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Public Trust – The Role of Business in Society?

I have spent some time listening to the discussions between climate change skeptics and proponents. One of my main takeaways is that there is rarely a thorough understanding of the science of the issue. Proponents can quote scientists and so can skeptics. I don’t believe that many of us though (myself included) have really done our own analysis of all the research papers and, even if we had, that we would know how to reach our own judgment on the sensitivity analysis, scenarios and balance of risks.

Most of us, on both sides, reach our conclusions based on whose advice we trust.

I feel the same as I follow the debate about the Gulf oil spill. How much oil is coming from the well? Could this incident have happened to any oil company or was BP more exposed to an accident like this than its competitors? Should we be using more dispersants or less? I hear conflicting opinions. The answers to these questions require a complex analysis and understanding of the issues and I don’t have the time or expertise to research each one for myself. So, I think that, as with climate change, we develop our individual opinions based on whose opinion we trust; a newspaper, a political leader, a company, a friend.

In a recent discussion about consumer purchase decisions at the 2010 Solutions Lab in D.C., I participated in a discussion on how consumers make purchase decisions. Few of us (again, myself included), look at the detailed sustainability credentials of a specific product. At best, we develop a level of trust in certain brands and incorporate that into our buying decisions.

This is why I think the trust in large organizations, government and companies especially, is so important. That is where we develop many of our opinions. And when that trust is low it is very unsettling for civil society. If this is correct, then companies have a responsibility to earn and maintain public trust, not just because their business depends on it, but because it is part of their role in society too.

Gulf Oil Disaster - Reflect or Deflect?

On June 9, 2010, CSRWire Talkback orginally published the guest post below that I wrote to appear on their site.

There is a lot of anger at BP right now resulting from the Gulf oil disaster. Someone told me recently that she was so angry she could think of nothing else and was unable to sleep - and she lives in DC, far from the immediate impact. But I question whether this anger is being harnessed in the right direction.

I watched four fishermen being interviewed on TV last weekend. They were angry at BP for polluting the Gulf and harming the fish stock. They were gassing up their boat and motoring on round to the Texas coast to see if the fishing was better there. What an irony and what better example of allowing anger to deflect attention from one’s own complicity in the event.

I learned recently that 10% of our transport fuel needs are met by oil coming from deep sea drilling. Less gassing up of our boats and cars would go a long way to obviating the need for deep sea drilling. Our pursuit of the lowest priced gas every time we fill up is an incentive for lowest cost exploration and production and for taking short cuts. As consumers we have a share in responsibility for the industry that serves our needs and in how our buying behavior incentivizes it to act.

I have no doubt that in the fullness of time and due process, it will emerge that BP, and perhaps other companies and government, should have done things to avoid the disaster or to respond more effectively. I doubt though there were many, if any, people walking around in BP cognizant of the likelihood of this particular incident and maliciously or even consciously ignoring it. There is absolutely a value in media and public attention to punish ‘bad behavior’ in organizations. But what we must be sure of is that we are not allowing ourselves to blame this on a particular set of circumstances at one company, such that we can isolate this as an aberration and conveniently not reflect on our own organizations.

In my mind, the right channel for our energy is not endless anger at BP. Instead use that energy for everyone in the corporate world, and indeed in non profit and governmental organizations, to be thinking to themselves, what catastrophic event of equivalent consequence, that could be caused by a failure in my organization or in my sector, have I unconsciously overlooked – social, environmental, or economic? Of course it is difficult to know what you don’t know, but if ever there was a motivator for thinking creatively, the Gulf oil spill should be it. It may not even be anything to do with your job, but as employees we have the obligation to create the right culture by raising and addressing those questions.

I recall reading once that identifying sometimes irrelevant circumstances that are different from our own is a psychological method we all use subconsciously to distance ourselves from the personal tragedies we read about in the papers each day. It is tempting to think “that company” is different. But I have friends and colleagues at BP and they are good people.* Wherever you are, by definition the unexpected could happen at your organization too.

None of my comments should in any way be seen as reducing the responsibility of the main parties in this tragedy. The question I ask is how best should we channel our desire to see change? How are you using your frustration and anger from this disaster, to reflect or deflect?

* In the interests of full disclosure I should declare that I worked for BP in a sales engineering role from 1987 to 1989.

Kevin Moss is Head of Corporate Responsibility for BT in North America. He shares his thoughts about the intersection between business and sustainability on his blog, CSR Perspective. The views reflected here are his own and, as such, may not necessarily reflect the views of BT, or of any former or future employer

Readers: Take up Kevin Moss’ challenge. Tell Talkback how your company or sector can prevent catastrophe.

Enough Stick Already, Where’s The Carrot?

I hosted a table last week at the DC Solutions Lab 2010 on the topic of corporate stakeholder relationships and whether stakeholders incent corporations to act sustainably.

The breadth and quality of the discussion was impressive. I was struck with a consensus we reached that individuals, in their roles as customers, employees and stakeholder do not, for the most part, act on their declared values in their role as members of civil society. I am sure you could find many people filling up their Memorial Day Weekend gas tanks in a BP station (wearing their customer hat) while proclaiming their anger with BP (wearing their member of civil society hat).

I admitted to having bought a toaster oven on-line the previous night without paying any attention to the sustainability credentials of the various vendors.

There is a clear ‘stick’ incentive for companies not to end up with a disaster on their hands that leads to consumer punishment - the risk component of corporate responsibility. But much less evidence of the ‘carrot’ incentive - reward for good actions.

Participants expressed hope that up and coming generations would do more to reward corporations for being sustainable with their buying, employment and share-ownership behaviors. But we had not reached that tipping point yet.

As a CR practitioner, avoiding risk is important but ultimately it’s a weaker incentive to do better than responding to reward. Risk mitigation sets a baseline, but does not incent leadership. Who knows how many bad things CR departments across the corporate world have helped companies avoid? It’s hard to build a business case to do more based on what didn’t happen. But when customers, investors and prospective employees flock to you because you do good, go above and beyond….that will really accelerate sustainable behavior. Roll on the tipping point.

I am hoping to have someone lead a table on this theme at each Solutions Lab in the program. We have run one in each of DC and New York so far. You can see my full take on the conclusions here and from there track back to the raw notes taken during the meeting itself.

Ethics Trumps Sustainability

I posted a blog in January "sustainability is over-rated" in which I posited that sustainability was just one of the principles against which Corporate Responsibility can be judged and practiced. A number of people commented that we should focus on action and not worry too much about terminology. Call me obsessed, but I cannot let it go at that. I believe more and more that ethics underpins sustainability and that we must be able to speak to ethics to be able to resolve some of the most challenging sustainability issues we will face in the future.

The broadly accepted principle of sustainability asks that we use resources in a manner that satisfies current needs without compromising the needs or options of future generations. Who says that the needs of the yet to be conceived, their children and their children’s children ad infinitum, are valued equally highly with the needs of those alive today? The answer is that our predominantly accepted code of ethics tells us that.

If being sustainable turns out to be easy, this might not matter. However, if being sustainable turns out to require behavioral change and perhaps sacrifice, we will need to be able to articulate and defend the ethical foundation on which it is based. To illustrate, I like to look at another view of the world……..

At BSR last year, many others and I listened to an inspiring plenary highlight by Zhang Yue Chairman and CEO of BROAD air conditioning in China. We all felt so good listening to a fantastically successful Chinese businessman talk about all he achieved through his environmentally friendly business approach. But you could hear the sharp intake of Westerners’ breath when he stated that of course he fired any employee who had more than one child, because more than one child per family was not consistent with a sustainable population and planet. This contrast in values is fundamentally an ethics question.

I recently read Practical Ethics by Peter Singer. It provided me with a structure to step back from my inherited values and look at them from an external perspective. I have not changed my views (that much!), but I understand them and their heritage much better. I also learned that our approach to sustainability is rooted in ethics and that some of our most difficult dilemmas, in particular when two good outcomes compete in a zero sum game, need to be sorted with the help of ethics, before we can apply sustainability correctly.

Can A Company Acquire Its Way Into Being Sustainable?

Unilever acquired Ben and Jerry’s, Dannon acquired Stoneyfields Yoghurt and more recently Coke acquired 40% of Honest Tea. This morning I had the pleasure of hearing Seth Goldman co-founder of Honest Tea speak at a networking breakfast of the National Capital Chapter of the Association of Corporate Growth (ACG).

Seth is a great speaker with a great sense of humor and plenty of good material. Go hear him if you have the opportunity. And he, or someone at Honest Tea, has the knack for identifying what might go viral. Just for fun, watch this very short video that demonstrates Wall Street is 89% honest!

We need people and companies like this to create a positive image for what sustainability can mean for business and for society. With the acquisition by Coca-Cola of 40% of Honest Tea I wanted to know whether the culture and approach of Honest Tea could help Coca-Cola to further its sustainability achievements. (The popular question is whether a large corporation will squeeze the sustainability out of a much smaller one, but I prefer the half glass full approach!)

I asked Seth this question in the Q&A and he was optimistic in his response, explaining that he felt Coca-Cola had embraced Honest Tea so far. At a worldwide meeting of Coca-Cola execs, announcement of the first Honest Tea production plant inside a Coca-Cola facility received standing applause from the audience. The Honest Tea process is fairly unique in Coca-Cola facilities in that it uses raw agricultural produce (tea leaves) rather than syrup, as its raw material. I can see how this might have a broader influence on a large company.

Seth also described being sought by Coca-Cola execs to input ideas on how they could enhance their existing sustainability efforts using their core resources and capabilities.

Maybe Seth’s enthusiasm is just infectious, but I for one was encouraged. The acquisition delivers continued rebalancing of Coca-Cola’s portfolio and provides alternative and more sustainable routes for growth. I need to find a parallel acquisition in my sector! As long as Honest Tea is nurtured as a catalyst for further change, this acquisition will be a model for another way of enhancing corporate sustainability. As Seth concluded (and as much as it pains me to say it with my British heritage), “the tea party has just begun”.

Guest Post – CA; Less Bad, enable Good, REALLY Well

I was speaking recently with Steve Boston, Chief Sustainability Officer at CA (formally known as Computer Associates) and he articulated to me a three part model he uses to approach sustainability. It is different but I think complementary to my Four Dimensions of Sustainability and I asked Steve if he would contribute a guest post for CSRPerspective.

We view our strategic framework as three very important and distinct components: “Do Less Bad”, “Enable Good” and “Do REALLY Well”. Each of these components must be viewed (and internalized) from both an environmental stewardship perspective and a business perspective.

“Do Less Bad” refers to the efforts a company must take to manage its carbon footprint (includes reduce energy consumption, minimize waste, etc). From a business perspective, this component is also where the majority of operational cost benefits are contained. On the “Do Less Bad” path, there is an incredibly close relationship to saving money and reducing our impact on the environment. For those companies first starting out with their sustainability programs, this is where they should start. It will prove the environmental and fiduciary value to your Board of Directors (which will enable more investment for “Enable Good”).

“Enable Good” refers to creating the technologies, materials and business processes which will allow for paradigm shifts in the way we all interact with the environment. For example, nuclear power generation is a technology which has changed the way we *think* about producing energy. It *enables* us to choose the type of energy we’re willing to consume. “Enable Good” is the area which will enable us to come closer to *eliminating* waste, bad energy and carbon emissions. This is also the strategy component which grows a company’s revenue opportunities in the sustainability space. This component is really cool, because it potentially changes the world. It’s also an opportunity to increase national competitiveness, create exports and help us with our economic concerns.

“Do REALLY Well” is the strategic component which speaks to how well we do the first two components. The better we do them, the more opportunity we have to talk about them and create a leadership positioning for ourselves. If you “Do Less Bad” and “Enable Good” better than your competition does, you immediately increase your ability to attract revenue and investment. Its great business AND it’s great for the world.

Steve Boston, Chief Sustainability Officer,
CA Office of Sustainability
Member, CA Council for Technical Excellence

To Measure or Not to Measure – The Dilemma Continues

Einstein said ‘everything that counts cannot be counted and not everything that can be counted counts’. But common wisdom has it that ‘you cannot manage what you cannot measure’.

Much of human nature and most of the business world thrives on the measurable. The stock market is after all the most quantified of company success measures.

And herein lies a key dilemma for the corporate responsibility practitioner; for CR to succeed within the business we need to demonstrate our value to the business with measurable outcomes. But for businesses to fully embrace corporate responsibility within the wider world, the business and its stakeholders need to embrace that not everything that counts can be counted.

I have written a number of posts on the topic; a commentary for GE’s sustainability report on the role of ROI in corporate responsibility; a piece for this blog on my view that SMART (where the M stands for measurable) objectives can undermine sustainability objectives; I have also written a number of times on my views on quantified corporate responsibility rankings.

This past Sunday the New York Times carried two articles expressing the same dilemma, but in different fields.

In Metric Mania in The Way We Live Now section of the magazine, Johan Allen Paulos explores the extent to which we use metrics, and presents some examples of how easily they can be misleading. His examples come mostly from social issues; medicine and poverty for example. He uses a ranking of the ’20 Most Lovable Neighborhoods’, “Friendliest Colleges’ and finally Standard and Poor’s Credit Ratings to illustrate the extent to which selecting and adjusting (I would say ‘weighting’) the criteria impacts the outcomes. Very similar to my concerns about CR ranking programs.

The Book Review carried a review of a book on testing and choice in education by Diane Ravich. According to the review, the book claims that testing has been gamed (my word) by teaching to the test, and apparent improvement achieved by changing testing procedures. These ideas parallel my concerns about the sustainability downside of measurable objectives. Illustrating the dilemma further, the author of course has to call on data to reach her conclusions!

Read both pieces. They are well worth it. They show that the measurement issues we are struggling with in corporate responsibility are not unique to us. We would do well I am sure to watch and learn from findings in other fields. Paulos concludes “This doesn’t mean we shouldn’t be counting – but it does mean we should do so with as much care and wisdom as we can muster”.

Learning to Dance: Discussing Ways to Improve Partnerships for Sustainability

"When Giants Learn To Dance" was the title of Rosabeth Moss Kanter's classic book about how corporations can be giants and innovators. Guy Clark's muscial advice is "You got to dance like nobody's watchin". But what if you are a large corporation, your dance is sustainability, and everyone is your dance partner and wants you to dance to their tune - your employees, shareholders, customers, and neighbors? This is the topic I'd like us to discuss during the 2010 Solutions Labs.

Last year I attended the DC Unconference organized by EDF, Ashoka and the Green Innovation in Business Network as part of a series across the country. The conference topic is driving green innovation in business. An ‘unconference’ is different from a traditional conference in that the agenda is created by participants at the beginning of the day. Anyone can bid to run a session as long as people are interested in attending it and most sessions are moderated discussions rather than presentations. As you can imagine, it is pretty free form and I found that invigorating.

This year the series has been renamed Solutions Labs 2010 and is running in nine locations across the country. They are a great opportunity for corporate responsibility practitioners to gain input from a broad range of stakeholders from outside of the corporation.

I am interested in using the opportunity presented by the Labs to explore the relationship between corporations and civil society on sustainability - the sustainability dance. Are those relationships well positioned to deliver sustainable solutions and behavior? (We might think for example about the contrasting relationships between the company and the employee, the shareholder and the customer). What changes would we like to see in the corporations themselves and in the relationships between the corporations and the stakeholder to accelerate positive change.

I am hoping to encourage attendees at different events across the country to run and attend sessions on that theme and record and post the findings. It will be valuable to build on each-other’s findings and also to identify commonalities and contrasts and see if we can explain them. We have some volunteers to lead sessions already and I will be running a session myself in DC on May 27th.

Are you attending a Solutions Lab in your city? Would you be interested in leading a session on these topics and collaborating in posting and comparing the outcomes? Leave a comment below and include your name and location if you would like to lead or help with a session, or add your name to the Wiki. The potential for diversity of approaches promises to be one of the most valuable and exciting aspects of the event series but for those who want it, we will prepare some questions to help leaders frame the discussion.

Full details for the series and how to register at Solutions Labs 2010 (and yes that is a photo of me from last year’s event. Don't worry, I'm not dancing!)

Do consumers want more data?

I don’t think so.

At a smart meter event hosted by Google and The Climate Group in DC a few weeks back, much of the discussion was on how much information consumers are going to have on their energy usage in the future and how they are going to act on that information to have their washing machine run at midnight, unplug their appliances when not in use and use their PDA to switch off lights remotely when the kids leave them on. I don’t see it that way.

There are iPhone apps to scan barcodes. So apparently, we will soon (if not already) be walking around the supermarket scanning products and checking their carbon footprint, ethical employee values, supplier code of practice. I am not persuaded.

At the LCA Supply Chain summit in Chicago last week, Dr Stan Rhodes of SCS did a superb presentation for assessing product performance against a new ANSI sustainability standard. The slides included a compelling visual representation of the results that certainly had me excited about the possibilities. Even then I don’t believe that most consumers would have the motivation or knowledge to interpret the results.

I hope consumers take ever more interest in the various ethical and sustainability implications of what they are buying. It will help me do my job. However, I don’t think comprehensive and detailed data will cut it for the consumer. That doesn’t mean it shouldn’t be provided for the sake of transparency. But it won’t have impact without trusted intermediaries to interpret it and simplify it down to actionable judgments. Those intermediaries might be NGOs, government, media, or perhaps some other organization. But walking round the supermarket comparing 15 dimensions of sustainability across two brands of cookies, switching the dishwasher on from the road? Not for me.

CR Conferences – Horses for Courses or The Good, The Bad and The Ugly?

I have just come to the end of speaking at a series of five corporate responsibility conferences/events in close succession. It seemed like a lot. In fact, my esteemed colleague @Dstangis even suggested on Twitter that I am attending so many conferences that perhaps I don’t have enough work to do! In practice, it probably represents only half the of what I could have gone to and I have to miss some I would very much like to attend. The budget only goes so far.

Seems to me that that the conferences fit into one of three categories that define the flavor of the event, and for me, will help me determine which I prioritize going forward. Those categories are defined by who is leading the conference: (1) mission driven organizations (2) schools/students and (3) conference organizations.

I have found that conferences driven by mission driven organizations and schools (or student) organizations in the CR space are the most valuable. They tend to have a better defined objective, clear flow of events and better organized panels. Those organized by mission driven organizations are the best for me for networking and learning from peers. Those organized by schools and students are without doubt the most energizing and motivating. Students tend to ask more challenging questions with little worries for the ‘people in glass houses’ concern that those of us in corporations might have when we consider challenging each other in public foray.

I have not been as impressed with events led and organized by conference companies. I have seen less interest from the organizers in the flow of the event and in the participants in the panels. I have also discovered that it is a bad sign when the panelists are not contacted by the facilitator in advance of the conference to ensure the different presentations fit together appropriately.

Last year I attended the Unconference in DC and am looking forward to attending again this year. This is a completely different conference format in which participants together determine the agenda at the beginning of the day. They are running in multiple locations this year with the new title Solutions Labs. I have some ideas for the Labs, which I will share shortly in a post.

I would be interested in hearing others perspectives on the CR conference circuit. Any you particularly recommend (unbiased perspectives welcomed, no self promotion please :-) )?

Encouraging Signs in the Marketplace

One of the most important stakeholders influencing corporate behavior is investors. Recent alignments between mainstream financial market organizations and corporate responsibility organizations are good reason to be encouraged. Of course, SRI’s have always been at the intersection of that space. For example, Calvert with their mission of ‘Integrating sustainability into capital markets for the health of the planet and its people.’ But I am referring here to financial organizations that are not mission driven in the same way.

Last year, Thomson Reuters acquired ASSET4 an investment research provider and offered an ESG/CSR information service.

In addition, last year, in August, Bloomberg launched a new ESG data service. I attended a compelling presentation about the service given by Curtis Ravenel at the annual members meeting of The Climate Group in New York last week. In the opportunity I had for a quick glance, BT seemed to fare well in the aggregate score.

NASDAQ has been running a CRD Analytics since June 2009 “a benchmark for stocks of companies that are taking a leadership role in sustainability performance reporting and are traded on a major US stock exchange”.

NYSE Euronext has partnered with the Corporate Responsibility Officers Association (of which in the interests of full disclosure I should say I am a governing board member) to accelerate professionalization of best practices in corporate responsibility. NYSE Euronext and CROA just released a joint CR practices survey across the member companies of NYSE Euronext.

Of course investors need to understand the data (Bloomberg’s analysis alone has 101 data sets) to be able to act on it. And as we know, good transparency doesn’t always correlate with good practices. But I think these initiatives (and others I have probably missed) are encouraging building blocks.

A North American’s Perspective on CR in the UK

I am often asked about how it is that Britain is more advanced than the USA on corporate responsibility. I don’t completely agree, but the question is so flattering so I tend to get drawn into coming up with reasons! Chris Coulter of Globescan has done a lot of research in the area over many years and so when we were together on a panel at BCCCC I took the opportunity to ask him afterwards to give me his view. One that I thought was perhaps less biased than mine. It was just after lunch so apologies for the clean up noise in the background!

Chris’s main points are:
• An engaged and competitive media
• A long standing and sophisticated NGO and Civil Society approach (eg. Business in the Community)
• Government engagement
• British companies having been exposed to international business for a long time
• A British culture of ‘doing the right thing’

Compare Chris’s views with Professor Jenn Griffin’s thoughts.

Recruitment Consultant Acre Resources Releases Corporate Responsibility Survey 2010

Recruitment Consultant Acre Resources today published their Corporate Responsibility Survey 2010. You can see the full survey and highlights here. They asked me to provide a commentary on the section addressing what we do…

The question in my mind is how much of the doing do we, the corporate responsibility practitioners do, and how much of the doing we try to get others to do. I consider the role of corporate responsibility practitioners is to engage with stakeholders to establish the CR strategy and policy, and then to set the groundwork that will enable, encourage and cajole stakeholders (mainly but not solely employees) to implement that strategy.

Our role should be as catalysts to embed corporate responsibility across the business. When a new issue arises we may have to do some of the doing ourselves in the first instance. However, this should only be as a means to proving the issue before we drive it to be addressed as a ‘business as usual’ operational responsibility thus freeing ourselves up to look over the horizon for the next unknown.

Over time, I would expect to see the functional components of the role, such as strategy, engagement and reporting, feature consistently in the top five activities. Themes such as climate change, ethical working conditions, or nutrition perhaps, will cycle through and feature only for so long as we are still determining the true impact of the issue prior to embedding it in the business.

It would be interesting to be able to look independently at the evolution of functional roles and themes and even examine where each theme is in its lifecycle; research, strategy, engagement, operationalization and hopefully, issue resolved!

Guest Post - Manpower

I recently received a note from Charles Bartels telling me of the passing of the Manpower’s Founder Elmer Winter. Charles is Director of Global Social Responsibility focused on Manpower's Workforce Development and Diversity. Attached to Charles’ note was a memo written by Elmer Winter that I thought illustrated a true understanding of embedding corporate responsibility into a company’s values. I asked Charles if he would contribute a guest blog from his unique perspective of having known Mr. Winters personally.

In November of last year, Elmer Winter, 97-year-old co-founder of Manpower passed away.

From the day in 1948 that he opened a tiny Milwaukee staffing office with his brother-in-law, through his retirement in 1976 and beyond, Winter was passionately committed to Manpower’s values for the dignity of people and the meaningful role of work in their lives.

Since his retirement in 1976, Winter kept regular office hours at the Manpower World Headquarters and took tremendous pride in watching the small business he co-founded in 1948 grow to a $22 billion Fortune 120 employment services firm with offices in 82 countries.

I had the privilege of helping Elmer in the past 3 – 4 years with his move to our new world HQ, arranging some of his collections, organizing a part of his legacy, and more. He was quite unique, especially in his unwavering belief in the role of business to act in support of the liberating power of education and employment. Elmer had a deep-seated belief in the “socially responsible” role of business for the benefit of the world society (and Manpower’s in particular – connecting people to work, helping our customers’ enterprises succeed).

In a memo he wrote for all employees in October 1969, Elmer elaborated on what I think is still, 40 years on, an enlightened approach to corporate responsibility. In answering the question “Does the Company Have a Mission Beyond Making a Profit for Its Shareholders?” he brilliantly weaves together the role of Manpower to meet the needs of our customers with our role to respect and build the dignity of workers. And within this he addresses our obligations to the 4 million people to whom we didn’t give jobs as well as the four hundred thousand we did!

I would urge you to read the memo here.

I think we all still have much to learn from the approach he describes. In so doing I hope we can further the spirit and legacy of a great man who certainly touched my life and, I am sure, the lives of many others.

A Partnership for Cross Generational Digital Inclusion

Last year BT decided to allocate some of its community investment to in-country partnerships outside of the UK. Not being one to miss an opportunity, I applied for a share of the funding and today we announced a two-year partnership with One Economy (OE) in the USA involving a grant, volunteering and collaboration.

In this video, Ken Eisner, Managing Director OE Ventures, talks about One Economy and about our partnership from his perspective.

Digital inclusion is a key CR focus area for BT. Access to the digital world is a critical component for social and economic wellbeing in the community. There are many digital divides; geographic, ethnic and wealth based are the most well known. The generational divide is less well known, but access to the internet for older people falls way behind access for the population as a whole. This creates additional hurdles for older generations to access social communications, news, government services, healthcare, financial services and many other necessary components of a modern day life. The FCC’s recently published National Broadband Plan includes reference to the generational divide.

Across the Atlantic in the UK, BT has been working on the generational divide through BT Internet Rangers. It provides young people with an internet based platform and a framework to help them teach their older family members how to use the internet. Our grant to One Economy (OE) is for them to build a US version of the Internet Rangers program, leveraging BT’s lessons from the UK and One Economy’s extensive experience in digital inclusion in the USA. I am sure there will be much learning in both directions.

We will need a new name though so people don’t think we are competing with the Ranger that rides with Tonto or with the National Park Service.

What is Our Role?

The Corporate Responsibility Officers Association posted this blog from me today. I thought it would be of interest to readers of CSRPerspective too.

I chair the professional development committee of the Corporate Responsibility Officers Association (CROA). I am especially passionate about this component of the work of the Association. I have a directional aspiration for the CRO and the practice to be considered in a similar way to the CFO, or the Chief Legal Counsel. I say ‘directional’ aspiration because I don’t expect, nor do I wish for it to be exactly the same. Both the financial and legal roles have a significant component of compliance and I see the role of the CRO as distinctly ‘beyond compliance’.

That said, one of the things that gives the CFO and Chief Legal Counsel (CLC) their gravitas, is a recognized set of responsibilities, competencies and principles to work to. I think we need the same for the CRO and for CR practitioners. Some say that this is navel gazing and we need to be out there embedding the principles of CR in the business. Others have said to me that our practice is only temporary and that once the principles are embedded in the business the need for our role will be gone. I think both perspectives are valid, although I disagree.....

Navel gazing; I certainly agree that we should be out there embedding the principles in the business. But that is no different than the CFO and the CLC needing to be out there ensuring that the employees across the company are aware of and implementing the principles of cost and revenue and the respect for the law in their day to day business activities. None of that denies the need for the defined role of the CFO and CLC, In fact I think it strengthens it.

The temporary nature of our role; If you believe that corporate responsibility is addressing climate change, then sure, once the science is fully accepted and incorporated into the way we run our business, the need for the role is fulfilled. But if corporate responsibility is about business acting positively in regards to the broadest needs of society and the environment, there will always be a new issues around the corner that the CRO will identify before it causes the business serious pain.

So I remain enthusiastic about this work to develop the professional standing of the practice. Defining a consistent set of competencies, job description and a behavioral code for the role are some of the first things I would like to see happen.

Guest Post CERES - Radical Transparency and Social Media Tools

Last week I wrote a post on highlights from CERES recently published ‘Roadmap for Sustainability’ regarding connectivity and communications. Andrea Moffat added an insightful response to the post, which follows below (with permission) as a guest post. Andrea is the Senior Director of Corporate Programs and oversees Ceres’ Corporate Accountability, Corporate Governance, and Corporate Outreach programs. She was also lead author of the report.

As Kevin draws out from the Ceres Roadmap—connectivity and communication are key elements of the new business reality for the 21st Century Corporation. As a telecommunications company, BT is working to leverage its own expertise to develop sustainability solutions. BT’s “work anywhere” tools have eliminated 1.5 million journeys per year, with an associated 58% reduction in carbon emissions. The environmental and social benefits of increased connectivity are clear—but as Kevin also points out, there are potential downfalls.

Kevin's comment regarding the risks that companies face from "radical transparency" is particularly ripe for further conversation. True enough, this era of social media lends itself to "short-termism," exactly the kind of thinking that has allowed companies to ignore risks from issues like climate change for far too long. Social media makes companies more vulnerable to criticism, and as Kevin notes, to “trial by public opinion.” Yet social media also presents companies with an extraordinary opportunity to actively engage with stakeholders in real time. Social media tools can be used by companies like BT to further engage stakeholders in constructive and candid dialogue. The short-termism that results from the "social networking news cycle" can and should be part of that discussion. For example, Timberland's "Voices of Challenge" forum offers stakeholders the opportunity to comment on controversial issues that affect the company. It takes boldness, yes, but those companies that embrace and leverage the opportunities offered by this era of "radical transparency" find that their efforts are rewarded through improved trust and credibility among stakeholders.

What Company Should I Join to be Fulfilled?

I spoke recently at the Social Enterprise Symposium at the Smith School of Business UMD. As always with student events, the audience was stimulating and the questions provided me with new frameworks and perspectives – including how fortunate I am to be in the job I am. There were many questions about working in the field: What is the most fulfilling role in a corporation? How can one make a difference? How should you be assessing a company that you are thinking of joining?

There was much discussion about ensuring that the company you join has a commitment to CR, demonstrated through volunteering programs, philanthropy, and green activities in the office. Implementing or participating in programs like is considered a way to help have a meaningful impact and be fulfilled.

However, I think it falls short. Similar to my view on the terminology ‘giving back to the community’, looking at voluntary work through the company, or at office green programs, as the way to get meaning from your work, suggests that working in a company is not in itself meaningful and societally fulfilling.

Such employee engagement programs are valuable and I have written much about them. They are especially valuable if they are seen as a means to an end through their ability to raise awareness and build momentum. But if you care about the impact of companies on society, you should not pick your employer just because they have a good volunteering program. I think you will be disappointed.

Instead, I recommend an approach of picking a sector about which you feel passionate. It might be healthcare, infrastructure, nutrition, or one of many other fields. Then, rather than ask the prospective employer in that sector if they have a green program in the office, ask a question that is core to the field and to your passion.

If the issue about which you are passionate is healthcare for the economically disadvantaged, ask the prospective healthcare employer what they are doing to profitably increase access to their healthcare services. If it is nutrition, ask the food company how they are rebalancing to increase the proportion of their portfolio that is of nutritional value. If it is a telco, ask them how they are tackling digital inclusion and if they see that as a threat or opportunity. If you really want to discriminate (and if the job market allows you to), this approach will be more likely to lead to a fulfilling job in a company that really wants to make a difference.

Transatlantic Contrasts in Corporate Responsibility

I spoke on a panel this month on “The Reality and Rhetoric of Corporate Social Responsibility” for George Washington University’s Institute for Corporate Responsibility.

Each year, Professor Jenn Griffin, associate professor at the Institute, takes a group of students on a highly oversubscribed trip to the UK to meet with corporate executives and look at contrasts between UK and US approaches to corporate responsibility. This is a topic that I often talk about here on my blog, so I asked her to share her top findings from years of visits and study. The video is below.

Connectivity and Communications - Key Driver of Sustainability (CERES)

CERES recently launched their report The 21^st Century Corporation: The CERES Roadmap for Sustainability. Last year’s report, CERES 20-20, laid out four pillars. The second pillar was ‘setting new standards and expectations for business leadership’. This new report dives deep into this pillar exploring 20 expectations related to governance, stakeholder engagement, disclosure and performance. It is comprehensive in breadth, thorough in depth and full of inspiring examples that demonstrate it can be done. I think it will remain valuable for many years as a benchmark.

My initial look was dominated by the four key drivers of sustainability: (1) Competition for Resources, (2) Climate Change, (3) Economic Globalization and (4) Connectivity and Communications. Although my original inspiration for CSRPerspective was the intersection between ICT and sustainability, I realized haven’t written much about that recently. In fact, this CERES report has reminded me of the importance of my own sector as it highlights it as one of the key drivers together with resources, climate change and globalization!

This part of the report highlights the rapidity and disaggregation of communications and the impact that has on tracking company’s sustainability performance. CERES talks about an era of “radical transparency” . I certainly agree with this. Some of my recent comments about the importance of social networking to demonstrate authenticity and bridge the gap between the company and civil society are a part of the picture. All companies, telecommunications, communications and others have the choice to embrace this now and use it proactively; or wait, but have a lot of catching up to do.

But I see some additional significant attributes of connectivity and communications that need to be taken into consideration. The less positive side of the “radical transparency” coin is trial by public opinion and, perhaps even more potentially destructive, the short termism engendered by the immediacy of the social networking news cycle.

Connectivity and communications have other potential positive attributes. On the topic of social and economic sustainability; leveling the playing field for the economically disadvantaged and providing better access to healthcare and education are some of these attributes. On the topic of environmental sustainability; substitution of and efficiency for energy intensive activities are positive elements. There are negative attributes too though which have the potential to be carried out more anonymously and on an ever increasing scale; things such as cyber crime, online bullying, child pornography and government abuse of human rights.

I am thrilled and newly inspired to see connectivity and communications considered by CERES to be one of the key drivers of sustainability. It brings with it a renewed obligation to the sector, and to everyone who uses connectivity or communications services, to take that responsibility seriously and ensure we do not permit the downsides to prevail. Rather we must leverage and optimize all the potential benefits.

By coincidence, this month, BT’s Global Services organization is highlighting some of the sustainability impacts of ICT services. You can read more about this here.

Social Enterprise Symposium: Transforming Business for the Global Good

I have the pleasure of joining an esteemed panel of speakers this week to discuss jump starting sustainability in the corporate sector. This is a topic that I talk about extensively on this blog and speak about at many conferences throughout the year. Businesses around the world are rethinking their business models, products and employment engagement programs to address sustainability.

The event is being hosted by University of Maryland’s Robert H. Smith’s School of Business and for those who are unable to attend in person, it will be streamed live here at 6.00pm EDT. You can also follow my tweets or post your own tweets throughout the event using the hash tag #SES10. The twitter stream will also be visible here.

Guest Post BASF – 3:1 Emissions Balance

Last week I had the pleasure of meeting Jack Armstrong Leader of BASF’s Construction Markets North America and also a board member of the Sustainable Building Industries Council and Chair of the Construction Market Team of the Plastics Division of the American Chemistry Council.

Jack described to me the “3:1 Study” that compared the carbon benefits and carbon burden of the chemicals industry. I was intrigued by the parallels with the Smart 2020 study produced by The Climate Group and Gesi, that I have written about previously and that looks at a similar comparison between benefit and burden in the ICT sector. Jack kindly agreed to say a few words about 3:1 Study on video for me.

Guest Post from EMC: Speaking of Climate Change…

A couple of weeks back in Some Thoughts on Climate Change I shared some responses to the recent controversies within the climate change space and in particular how corporations should respond. Kathrin Winkler, Vice President and Chief Sustainability Officer at EMC Corporation shared her thoughts on the same topic on her own blog Interconnected World. I found them very enlightening and asked Kathrin if I could repost……

The subject of Climate Change has inexplicably (OK, maybe explicably) become a touchy one, particularly here in the U.S. (though I'm assured by a friend Down Under that we are not alone). I'm sure you've seen the polls, not to mention the press. One of the conundrums (conundra?) of being in an environmental sustainability job is deciding how to talk about Climate Change and how to react when the confronted by a challenge to the idea of global warming.

With nearly 43,000 employees, EMC has its share of people who are understandably befuddled by the barrage of conflicting information in the media and simply don't have the time to do the research to sort it out. And yes, we have our out-and-out skeptics and cynics, too. So what do I say when someone says to me "Did you hear? They've found out that the earth is actually cooling!" A woman on our Green Business Leadership team was asking my advice on this question the other day. And I'm not really sure what the best approach is.

We can…

…Tackle the objections one by one, starting with "don't confuse weather with climate".

…Get pedantic, delving into climate forcings and the carbon cycle.

…Go narrow, focusing on energy and how reducing dependence on fossil fuel is good for our wallets, for national security and for the economy.

…Go wide, emphasizing that even without global warming, the environmental insults we are perpetrating on the planet are devastating water supplies, destroying species, and hampering ecosystem services that communities depend on, never mind using up resources like water, tin, copper and much more.

…Appeal to people's competitive natures by highlighting how China is taking the initiative in green technology.

…Be selfish, maintaining that regardless of individual opinion, it's good for business to care about Climate Change since our investors, customers, and partners are asking us to demonstrating that we're responsibly managing the associated risks.

…Deflect. Expound on how increased atmospheric CO2 concentrations are causing ocean acidification that can be measured in the thinning shells of pteropods, endangering this critical link in the food chain. (Warning: this one can stop a conversation dead in its tracks!)

…Dismiss "ClimateGate", pointing out that the behavior of a few scientists doesn't change the science.

…Simply hold our ground with "the science really is unequivocal, and corroborated across many, many disciplines".

… Soft-pedal by only referring to "Climate Change" and avoiding "anthropogenic" (human-caused) so as not to inflame the most rabid skeptics.

…Cite well-known conservatives who have concluded it's a real issue - people like David Brooks and Rupert Murdoch.

…Play the percentage card, by seeking agreement with the challenger that there is at least a reasonable chance that the skeptics are wrong, leading to the conclusion that we can't afford to take that chance.

All of these approaches are legitimate, and I've use all of the above depending on the person, the nature of the comment I'm responding to, and the circumstance of the conversation. The problem is that whenever I sidestep the fundamental question, I feel a bit like a coward. On the other hand, my job is to drive change, and small detours can get you past roadblocks to progress.
How have you handled it?

What does Corporate Responsibility Mean to You?

Get an inside view and hear personal insights on what corporate responsibility means to some of my colleagues in BT across a range of CR roles. Is it a strong economy, a sustainable 2012 Olympics, a different attitude to work? Is it about applying commercial principles to CSR, CSR principles to our commercial practices? Can business help address the challenges the world faces? Hear perspectives from my BT peers in different roles and look out for more in coming weeks.

What does corporate responsibility mean to you?

Don’t Let “Internet Fear” Stop You from Giving to Chile

There have always been reasons for not giving to charitable causes; the urban myth of the panhandler who earned enough from it that he drove a Mercedes; the more realistic story of the charity that spends most of its funding on overheads and now, unfortunately, the exploitative stories of willful use of search terms like ‘Chile’, ‘donate’ and ‘earthquake’ to spread viruses.

But of course none of these are good reasons not to give. The Mercedes story is a myth. There are a great many websites such as Charity Navigator that provide all the insights needed to help choose a good charity.

But what about the internet security problems that have recently arisen with people searching for Haiti and Chile? How do we make sure they are a reason for not giving?

I have a few suggestions. Most importantly, don’t respond directly to links in emails soliciting donations. Instead, go to the internet and search for the website of the organization or another organization you know, or go through your company’s selected donor (for example BT works through DEC in the UK and the American Red Cross in the USA).

But to give you even more insight into the aspects of security and giving, I spoke with a colleague, Sushila Nair, from our security practice and asked for some additional hints on how to void the common pitfalls on the internet.

Kevin: How can I ensure that my personal or corporate virus software protect me against these threats?

Sushila: It is extremely important that you keep your antivirus up to date. Your antivirus should be set to look for new updates every hour or so to minimize the time you are unprotected.

To ensure that you are detecting newer threats, it is very important that you run Windows update to ensure your system has all the latest patches on it. If you don’t update Windows regularly you are leaving yourself open to many exploits that your antivirus may not have updated yet.

However it is also important to know that your antivirus won’t protect you against all malware. It is advisable that you use layered defense and install anti-spyware and a personal firewall.

Take sensible precautions by going to well known and respected web sites. Click on links with care, after all if it is not a reputable, well recognized site would you really be interested in what they have to say?

Kevin: What do I do if one of those windows comes up that looks like operating anti-virus software, warning me that my computer has a virus problem? I know I shouldn’t accept it, but I am nervous about touching anything on the screen at all – should I do a hard shutdown of my computer?

Sushila: There has been a lot of fake anti virus software out there. It claims to have detected some malware and then tried to install itself. It will then inundate you with requests for money and claims that you have been infected. What ever you do don’t let it install the software on your computer. Stop the program by using Windows task manager or if necessary restart your computer. If the software does a partial install then restore your system restore point.

Kevin: How can I protect myself from having my credit card number stolen?

Sushila: Any site where you are using your credit card number should be treated with care. Ensure that the site is using Secure Socket Layers (SSL). You can verify this by noting the padlock comes up, typically at the bottom of your screen when you are using it. Many banks are offering the capability to use Virtual Account Numbers. The idea here is that you generate a virtual credit card number which you use just for that transaction and so if anyone steals the number it is worthless.

Kevin: Does it really matter what browser I use? Is Internet Explorer less secure than Firefox?

Sushila: Malware developers like to get the biggest bang for their buck and they always try and exploit the most common platforms. There are more people using Internet Explorer and Windows so using Chrome or Firefox moves you out of the main stream and may decrease your risk

For the more internet savvy, a more technical treatment of the issues on our Secure Thinking blog

Employees Should Be Part of Any Green Solution

A report published by the National Environmental Education Foundation (NEEF) last week highlights the business benefits of environmental and sustainability education for employees. According to the study, these business benefits include improving operational efficiency, strengthening customer and community relations, innovation, supply chain management, and attracting and retraining employees.

I would agree with the assessment of these business benefits, and emphasize that the value of sustainability education and engagement of employees is as a means to an end, not as an end in itself. Engagement in environmental programs increases awareness of and sensitivity to key sustainability issues.

Often, employees take that heightened sensitivity back into the workplace and apply it in their day jobs, as well as at home and in their communities. For example, the McDonald's project cited in the study shows how restaurants and their employees worked with customers to reduce 3 million pounds of CO2; BT and Hewlett-Packard have created programs to support employees who want to install solar installation in their homes.

While the report highlights several very tangible business benefits of employee engagement in sustainability initiatives it neglects one key intangible benefit: trust. Authenticity is the key here. I maintain that trust is driven by authenticity and distrust by lack of authenticity.

We judge whether a person is authentic by the consistency with which they apply their values. The public judges companies in the same way. If we declare a corporate responsibility value through our environmental investments we are expected to apply that value consistently. Therefore it is important that environmental values are applied consistently throughout the company and incorporated into the work of all employees -- not just Corporate Social Responsibility professionals.

What would you think of an IT company building a solar installation on top of an inefficiently run data center? Unfortunately, this is a plausible scenario in the absence of the involvement and coordinated efforts of employees throughout the company.

However, when employees are engaged, they can help align practices throughout the company, resulting in outcomes like Baxter's "lean" energy program for its 63 key manufacturing facilities. At BT we have tackled core operations by widening the operating temperature range of our network data centers to significantly reduce HVAC usage.

This report provides good news in a down economy. Companies should be encouraged by examples of the linkages between sustainability education and engagement of employees and clear business benefits. However, we still have work to do.

A recent study from Brighter Planet finds that 86 percent of firms fail to engage employees on sustainability. And, true skeptics are likely to question the scarcity of quantifiable measures of impact of engagement of employees in sustainability initiatives. I agree with NEEF that next steps include gathering data further linking employee engagement to environmental outcomes.

This post was originally published on March 4, 2010 on GreenBiz.com at http://www.greenbiz.com/blog/2010/03/04/employees-should-be-part-any-green-solution

PR News CSR Awards: Highlights on Authenticity, Corporate Community Investment and Social Networking

Here is the first part of my keynote at the PR News CSR Awards last week addressing how corporate responsibility can contribute towards rebuilding trust in business. My key point is that authenticity is key to trust. We judge whether a person is authentic by the consistency with which they apply their values. I imagine people judge corporations in the same way.

So if we express our values through our community investment, then to substantiate our authenticity, we need to be consistent in applying those values to our core business; our products, our employees, our customers and our public voice as expressed in our brands, advertising and lobbying. My challenge to the CR practitioner, myself included, is to increase the proportion of time spent in the core business. I would welcome your comments.

In the second part of my comments, I explained that I see a key role for corporate community investment, not so much as an end in itself but as a means to increasing sensitivity and awareness amongst our employees that they can take back and incorporate into their jobs. Volunteering is especially important from this perspective. But beware, community investment can undermine authenticity if we do not follow through and apply the same values in our core business.

I also address the key role I see for social networking to bridge that perceived distance between the company and the stakeholders. Frank and engaging exchanges with corporate executives, as demonstrated by Bill Marriott of Marriott and by Tom Glocer of Thomson Reuters, and with our employees, can be one of the best ways to demonstrate authenticity and to bridge the perceived distance between the stakeholder and the corporation.

Who decides what is acceptable?

A few days ago an employee within Citi cut off the internet business account of a customer, Fabulis. The Citi employee determined Fabulis breached Citi rules for what internet business accounts Citi is prepared to support.

In fact it was a mistake. The employee made what seems to be a serious misjudgment that the Fabulis website contained pornography. The site didn’t contain pornography and didn’t breach Citi’s standards (although perhaps the content did breach the individual’s personal standards regarding sexual orientation) and the account has been reinstated.

Lots of interesting issues, but from a corporate responsibility perspective I am most fascinated by the question of whose values should be applied and how, by a corporation operating across regions, countries and cultures.

Citi’s clarification of the situation for Internet Business Accounts includes the statement “we will continue to reserve the right to decline or suspend an account if we find illegal or discriminatory content, or if the site involves gambling or pornography.” Citi is clearly defining a set of standards, beyond legal, that they will require their customers to adhere to.

I have written a couple of posts suggesting that we should include sustainability criteria in selecting our target customers. This approach from Citi takes things a step further by refusing to do business with customers that are carrying out activities that do not meet certain standards, although they are legal.

I believe that a fundamental characteristic of corporate responsibility is ‘beyond compliance’. On a related note, as I once wrote in a blog, I believe that ‘legal doesn’t equal sustainable’.

But in practice, and employee error aside, when you start refusing to do business, the challenge is twofold. First, whose standards define what constitutes discriminatory content, pornography and gambling? Are Sports Illustrated’s ‘paint-on’ swim suits considered to be porn? Are state lotteries gambling? Are ethnic, gender or sexually oriented websites discriminatory?

And secondly who actually reviews the material and decides?

I welcome companies trying to apply their CR values broadly, but I am going to have to give a bit more thought to how it plays out in practice and where I draw the line.

And the winners are...

Congratulations to all the winners and finalists from yesterday’s PR News CSR awards. For readers of this blog, Frank Mantero, Director of Corporate Citizenship Programs at GE and a guest blogger for CSRPerspective last year, won Executive of the Year – Public Relations. Congratulations Frank!

I was honored to give the keynote at the event yesterday. The main theme of my address was that to gain trust, we have to establish authenticity. Authenticity will be established by the consistent application of our values. So we have to take the values declared in our corporate responsibility and in particular in our community investment activities and apply them in our core business. (I will be posting a video of the keynote shortly.)

A few people approached me with comments and in addition I facilitated a discussion immediately after the event to discuss the points I had raised. Chatham House rules applied.

I was interested in the focus of the comments;

No one challenged my main theme but neither did they jump forward to reinforce it. When asked specifically, there seemed to be support, but I had anticipated stronger reactions either for or against. I had thought some would tell me I was an idealist – no one has yet!

Commentators were more taken with my:

• use of movies to illustrate public perception of corporations;
• criticism of the terminology of ‘giving back’ as implying we are somehow taking away. A number of people approached me to express support for my raising that issue. I wrote about this last year too; and
• pitch for social media as a tool to bridge the gap between individuals in the company and external stakeholders.

Social media attracted more attention than anything else. I received a lot of support (from users of social media of course). But there was also significant and well founded skepticism about whether a corporate blog can be truly authentic (I think the obligation is on bloggers to demonstrate that this is possible). Also a comment that I do sometimes worry about myself, suggesting there is a self sustaining community of bloggers and tweeters all conversing voraciously with each other and then, there is everyone else.

Authenticity is the key to Rebuilding Trust

I am honored to be the keynote presenter today at the PR News 2009 CSR Awards at the National Press Club in DC. The awards program has been running since 2005 with an ever broadening range of awards categories. It is much broader than the PR News title might lead you to expect.

In my keynote I am addressing how we can rebuild trust in business. All the trust surveys aside, I find it most notable that three of this year’s Oscar best picture nominations, Avatar, District 9 and Up in the Air have large corporations as their main protagonists. Each of these corporations is portrayed as distant and as societally and environmentally oblivious. If this represents the public perception of corporations, and I think it does, we have a long way to go.

Authenticity is key to trust. We judge whether a person is authentic by the consistency with which they apply their values. I imagine people judge corporations in the same way.

So if we express our values through our community investment, then to substantiate our authenticity, we need to be consistent in applying those values to our core business; our products, our employees, our customers and our public voice as expressed in our brands, advertising and lobbying. My challenge is to the CR practitioner, myself included, is to increase the proportion of time spent in the core business.

I also see a key role for community investment, not just as an end in itself but as a means to increasing sensitivity and awareness amongst our employees that they can take back and incorporate into their jobs. Volunteering is especially important from this perspective. But beware, community investment can undermine authenticity if we do not follow through and apply the same values in our core business.

Lastly, I see a role for social networking to bridge that perceived distance between the company and the stakeholders. Frank and engaging exchanges with corporate executives, as demonstrated by Bill Marriott of Marriott and by Tom Glocer of Thomson Reuters, and with our employees, can be one of the best ways to demonstrate authenticity and to bridge the perceived distance between the stakeholder and the corporation.

Please let me know what you think of these ideas.

Some Thoughts on Climate Change

There have been some significant back-currents recently in the wave of progress on climate change; the outcome from Copenhagen that was short of many people’s expectations; some climate change scientists and some involved in the IPCC pursued poorly conceived public statements, exchanged particularly unscientific emails or exaggerated the strength of their findings; recently three significant members of USCAP have left that group. Skeptics have appropriately highlighted these issues.

To put things back in perspective, I enjoyed reading Frank Robert’s economic view on balance of risks in the New York Times on Sunday. Of course, we need to be careful not to be overly reliant on fear as the motivating factor. ‘Just in case’ is not a strong argument for action. The balance of risks has to be compelling.

The scientists have a dilemma. Not long ago I recall the scientific community was being criticized for not being forceful enough in its message. I recall comments that it was too mild in its language, too many caveats, too academic in its articulation of the outcomes. Now it seems we have our just desserts and much of the criticism has reversed. Of course balance is everything and perhaps one lesson is the importance of being true to ones core values.

I think many companies are at a bit of a loss as to how to respond to these back-currents and as a result have gone quiet on the topic or reverted to energy efficiency and energy security as the reasons for reducing energy usage. But for those who are convinced by the scientific evidence of anthropogenic global warming this is not the time to do that. This is the time to stick to principles. Regaining the momentum later will be much harder than the effort to maintain it now.

I do think companies need to get better at articulating why we hold the positions we do. We owe it to our stakeholders to be able to do this and if we can define clearly what evidence underpins our positions, it easier to define if and how we should respond to a particular change.

More than ever, I don’t think we can ignore those who are skeptical. We need to engage them with the same respect and sense of inquiry and open debate that we do those who are supporters.

Which Stakeholder Hat are you Wearing Right Now?

Different stakeholder groups have different standards when it comes to CR.

Members of civil society have the most demanding standards for how a company should discharge its corporate responsibility obligations. They are easily riled about a corporate misdeed in the paper. Of course they may have little invested.

A customer, wanting to buy a product, has slightly more invested in the company, and a lower threshold for what is acceptable. Much lower I suspect if they really want the product!

Shareholders have the lowest thresholds and give little or no thought to the corporate responsibility of the companies in which they invest. Perhaps they put a small proportion of their holdings into socially responsible investing (SRI) to ease their conscience. But for the most part shareholders look at quarterly returns, and trying to outperform the index.

What about employees? At times of strong employment when the potential employee has the stronger hand, reputational issues count for something in choosing an employer. Once in a company and committed though, employees can be defensive of their employer almost to a fault.

What is interesting to me is that the same individual can have multiple stakeholder relationships with a single company on the same day. And apply different values to that one company, depending on the moment.

I can envisage someone reading the morning papers as a member of civil society and feeling angry about a corporate misdeed by a particular oil company. But that same person will visit that company’s gas station on their way to work because it is on the right side of the road rather than go through the hassle of crossing oncoming traffic to the competitor’s station. And I would bet they don’t even consider reviewing their mutual fund or share holdings to weed out the company whose actions offended them so that morning.

What does it mean to us as CR practitioners that our stakeholders can change their spots so readily? Ideally we would hold our companies to the highest standards – that of the member of civil society. But if the invested stakeholders (customers and investors) don’t support us, we are left at a competitive disadvantage.

Perhaps CR practitioners could make more progress if individuals applied their values more consistently whichever stakeholder hat they were wearing at that moment. If investors and customers would put their money where their civil society values sit we would have stronger business cases for taking action.

Awareness is the first step in change. If we could help stakeholders to see the inconsistencies in their own value judgments we would be making a start at closing that gap.

Are You Happy?

I have noticed more reports than usual about happiness and wellbeing in recent months. Carol Graham’s excellent piece in the Washington Post in January basically concludes that happiness is linked to stable relationships, stable health and enough (but not too much) income.

Gallup’s Happiness poll identified that “Americans' happiest days of 2009 were on or close to holidays, consistent with previous mood index scores showing that days with more-than-normal time dedicated to socializing with family and friends enhance people's happiness and enjoyment.”

The recently published 59 Seconds by Richard Wiseman concludes that fundamental ‘circumstantial changes’ (moving house, getting a pay rise), result in only short term happiness as we quickly adapt to the new lifestyle, whereas ‘intentional change’, in which he includes what seem to me to be less significant activities, such as joining a new club or starting a new hobby, results in prolonged happiness. He also identifies that acquiring new things does not generally equate with increased happiness.

It is well recognized that two of the key challenges for sustainability are consumerism and the requirements for continual and short term growth in financial markets. But if these things do not lead to happiness, why do we strive for them to such a great extent?

I can think of a couple of reasons. One is that economic growth is very measurable and we all like things that are measurable. Another (perhaps related) is that GDP is such a prevalent metric for development. In fact at BT we have linked our Climate Stabilization Intensity Target for carbon reduction to our contribution to GDP to allow for both economic development and carbon reduction.

Graham’s article in the post takes the concept further and talks about the ‘economics of happiness’ identifying how governments are starting to look for metrics much broader than GDP to measure development. It is worth a read.

As a nation dedicated to the pursuit of happiness I think it would be well worth looking closer at the findings of these and other studies and understanding what really makes people (amongst them employees, customers and shareholders) happy. I suspect the findings could change some of the basic principles on which we measure success and allow us to build new foundations that better support sustainability.

Spending Money to Solve Systemic Problems

In Speaking of Faith on NPR this past weekend, Jacqueline Novogratz, talked about a third way for development, somewhere in between charity and business. She pointed out that despite having the largest population of NGOs per capita, Haiti has made limited advances. Traditional quarterly returns driven capitalism doesn’t help much either in the poorest economies.

Novogratz describes the market as one of the best listening devices we have on the planet. As she puts it, “if I give you a gift you would be highly unlikely to tell me what is wrong with it – when I come visit, you might put it on the mantelpiece to show me how much you like it. The same happens with charity. But if I ask you to buy something from me you suddenly become a customer with a big attitude as to what’s right about it and what’s wrong with it. Suddenly that conversation that we are having becomes much more real. The market is one of the best listening devices we have on the planet “

Novogratz talks about Patient Capitalism, a form of social entrepreneurship that she addresses through the Acumen Fund.

From a CR perspective I like to think in terms of finding a source of funding within companies that is ring-fenced. It would be dedicated to funding ventures with commercial potential and social/economic benefit, but that carry levels of risk, or timescales, that put them below the threshold for investment on a ‘business as usual’ basis. Maybe this could be a proportion of community investment or foundation money, maybe it comes from the business, or maybe this is a new category of spend.

Either way it presents an opportunity to combine the motivational and ‘survival of the best’ characteristics of capitalism with the patience and risk tolerance that we see in the non-profit world. If we could get it right this might be part of the solution to how we give money to solve systemic problems.

Haiti: Raising Money to Solve Systemic Problems

I have been thinking about a statement I read in a blog from Davos last week by one of BT’s thought leaders - J.P. Rangaswami. J.P. said “the key elements that kept repeating themselves [in Munich and in Davos] were these: that Haiti was an economic and social and political disaster more than anything else; Dominica, the other half of the island of Hispaniola, would have suffered far less even if the epicenter was in that half of the island.”

Governments, companies, employees and the general public have risen to the challenge of this disaster with great generosity, but are our efforts as effective as it could have been? Would it have been better had we used the same amount of money to support the development of Haiti well before the disaster, rather than to dig out of it now?

In the case of Haiti it is a moot point. The disaster has happened, the situation is what it is and we need to help. But the point applies to future events and giving.

If we collectively donated the same amount of money for infrastructure development before the disaster occurred, perhaps we could have reduced suffering even more in which case it would have been money better spent. However, I this feels like a cold and calculating way of determining approaches to giving.

There are two challenges facing corporate responsibility practitioners; raising money to solve systemic problems and spending money to solve systemic problems.

Let me put aside for now the question of how that money would have to be spent to achieve the necessary improvements. I will try and consider that in a future post.

As I have written before, it is easier to raise money to feed a homeless person than to support a drug and alcohol dependency program or a job training program for the same person. It is easier to raise money to fund a crew to pull a child from a building than to raise money to pay for more resilient concrete in the first place.

It is an emotional reaction, to which I am subject as much as the next person, that leads us to more readily respond to a person in immediate need than prevent them getting into need in the first place.

Compounding this, disaster response is somewhat measurable and time-bound. How much did companies donate in the first day, first week, first month after a disaster. This is much easier than reporting on and comparing long term activities that improve underlying infrastructure and effect change in society. And companies are drawn to deliverables that are measurable and time-bound.

Somehow we need to look for ways to motivate ourselves, our companies and our stakeholders to be increasingly sustainable in our approach to philanthropy and community investment. Maybe the disproportionately bad impact of the earthquake on the population of Haiti can be a jumping off point for that.

Of course, we will still need to provide support in disasters, but hopefully less will be needed.

England and America: Two Nations Separated by a Common Language

Not specifically CR, but one thing that has struck me on this visit to the UK are the number of issues, in the newspapers and on the TV and radio, that are common concerns for the British and the Americans.

Amongst them are overcrowding in prisons, dealing with released sex offenders, costs and end of life decisions of aging populations, discrimination against older people (in the UK required to retire at 65), the optimum age for testing for women’s cancers in particular, achieving good completion rates for the national census, an ever increasing gap between the rich and the poor.

That isn’t to say that each country is reaching the same conclusions on how to address those issues. Far from it. But having lived in two countries for a significant length of time I have a developed a strong appreciation for the view that you cannot simply transplant solutions across international borders, even with two countries with a common language and similar levels of economic and educational development.

Solutions that work do so because they tie in with many interdependent factors specific to the community in which they are applied. But we can learn from each other and, although I cannot articulate why, I do get some level of comfort from seeing the issues feature here too. Maybe it is a validation that they are real and difficult issues if another country is struggling with them too.