What Comes Around Goes Around

One of my husband’s favorite television shows is My Name is Earl.  Earl’s new found belief in karma is the backdrop of the show in which Earl tries to set right everything bad he’s done in hopes that by doing good, good will come to him.  While the show is fun and entertaining, I think it makes a good point.  Call it whatever you want—karma, the spirit of the universe, God— I have to agree with Earl.  When we honestly do as much good as we can, it not only benefits those we serve, but the good comes back to us ten fold.  And this rings true in every aspect of our lives, both personally and in business.

So this brings me to my question, why isn’t every company in the world grabbing social responsibility by the horns and incorporating it into their core business model? In Don’t Underestimate Power of Social Responsibility Lisa Hickey asserts that the common phrase, “what goes around comes around” is especially true in business.  She states, “There is a perfect correlation between socially responsible companies and economically viable companies.”

In The Business Benefits of Corporate Social Responsibility several benefits to business are discussed such as building a reputation as a responsible business sets you apart, customers are rewarding responsible companies, and reducing waste and emissions saves money.  Additional benefits addressed in the article are as follows:
•    A good reputation makes it easier to recruit employees.
•    Employees stay longer, reducing the costs and disruption of recruitment and retraining.
•    Employees are better motivated and more productive.
•    CSR helps ensure you comply with regulatory requirements.
•    Activities such as involvement with the local community are ideal opportunities to generate positive press coverage.
•    Good relationships with local authorities make doing business easier.
•    Understanding the wider impact of your business can help you think up profitable new products and services.
•    CSR can make you more competitive and reduces the risk of sudden damage to your reputation (and sales). Investors recognize this and are more willing to finance you.

Corporate Social Responsibility also describes six driving factors for CSR: (1) the shrinking role of government, (2) demands for greater disclosure, (3) increased customer interest, (4) growing investor pressure, (5) competitive labor markets, and (6) supplier relations.

Will Marré, acclaimed CSR speaker and advocate, is a passionate voice for the benefits of social responsibility.  In Corporate Social Responsibility and ThoughtRocket.com he’s quoted, “When you combine the triple bottom line of people, planet, and profit, the new sources of value and points of differentiation you uncover yields topline growth, fiercely loyal customers, and committed internal and external talent.”  Marré takes it a step further asserting that when CSR is incorporated into the business model it creates the greatest economic opportunity in the history of the world.   He states in Corporate Social Responsibility Gains a Daily Voice on the Web,
“Every problem is an opportunity. In the next decades we will have to re-invent every product we use to be ecologically friendly, energy efficient and recyclable. Just the opportunity to change all the light bulbs in the world has a mind-boggling upside.  The opportunities to lift billions of people from poverty, educate billions to live in the 21st century and unlock the keys to sustainable living and sustainable relationships are endless.”

So, I return to my question: Why isn’t every company in the world embracing their social responsibilities when there is nothing to lose and everything to gain?  Doing good is a virtuous cycle that positively influences everyone and everything it touches.  So let’s take our cues from Earl, and even if our reason for doing good is so that good will come to us, we’ll make the world a better place.

- Jeannie Foy, ThoughtRocket Editor

CSR Will Still Survive the Economy

This past February in my post, CSR Will Survive the Economy, I make a case for CSR initiatives still having a bright future despite the economic downturn.  But as the recession continues and companies struggle through recovery, it makes me wonder…Just how long will the triple bottom line prevail when profit is at the front of everybody’s mind?

In Bonus Rage and its Pitfalls John Robertson discusses how new restrictions for top executives has a downside, social responsibility initiatives in particular taking a big hit.  He contends that in order for companies to operate under the triple bottom line of people, planet, profit, executives need the freedom to exercise judgment.  He states, “If companies were to be more than simply cash registers, executives had to be empowered to make choices. Directors needed to decide how the value being created should be divided up: how much to employees, how much to suppliers, how much to shareholders, how much to deserving community organizations and at what cost to the physical environments in which the company operates.”  He continues, “Unfortunately, this is precisely the discretion being stripped from the repertoire of the modern corporate executive as he is forced to make an unequivocal commitment to financial success.”

Robertson also contends that this won’t get better any time soon with governments looking to maximize the financial returns from their recent equity purchases, executives trying to repay loans as quickly as possible, and employees too scared of losing their job to demand better from their employer.

While Robertson makes a convincing argument, I believe that it’s only an excuse, a reason for leadership to free themselves of any obligation to humanity and the environment.  You see, this viewpoint stems from the idea of corporate social responsibility being solely a cost, rather than an integral, revenue building part of the business model.  Companies and leaders alike that still hold to the belief that CSR is merely writing a check will most likely cut back or quit their CSR practices altogether in the name of financial strife.

On the other hand, however, there are others who will strongly embrace the great opportunities social responsibility presents and come out stronger on the other side of this recession. Will Marré, CEO of REALeadership Alliance, states, “When times are tough it’s hard not to be hijacked by fear. Thinking about how much good we can do becomes downright unnatural when we’re genuinely afraid we won’t have what we need.  But what if we turn that fear upside down?  Imagine that the key to security, prosperity, and happiness comes from doing good.  As much good as possible.”  According to Marré, now is the time to invest in social responsibility.  In fact, he contends that saving the world is the greatest economic opportunity of our time.

I do indeed stand by my original posting…CSR will survive the economy.  We cannot allow our values to be turned on and off depending on the weather of the current situation.  The triple bottom line is a way of doing business, not a fad that has run its course.

Socially Responsible Leadership

It takes strong leaders to transform business and change the world.  But it can be done…and must.

In Five Features of Great Socially Responsible Leadership Mallen Baker gives a great list of strong socially responsible leadership qualities.
1) Being prepared to challenge the logic of your industry.
2) Doing something because it is the right thing to do, and then working out how to make it pay.
3) Understanding that the leaders sets incentives - and sometimes the bottom line is the wrong incentive.
4) Understanding when to follow the rules, and when to use common sense in the face of unintended outcomes.
5) Knowing that just because people around you see you as a leader, it doesn’t mean you’re a good one.

Will Marré also asserts a socially responsible leadership model in his recent article, CSR and the Four Ideals of Socially Responsible Leadership, he calls REALeadership.  The model is based on four principles:
R—Relevant.   A leader’s impact is long.  Their decisions weigh more than others.  So they must be wise enough to constantly see the big picture, to carefully consider the impact of their decisions on employees, customers, suppliers, the environment, the community, and the generations of unborn.
E—Ethical.  To be ethical is to be moral.  The moral standard is do as much good as you can.  Create the Greatest Total Value you can.  For everyone, all the time.  Why else lead?
A—Abundance. Sustainable Abundance requires more than innovation.  It demands invention.  It requires creating something with unique value that genuinely benefits humanity and heals the environment.
L—Legacy. A leader’s legacy is his or her impact on the future.  The world needs saving.  We need new solutions we can implement as fast as possible.

Leadership, especially in today’s world climate, is indeed a great responsibility, but it’s also a great opportunity to do something really amazing.  I think Marré says it best in the conclusion of his article, “If you aren’t going to save the world then get out of the way and make room for someone who is.” Are you up to the challenge?

Social Responsibility vs. Greenwashing

Wow—greenwashing sure has been the subject of a lot of discussion lately.  I wanted to follow up on my recent post on the subject, War on Greenwashing.  It seems that while we are paying closer attention and trying to support green companies, we’re just as worried about being misled about who and what is actually as green as they claim to be. The “Green” Hypocrisy: America’s Corporate Environment Champions Pollute The World reports some disappointing news.  It states, “The irony of the “green” movement of US companies is that many of the firms that spend the most money and public relations effort trying to show the government, the public, and their shareholders that they are trying to improve the environment are also among the most prolific polluters in the country.”

The article goes on to list the Top Ten Greenwashers in America.  They are as follows:
1.    General Electric
2.    American Electric Power
3.    ExxonMobil
4.    DuPont
5.    Archer Daniels Midland
6.    Waste Management, Inc.
7.    International Paper
8.    British Petroleum
9.    Dow Chemical
10.    General Motors

Some are no surprise such as ExxonMobill (Read my post Exxon-Exoff), but all should be ashamed.  This time in history presents us with such an amazing opportunity to do something great in changing the world, in making a real difference in the lives of so many.  And when I see big companies with powerful leaders wasting this opportunity by flitting away their money on some bogus PR campaign or half efforts at protecting the environment, it drives me crazy.  Sure, things are bad right now, but at the same time we have the power to turn it around and give a real future to our children.  It’s exciting!  And if you’re not willing to rise above the herd and, as the saying goes, turn lemons into lemonade, then get out of the way and make room for someone who is.

We Can Change the World

I talk a lot about the power individuals have in changing the world, specifically as consumers, and that’s because I truly believe we can each make a difference that matters. And more and more consumers are starting to embrace their role in influencing companies to go green.  Consider these recent findings from “BBMG Conscious Consumer Report: Redefining Value in a New Economy” as reported in BBMG Study Finds ‘Green Trust Gap’:

•    77 % of Americans agree that they “can make a positive difference by purchasing products from socially or environmentally responsible companies.”
•    Nearly seven in ten Americans agree (67%) that “even in tough economic times, it is important to purchase products with social and environmental benefits,” and half (51%) say they are “willing to pay more” for them.
•    Seven in ten consumers (71%) agree that they “avoid purchasing from companies whose practices they disagree with”; and approximately half tell others to shop (55%) or drop (48%) products based on a company’s social and environmental practices.
•    Green factors are very important in purchasing a product: 47% energy efficiency, 32% locally grown or made nearby, 31% all natural, 29% made from recycled materials and 22% USDA, a significant growth over 2007.

These numbers are exciting and suggest a great change that is taking hold.  But at the same time, these numbers are only statistics unless the green revolution becomes personal.  Personal to each one of us.  Personal in a way that makes us change our own behaviors to become part of the solution.  So…what’s one thing you can do this week to make a difference?  What’s one thing you can buy or not buy?  Let’s make it personal and see the world change.

War on Greenwashing

Almost every company wants to go “green” these days, and perhaps even more are claiming to.  The term “greenwashing” comes to mind.  Greenwashing refers to companies masquerading as green companies or spending more money and time advertising being green than actually being green.  Yuck.  I know.

So this brings us to the question, how do we know if a company or product is actually as green as it claims to be? In 10. Ecological Intelligence Bryan Walsh gives the example of buying an organic T shirt.  A conscientious consumer buys an organic T shirt because of course organic is supposed to better, but the label “organic” doesn’t take into account the fact that the amount of organic cotton required for one T shirt is 2,640 gallons of water or that the dye used on the T shirt has harsh chemicals that are now polluting groundwater.  

So what do we do?  Not buy anything? Luckily the answer is no.  Walsh goes on to discuss how we are beginning to more concretely measure one’s carbon, social and biological footprints.  Famed psychologist Daniel Goleman calls it Ecological Intelligence.  According to Walsh a new science called industrial ecology is using a method called life-cycle assessment (LCS) to actually calculate the total impact of products, companies, etc.    

Pretty awesome, huh?  But I have to admit it sounds a little too complicated for my weekly jaunt to the grocery or drug store.  Walsh also discusses a great website Good Guide.  Good Guide is a great, easy to use, consumer web site that rates everyday products from milk to makeup to toys so that we can make more educated consumer decisions.  I highly recommend you check out the site.  It will revolutionize the way you shop.  

Also to help average consumers discern greenwashing Good Housekeeping has adopted a Green seal of approval.  In addition to the requirements for the original Good Housekeeping seal such as quality and safety, the Green seal indicates that a certain product has met criteria such as energy efficiency, packaging reduction and water quality.

Consumers today mean business when it comes to holding companies accountable for their actions and the products they sell.  Consumers today are an overwhelming face for sustainable change.  While it used to be only companies started by dreamy-eyed hippies tried to build green supply chains and invent sustainable products, now the largest companies on the planet are getting serious about detoxing corporate commerce.  Now consumers are getting armed with intelligence to separate the pretenders from the genuine future-friendly products.