2-equivalent tag on its burgers and sandwiches – a revolutionary move in the food business.
There was a 27% increase in customer loyalty [between 2007 and 2009] and the chief executive concludes that at least half of that comes from sustainability efforts
Areas to improve:
If Swedish companies have a corporate responsibility weakness, it might be in the area of philanthropy – a possible contributor to only four Swedish companies making it into the DJSI World index in 2010 – down from six in 2005.
Diversity, too, in both ethnicity and gender, is a recognised challenge in senior managerial and board positions. Currently, among companies listed on the Swedish stock exchange, 21% of board members are women.
WWF believes Sweden is in danger of losing its position as a frontrunner in sustainability because it hasn’t moved swiftly enough to scale the innovative products and solutions generated by NGOs and budding entrepreneurs.
That's enough cutting and pasting. Here's the full briefing. Don't say I never give you anything :)
And remember, you can get this kind of insight for another six key countries here.
Wednesday, August 24, 2011
Why I've changed the name of this blog to being about smarter business
Regular readers may notice I've now incorporated the words 'smarter business' into the title.
It's a lot better, I think, than the slightly pompous title I had initally, "reflections on ethical business", which aside from pomposity, made me feel about 80 rather than 35.
I've changed the title as smarter business is really what sustainability and corporate responsibility is all about now.
We don't need these older CR/CSR/SD terms any more.
For the companies who don't yet 'get it', smarter business is a much easier sell than vague and esoteric terms that can easily be associated with some kind of lefty plot or woolly hippy thinking. (Yes, that's still an issue)
That's not to say I won't use them sometimes, but 'smarter business' or 'intelligent capitalism' (for the more high minded among you!) is a lot better, and I think takes us further, faster, as a paradigm.
I'm not going to claim to have even come close to inventing this idea, but I'm committing to jumping on the bandwagon fully now.
Hold me to account with acerbic comments all you like if I drift away.
This recently post "Nine ways corporate responsibility benefits your business" should really have been titled: "Nine ways to run a smarter company".
Of course, I understand that heads of CSR, CR and sustainable business can't change their titles overnight.
But pitching their jobs as capable of opening new markets through innovation around customer needs, desires and behaviours, predicting real, relevant trends, and innovating internally for savings or more income, has to be where heads of SD CSR/CR etc will surely want to be moving.
Either that, or just do the sustainability report every year :) How much fun would that be?
On a more serious note, if corporate responsibility reporting evolves into holistic company performance reporting, which it seems to be doing, CR heads will have to make themselves properly commercially relevant in the next few years to come, or risk irrelevance as unit heads get on with embedding smarter business into how the company works every day.
I don't want to end this post on a negative note.
What I'm really excited about are the opportunities the smarter business agenda represents for systems change (via corporate collaborations in supply chains or design, for example) and B2B and B2C customer behaviour change. (by internal and product/service innovations)
So, welcome to the smarter business blog. I'll do my best to write with that in mind.
It's a lot better, I think, than the slightly pompous title I had initally, "reflections on ethical business", which aside from pomposity, made me feel about 80 rather than 35.
I've changed the title as smarter business is really what sustainability and corporate responsibility is all about now.
We don't need these older CR/CSR/SD terms any more.
For the companies who don't yet 'get it', smarter business is a much easier sell than vague and esoteric terms that can easily be associated with some kind of lefty plot or woolly hippy thinking. (Yes, that's still an issue)
That's not to say I won't use them sometimes, but 'smarter business' or 'intelligent capitalism' (for the more high minded among you!) is a lot better, and I think takes us further, faster, as a paradigm.
I'm not going to claim to have even come close to inventing this idea, but I'm committing to jumping on the bandwagon fully now.
Hold me to account with acerbic comments all you like if I drift away.
This recently post "Nine ways corporate responsibility benefits your business" should really have been titled: "Nine ways to run a smarter company".
Of course, I understand that heads of CSR, CR and sustainable business can't change their titles overnight.
But pitching their jobs as capable of opening new markets through innovation around customer needs, desires and behaviours, predicting real, relevant trends, and innovating internally for savings or more income, has to be where heads of SD CSR/CR etc will surely want to be moving.
Either that, or just do the sustainability report every year :) How much fun would that be?
On a more serious note, if corporate responsibility reporting evolves into holistic company performance reporting, which it seems to be doing, CR heads will have to make themselves properly commercially relevant in the next few years to come, or risk irrelevance as unit heads get on with embedding smarter business into how the company works every day.
I don't want to end this post on a negative note.
What I'm really excited about are the opportunities the smarter business agenda represents for systems change (via corporate collaborations in supply chains or design, for example) and B2B and B2C customer behaviour change. (by internal and product/service innovations)
So, welcome to the smarter business blog. I'll do my best to write with that in mind.
Tuesday, August 23, 2011
Big business collaboration around sustainability: Now it's getting interesting
Discussions around business collaboration on sustainability issues are not new.
For as long as I can remember, companies have been talking about working together to fix systemic social and environmental problems.
But for years that's all it was, largely. Mainly talk, with a pilot project here and there.
Some sectors, like logistics firms and cement companies, among others, went further than most.
But generally collaboration was more discussed than utilised seriously.
Supermarkets have always been too hyper-competitive to do much in the space. Other retailers and FMCG firms have dallied with the idea. Last year it began to look like some of them, driven by leaders such as Unilever, now want to make a serious effort.
Whilst retailers and others were trying to work out whether sustainability was something to compete on (it generally isn't), industry and issue-specific working groups emerged, tackling everything from palm oil to leather to soy to biofuels.
These continue to be fascinating, but are often held back by a lack of ambition and the pace of the slowest members, not to mention governance issues and conflicts of participant intentions.
So we've made some progress. The idea is no longer alien and some firms/sectors are moving ahead tentatively but seriously.
Now, it seems to me, bi-lateral deals and more niche industry groups might start leading the way.
Consider the rumour that Adidas, Nike, Puma and other firms recently targeted by Greenpeace want to collaborate to create an industry-wide solution to toxic supply chain pollution.
This might happen via an entity such as the Sustainable Apparel Coalition or another, similar mechanism.
This sounds to me like a potential game-changer on collaboration. It's an issue where the firms can't really compete, and where collaboration can deliver a solution to the perennial free-rider problem of a big player staying out of it. Greenpeace will be there to make sure they join in.
In other news, I read today that Ford and Toyota want to collaborate (after a chance meeting of their CEOs, gotta love that), on a hybrid system for trucks in the US. This is highly significant, given trucks are where the profits are right now for US automakers.
It may well be the case that careful collaboration is starting to become much more 'strategic'. I hesitate to use that word given how much it is mis-used in the the field and generally, but I can't think of a better one.
I know there are further examples beyond those I have mentioned where collaboration is becoming serious.
Inter-company and sector collaboration has always been of huge interest to me. It's the only way to solve the capital cost problem of sustainability innovation. (sustainability doesn't always have to cost more, but adapting practices always does, initially)
It means systems can be changed, whether that's how trucks are made and designed, or how brand buyers incentivise suppliers to alter production methods.
I'm conscious of sounding hubristic on this issue, but I for one will be keeping a much closer eye on corporate collaborations around sustainability and what they mean for changes across industries and their supply chains.
It feels like around now, is the time when the idea is becoming more of a reality.
Now it's really getting interesting.
For as long as I can remember, companies have been talking about working together to fix systemic social and environmental problems.
But for years that's all it was, largely. Mainly talk, with a pilot project here and there.
Some sectors, like logistics firms and cement companies, among others, went further than most.
But generally collaboration was more discussed than utilised seriously.
Supermarkets have always been too hyper-competitive to do much in the space. Other retailers and FMCG firms have dallied with the idea. Last year it began to look like some of them, driven by leaders such as Unilever, now want to make a serious effort.
Whilst retailers and others were trying to work out whether sustainability was something to compete on (it generally isn't), industry and issue-specific working groups emerged, tackling everything from palm oil to leather to soy to biofuels.
These continue to be fascinating, but are often held back by a lack of ambition and the pace of the slowest members, not to mention governance issues and conflicts of participant intentions.
So we've made some progress. The idea is no longer alien and some firms/sectors are moving ahead tentatively but seriously.
Now, it seems to me, bi-lateral deals and more niche industry groups might start leading the way.
Consider the rumour that Adidas, Nike, Puma and other firms recently targeted by Greenpeace want to collaborate to create an industry-wide solution to toxic supply chain pollution.
This might happen via an entity such as the Sustainable Apparel Coalition or another, similar mechanism.
This sounds to me like a potential game-changer on collaboration. It's an issue where the firms can't really compete, and where collaboration can deliver a solution to the perennial free-rider problem of a big player staying out of it. Greenpeace will be there to make sure they join in.
In other news, I read today that Ford and Toyota want to collaborate (after a chance meeting of their CEOs, gotta love that), on a hybrid system for trucks in the US. This is highly significant, given trucks are where the profits are right now for US automakers.
It may well be the case that careful collaboration is starting to become much more 'strategic'. I hesitate to use that word given how much it is mis-used in the the field and generally, but I can't think of a better one.
I know there are further examples beyond those I have mentioned where collaboration is becoming serious.
Inter-company and sector collaboration has always been of huge interest to me. It's the only way to solve the capital cost problem of sustainability innovation. (sustainability doesn't always have to cost more, but adapting practices always does, initially)
It means systems can be changed, whether that's how trucks are made and designed, or how brand buyers incentivise suppliers to alter production methods.
I'm conscious of sounding hubristic on this issue, but I for one will be keeping a much closer eye on corporate collaborations around sustainability and what they mean for changes across industries and their supply chains.
It feels like around now, is the time when the idea is becoming more of a reality.
Now it's really getting interesting.
Nine ways corporate responsibility benefits your business
Here's nine ways corporate responsibility benefits your business:
1. Brand value and reputation – benefits realised from responsible business that improve the value of the brand and/or the reputation of the brand or organisation.
2. Employees and future workforce – benefits from responsible business practice that affects the working life of employees, and the ability to attract and hold on to talent. This includes employee motivation, productivity, recruitment, satisfaction, retention, engagement, and loyalty.
3. Operational effectiveness – improvements and innovation in an organisation’s practices and processes as a direct result of being more responsible and sustainable, creating more effective operations and higher levels of efficiency.
4. Risk management – benefits resulting from CR efforts that improve the organisation’s ability to identify and reduce exposure to risk, and prepare for and manage risks better.
5. Direct financial impact – direct benefit to the financial performance of an organisation. For example improving access to capital, reducing costs, and improving shareholder value.
6. Organisational growth – an opportunity for overall organisational growth derived from being a responsible business, whether through new markets, new product development, lateral expansion, new customers, or new partnerships/alliances.
7. Business opportunity – new opportunities or innovation generation created for all stakeholders specifically because of their efforts in being a responsible business. This can result in new business development, but critically it is about win-win opportunities for a variety of stakeholders.
8. Organisational leadership – defined as “leadership achieved through helping society” which results from a radical change in the internal corporate values and external market reconstitution.
9. Macro-level sustainable development – defined as “the impact and responsibilities an organisation has to higher level economic, social and environmental issues”.
These points are taken from an essay by David Grayson: "Why companies must build the business case", published next week in the September edition of Ethical Corporation magazine.
David is director of the Doughty Centre for Corporate Responsibility at Cranfield School of Management and a long-standing Ethical Corporation contributor.
More on the latest issue of our fabulous magazine is here. This month, as always, it's a cracking read.
1. Brand value and reputation – benefits realised from responsible business that improve the value of the brand and/or the reputation of the brand or organisation.
2. Employees and future workforce – benefits from responsible business practice that affects the working life of employees, and the ability to attract and hold on to talent. This includes employee motivation, productivity, recruitment, satisfaction, retention, engagement, and loyalty.
3. Operational effectiveness – improvements and innovation in an organisation’s practices and processes as a direct result of being more responsible and sustainable, creating more effective operations and higher levels of efficiency.
4. Risk management – benefits resulting from CR efforts that improve the organisation’s ability to identify and reduce exposure to risk, and prepare for and manage risks better.
5. Direct financial impact – direct benefit to the financial performance of an organisation. For example improving access to capital, reducing costs, and improving shareholder value.
6. Organisational growth – an opportunity for overall organisational growth derived from being a responsible business, whether through new markets, new product development, lateral expansion, new customers, or new partnerships/alliances.
7. Business opportunity – new opportunities or innovation generation created for all stakeholders specifically because of their efforts in being a responsible business. This can result in new business development, but critically it is about win-win opportunities for a variety of stakeholders.
8. Organisational leadership – defined as “leadership achieved through helping society” which results from a radical change in the internal corporate values and external market reconstitution.
9. Macro-level sustainable development – defined as “the impact and responsibilities an organisation has to higher level economic, social and environmental issues”.
These points are taken from an essay by David Grayson: "Why companies must build the business case", published next week in the September edition of Ethical Corporation magazine.
David is director of the Doughty Centre for Corporate Responsibility at Cranfield School of Management and a long-standing Ethical Corporation contributor.
More on the latest issue of our fabulous magazine is here. This month, as always, it's a cracking read.
Monday, August 22, 2011
A good book on corporate reputation
I've been reading a recently published book called "Reputation Rules" by US academic and consultant Daniel Diermeier.
You can see what it covers here.
I've found it a well-written, readable and compelling book. Refreshingly clearly written, unlike many books in the broad corporate responsibility space.
Some of the case studies I know well, others I'm much less familiar with. Toyota, BP, Shell, General Electric, J&J are all covered. There's some good, simple checklist style advice.
Importantly, it's jargon free, which means other executives in your company will be able to understand it.
It's well worth $18, despite the very US-centric focus.
I can see myself dipping back into the book for years to come.
Some further, practical-looking resources that might be useful are here.
You can see what it covers here.
I've found it a well-written, readable and compelling book. Refreshingly clearly written, unlike many books in the broad corporate responsibility space.
Some of the case studies I know well, others I'm much less familiar with. Toyota, BP, Shell, General Electric, J&J are all covered. There's some good, simple checklist style advice.
Importantly, it's jargon free, which means other executives in your company will be able to understand it.
It's well worth $18, despite the very US-centric focus.
I can see myself dipping back into the book for years to come.
Some further, practical-looking resources that might be useful are here.
Share prices, media coverage and corporate responsibility
Sometimes the obvious needs proving again. So it can often be with reputation, investor sentiment and your company share price.
In the brief video below, academic Joel Peress, an Associate Professor of Finance at INSEAD, points out that two factors affect share prices.
The first, of course, is business fundamentals. Profits, cashflow, outlook, etc.
The second, he says, is "noise", fads, what some call "animal spirit".
These are not related to fundamentals but clearly affect stock price.
Peress has compared NYSE-listed stocks in the US who were featured in print media vs. those not in covered in the print media.
He tracked coverage and then the return on that stock in a twelve month period.
Peress found that companies that were NOT in the media, earned excessive returns to investors.
There are some variables here, of course. And we must remember 12 months is nothing in the long term world of CR.
However, what this research shows is the potential for media coverage, presumably negative, to influence your share price.
The link here with corporate responsibility is clear, given that most modern scandals have a real or perceived ethical dimension.
Less bad coverage = higher share price.
Some of course, might argue that keeping the company head below the parapet on everything is also a viable option given the results of Peress's research.
The problem with that is that it's not up to you to decide who writes about you, or when.
That means favourable coverage is your aim.
If you can't manage that (it's hard to do consistently) then less bad coverage may well mean a higher share price.
Clearly, well thought through responsible/sustainable business programmes can help here. If you get them right, and present them well.
"This is obvious stuff", I hear you say.
That's true, but having an acacemic at a leading business school back up what you think you know, is no bad thing for that meeting with the CFO when budget time comes around.
Here's the five minute video on Joel Peress's INSEAD research:
For those among you who like reading academic research on this kind of thing. Try this. And also this.
In the brief video below, academic Joel Peress, an Associate Professor of Finance at INSEAD, points out that two factors affect share prices.
The first, of course, is business fundamentals. Profits, cashflow, outlook, etc.
The second, he says, is "noise", fads, what some call "animal spirit".
These are not related to fundamentals but clearly affect stock price.
Peress has compared NYSE-listed stocks in the US who were featured in print media vs. those not in covered in the print media.
He tracked coverage and then the return on that stock in a twelve month period.
Peress found that companies that were NOT in the media, earned excessive returns to investors.
There are some variables here, of course. And we must remember 12 months is nothing in the long term world of CR.
However, what this research shows is the potential for media coverage, presumably negative, to influence your share price.
The link here with corporate responsibility is clear, given that most modern scandals have a real or perceived ethical dimension.
Less bad coverage = higher share price.
Some of course, might argue that keeping the company head below the parapet on everything is also a viable option given the results of Peress's research.
The problem with that is that it's not up to you to decide who writes about you, or when.
That means favourable coverage is your aim.
If you can't manage that (it's hard to do consistently) then less bad coverage may well mean a higher share price.
Clearly, well thought through responsible/sustainable business programmes can help here. If you get them right, and present them well.
"This is obvious stuff", I hear you say.
That's true, but having an acacemic at a leading business school back up what you think you know, is no bad thing for that meeting with the CFO when budget time comes around.
Here's the five minute video on Joel Peress's INSEAD research:
For those among you who like reading academic research on this kind of thing. Try this. And also this.
Thursday, August 18, 2011
"Sustainability ain't gonna last forever" / the opportunities in behavioural change
The part of the title in quote marks above is a direct quotation from a corporate executive faced with looking at what sustainable business meant for their company.
In other words, despite the paradoxical nature of the statement, sustainable business is a fad that will go away soon.
How wrong that executive was, and is.
Sustainable business used to be about license to operate, trust, cause related marketing and environmental efficiency, among other issues.
Now we realise it's about having a market to sell to, and resources to meet society's needs in the next few decades and beyond.
A wholly different proposition.
As some readers will know, I don't believe the ethical consumer is any kind of solution to, or business case for, tackling the serious social and environmental problems business faces.
But the sustainable citizen, that's a whole other proposition. That's where we'll need to get to.
That's where the real opportunity for business in B2C engagement lies. Whole industries will be turned upside down in efforts to understand how to meet the needs of sustainably citizenry in the next few decades.
Those that get it early, or soon after the leaders, will win. Those who cling onto the old business model will slowly die out.
I'm talking about business engagement firstly in internal behavioural change, and secondly in citizen/customer behavioural change.
I had an hour yesterday with Amanda Long, formerly of Unilever and Anglian Water, who re-invigorated my thinking on this issue. She's now boss of change management consultancy Corporate Culture.
Amanda has promised to flesh out her thinking in this area in an article for Ethical Corporation.
What if, she suggests, companies can start doing what some have been talking about for years, and that FMCG firms have led the way on, outside of a few retail companies?
That's teaming up with institutions and NGOs, to name a couple, to engage customers in changing the way they live, to minimise resource use.
Of course, we all know about the campaigns that have led the way here: Persil, Marks & Spencer and others have done lots in this area. Centrica/British Gas is thinking hard about this too. But personally I hadn't considered quite how far it could go beyond a few leading brands. For example, what if ALL the utilities had a real plan to do this kind of work? More fool me for not thinking that idea through properly.
That may be a big ask: Traditionally water utilities have been reactive at best. Power generating companies usually appear to be more of the problem than the solution.
Anglian Water has a programme around behavioural change, called Love Every Drop. To give you an example of another opportunity that occurs to me: I read this week that about 15% of London's excessive air pollution is caused by taxi drivers idling their engines. Think about that. I am.
After persuading me of the deep and lasting potential of citizen/customer behavioural change for business sustainability Amanda said one thing that really struck home:
"Behavioural change is at a level of misunderstanding that sustainability was at five years ago, and CSR was at ten years ago"
From what I know, she's right.
When it comes to potential business innovation, there's nothing like a misunderstood opportunity.
More on this issue again soon.
It's now been pushed way up my agenda. Late to the party as I may be.
In other words, despite the paradoxical nature of the statement, sustainable business is a fad that will go away soon.
How wrong that executive was, and is.
Sustainable business used to be about license to operate, trust, cause related marketing and environmental efficiency, among other issues.
Now we realise it's about having a market to sell to, and resources to meet society's needs in the next few decades and beyond.
A wholly different proposition.
As some readers will know, I don't believe the ethical consumer is any kind of solution to, or business case for, tackling the serious social and environmental problems business faces.
But the sustainable citizen, that's a whole other proposition. That's where we'll need to get to.
That's where the real opportunity for business in B2C engagement lies. Whole industries will be turned upside down in efforts to understand how to meet the needs of sustainably citizenry in the next few decades.
Those that get it early, or soon after the leaders, will win. Those who cling onto the old business model will slowly die out.
I'm talking about business engagement firstly in internal behavioural change, and secondly in citizen/customer behavioural change.
I had an hour yesterday with Amanda Long, formerly of Unilever and Anglian Water, who re-invigorated my thinking on this issue. She's now boss of change management consultancy Corporate Culture.
Amanda has promised to flesh out her thinking in this area in an article for Ethical Corporation.
What if, she suggests, companies can start doing what some have been talking about for years, and that FMCG firms have led the way on, outside of a few retail companies?
That's teaming up with institutions and NGOs, to name a couple, to engage customers in changing the way they live, to minimise resource use.
Of course, we all know about the campaigns that have led the way here: Persil, Marks & Spencer and others have done lots in this area. Centrica/British Gas is thinking hard about this too. But personally I hadn't considered quite how far it could go beyond a few leading brands. For example, what if ALL the utilities had a real plan to do this kind of work? More fool me for not thinking that idea through properly.
That may be a big ask: Traditionally water utilities have been reactive at best. Power generating companies usually appear to be more of the problem than the solution.
Anglian Water has a programme around behavioural change, called Love Every Drop. To give you an example of another opportunity that occurs to me: I read this week that about 15% of London's excessive air pollution is caused by taxi drivers idling their engines. Think about that. I am.
After persuading me of the deep and lasting potential of citizen/customer behavioural change for business sustainability Amanda said one thing that really struck home:
"Behavioural change is at a level of misunderstanding that sustainability was at five years ago, and CSR was at ten years ago"
From what I know, she's right.
When it comes to potential business innovation, there's nothing like a misunderstood opportunity.
More on this issue again soon.
It's now been pushed way up my agenda. Late to the party as I may be.
Solutions to UK social unrest and youth unemployment
Here's an excellent article by Simon Marcus on how community-based organisations such as the one he founded in 2006 can make a real difference to youth unemployment and social unrest.
Business can play a role here. The staff needed are so specialist that volunteering is not really an option. But hard cold cash will go a very long way indeed.
If you have a community budget for London, here's where you should spend it.
See: Practical community solutions to London’s looting spree for more details.
Also make sure to visit: http://www.theboxingacademy.co.uk/index.html
(Non-UK readers, don't worry, I'll get back to internationally-relevant posts forthwith.
Business can play a role here. The staff needed are so specialist that volunteering is not really an option. But hard cold cash will go a very long way indeed.
If you have a community budget for London, here's where you should spend it.
See: Practical community solutions to London’s looting spree for more details.
Also make sure to visit: http://www.theboxingacademy.co.uk/index.html
(Non-UK readers, don't worry, I'll get back to internationally-relevant posts forthwith.
Wednesday, August 17, 2011
Ethical Corporation: How far have we come? 2001 vs 2011
Looking through our archives, I found the PDF of our first ever edition, published the day Enron declared bankruptcy in December 2001.
The design and layout are not good. (In defence of our designer, who remains the same today, we paid him a pittance for it!)
Interestingly, much of the content remains deeply relevant. Some of it shows you how far we have moved in ten years. Other articles show just how much we still don't know how to manage effectively.
It's always good to go back sometimes and compare then with now. In many ways the corporate responsibility agenda has changed hugely. In others it's very much the same.
Our December 2001 edition and our July-August edition 2011 are both embedded below for your perusal and comparison.
What's different? The issues have 'spread' across the business spectrum. We now look at country policy, at specific management indicators, at some genuinely holistic forward looking corporate sustainability strategies
What's stayed the same? The need for the business case. The need to persuade management and investors, the need to understand what trust means and how to get it, and keep it.
Let's also not forget the inability of large companies to predict and manage crises, which from 2001 onwards (Arthur Andersen) became much more serious for business sustainability.
See for yourself:
Ethical Corporation in 2001:
Ethical Corporation in 2011:
The design and layout are not good. (In defence of our designer, who remains the same today, we paid him a pittance for it!)
Interestingly, much of the content remains deeply relevant. Some of it shows you how far we have moved in ten years. Other articles show just how much we still don't know how to manage effectively.
It's always good to go back sometimes and compare then with now. In many ways the corporate responsibility agenda has changed hugely. In others it's very much the same.
Our December 2001 edition and our July-August edition 2011 are both embedded below for your perusal and comparison.
What's different? The issues have 'spread' across the business spectrum. We now look at country policy, at specific management indicators, at some genuinely holistic forward looking corporate sustainability strategies
What's stayed the same? The need for the business case. The need to persuade management and investors, the need to understand what trust means and how to get it, and keep it.
Let's also not forget the inability of large companies to predict and manage crises, which from 2001 onwards (Arthur Andersen) became much more serious for business sustainability.
See for yourself:
Ethical Corporation in 2001:
Ethical Corporation in 2011:
Tuesday, August 16, 2011
How never to respond to environmental campaigners: Five lessons from APP/Solaris
I could paraphrase this article into a blog post, but it's best if you just click here and read it for yourself.
It's about our old friends Asia Pulp and Paper (their Australian arm, Solaris to be exact), and responses to a Greenpeace campaign.
The article above is short, punchy and well, contains some very salient lessons for corporate communicators, public relations and, well, just about everyone else.
Watch the video, look at the ad. Google News the company.
This is a live case study of how not to screw up.
Use this example in your internal presentations to make the business case for engaged communications and real stakeholder engagement. Show it to your PR firm.
Here are five of the key lessons:
1) Real science matters most: If want to repudiate claims by green campaigners, you can't use front groups. You must use independent scientists. If you don't, you'll get caught, and it looks even worse for you. Journalists hate being fooled first time around more than just about anything else!
2) Control your spin: When your brand is seriously under attack it's a really really good idea to understand whether your PR firm is actually qualified to work on in such complex areas as the environment or human rights. Usually they are not. Look at who in the firm will be doing the comms work. It won't be the bosses that sell you the contract.
3) Keep your staff in line: Employees, from the CEO downwards, take attacks on their company very seriously indeed. This is a good thing, and a bad thing. When emotion comes into play in an uncontrolled environment, you could get results as in the above article. That is a complete PR disaster. Not only is your firm humiliated, it makes you look venal.
4) Don't pretend you are engaging when really you are not: APP does this constantly (see above link) and it is being seen through time and again by just about everyone. If a group such as Greenpeace, that does understand you can't do it all at once, asks you to do something, they probably have a point. Obfuscation will only result in drawing out a conflict your brand, your people and your customers do not need. The only winners are the PR flack and the lawyers.
5) Watch your tone, and content: Big companies are easy targets. Not just for green groups, but for anyone on the internet who's angry, irritated or just doesn't like you, or companies like you. If you enrage the blogosphere, the influential tweeters, even someone with 1500 LinkedIn contacts who posts a comment, you can lay yourself open to a multi-fronted attack. Death by a thousand cuts is still death, and it hurts a lot more I would imagine.
If companies such as APP or their subsidiary, Solaris, are allowing employees to post virulent, personal attacks on campaigners with a deeply threatening tone, they are soon set to become an academic case study, a consultant's pitch and a general bête noire for new hires and campaigners alike. They, and myriad others, will all find the story on the internet now and forever, no matter how many pages someone takes down, or Facebook comments are deleted.
Ignore the above five lessons, and you may see headlines like this:
Tiger dies fleeing forest logged for Aussie toilet roll
More on all this nonsense, here.
And these earlier blog posts may be of interest:
Gap Inc, and stakeholder engagement, lessons from a crisis
Burson Marstellar and Facebook/Google case shows the need for PR firm audits
Private Eye increases pressure on Asia Pulp & Paper
17/08/11: UPDATE: Australian marketing magazine Mumbrella has an update on the Solaris and Greenpeace story mentioned above.
According to Mumbrella: "Mumbrella understands that the comments were made by a senior member of Solaris management who yesterday owned up internally. Solaris corporate affairs director Steve Nicholson told Mumbrella that he was cutting short an overseas holiday to return to address the issue. The company had been receiving advice from public relations agency PPR."
It's about our old friends Asia Pulp and Paper (their Australian arm, Solaris to be exact), and responses to a Greenpeace campaign.
The article above is short, punchy and well, contains some very salient lessons for corporate communicators, public relations and, well, just about everyone else.
Watch the video, look at the ad. Google News the company.
This is a live case study of how not to screw up.
Use this example in your internal presentations to make the business case for engaged communications and real stakeholder engagement. Show it to your PR firm.
Here are five of the key lessons:
1) Real science matters most: If want to repudiate claims by green campaigners, you can't use front groups. You must use independent scientists. If you don't, you'll get caught, and it looks even worse for you. Journalists hate being fooled first time around more than just about anything else!
2) Control your spin: When your brand is seriously under attack it's a really really good idea to understand whether your PR firm is actually qualified to work on in such complex areas as the environment or human rights. Usually they are not. Look at who in the firm will be doing the comms work. It won't be the bosses that sell you the contract.
3) Keep your staff in line: Employees, from the CEO downwards, take attacks on their company very seriously indeed. This is a good thing, and a bad thing. When emotion comes into play in an uncontrolled environment, you could get results as in the above article. That is a complete PR disaster. Not only is your firm humiliated, it makes you look venal.
4) Don't pretend you are engaging when really you are not: APP does this constantly (see above link) and it is being seen through time and again by just about everyone. If a group such as Greenpeace, that does understand you can't do it all at once, asks you to do something, they probably have a point. Obfuscation will only result in drawing out a conflict your brand, your people and your customers do not need. The only winners are the PR flack and the lawyers.
5) Watch your tone, and content: Big companies are easy targets. Not just for green groups, but for anyone on the internet who's angry, irritated or just doesn't like you, or companies like you. If you enrage the blogosphere, the influential tweeters, even someone with 1500 LinkedIn contacts who posts a comment, you can lay yourself open to a multi-fronted attack. Death by a thousand cuts is still death, and it hurts a lot more I would imagine.
If companies such as APP or their subsidiary, Solaris, are allowing employees to post virulent, personal attacks on campaigners with a deeply threatening tone, they are soon set to become an academic case study, a consultant's pitch and a general bête noire for new hires and campaigners alike. They, and myriad others, will all find the story on the internet now and forever, no matter how many pages someone takes down, or Facebook comments are deleted.
Ignore the above five lessons, and you may see headlines like this:
Tiger dies fleeing forest logged for Aussie toilet roll
More on all this nonsense, here.
And these earlier blog posts may be of interest:
Gap Inc, and stakeholder engagement, lessons from a crisis
Burson Marstellar and Facebook/Google case shows the need for PR firm audits
Private Eye increases pressure on Asia Pulp & Paper
17/08/11: UPDATE: Australian marketing magazine Mumbrella has an update on the Solaris and Greenpeace story mentioned above.
According to Mumbrella: "Mumbrella understands that the comments were made by a senior member of Solaris management who yesterday owned up internally. Solaris corporate affairs director Steve Nicholson told Mumbrella that he was cutting short an overseas holiday to return to address the issue. The company had been receiving advice from public relations agency PPR."
Corporate sustainability: B2C is defensive, B2B is opportunity
In a new forthcoming article in Ethical Corporation, our long-time columnist and writer, Jon Entine summarises some of the latest research and thinking on the ethical/green consumer.
The results? Unsurprising for anyone who has looked hard at the numbers.
Whilst organic is taking a big beating in the current troubled times, (and so it should, argue many, since it may be holding back land that could be a lot more productive) the idea that consumers could be persuaded to fund corporate sustainability has always been nothing more than a myth.
More on Jon's findings in a moment.
My view on this is a simple one: Consumers expect big brands they WANT to trust to simply get on with being more sustainable. But they won't (en masse), pay any extra for it. Some small groups will, but has Tony Hancock once whimsically said: "That won't get the baby washed".
Why should consumers pay for it anyway? It's the company/brand that makes the profit, let them deal with it. That's their view, or at least most of them.
The reward is continued custom. I can't see what's wrong with that. If greener/ethical products offer greater value (rather than the same, just without 'guilt'), the situation CAN be different. But that can move a brand away from mass market quickly if care is not taken. (More on that below)
This state of affairs is not without problems of course.
I was with a company board of a 10 billion plus turnover company earlier this year talking about green strategy and consumer expectations.
A regional CEO, in charge of a billion euros a year in turnover, wanted to know how the company could communicate and market its forthcoming environmental policies to sell more products.
His face dropped when I pointed out the best they could probably do is customer re-assurance. It makes sustainability appear a solely defensive strategy where consumers are concerned. This does not help the business case.
As a millionaire investor and entrepreneur once put it to me: "I can walk into your house and tell you 10 ways to save money, and you won't be nearly as interested as hearing about how you can make more money than you currently do". He has a point there about human nature.
But for the B2C market, defence is essentially what sustainability strategy is for most companies. As Jon points out in his forthcoming article in our September edition:
"Perhaps the most encouraging twist is not the fragile green buying trend but the turn by manufacturers toward a greener style of business"
We know companies can save big in the supply chain by working with suppliers on running better businesses. More on that here.
Back to the consumer market, if you are not convinced, here's some points from the forthcoming article by Jon Entine in our September edition.
So, on the one hand:
- The Lifestyles of Health and Sustainability (LOHAS) annual survey estimates that about 13-19 percent of American adults are dedicated green buyers, with total ethical purchasing topping $290 billion.
- The US-based Cone Communications, which publishes an annual Green Gap Trend Tracker, estimates that 70 percent of American consumers consider the environmental impact of their purchasing when they buy.
BUT:
- "According to leading marketing experts, these optimistic figures reflect attitudes not buying patterns. Studies of consumers have shown time and again that people wax environmental until its time to pay the bills."
- “Nothing in the historical research suggests that consumers are buying green at anywhere near the numbers that these surveys claim they are,” says Shruti Gupta, marketing professor at Penn State University in Abington, Pennsylvania, one of the world experts in ethical behaviour. “Buying green products presents people with a social dilemma: they have to be willing to pay premium costs—not for their own direct benefit, but for the greater good. While people love to voice their idealism to survey companies, the cold facts are they almost always put their self-interest first.”
- “Consumers will buy pricier green products,” Dr. Gupta says, “but only if they are convinced that the sacrifice—higher prices—signals some genuine or measurable value.”
- "We need proof that a green product or service is “as effective and of the same quality” as alternatives, agrees Kate James of Grail Research, a leading consumer research company. Grail, which tracks actual buying patterns, reports that although 85 percent of US consumers claim they buy green at least occasionally, less than 8 percent actually do. Travel separates the wheat from the chaff. According to the marketing firm Ypartnership, although 8 in 10 vacation travelers consider themselves "eco-conscious," only 1 in 10 books based on green considerations."
- Finally, over to the UK for some stats: "The challenging economy has hit green purchasing hard, as almost two-thirds of consumers have cutback on green purchases. Even in more robust times, green was a challenging sell. A 2008 study funded by the UK Economic and Social Research Council found that 30 percent of consumers report they were very concerned about environmental issues but they struggled to translate this into purchases. As a result, the market share for “ethical foods,” one of the most visible segments of the green market, has yet to crack 5 percent despite a boom in environmental consciousness.
So what's the answer here? To me it's fairly simple, although the execution of is one of the hardest business challenges a company can and will soon face.
It's all about embedding sustainability into the supply chain. Easy for me to say, very hard to do. Marks & Spencer are working hard at this, as are Unilever and P&G, as we all know.
Those savings may, or may not (as Jon points out in his article) end up being passed onto the consumer.
Whether they are or not, companies that want to communicate greener/more ethical credentials will need a clear, honest and transparent programme in place with suppliers if they want to convince consumers to keep buying their brands.
The bottom line? Corporate sustainability is all about defence with consumers, and opportunity with suppliers and partners.
If you are interested in meeting some of the leading companies doing this, they will be in New York in late October, and London in late November.
The results? Unsurprising for anyone who has looked hard at the numbers.
Whilst organic is taking a big beating in the current troubled times, (and so it should, argue many, since it may be holding back land that could be a lot more productive) the idea that consumers could be persuaded to fund corporate sustainability has always been nothing more than a myth.
More on Jon's findings in a moment.
My view on this is a simple one: Consumers expect big brands they WANT to trust to simply get on with being more sustainable. But they won't (en masse), pay any extra for it. Some small groups will, but has Tony Hancock once whimsically said: "That won't get the baby washed".
Why should consumers pay for it anyway? It's the company/brand that makes the profit, let them deal with it. That's their view, or at least most of them.
The reward is continued custom. I can't see what's wrong with that. If greener/ethical products offer greater value (rather than the same, just without 'guilt'), the situation CAN be different. But that can move a brand away from mass market quickly if care is not taken. (More on that below)
This state of affairs is not without problems of course.
I was with a company board of a 10 billion plus turnover company earlier this year talking about green strategy and consumer expectations.
A regional CEO, in charge of a billion euros a year in turnover, wanted to know how the company could communicate and market its forthcoming environmental policies to sell more products.
His face dropped when I pointed out the best they could probably do is customer re-assurance. It makes sustainability appear a solely defensive strategy where consumers are concerned. This does not help the business case.
As a millionaire investor and entrepreneur once put it to me: "I can walk into your house and tell you 10 ways to save money, and you won't be nearly as interested as hearing about how you can make more money than you currently do". He has a point there about human nature.
But for the B2C market, defence is essentially what sustainability strategy is for most companies. As Jon points out in his forthcoming article in our September edition:
"Perhaps the most encouraging twist is not the fragile green buying trend but the turn by manufacturers toward a greener style of business"
We know companies can save big in the supply chain by working with suppliers on running better businesses. More on that here.
Back to the consumer market, if you are not convinced, here's some points from the forthcoming article by Jon Entine in our September edition.
So, on the one hand:
- The Lifestyles of Health and Sustainability (LOHAS) annual survey estimates that about 13-19 percent of American adults are dedicated green buyers, with total ethical purchasing topping $290 billion.
- The US-based Cone Communications, which publishes an annual Green Gap Trend Tracker, estimates that 70 percent of American consumers consider the environmental impact of their purchasing when they buy.
BUT:
- "According to leading marketing experts, these optimistic figures reflect attitudes not buying patterns. Studies of consumers have shown time and again that people wax environmental until its time to pay the bills."
- “Nothing in the historical research suggests that consumers are buying green at anywhere near the numbers that these surveys claim they are,” says Shruti Gupta, marketing professor at Penn State University in Abington, Pennsylvania, one of the world experts in ethical behaviour. “Buying green products presents people with a social dilemma: they have to be willing to pay premium costs—not for their own direct benefit, but for the greater good. While people love to voice their idealism to survey companies, the cold facts are they almost always put their self-interest first.”
- “Consumers will buy pricier green products,” Dr. Gupta says, “but only if they are convinced that the sacrifice—higher prices—signals some genuine or measurable value.”
- "We need proof that a green product or service is “as effective and of the same quality” as alternatives, agrees Kate James of Grail Research, a leading consumer research company. Grail, which tracks actual buying patterns, reports that although 85 percent of US consumers claim they buy green at least occasionally, less than 8 percent actually do. Travel separates the wheat from the chaff. According to the marketing firm Ypartnership, although 8 in 10 vacation travelers consider themselves "eco-conscious," only 1 in 10 books based on green considerations."
- Finally, over to the UK for some stats: "The challenging economy has hit green purchasing hard, as almost two-thirds of consumers have cutback on green purchases. Even in more robust times, green was a challenging sell. A 2008 study funded by the UK Economic and Social Research Council found that 30 percent of consumers report they were very concerned about environmental issues but they struggled to translate this into purchases. As a result, the market share for “ethical foods,” one of the most visible segments of the green market, has yet to crack 5 percent despite a boom in environmental consciousness.
So what's the answer here? To me it's fairly simple, although the execution of is one of the hardest business challenges a company can and will soon face.
It's all about embedding sustainability into the supply chain. Easy for me to say, very hard to do. Marks & Spencer are working hard at this, as are Unilever and P&G, as we all know.
Those savings may, or may not (as Jon points out in his article) end up being passed onto the consumer.
Whether they are or not, companies that want to communicate greener/more ethical credentials will need a clear, honest and transparent programme in place with suppliers if they want to convince consumers to keep buying their brands.
The bottom line? Corporate sustainability is all about defence with consumers, and opportunity with suppliers and partners.
If you are interested in meeting some of the leading companies doing this, they will be in New York in late October, and London in late November.
Friday, August 12, 2011
Asia Pulp & Paper greenwashes on bravely (guest post)
A guest post from Brendan May. From his excellent blog:
In recent weeks Asia Pulp and Paper (APP) seems to have all but given up on PR (getting others to say you're good) and reverted to the time honoured tradition of buying up as much advertising space as possible (you saying you're good).
My Saturday must-read, The Week magazine, is now defaced by whole page 'APP Cares' ads on biodiversity in every issue.
Sky TV, whilst in partnership with WWF on rainforest conservation, runs greenwashing spots from APP at every opportunity. In Australia, APP has resorted to the blunt and aggressive (and counter-productive), as you can see here.
Could this per chance have anything to do with the loss of one of APP's biggest customers down under in recent weeks? Metcash deserves wholesome praise for doing the right thing and acting fast. See http://tiny.cc/4t8yz
Writing from Holland, my mother informs me that the APP greenwash fiesta is in full swing on Dutch TV. The old 'we plant trees' joke, apparently. She makes the point that no Dutch consumers have ever heard of APP (the same applies throughout Europe) and asks why they would spend so much advertising a brand no-one can buy directly.
I have no answer to this. One of the many mysteries of APP's communications strategy (see past posts) is that in raising its profile among audiences to whom it was previously unknown, it recruits new foes almost by the hour, since anyone who looks up APP after seeing one of their nonsensical ads will instantly see for themselves what this charade is all about.
If I were APP, I'd shut up about the environment.
This company is fast becoming a major embarrassment to the whole Indonesian corporate sector. Perhaps the Indonesian government will exert some pressure and make its bosses see sense.
Meanwhile, a Texas-based advertising agency seems totally oblivious to the nonsense they are peddling for their client. Presumably APP couldn't find an ad agency in any of America's coastal cities. WARNING - don't read this if you're already in a bad mood. Too ghastly for words really.
So, do keep your eyes peeled for more APP greenwash in the weeks ahead. They seem to think it helps them. And do encourage broadcasters and print media not to take this tarnished advertising revenue.
I had hoped APP might have moved in the right direction by now, as customers continue to look elsewhere and NGOs expose an ever worsening tale of greenwash. Sadly it seems we shall have to wait a little longer.
In recent weeks Asia Pulp and Paper (APP) seems to have all but given up on PR (getting others to say you're good) and reverted to the time honoured tradition of buying up as much advertising space as possible (you saying you're good).
My Saturday must-read, The Week magazine, is now defaced by whole page 'APP Cares' ads on biodiversity in every issue.
Sky TV, whilst in partnership with WWF on rainforest conservation, runs greenwashing spots from APP at every opportunity. In Australia, APP has resorted to the blunt and aggressive (and counter-productive), as you can see here.
Could this per chance have anything to do with the loss of one of APP's biggest customers down under in recent weeks? Metcash deserves wholesome praise for doing the right thing and acting fast. See http://tiny.cc/4t8yz
Writing from Holland, my mother informs me that the APP greenwash fiesta is in full swing on Dutch TV. The old 'we plant trees' joke, apparently. She makes the point that no Dutch consumers have ever heard of APP (the same applies throughout Europe) and asks why they would spend so much advertising a brand no-one can buy directly.
I have no answer to this. One of the many mysteries of APP's communications strategy (see past posts) is that in raising its profile among audiences to whom it was previously unknown, it recruits new foes almost by the hour, since anyone who looks up APP after seeing one of their nonsensical ads will instantly see for themselves what this charade is all about.
If I were APP, I'd shut up about the environment.
This company is fast becoming a major embarrassment to the whole Indonesian corporate sector. Perhaps the Indonesian government will exert some pressure and make its bosses see sense.
Meanwhile, a Texas-based advertising agency seems totally oblivious to the nonsense they are peddling for their client. Presumably APP couldn't find an ad agency in any of America's coastal cities. WARNING - don't read this if you're already in a bad mood. Too ghastly for words really.
So, do keep your eyes peeled for more APP greenwash in the weeks ahead. They seem to think it helps them. And do encourage broadcasters and print media not to take this tarnished advertising revenue.
I had hoped APP might have moved in the right direction by now, as customers continue to look elsewhere and NGOs expose an ever worsening tale of greenwash. Sadly it seems we shall have to wait a little longer.
Thursday, August 11, 2011
Sustainable business leadership: Goodbye Ray Anderson
Sustainable business lacks many business heroes. CEOs are hard to admire consistently.
The complexity of big global business means its easy to slip from hero to zero pretty quickly.
The bosses we can admire consistently tend to be those in smaller companies who stick around longer.
Alessandro Carlucci, CEO of Natura is one.
Jeff Swartz, Timberland boss is another.
There are other well-trodden and well-known examples.
The NGO movement too, has a patchy record on leadership that encourages business sustainability. There are some leading figures, but a recent dip in form by most big campaign groups means leadership lags there too.
Ray Anderson sat firmly at the top of the tree as a business leader we could all take inspiration from. I won't go into the details of his achievements here. Others have done that.
His death on August 8th leaves a leadership gulf in the sustainable business world.
I only met him one, for about eight minutes, in an empty conference room in Toronto, back in 2008 for an interview. (I'll post a link to the podcast when I can find it)
He struck me as a real gentleman, in the old school sense. More than that, he knew just how to capture the imagination and put his thoughts and ambitions into your memory better than just about anyone I have ever met.
His diction was slow, deliberate and rationed. Not a word wasted, and not an important phrase, based on evidence, left unsaid.
Given his length of service to his company, and unswerving humility, ambition and drive, he's been an inspiration to us all on the environment for longer than I've been working in the field.
His counterpart on human rights, Sir Geoffrey Chandler, was for me his equivalent on the social side of business.
Ray Anderson will be sorely missed. Luckily for Interface, the current CEO, Dan Hendrix, will continue to inspire the company Ray created, of that I have no doubt.
Here's a podcast I taped with Dan back in June this year. Listen and you'll hear what I mean.
We published an essay taken from Ray Anderson's last book recently. You can read it here.
In 2010 he was nominated by our annual awards judges as the man most deserving of our lifetime achievement award.
This week, Mallen Baker wrote an excellent blog post about Ray's impact. That's here.
John Elkington's take on Ray and his impact can be found here.
Here's a TED video where he talks about just what's possible if a leader puts his/her mind to it.
Ray Anderson will be sorely missed. I am sure Inteface will honour his memory.
My hope is that we'll find other, equally values-driven CEOs to take his place in the coming years.
The idea of sustainable business as a zero-sum game is changing slowly.
Finding and celebrating a few more high profile bosses who emulate Ray Anderson will help that accelerate, if they can last more than four years in large listed companies.
Until that happens, we'll continue to put the smaller-firm CEOs we can find on the higher pedestal they deserve.
The London riots: Small community charities where business can help
Thanks to those who responded to my recent post around good community initiatives in London for business to consider in response to the recent troubles.
Aside from the two I mentioned, here's a few more, hope they might be useful:
Live Magazine
Live is a free quarterly magazine, website and community created entirely by young people aged 14-22 where they cultivate their creative talents and learn alongside established media professionals in funky offices in Brixton.
Last year they launched a Live East for young people in east London and are still looking for a business partner that would support them in producing a Live North for north London young people.
Business support needed is pro bono. i.e. Cheap shared office space, business mentoring, the model is social enterprise: http://live-magazine.co.uk
New Horizons Youth Centre in Kings Cross: http://www.nhyouthcentre.org.uk
The Complete Works:
A London based charity that aims to promote the advancement of education for young people. They work with young people excluded from mainstream education, young offenders and those at risk of offending.
They take creative projects into mainstream schools including: plays, film projects and music workshops. The inspiration for creative projects comes from the young people, who set the agenda: www.tcw.org.uk
Any other suggestions would be much appreciated.
Aside from the two I mentioned, here's a few more, hope they might be useful:
Live Magazine
Live is a free quarterly magazine, website and community created entirely by young people aged 14-22 where they cultivate their creative talents and learn alongside established media professionals in funky offices in Brixton.
Last year they launched a Live East for young people in east London and are still looking for a business partner that would support them in producing a Live North for north London young people.
Business support needed is pro bono. i.e. Cheap shared office space, business mentoring, the model is social enterprise: http://live-magazine.co.uk
New Horizons Youth Centre in Kings Cross: http://www.nhyouthcentre.org.uk
The Complete Works:
A London based charity that aims to promote the advancement of education for young people. They work with young people excluded from mainstream education, young offenders and those at risk of offending.
They take creative projects into mainstream schools including: plays, film projects and music workshops. The inspiration for creative projects comes from the young people, who set the agenda: www.tcw.org.uk
Any other suggestions would be much appreciated.
Wednesday, August 10, 2011
Sustainability and corporate innovation: six key lessons
Here's an interesting short-ish video on how CEOs can drive innovation into their business.
The interviewee, INSEAD Professor Hal Gregersen, talks about how:
1) Innovation by leading companies is CEO-led, not delegated. It becomes everybody's job.
2) Leading innovators talk to all kinds of people, not just colleagues.
3) Innovators never stop asking questions about how the world works, and why.
4) Purpose is an incredibly important driver: companies are now increasingly re-thinking the reasons for their existence.
5) Only a third of our ability to innovate is DNA-driven: The rest must be, and can be learned.
6) Investors value innovation in business. They put a premium on what they believe innovative companies will do tomorrow.
He names Salesforce.com, Google, Apple, and a firm called Intuitive Surgical as some of the top business innovators.
Gregersen also names Natura, the Brazilian naturally-focused cosmetics firm, who work with local communities to develop products.
Here's an article we published on the company a couple of years back,
And here are some more videos from INSEAD. Some of them are quite good.
The interviewee, INSEAD Professor Hal Gregersen, talks about how:
1) Innovation by leading companies is CEO-led, not delegated. It becomes everybody's job.
2) Leading innovators talk to all kinds of people, not just colleagues.
3) Innovators never stop asking questions about how the world works, and why.
4) Purpose is an incredibly important driver: companies are now increasingly re-thinking the reasons for their existence.
5) Only a third of our ability to innovate is DNA-driven: The rest must be, and can be learned.
6) Investors value innovation in business. They put a premium on what they believe innovative companies will do tomorrow.
He names Salesforce.com, Google, Apple, and a firm called Intuitive Surgical as some of the top business innovators.
Gregersen also names Natura, the Brazilian naturally-focused cosmetics firm, who work with local communities to develop products.
Here's an article we published on the company a couple of years back,
And here are some more videos from INSEAD. Some of them are quite good.
Tuesday, August 09, 2011
List of good community initiatives - your help needed
UK readers: Who are the inner city charities and education/youth projects that work? And not just in London, but elsewhere in the UK.
Apologies to my overseas readers, but I want to focus on the UK for this post, perhaps understandably)
I am compiling a list of locally-based community organisations for businesses to donate to in light of the recent riots and looting all over London.
This is urgent and important, so please take a minute to post your suggestions on the blog.
I've mentioned the Boxing Academy, based in Tottenham and Hackney, that offers an alternative to school exclusion in those areas.
One other is Reprezent 107.3FM. It's a community radio station by and for young people in London. It now covers Greenwich, Lewisham, Southwark, Lambeth, Bromley, Croydon, Tower Hamlets, Hackney and parts of Newham. The approximate listenership is 60,000 (FM), and 12,000 (online) 13 to 25 year olds.
Please add your comments. If business would like to help work to secure an operating environment in London, companies large and small will need to get involved, long term.
These technology-coordinated events of serious social unrest are likely just beginning. Business will need to play a role.
Let's work out how money should be best used. My view is that's through small, community-based organisations run by local people who know their areas. Big NGOs won't be able to help much here. We need a list of smaller charities for companies to put into their budgets.
Yes of course it's more complex than this. Of course here are bigger questions raised that need to be thought about and discussed in detail about the direction our society is heading in. Of that there is no doubt.
In the meantime, help me put together a list of organisations that can help this year and next. They matter most in the very short term, whilst we work out the longer term plan.
(Some readers may find this previous post of some interest: Anyone for a business case for inequality reduction?)
Apologies to my overseas readers, but I want to focus on the UK for this post, perhaps understandably)
I am compiling a list of locally-based community organisations for businesses to donate to in light of the recent riots and looting all over London.
This is urgent and important, so please take a minute to post your suggestions on the blog.
I've mentioned the Boxing Academy, based in Tottenham and Hackney, that offers an alternative to school exclusion in those areas.
One other is Reprezent 107.3FM. It's a community radio station by and for young people in London. It now covers Greenwich, Lewisham, Southwark, Lambeth, Bromley, Croydon, Tower Hamlets, Hackney and parts of Newham. The approximate listenership is 60,000 (FM), and 12,000 (online) 13 to 25 year olds.
Please add your comments. If business would like to help work to secure an operating environment in London, companies large and small will need to get involved, long term.
These technology-coordinated events of serious social unrest are likely just beginning. Business will need to play a role.
Let's work out how money should be best used. My view is that's through small, community-based organisations run by local people who know their areas. Big NGOs won't be able to help much here. We need a list of smaller charities for companies to put into their budgets.
Yes of course it's more complex than this. Of course here are bigger questions raised that need to be thought about and discussed in detail about the direction our society is heading in. Of that there is no doubt.
In the meantime, help me put together a list of organisations that can help this year and next. They matter most in the very short term, whilst we work out the longer term plan.
(Some readers may find this previous post of some interest: Anyone for a business case for inequality reduction?)
Monday, August 08, 2011
London on the brink? It feels like it
I'm writing this from my flat in London. I live on the Bemerton estate, behind King's Cross station.
It's classic inner city London: New developments next to 1960's housing estates.
Middle class professionals in the midst of social housing tenants.
More social housing than new development, but it usually feels fairly safe, despite the obvious lack of wealth.
Last night one local supermarket on Caledonian road was attacked.
Much larger-scale incidents have been taking place in Enfield, Tottenham and Hackney since Saturday.
As I walked through my neighbourhood this evening the tension in the air was almost palpable.
On the way home I saw numerous heavy duty police vehicles headed out to the trouble spots.
Given the relationship on my estate between some local youths and the police, they may be back where I live tonight.
A journalist friend of mine has just been on the BBC talking about how some incidents are being co-ordinated via the Blackberry messenger service and are set to spread tonight.
He's on Twitter right now, in the thick of the action.
Meanwhile the chair of the inner city youth education charity I am trustee of, Simon Marcus, has just been on Channel Four news talking about how communities can develop their own solutions.
It's all feeling very close to home for me tonight as a result.
It looks like it will be a long night for the police and many others in London.
The trigger for this was apparently the shooting of a man in Tottenham.
It's not yet known whether he shot a policeman who was also wounded in the incident a few days ago. Time will out the truth there.
It appears to be spreading tonight to other UK cities now.
What's worrying about all this is anarchic nature of it all.
A few co-ordinated messages, passed on, and groups of teenagers and others have caused chaos, smashing up shops and looting in their own communities.
Commentators will blame the cuts in public spending meaning closure of youth clubs, combined with lower police numbers and record highs in youth unemployment.
My concern is that this may just be the beginning. We've been here before in the UK.
I grew up seeing scenes like this on 1980's television, which was the last time we had this level of financial austerity.
It took a lot of time, money and effort to bring stability back to inner city communities in London, Liverpool and other cities.
Business can play a role here. By supporting local education and youth groups that make a difference.
I've seen first hand, and continue to, just how community projects, when run well, can make a difference in deprived areas.
The Boxing Academy is among the first wave of new, realistically-orientated community projects that really matter.
Unlike some UK charities in the CSR world who like businesses to hand them cash and have vast numbers of dizzy employees, real, lean, pragmatic community projects will need your company's help in the coming years.
Time to get 'strategic' about community funding. Time to look at measurable results. Time to support organisations like the Boxing Academy. Take a look at their website for yourself.
Groups like this are the best chance companies have of making a difference in deprived communities in the coming years of slow growth and massive public spending cuts here in the UK.
It's classic inner city London: New developments next to 1960's housing estates.
Middle class professionals in the midst of social housing tenants.
More social housing than new development, but it usually feels fairly safe, despite the obvious lack of wealth.
Last night one local supermarket on Caledonian road was attacked.
Much larger-scale incidents have been taking place in Enfield, Tottenham and Hackney since Saturday.
As I walked through my neighbourhood this evening the tension in the air was almost palpable.
On the way home I saw numerous heavy duty police vehicles headed out to the trouble spots.
Given the relationship on my estate between some local youths and the police, they may be back where I live tonight.
A journalist friend of mine has just been on the BBC talking about how some incidents are being co-ordinated via the Blackberry messenger service and are set to spread tonight.
He's on Twitter right now, in the thick of the action.
Meanwhile the chair of the inner city youth education charity I am trustee of, Simon Marcus, has just been on Channel Four news talking about how communities can develop their own solutions.
It's all feeling very close to home for me tonight as a result.
It looks like it will be a long night for the police and many others in London.
The trigger for this was apparently the shooting of a man in Tottenham.
It's not yet known whether he shot a policeman who was also wounded in the incident a few days ago. Time will out the truth there.
It appears to be spreading tonight to other UK cities now.
What's worrying about all this is anarchic nature of it all.
A few co-ordinated messages, passed on, and groups of teenagers and others have caused chaos, smashing up shops and looting in their own communities.
Commentators will blame the cuts in public spending meaning closure of youth clubs, combined with lower police numbers and record highs in youth unemployment.
My concern is that this may just be the beginning. We've been here before in the UK.
I grew up seeing scenes like this on 1980's television, which was the last time we had this level of financial austerity.
It took a lot of time, money and effort to bring stability back to inner city communities in London, Liverpool and other cities.
Business can play a role here. By supporting local education and youth groups that make a difference.
I've seen first hand, and continue to, just how community projects, when run well, can make a difference in deprived areas.
The Boxing Academy is among the first wave of new, realistically-orientated community projects that really matter.
Unlike some UK charities in the CSR world who like businesses to hand them cash and have vast numbers of dizzy employees, real, lean, pragmatic community projects will need your company's help in the coming years.
Time to get 'strategic' about community funding. Time to look at measurable results. Time to support organisations like the Boxing Academy. Take a look at their website for yourself.
Groups like this are the best chance companies have of making a difference in deprived communities in the coming years of slow growth and massive public spending cuts here in the UK.
Friday, August 05, 2011
Learning from leadership failure, Barbie lessons, supply chain slavery risks and sustainable marketing
Here's some August reading and listening for you:
Podcast: Learning the lessons from leadership failure
Feature: Social media and environmental campaigning: Brand lessons from Barbie
Feature: Human trafficking and slave labour: Regulation increases as consumers expect more
Op Ed article: Marketing : New sustainable skills for leading marketers
All comments and feedback, as always, are appreciated.
Podcast: Learning the lessons from leadership failure
Feature: Social media and environmental campaigning: Brand lessons from Barbie
Feature: Human trafficking and slave labour: Regulation increases as consumers expect more
Op Ed article: Marketing : New sustainable skills for leading marketers
All comments and feedback, as always, are appreciated.
Thursday, August 04, 2011
Kudos to ING
Here at Ethical Corporation, we've been researching sustainable finance for a conference we intend to host later in the year, in early December 2011.
As part of that we've interviewed about thirty senior executives, in depth, at large financial institutions.
One of the companies we interviewed was ING.
To be precise my colleague Catherine McNally spoke with no less than four executives from ING who were incredibly open and helpful.
Reviewing the call notes to help structure our agenda with my colleague, I couldn't help but be incredibly impressed by their openness, commitment, knowledge and transparency around difficult and complex issues.
ING seems to me a bank to keep an eye on. I'm no sustainable finance expert, but they really seem to know their stuff.
Like a lot of Netherlands-based firms, they come across as modest, serious and thoughtful, and just quietly getting on with the job of embedding sustainability.
Here's an article I wrote about them three years ago, in case it might be of interest.
And here's a link to the extensive country briefing on sustainable business in the Netherlands we published recently.
As part of that we've interviewed about thirty senior executives, in depth, at large financial institutions.
One of the companies we interviewed was ING.
To be precise my colleague Catherine McNally spoke with no less than four executives from ING who were incredibly open and helpful.
Reviewing the call notes to help structure our agenda with my colleague, I couldn't help but be incredibly impressed by their openness, commitment, knowledge and transparency around difficult and complex issues.
ING seems to me a bank to keep an eye on. I'm no sustainable finance expert, but they really seem to know their stuff.
Like a lot of Netherlands-based firms, they come across as modest, serious and thoughtful, and just quietly getting on with the job of embedding sustainability.
Here's an article I wrote about them three years ago, in case it might be of interest.
And here's a link to the extensive country briefing on sustainable business in the Netherlands we published recently.
Arming donkeys
This regular podcast series, called "Arming the Donkeys" by author and academic Dan Ariely, is both amusing and useful.
He interviews pychologists, sociologists and behavioural economists to try and shed some light on why we behave the way we do.
Some great insights. The conversations are direct, short and informative.
What more can you ask from a podcast?
They make a refreshing change from the slightly smug ego trips you often see in TED videos.
He interviews pychologists, sociologists and behavioural economists to try and shed some light on why we behave the way we do.
Some great insights. The conversations are direct, short and informative.
What more can you ask from a podcast?
They make a refreshing change from the slightly smug ego trips you often see in TED videos.
A gaggle of pods on sustainability and CSR etc
I'm not sure what the collective noun for podcasts is. I think it should be "a gaggle".
On that basis, here's all our recent podcasts, in one place, for your delectation and delight.
(We're having the download file fixed in iTunes since the link changed when we launched our new website a little while back)
Meanwhile, all recent podcasts are here, and here's a few examples of the scintillating conversation that awaits you when clicking on the above link would be:
Business and human rights - the state of play
Corruption executions in China - on the rise
What does private equity know about sustainability?
Unilever's sustainable living plan - a tall and impressive order
Lots more, here.
On that basis, here's all our recent podcasts, in one place, for your delectation and delight.
(We're having the download file fixed in iTunes since the link changed when we launched our new website a little while back)
Meanwhile, all recent podcasts are here, and here's a few examples of the scintillating conversation that awaits you when clicking on the above link would be:
Business and human rights - the state of play
Corruption executions in China - on the rise
What does private equity know about sustainability?
Unilever's sustainable living plan - a tall and impressive order
Lots more, here.
Campaigners need to aim for global
I haven't yet heard about a major emerging market company that's significantly changed practices based on the activities of a social or environmental campaign group.
I am sure there are some. If readers know examples I'd love to know who they are.
A friend of mine raised this very point over dinner last night.
His argument was that groups such as Greenpeace, Global Witness, WWF (when they used to do campaigning), and others, tend to focus still on the Western brands for change.
The logic is easy to understand: Go after the big vulnerable brands who care about their reputation, and persuade them to influence the supply chain, as with this current campaign against Nike and Adidas.
It has worked very well before, as Mike Harrison, chief brand officer at Timberland, told me back in June.
But at some point soon, campaign groups (such as they are right now), will need to score a big emerging market brand victory.
Perhaps there have been some without Western company pressure, I don't know. If I missed that, let me know.
(John Morrison of the Institute of Human Rights and Business believes that in some ways, electronics suppliers in Asia are further ahead than the big Western brands who buy from them. More on that here)
I am sure there are some. If readers know examples I'd love to know who they are.
A friend of mine raised this very point over dinner last night.
His argument was that groups such as Greenpeace, Global Witness, WWF (when they used to do campaigning), and others, tend to focus still on the Western brands for change.
The logic is easy to understand: Go after the big vulnerable brands who care about their reputation, and persuade them to influence the supply chain, as with this current campaign against Nike and Adidas.
It has worked very well before, as Mike Harrison, chief brand officer at Timberland, told me back in June.
But at some point soon, campaign groups (such as they are right now), will need to score a big emerging market brand victory.
Perhaps there have been some without Western company pressure, I don't know. If I missed that, let me know.
(John Morrison of the Institute of Human Rights and Business believes that in some ways, electronics suppliers in Asia are further ahead than the big Western brands who buy from them. More on that here)
Wednesday, August 03, 2011
Don't put anything back
That you didn't take away in the first place.
There's a serious point here.
It's an old point, but still a good one.
Too many commentators, journalists, companies, NGOs and PR people still talk about 'giving back'.
What did you take, exactly?
If you work for the average company, or even an unusual one, chances are your organisation is not one that needs to make amends. (Unless you work for Asia Pulp & Paper that is)
Sure, your business has social and environmental impacts.
But far better to focus on minimising environmental impacts and maximising social gains, than talk about 'giving back'.
'Giving back' implies an unhelpful combination of guilt and condescension.
Neither helps you make a positive difference. Neither helps you make a positive impression in your communication.
Focus on what you can do, not on what you think you might have done.
There's a serious point here.
It's an old point, but still a good one.
Too many commentators, journalists, companies, NGOs and PR people still talk about 'giving back'.
What did you take, exactly?
If you work for the average company, or even an unusual one, chances are your organisation is not one that needs to make amends. (Unless you work for Asia Pulp & Paper that is)
Sure, your business has social and environmental impacts.
But far better to focus on minimising environmental impacts and maximising social gains, than talk about 'giving back'.
'Giving back' implies an unhelpful combination of guilt and condescension.
Neither helps you make a positive difference. Neither helps you make a positive impression in your communication.
Focus on what you can do, not on what you think you might have done.
Faking the retail experience
We've all seen, and perhaps (accidentally?) bought, the odd fake branded product.
More than 15 years ago I recall buying "Roy Bon" sunglasses, complete with fake leather case and comical logo, in India. They didn't last long.
The counterfeits trade is worth somewhere between $600 billion and a trillion dollars a year, according to various sources I found on Google. That's quite a lot.
'Entrepreneurs' in China have taken the fake brand experience to a whole new level, according to media reports dating back up to five years.
In recent times Apple, Ikea and Starbucks are all big brands who have been copied on a major scale in China, say various reports linked to above.
Now the copyright theft has moved to a whole new level, Reuters reports:
"This knock-off Ikea store is emblematic of a new wave of piracy sweeping through China. Increasingly sophisticated counterfeiters no longer just pump out fake luxury handbags, DVDs and sports shoes but replicate the look, feel and service of successful Western retail concepts -- in essence, pirating the entire brand experience.
"This is a new phenomenon," said Adam Xu, retail analyst with Booz&Co. "Typically there are a lot of fake products, now we see more fakes in the service aspect in terms of (faking) the retail formats.""
More than 15 years ago I recall buying "Roy Bon" sunglasses, complete with fake leather case and comical logo, in India. They didn't last long.
The counterfeits trade is worth somewhere between $600 billion and a trillion dollars a year, according to various sources I found on Google. That's quite a lot.
'Entrepreneurs' in China have taken the fake brand experience to a whole new level, according to media reports dating back up to five years.
In recent times Apple, Ikea and Starbucks are all big brands who have been copied on a major scale in China, say various reports linked to above.
Now the copyright theft has moved to a whole new level, Reuters reports:
"This knock-off Ikea store is emblematic of a new wave of piracy sweeping through China. Increasingly sophisticated counterfeiters no longer just pump out fake luxury handbags, DVDs and sports shoes but replicate the look, feel and service of successful Western retail concepts -- in essence, pirating the entire brand experience.
"This is a new phenomenon," said Adam Xu, retail analyst with Booz&Co. "Typically there are a lot of fake products, now we see more fakes in the service aspect in terms of (faking) the retail formats.""
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