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Wednesday, May 26, 2010

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.

Monday, May 24, 2010

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”.

Thursday, May 20, 2010

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

Monday, May 17, 2010

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”.

Friday, May 14, 2010

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!)

Monday, May 10, 2010

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.

Wednesday, May 5, 2010

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 :-) )?