The news here – most of it political – is unrelentingly sour: no budgets, no agreements on deficit reduction, charges and counter charges about regulation, and an unwillingness to compromise on any issue of substance. The Republican presidential primaries are adding to the depression. To hear them talk, our country is near collapse and it’s all the fault of the president, misguided policies and over-regulation. TV is no place to escape either since we are constantly bombarded with special interest advertisements reminding us about how our government has put us on the road to ruin.
Taking my own advice, I flew to Phoenix last week to attend the Boston College International Corporate Citizenship Conference. In attendance were primarily representatives from large corporations with active corporate responsibility programs. What a refreshing change to meet people with a can-do attitude, willing to roll up their sleeves and get down to work. These were people who realized their companies were facing significant societal problems and were actually trying to do something about it.
At the conference, Ernst and Young reported that there is a profound shift taking place in corporate sustainability, “as efforts move from purely voluntary to programs that, while not mandated by laws or regulations, have become de facto requirements due to the expectations of customers, employees, shareholders and other stakeholders.” Chief among these programs are reducing greenhouse gas emissions, reducing energy consumption, recycling products or packaging, addressing working conditions/human rights issues, and considering the financial risk associated with climate change.
So, what is driving this productive behavior? Could it be a more realistic view of their world? Reducing costs is always a driver for any corporation trying to be profitable, but now the consideration includes items that have long term impact on our environment such as reducing energy, water consumption and packaging. A close second as a motivator is stakeholders’ expectations, including those of customers, employees and shareholders. As you might expect, rankings and ratings matter to company executives. A study from Nielsen released at the conference reported that “66 percent of consumers around the world say they prefer to buy products and services from companies that have implemented programs to give back to society.” Regulations rank low on the motivators for taking action. One presenter said, “It’s not about what we must do, but what we should do.”
Throughout the conference, a common refrain was how companies were being driven to change their behavior as a result of four pressures: stakeholders, environment, employees and supply chain. Consider these examples:
- I facilitated a panel with representatives from Accenture and Intel about programs they have underway to promote the advancement of women and girls.
- Dell reported on how – based on customer requests – it was experimenting with using bamboo for packaging in order to reduce waste and energy. It is now using hydro power to run its newest data center and exploring other ways to reduce energy costs.
- Microsoft reported it was paying increased attention to work force issues regarding its supply chain.
- Hershey reported on how it was improving the working conditions of coca workers in West Africa.
- New Balance shoes reported on steps to reduce waste and create good working environments.
I flew back to the depression pit of Washington with a few thoughts on my mind:
First, it’s easy to be skeptical about corporate story-telling. However, the people I met appeared to be genuinely concerned about these issues and were proud of what their companies and employees are doing. In fact, as these large corporations focus increasingly on these big projects, it seems likely that more of their resources will go to these company-wide efforts. Nonprofits will be key partners in helping them achieve their goals, but this could put budget pressure on general interest grants not associated with company objectives.
Second, I was impressed by how much of this activity was driven by employee expectations. They expect their employers to be socially responsible and are actively engaged in making it happen. Nielsen reported that 62 percent of all consumers prefer to work for companies that give back to society. Stakeholder expectations around supply chains, energy consumption and greenhouse gases are also increasing and driving innovation. This is a reminder to us all that personal action still makes a difference.
Finally, I’m puzzled by the seeming disconnect between the corporate social responsibility folks and those who advertise and lobby on behalf of corporations here in Washington. The United Chamber of Commerce is pouring hundreds of millions of dollar into elections and fighting regulations. This town is crawling with lobbyists complaining about too much regulation and taxes. If employees are so important, why aren’t corporations demanding a reasonable compromise on health care? When was the last time these Washington folks actually talked to their social responsibility teams who are addressing issues and making progress?