Occupy Wall Street in pictures

Yesterday I was near Wall St. and went to meet some of the protestors who had sat through freezing weekend temperatures without heat or much proper shelter.

Many of them seem to have come together for very different reasons.

Some are protesting banks and finance, some healthcare, some the Iraq and Afganistan wars, others climate change and others simply the economic system in general.

The protestors I spoke with included a mix of hippies, educated students, anarchist/anti-capitalist types and a group of folks with disabilities protesting funding cuts and support cuts.

It's very clear to me that this movement, at least in New York, is simply about general dissatisfaction with the state of affairs we find ourselves in.

Thinking back to the anti-capitalist and anti-globalisation protests of the late 1990s and early 2000's, it's pretty small beer by comparison. And compared with the 1960's and '70's, who are we kidding?

On the one hand these protests are aiding debate about where we are.

On the other, the small size and lack of direction in them shows us perhaps just have far we have fallen in terms of impetus to encourage political action, or at least serious debate about sustainable solutions.

What's worrying to me is that even in the midst of this ongoing crisis, this is the best we can seem to muster publicly. What happened to us? Perhaps we've become lost in nuance, grey areas and lobbying.

The more we know about ever more complex systems, the less we seem to be able to do to change them.

Here's some of the pictures below of the protestors and their signs I took on Sunday.

If reading via email you'll need to read this post online to see them.

Bothered by banking

Tree worship, I think

Drummers and senior citizens

Generally upset with US capitalism

Climate, water, gas fracking, all in one combo protest

Healthcare capitalism concerns

Not really a radical statement in Europe

One end of the camp: Books. The other: Drums 

Protesting cuts to services, I think

A good friend of mine has written up her thoughts after joining the protestors for a day.

It's worth taking a few minutes to read this. She offers excellent and thoughtful insights on the Wall Street protests in this post.

UPDATE 1/11/11: This report helps explain the unifying anger amongst protestors around the economics of income inequality. To quote from it/SocialFunds.com:

"The wealthiest 20% of Americans now hold 87.2% of wealth. The net worth of the top one percent is 225 times greater than the median. The median net worth of black households is $2,200, the lowest ever recorded. And for the first time, the percent of home value owned by homeowners was below 50%; in other words, banks now own more of the value of the nation's housing stock than do homeowners themselves." 

Good comms from Unilever

Changing how consumers act: Marketing's toughest challenge

Unilever's latest sustainability newsletter is worth a look.

The font they use for headlines is dreadful and hard to read.

Some kind of 'retro 1980's future font' idea that really doesn't work.

BUT the content is good. That's what matters.

The very fact that they send out something readable and compelling (once you have squinted through the headline) means they are a step ahead of most companies.

The content is short, numbers-focused and shows they are making some progress.

Unilever's supplier engagement work is particularly impressive. Here's that part of the newsletter.

And their consumer behaviour change efforts continue to impress.

There's much more to do and prove there of course. Selling out of promotional packs (see link) is one thing. Demonstrating consistently reduced consumer environmental impact is much harder.

Aside from moaning about their headline font, I'd argue that third party endorsements/comments around what Unilever are doing on sustainability would add further credibility.

But it's still pretty good compared with dull press releases written in legalese. Or an annual CR report.

In the land of the blind, the one-eyed man is indeed king.

New FT special on greener tech adds to confusion

Yes, I know I've argued before that CSR terminology doesn't matter any more.

But as I suggested in a previous post, it is worrying that so many companies see sustainability only as a green issue.

That matters.

The Financial Times, read by everyone with serious decision making power in your boardroom, today re-enforces the accidental canard of green as sustainable in a special report on green tech (should be greener tech)

It's a decent read for what it is.

But it's not helpful when one of the leading newspapers misunderstands the very subject it purports to write about.

How do we change this? Leading companies must make the distinction clear in their communications, consistently.

There's a business case for this: Why let competitors who are only greener free ride in your corporate wake when you've spent time and effort on being more holistic?

US cousins please note: Sustainability is also social

Not just a green issue

This is a well-trodden adage, or even complaint. But as I sit here in a conference room in New York listening to some of the largest companies in the US talk about supply chain sustainability, I can't help but be reminded of the title of this post once again.

Company after company on our speaking roster has presented important and increasingly sophisticated practices on how they are engaging, or more commonly, strongly suggesting to, suppliers, that they raise their game on the environment.

Minimising water use and carbon emissions is one thing. It's usually associated with a clear business case. That's great. But neglecting social concerns will not eventually lead to sustainability.

It's not every company. Many here at the conference, such as Intel, take social issues very seriously.

But when two days of conversation amongst the leading companies is dominated by easily measurable (by comparison) green(er) issues, it's clearly a worrying sign.

To be fair: As a company manager, you start where you have the easiest wins with the best made business case. Get the house in order first, then move onto the more complex issues. I understand that.

But many of the complex issues concerning environmentalists hinge on social issues: Deforestation is a consequence of corruption, poor institutions, legal enforcement and in some cases, poverty. These are all social issues. Simply cutting Asia Pulp & Paper out of your supply chain (as most attendees at the conference said yesterday they have already) will not be enough in the future.

Beyond tier one supplier water use, carbon emissions and toxic chemicals, companies are going to need to start understanding their role in the difficult social issues that affect their supply chain.

Partnering with NGOs and emerging market institutions will be one way to explore this.

For now, I'm impressed by what Intel, Bombardier, Kimberly-Clark, Kraft, PepsiCo are doing with tier one suppliers in terms of process management and standards integration

What will be much more interesting is when we realise that incremental greenery won't cut it beyond a certain point.

That's when we'll start having those difficult social-related conversations that go beyond tick box social auditing.

I'll be fascinated to see whether the European version of the conference described above is more about social issues than this one. I'll report back on the blog during the conference itself.

The latest financial news

Finally, it all makes sense.

Live tweets from our engaging suppliers conference in NY tomorrow

Tuesday this week Ethical Corporation is hosting a second New York conference of the year.

It's on how leading companies engage suppliers and help them drive sustainability performance management into their businesses.

Here's the agenda for the conference, which runs Tuesday and Wednesday this week in Manhattan

We'll be tweeting from it using the hashtag: #SCSNY from 9am tomorrow if readers are interested.

Six days until we hit seven billion people: Five things business can do to help

The World Population Clock tell us this is so.

If nothing else it's a milestone that should help us think hard.

Think hard about what the role of sustainable business should be in a world with that many people in.

When it comes to big macro issues such as population companies often struggle in terms of 'taking a position'.

As well they might. What can they say? Issue a press release about "Short term opportunity and long term resource threat"?

That's not really appropriate. On issues such as this, actions speak louder than words.

Actions such as:

1. Supporting independent research on what population growth will mean for resource scarcity
2. Joining competitors, peers and industry groups to express concern about this
3. Work towards collaborative solutions that minimise waste and look at alternatives
4. Being publicly honest about the outlook: Stop pretending that 8 billion people can all have iPhones
5. Put greater pressure on politicians to understand the outlook - and incentivise solutions. Call it good lobbying, or call it self interest. On resource scarcity, it's often the same thing

Why communicating your sustainability report is a bad idea

What your report looks like to stakeholders

Last week I was discussing CR communications with a head of sustainability here in London.

Which email service, he asked me, would I recommend using to announce the publication of a sustainability report.

I was immediately conflicted between commercial objectives and logic.

"Well" I said, "you could use our competitors who have an email service".

However, direct e-shots to databases is a quick way to kill the effectiveness of said database. I said.

You can also use Ethical Corporation's press release service (we publish them on our website for a small fee)

But really, I said, (at which point what I believe to be logic took over from commercial considerations), you shouldn't be communicating your sustainability report, at all. No sir.

What kind of talk is this? you might ask. Pure sedition?

An ethical business blogger advocating a lack of communication, has the world gone mad?

Well, yes it largely has. But I'm still partially sane, I'd hope. At least for this week.

Here's what I'm saying: Sending an email announcement about your report is a bad idea. Press releasing your report is a bad idea.

Why? Because your corporate responsibility report is not news. It is not really interesting. After all, what is a report? It's a collection of data and self-penned stories designed to show progress to stakeholders, who largely ignore it. (Almost completely, let us be honest)

But that doesn't mean you don't have stories to tell. It's the format that makes all the difference.

So when you publish a report, don't tell me you've published it (I expect you to anyhow), but tell me a compelling story from it.

Consider these two headlines you might send to media/stakeholders/NGOs/whoever:

1) Company X releases 2010 sustainability report

2) Company X helps 50 suppliers reduce costs and stabilise their business

or: Company X saves xxx tonnes of carbon and uses savings to innovate

or: Company X takes greener thinking and turns it into a new product line or service offering.

Do you see what I'm getting at?

Tell stories from your report, over time. That's a much better idea than simply trying to tell the world (or the CR community, more accurately) that you've published your CSR/Sustainability report.

We're bringing together some of the leading companies in the space to talk about this, and other issues, in November in London. Here's where to sign up and join us.

Here's some further reading.

Patagonia continue to blaze a trail on sustainability innovation

Now available used

Alongside having my favourite corporate website of all time on transparency, Patagonia has some new ideas about sustainable consumption. Read about them here.

Briefly, the idea is to "enable consumers to resell their used Patagonia apparel via the Common Threads Initiative within eBay. In addition, consumers will now be able to resell their used Patagonia apparel on a new Used Clothing & Gear section on Patagonia's website".

The article linked to above has some interesting analysis of the pros and cons of this new approach.

Here's another example of collaborative sustainability innovation from Marks & Spencer. 

Collaboration and behaviour change are the new terms for what we do in this field, and about time too.

The ultimate bigot's calendar of Europe

For a lighter look at cultural stereotypes, have a look at this: The ultimate bigot's calendar of Europe   (Amusing and worrying in equal measure)

Why hacking matters, and why we should understand it better

Here's a good TED video from Misha Glenny, author of the brilliant book McMafia, which you should all read for an alternative view of history since 1991, through the eyes of organised crime. 

His new book is on hackers, and solutions to them. It's all about engagement, as ususal. 

So responsible business thinking, policy and action could have a dramatic effect on your corporate security, if he is right.

Now there's a business case to get your CIO or your 'hard as nails ex-copper head of security' on board with ethical business considerations.

Here's a salient quote:

"There are two types of companies in the world: Those that know they've been hacked, and those that don't".

See below for more or click on the link below if you get these updates via email:

Misha Glenny: Hire the hackers!

“The first time you meet a CEO shouldn’t be in a time of crisis”

Unhappy days for RIM

The headline above is a great quote. It's taken from this Wall Street Journal blog about Research In Motion's CEO apologising, perhaps too late, to BlackBerry customers about the recent outage.

There's a lesson here in crisis management for your company, two in fact:

1) Do it better than RIM, and have senior people saying they take the issue seriously, quickly.

As Eric Dezenhall puts it in the post above: “What so many crises comes down to are two questions: Am I going to be OK and what are you doing about it”. As a BlackBerry customer, I didn't hear a word from the company during their crisis. That's not good.

2) Make sure that a crisis, as the quote suggests, is not the first time anyone has seen your CEO.

Point two relates to my recent post about the current protest movements and CEOs being known for having a view on particular issues.

Ideally of course, those would be views about practical solutions to common issues important to society.

Here's the RIM CEO apology on YouTube:





It's also useful if the other popular video of your CEO is NOT like this one:

Microsoft pushed to engage suppliers, but it may help

This looks like part of a significant shift: Microsoft to Require Annual Sustainability Reporting by Vendors.

I wouldn't put Microsoft in the top tier of leading responsible companies, but they are not that far off either. (2010's Russia incident was a major black eye)

As a massive company with a lot of influence, though, this news is undoubtedly significant.

They look like they may have been pushed into it, and the approach outlined in the press release looks rather compliance focused.

Nevertheless, where big brands lead, others will follow.

The smartest route here, of course, is to help suppliers meet requirements, and run better businesses that deliver savings across the board.

It will be interesting to hear how and if Microsoft plan to do this.

There's a couple of events coming up where you can meet some of the leading companies doing this kind of work.

Many of them will be in New York next week, and in London in a few weeks time.

Greenpeace vs. Asia Pulp & Paper spat now overtly political

John Sauven: Huge threat to your national security, obviously

Regular readers, patient with my painful prose, will note I have not blogged on Asia Pulp & Paper for a while.

Their relentless greenwashing, steered by the inept buffed fingernails of the intellectual pygmies at Cohn & Wolfe, was becoming, well, dull to report on weekly.

Now though, dear readers, it really is worth updating you. Here's a really simple timeline of some recent events in and around Indonesia, home of APP, and the questions they raise:

May 2011: Campaign launches against Mattel for having APP products in the supply chain.

This results in protests from radical groups against GP in Indonesia. Questions are raised about GP's registration and funding. None are proven to have a basis in fact.

September 2011: GP greets journalists from conservative publications (WSJ, The Australian etc) on recent press tour arranged by APP. Greenpeace activists hand out information packs to journalists in Jakarta on APP's practices.

Greenpeace ramps up US, New Zealand and Australian campaign against APP paper products and purchasing companies. Anonymous online attacks against GP tracked by media back to APP subsidiary in Australia.

September 2011: Visa given for John Sauven's (head of GP UK) visit to Indonesia by Indonesian Government.

September 2011: Next day articles in Indonesia media claim Sauven will be refused entry

October 2011: Sauven refused entry to Indonesia and deported.

The campaign continues. But has become now overtly political.

How did media know that a visa had been granted?

Who decided to deport the head of Greenpeace when he landed, despite a visa having been granted?

How are companies that Greenpeace campaigns against in Indonesia involved, as they surely must be?

Who is trying to deport Greenpeace campaigner Andy Tait with dodgy documentation?

All important questions. As yet answers are not publicly known.

No doubt the facts will surely come to light at some point. They always do in the end.

More on this at Brendan May's blog.

Greener capacity building in China: Great example of smarter business

Here's an excellent example of how companies and Western institutions can make a difference on the ground in China and elsewhere when it comes to the environment, or any other issue where help is needed.

Read the article and think to yourself: Is my company's money best spent in non-strategic philanthropy and volunteering (Let's face it, most activities in those areas aren't terribly strategic), or on something like this, which really can make a substantive difference towards business goals in the supply chain?

I'm not saying philanthropy and volunteering don't matter in these cash-strapped times.

They do. The question is, why don't you do both?

At least one of them has a real, measurable outcome: Reducing pollution in your supply chain.

That should give you, as a practitioner, access to budgets outside the usual paltry CR spend allocation.

Who is best at authentic, corporate reputation in the USA?

As part of our commitment at Ethical Corporation to try and 'mainstream' corporate responsibility, (and to make some money and grow our business too) we're hosting a conference in March 2012 in NY on how the best companies build and preserve their reputations through authentic, transparent actions and communications.

If you know any company who is good at that, or an individual who has a good story to tell, please let my colleague Hayley Dunn know: Hayley.Dunn@usefulsocialmedia.com.

So far we have about ten companies sending very senior executives. It should be an interesting conference which we also plan to host in London in 2012.

Confirmed to speak include: Verizon, Siemens Corporation, GE, Caesars Entertainment, Chubb Corporation, REI, Best Buy, AIG, Virgin Atlantic.

I am fascinating by the evolution of crisis management away from old school PR and towards real solutions and honest debate.

Amongst all the bad news, it's one shaft of light in the business landscape.

Look forward to comments. (saying that has no doubt cursed this post to get none at all! Help me out here... as the New Yorkers would say, "What am I, chopped liver over here?".

Anyone for a free pass to a conference in NY next week?

I'm chairing our 'engaging suppliers in sustainability' conference next week in New York.

Here's the website for it. Come and join us. Email me if you want a discount to attend.

It's on October 25-26 in Manhattan. We need a couple of helpers to hold microphones and help us run registration at the event.

If you know anyone who might be interested in helping out for a free pass, please ask them to contact me on toby.webb@ethicalcorp.com, thanks!

Ethical Corporation podcasts now fixed on iTunes

After much gnashing of teeth and beating of brow, we've finally been able to fix our iTunes podcast channel.

It's been broken since we switched to a new website earlier in the year. So if you listen to us on iTunes, the podcasts were not downloading until today.

Now though, our podcasts are fixed. Hooray. Whoop, run in circles around the room.

Or just listen to my (un) dulcet tones stumbling through badly prepared interviews with heads of sustainability and others, by clicking here.

Recent interviewees who have smiled patiently at my ramblings include executives from Nike, Diageo, the  Environmental Investigations Agency, and the head of the RSPO, Darrel Webber. Enjoy.

If you listened to them previously on iTunes: The right channel is "Ethical Corporation Podcast". Just hit subscribe/refresh and they should all download.

Podcasts a plenty on corporate ethics

Welcome back, protest..

A sign of the times

We've missed you. It's been a few years since you've gone on a global tour.

It's good you are back, in many ways.

Of course, no-one sane condones violence, there's no need for that, ever.

But demonstrations of disapproval around political mis-management and spinelessness?

Can we have some more please?

Then we might change something.

Politicians respond to demonstrations, sometimes.

Now even the Americans are demonstrating. When that happens, you know something really is wrong.

Companies too, often take note of citizen protests.

 Look at Ethical Corporation's first cover, ten years ago.

At least some early CSR responses were based on concerns around those incidents of citizen unrest.

Back then it was the nebulous issue of 'globalisation' some folks were up in arms about.

These days there's a bit more focus. Yes the big theme is still greed. But we know more about why financial disaster happens than we did, and who is responsible.

We even know more about solutions than we did ten years ago. No perfect answers, but some better ones.

Some of them are coming from the companies who helped create the system we have now, such as McKinsey. Many others are also out there.

When they say the modern methods are out of control, we really ought to listen. No-one understands the monster as well as he who helped create it.

Now we need smart, progressive companies AND citizens, to gang up on Government and help them set the frameworks for the future.

Business is going to have to get off the sidelines and become more involved in the future.

Neutrality is not a defence. We need CEOs to make their views clearer, whatever they might be.

Wal-Mart and China's western brand ethical stitch-up

Great wall of management rather helpful in China

Amidst all the environment and social unrest stories out there, it's oddly refreshing when a good old 'business ethics and politics' tale comes to light.

The FT reports that:

"Two junior Walmart store managers in China have been arrested as local authorities investigate allegations that the US retailer mislabelled ordinary pork as organic at its scandal-plagued Chongqing city operation."

What might be wrong with this occurance?

According to our man in China, Paul French, it's that only junior local managers are arrested when things go wrong. Rarely (Rio Tinto's Stern Hu aside) if ever, do Western expat managers get in trouble in China. In this case, for example:

"Walmart, which has 350 stores across China, closed its 13 Chongqing stores earlier this month after police discovered they were selling ordinary pork as organic pork – a label that can result in the product fetching three to five times the usual price."

So this is not exactly an isolated incident. The FT goes on to say that:

"This is the third time this year that Walmart’s Chongqing operations have run into trouble with local authorities. It has been punished 21 times in the city since 2006"

What is going on here? Paul's view is that it suits the Chinese government to bash a big Western brand now and again. Chinese brands are often in trouble with customers, so hanging a big foreign corporate out to dry now and again goes down quite well with the masses and mollifies the blogosphere somewhat.

But China does not want to upset Wal-Mart too much. China needs FDI, jobs, Western brands and everything good that comes with them.

So simply arresting and imprisoning a couple of local guys suits everyone. Foreign managers are not scared away. The money keeps rolling in, and a couple of the little guys take the fall.

Look at what happened with Sanlu a few years ago.

Suits everyone doesn't it? Except perhaps anyone with a sense of justice.

In the West, in a scandal such as this, some senior heads would roll.

Not in China. Who says the Chinese don't understand cynical and effective public relations?

A very good point indeed

(Email subscribers: Click on the download link to view the image, it's worth it!)

CSR 1.01: Practical advice on transparency, communications, crisis and the media

Listening is often best 

Here’s a list of do’s and don’ts I prepared recently for retailers and their suppliers.

This list is mainly aimed at those who are at the early stages of CSR, transparency, communications, reporting and media relations.

I hope they might be useful for some readers.

I’d be happy to come and talk about these further with your company or association.

Reporting & Communications

DO:

-  Have a CSR report – and where relevant/possible, conform to international norms/best practice. Use GRI (as a tool, not a bible) consider using assurance and stakeholder panels. Most importantly: secure credible endorsements for your approach

-  Update your websites: An annual report is not enough

-  Issue press releases when you have something to say, but not otherwise

-  Consider targeted media and opinion-former engagement

-  Have someone to speak up for you: Have quotes from partners in your communications. Find NGOs to work with, who are credible!

DON’T:

-  Simply believe a website page or two on compliance is enough: It is not

-  Think that trade group membership, ON ITS OWN is enough to create convincing communications

-  Just email out notices to the trade press and mainstream media and expect people to read it. Find an angle, and a good one

-  Stop at just reporting: Ongoing communications on issues as they arise is key!

Communications mediums:

DO:

-   Remember that email still matters most as an outgoing medium

-   Understand that your announcements will be ignored, unless significant

-   Spend time considering the risks to unnecessary communications

-   Realise that different mediums have different audiences, and therefore risks

-   Tailor your messages to those different formats, and be careful which you use!

-   Talk to your communication heads about whether the have a corporate account/page for Facebook/Twitter and which others they use (e.g. in China)

-   Make sure your Facebook / Twitter account managers don’t respond negatively to comments, and understand which to ignore and which to take seriously!

DON’T:

-  Underestimate the risks posted by social media to your brand/company!

-  Assume that nice comments on one media channel translate to another: They don’t! (trends can erupt on Twitter in hours)

-  Forget what your audience is interested in: Compliance is a VERY hard sell as good news!

-  Think that a few nice comments on Facebook means you are protected on Twitter, you ain’t

-  Believe that your CSR report is of interest to social media users: IT IS NOT. Some messages in it could be, but not the whole report!

Building relationships:

Trade Press

DO:

-   Cultivate relationships with trade press journalists and editors

-   Keep them up to date on your work, regularly

-   Be honest with them about the challenges you face

-   Share successes: Offer interviews with senior executives, not just press releases

-   Understand their commercial dynamics and support them where you can

DON’T:

-  Allow your PR company or advertising agency to ‘go too far’ on placing ads/sponsorships (i.e. setting conditions)

-  Fall out with them: If they write something you don’t like, don’t get angry

-  Expect them to be able to always defend you or influence the mainstream media

The mainstream media

DO:

-   Engage them where appropriate: You can’t ignore the media BUT you must be careful: Compliance is traditionally a negative story…

-   Understand their deadlines and commercial drivers: Columnists get paid on clicks!

-   Understand what makes a good story for them: Not “less people got hurt” but “Chinese suppliers cut pollution” (still a major risk as a story ‘hook’)

DON’T:

-  Assume you will get good coverage: You probably won’t

-  Belie-e that all publicity is good publicity: It ain’t!

-  Underestimate the possibility that your communications will be twisted against you: Sub editors often write stories. Junior journalists often cover ‘sweatshop’ stories

-  Expect the media to be fair: It is not!

Tone and content

DO:

-   Be humble and reasonable

-   Show you are working on practical solutions and have targets to hit

-   Talk about compliance management as ‘doing smarter business’ and helping suppliers

-   Demonstrate a desire to engage with external partners: Not just auditors or trade groups, but beyond!

DON’T:

-  Pretend you know the answers to complex problems

-  Avoid the difficult questions: The media and consumers are smart: you can’t fool them

-  Get upset if you get bad coverage: It happens

-  Get angry in interviews, or write angry letters to the media: engage them with facts

-  Assume your facts are taken as true: You need numbers from credible institutions

Overall key takeaways:

1) Humility is everything in reporting and communications (and CR generally)

2) Partnerships are ESSENTIAL and show you are engaged

3) The trade press matters more than you think, and can be an excellent ally

4) The mainstream media is unfair: be aware of the risks. Reach out to them ONLY at the right time!

5) Social media communications on supply chain issues are HIGH RISK and must be treated accordingly!

6) Reputation departs on a fast horse, and arrives slowly on foot (GAP, Nike, Adidas, H&M as key examples)

Further reading and resources:

Dealing with the media (presentation)

http://www.slideshare.net/Tobiaswebb/bsci-training-tw-slides

Ethical Corporation Communications and Reporting content channel

http://www.ethicalcorp.com/communications-reporting

How Gap Inc. Engaged With its Stakeholders

http://sloanreview.mit.edu/the-magazine/2011-summer/52415/how-gap-inc-engaged-with-its-stakeholders

Engaging colleagues: Selling sustainability to the marketers

http://www.ethicalcorp.com/stakeholder-engagement/engaging-colleagues-selling-sustainability-marketers

How to Measure Social Media Impact and ROI

http://usefulsocialmedia.com/impact/

PR and sustainability briefing

http://www.ethicalcorp.com/communications-reporting/pr-and-sustainability-briefing-part-1-reputation-economy

Hannah Jones, VP sustainable business and innovation at Nike, on targets, performance, outlook and ambition

http://www.ethicalcorp.com/supply-chains/podcasts/hannah-jones-vp-sustainable-business-and-innovation-nike-targets-performance-

Smarter business blog

http://ethicalcorp.blogspot.com/

Ethical Branding briefing

http://www.slideshare.net/Tobiaswebb/ethical-corporation-briefing-on-ethical-branding

Smarter Business and Sustainability: What it means for Management

http://www.slideshare.net/Tobiaswebb/csr-smarter-business-and-what-it-means-for-management

A headline that makes the business case for employee engagement

Here's the full story, such as it is.

Lighthearted headlines aside: This kind of thing can happen easily in volatile markets.

And that's where the money is for the future.

Ethics as risk management in action, I think is the phrase here!

Readers via email click on the attachment link to see the story. Headline: "Egypt Telecom Staff Hold CEO Hostage".

This isn't the first time this has happened (Honda in China, various mining and apparel firms etc), and it sure won't be the last. 

Sustainable innovation: Can Branson recycle waste into jetfuel?

Let's hope he can. Branson/Virgin's plan is to capture "waste gases from 65% of the world’s steel mills, capturing, fermenting and chemically converting it for use as a jet fuel."

Here's the 50 second video on how it might work: (Click on link at end if email subscriber to this blog)





The objective is to halve the emissions from jet fuel. And the timescale?
"Within three years we aim to fly Virgin Atlantic planes with the new fuel on flights from Shanghai to London and Delhi to London, and to follow this with operations in the UK and the rest of the world.'

Isn't it amazing what we can make possible when we put some time, money, thought and focus into sustainability innovation?

Show this to your CEO, or at least the highest-level manager you can reach, today.

The need to link ethics and sustainability, and why language, not terminology, matters

I was at a meeting with some lawyers and anti-corruption consultants recently.

During the meeting it became obvious that whilst they were interested in the ethics angle of anti-corruption compliance, sustainability didn't register as relevant.

They looked bemused when I mentioned it in a similar context to corporate ethics.

Ethics itself, is often looked at two ways in the anti-corruption space (where I have chaired a few conferences over the years).

Firstly, it's lumped in with compliance as meaning obeying codes of conduct.

Secondly, if viewed more widely, its often looked at just as a training and badly-understood corporate culture issue around "doing the right thing".

What am I saying here? (I'll keep this short)

I'm suggesting that the term 'ethics', still only five years old for many compliance folks, is not an universally agreed paradigm in many companies and within the firms of their advisors.

Secondly, sustainability executives, teams, advisors and 'Chief Sustainability Officers' are in many cases, a long way from being understood as relevant to compliance and ethics teams, who ought to be their closest ally in any company.

How do we close that gap?

It's by not talking about sustainability internally. Simply about smarter and better run business, that's attuned to both risks and opportunities.

Innovation is one word that's better understood than sustainability, which, frankly, is not even a better term than CSR.

Time, perhaps, to think harder about the language we use.

I've noticed a MASSIVE difference in the reactions of both executives and business journalists when I've switched 'sustainability' for 'innovation', or 'better run business'.


NB: Eagle-eyed readers might comment that in this earlier post I said terminology doesn't matter any more.

Am I contradicting myself? I hope not. In the earlier post I was suggesting companies and consultants should stop re-inventing terms to look more interesting. That's fiddling while Rome burns in my book. What I mean in this above post is that we need to take jargon out of the area, and just talk about doing better business. That seems consistent to me. 

12 responsible business management issues for 2012

The team at Ethical Corporation spend at least a third of their time on research into what companies are doing, and thinking, in the field of sustainable business.

Luckily, I get to spend about half my time on this.

It's a lot of what my job entails: Work out what's happening, try and turn it into conference or report products and fodder for this blog and the magazine.

Right now, amongst other research projects, we're looking into the big management issues that company executives want to talk about at 2012's Responsible Business Summit.

That's our behemoth of a conference that takes place each year in May in London.

In 2012 it will be held on May 8-9 at the Novotel Hammersmith, a fantastic venue for debate and discussion.

Here are some of the issues we are looking at having CEOs speak about, or managers discuss, at next year's conference.

I'd value your views on what's missing, or appropriate from our list.

(Update: 12/10/11: Please note this is not a ranking, just a list, it could easily be in a different order)

1. B2B Collaboration: How are leading companies working together, and when do they compete?
2. Supply Chain Resilience: How can big companies help suppliers run safer, sustainable, smarter businesses?
3. Collaborations with unexpected partners: skills to build and sustain with NGOs and Institutions
4. UK Responsibility Deals - What's the latest, do they work, is there an impact? 
5. Behaviour Change: Internal and Customer - How are large firms engaging with this idea? 
6. Stakeholder engagement to embed CR: Employees, Managers, NGOs and Media
7. Emerging markets: Which are the companies set to manage sustainability best in the next five years?
8. Global Compact / WBCSD / CSR Europe / IBLF / BITC: What is the distinctive role of the business led CR coalitions in the next decade? 
9. China and the Party perspective: what frameworks will they set? 
10. The role of boards: How do they exercise oversight? What skills do you need to have for and in your board? 
11. What will the EU Commission's latest Communication on CSR mean for business transparency? 
12. Engaging busy middle managers on a regular basis, how to track and incentivise progress

There will be many more to add to the list, here's last year's agenda. 

Look forward, as always, to your comments on what else should be on the programme.

Tablets and twitter will only take campaigners so far

Cheap as chips, nearly

The 'technology revolution' stories are coming thick and fast at the moment.

Amazon has launched the cheaper tablet Kindle Fire. 

Smartphones are everywhere. 

Second and third generation phones mean first generation smartphones are hitting emerging economies now. 

This spread is giving them faster, clearer, more nuanced and detailed internet access as wireless broadband takes hold.

Smartphones all have cameras and video. Now everyone can document everything. 

The world's cheapest tablet computer is now available to students in India for as little as $35 a pop.

This company, 4G Africa, points out that although only 1% of Africans have broadband internet access, new technology firms are utilising Wi-MAX technologies (super powerful wi-fi) to wire up cities of millions of people with internet access in less than two months per city.

So lots more people are getting online with mobile internet, fast connections, cameras and video capabilities. 

Many have an interest in large companies and what their operations mean for them as both consumers and stakeholders. 

The rise in NGO activity in and around China is testament to that.

Meanwhile, sites in the UK such as 38 Degrees or Change.org in the US, are becoming effective campaign aggregators. 

Other entities, such as LaborVoices will try to utilise crowdsourcing for both solutions and pressure.

It all sounds rosy for those of who claim that engagement with campaigners is a key part of business strategy, right?

Well, yes. 

But perhaps no.

What happens when Twitter campaigns become so regular they are, or can be, ignored? 

How many petitions from online aggregators will CEOs listen to? 

Most importantly: When will stories of social media campaigns or simply complaints against a firm, stop becoming newsworthy? When has the media 'had enough' of an issue? 

(See this climate change graph for how this can happen)

The media loves big brand names and apparent 'controversy'. 

But what if there's a new campaign three times a day?

My feeling is that it will be all about the new angle, not just the same old campaign. 

India's media explosion in recent years has clearly helped corporate accountability coverage. 

But even with the rise of online media we will one day see in Africa, campaigners will need to recognise that 'more of the same' is just not always going to work.

As things stand, the campaigns are still effective. The trend, for now, is positive.

Social media scares companies witless. 

The media, old and new, still loves a good old sweatshop/child labour/safety/environmental hypocrisy story.

But the day will come when the thin layer of big brands currently being campaigned against will just not be able to do much more. 

There's a lot to do at Nike, or at Diageo. But these guys are no longer the problem.

Campaigners will have to go after the firms at the "next level" down. 

These are emerging market firms, and Western companies no-one has really heard of, not just those big brands who buy from them.

These are companies such as Asia Pulp & Paper. 

These targets, who are much less initially vulnerable, are already proving to put up a much tougher fight. Consumer outrage and institutional condemnation is much harder to muster than in the West. Or the company is simply well under the radar of the media.

For example, APP has been tussling with campaign groups for at least a decade, to not much avail. 

By contrast, Mattel rolled over recently in a matter of months. 

So what does all this mean? 

On the one hand social media and cheaper handheld communications technology and growing internet access looks to provide stakeholder power with a major filip. 

On the other, the next layer of companies below the big brands will be much more resistant to change. 

Quite how faster, better, more ubiquitous technology helps bring them to the campaigners negotiating table remains to be seen.

Does corporate social responsibility affect the cost of capital?

 

Picture above: Gratuitious graph to show deep understanding of stock images by the author


Apparently so, say the authors of an academic paper who have just been awarded the Moskowitz Prize for Socially Responsible Investing. Here's a link to the paper.

They argue, as you would expect, that CSR lowers the cost of capital for large US companies. Hooray. You probably wouldn't win the Moskowitz prize for arguing the opposite I guess. 

This 15 year old gong is awarded for "outstanding quantitative research in sustainable investing" each year.

So what are the key findings of the research? (Let's remember the rigour of academic papers, at least in theory here, so this should be credible)

The paper is hard to understand in many places. It's dense, complex and not particularly well structured. But here's the headlines I pulled out. (It also repeats itself a lot!)

"More than half of the Fortune 1,000 companies in the U.S. regularly issue CSR reports, and nearly 10% of U.S. investments are screened to ensure that they meet CSR-related criteria" (I find this last part hard to believe, unless we simply count negative SRI screening)

"Improved CSR can enhance firm value by reducing the firm’s cost of equity capital"

And the evidence for this?

"Using a sample of 12,915 U.S. firm-year observations from 1992 to 2007, we find that firms with a better CSR score exhibit lower cost of equity capital after controlling for other firm specific determinants as well as industry and year fixed effects. Moreover, we find that CSR investment in improving responsible employee relations, environmental policies, and product strategies substantially contributes to reducing firms’ cost of equity"

And in conclusion:

"while prior research emphasizes the importance of corporate governance for firms’ valuation and access to external financing, our research suggests that investment in CSR activities is also important to firms as it has power to explain a firm’s cost of equity beyond corporate governance and other risk factors."

So there we have it. Another study that produces a similar result to lots of other studies.

Was this useful? I don't know. But I guess every piece of evidence, no matter how hard to read, helps.

The best of Ethical Corporation's management analysis

Here's a link to a new publication Ethical Corporation has just released.

It's called "Smart Strategy for Sustainable Business". The PDF is a sixty page round-up of the best of our management articles in the last two years.

If you are subscriber you can get it for free by emailing subs@ethicalcorp.com

If you'd like to buy it, there's 20% off if you tell my colleagues "Toby said I can have 20% off" when you contact them.

Here's some of what the new Smart Strategy for Sustainable Business report has inside:

• An in-depth review of Unilever’s ‘Sustainable Living Plan’ and achievements to-date
• Analysis of Toyota’s reputation crash
• A guide on corporate responsibility benchmarks when calculating remuneration for top executives
• Insight into the emergence and increasing importance of brand value leadership
• A detailed feature on how companies are using accountants to help value sustainability
• A critique of the big four international audit and consulting firms, and when to use them and when to seek more small, specialist advise
• An overview of the questions investors ask and suggests how data generated for corporate responsibility reports can help answer them

 More, here. And a free sample of what's inside is here.

More on B2B Collaboration: The UK energy efficiency deal

The debate around competition and collaboration among large companies is finally maturing.

For years, a few executives have pointed out that on big, macro issues such as climate change, collaboration is more important than individual advantage, at least in the early stages of changing systems.

Now we're starting to see more and more of it. These new collaborations go beyond the models of the last five to ten years, which were often around basic standards, development partnerships or sectoral targets.

Those were all useful steps forward. But they were not really game changers with regard to making an impact on product consumption and consumer environmental impact.

Now energy price hikes and climate change concerns have collided properly, B2B collaboration towards systems change in consumer marketplaces is becoming genuinely interesting.

Back in 2008 I co-ordinated the group that published a report into just how Government could act to drive such collaborations. It was endorsed as policy by our current Prime Minister, but has not been put into action in quite the way we had suggested.

Despite our current Government not quite using its mandate as it could, companies are now seriously starting to step up to the mark, for example in the area of finance for energy efficiency investment in UK residential and business premises.

Here's an article that lays out some of the initial plans. It's a little vague on some of the detail, but the intent of the corporate partners seems clear: Collaboration beyond competition, at least for now.

Some of the firms involved include British Gas, Carillion, E.ON, EDF, Kingfisher, Goldman Sachs and HSBC.

Of course there's a commercial angle here for all these companies. So there should be.

Whether or not this scheme works, the idea of big corporate B2B collaboration on issues where Government can only go so far and where the traditional markets and systems limit change, is finally taking hold.

That is surely something to celebrate.

I'm being briefed on another scheme in the next couple of weeks by a major UK company that has developed a consortium around a particular piece of infrastructure. I'll report back on that in due course on the blog.

Meanwhile, here is Hannah Jones from Nike on the topic. And here's a previous post showing some trending interest from readers.

Finally, here's an older post which mentions another example of B2B collaboration.