Corporate Social Opportunity with Organic Light Bulbs

Yesterday I met with the owners of eFactor Media about one of their name brand clients who is a leader in creating the next generation of lighting.  It’s called organic light emitting diodes or OLEDs.  The world has been waiting for affordable OLED lights for a long time.  They light 10 times longer than the longest lasting florescent lights, have no mercury and now are made out of organic polymers.  The vision is that in the coming decades all electric lights in the world will be replaced with lighting that uses a fraction of the current energy to manufacture and illuminate.  This is a genuine opportunity to help create a more sustainable future that brings the benefits of technology to all corners of the globe.

It also turns out that literacy rates go up by where electric lights are introduced because it creates more productive awake time to read and learn and even to do homework.  What my colleagues and I were talking about is how to help this global technology company translate their green science into a culture with the visionary zeal to convert the world’s use of lights to organic ones.  This is how Corporate Social Responsibility becomes Corporate Social Opportunity.

ChangeING

I just finished a two-day leadership workshop for ING, the giant Dutch global bank, insurance, and investment company.  They were pretty calm despite the carnage of the financial services industry over the past six months.  It’s hard to rattle the Dutch.  They’ve endured everything:  World Wars, depression, and the great tulip bubble.  Their mantra is “steady, steady…now breathe.”  It’s a refreshing change from the shrieks and howls of Wall Street crybabies.

What struck me about ING is that they are on another planet (literally) about Corporate Social Responsibility than most American firms.  Just go to their homepage (ING.com) and click on Corporate Responsibility and prepare to be impressed.  As a huge international concern with 135,000 employees they are dedicated to educating the illiterate of our world with their Chances for Children program.  They hooked up with UNICEF to provide volunteers in places like rural Brazil, India and Ethiopia.  They are a serious player in microfinance, and they participate in just about every environmental heal-the-earth campaign around the world  (The FTSE 4 Good Index, Dow Jones Sustainability Index, the Carbon Disclosure Project, The European Academy of Business in Society, Equator Principles, Global Reporting Initiative, Oikocredit, Round Table on Climate Change, Amnesty Round Table on Human Rights, UN Global Compact, and several more.)

They also have a great start at integrating sustainable strategies to spur market growth and distinguish their brand.  In Europe they lease cars that rolls in fees to offset the cars CO2 emissions.  But their biggie is their social and environmental risk policies that they apply to every lending decision.  Loans will only be authorized if the purpose of the loan meets social and environmental criteria.  Huh?  I am sure like all big companies ING is not perfect at implementing its lofty ideals.  But that’s not the point.  What is amazing is the speed of the sustainability revolution.  When huge global organizations create policies and strategies aimed at creating a sustainable future we are witnessing the first energy pulses of a massive wave of change.  And it’s only the beginning.  But at least it is.

Business Model for Corporate Social Responsibility

There is a growing realization that business-as-usual will lead us to the end of our world.  What the leaders of the future want to learn is how they can build businesses that build a better world.  Now.   The movement away from short term, self-interest is taking hold in the most unlikely places.  Suddenly, business gurus like Harvard’s Michael Porter are holding up socially strategic companies like Whole Foods as a new model for business strategy.  It’s nothing short of a re-definition of capitalism.

Raw, financially driven capitalism rewards anything that reduces cost and increases price.  Anything.  Even Adam Smith, capitalism’s philosopher, knew that.  Before he wrote Wealth of Nations he wrote Moral Sentiments, which makes the case that virtue is at the core of all enlightened self-interest.  He never intended for butchers to cheat or bakers to poison their customers for a few shillings and then leave town.  We live in an age that was unimagined by 18th century economic philosophers.  The size and scope of power of global businesses tied to constant advances in technology have become the most potent force on our planet.  Whether it’s a force for good or is a force simply to amass more wealth and power without regard to the world we are creating is simply a leadership choice.

Good Capitalism

Good Capitalism is a bigger idea than industrial or financial capitalism of the 20th century.  It challenges us to think about free enterprise as a means to be free to create as much real value as we can.  It’s not the freedom to exploit, pollute, and poison.  Rather, it’s the freedom to create a more just, sustainable, and empowering world.  Academic journals and now the traditional business press are flooding us with a steady stream of articles on the social and environmental good forward-thinking leaders can wield through business enterprise.  This is not turning business into non-profits or even semi-profits.  You can make a fortune using innovation to benefit humanity.  It’s simply “Good Fortune” for all concerned.

This is not simply bringing social responsibility to business.  That is a small idea.  Social responsibility asks business leaders to reduce pollution, ensure fair labor practices, give to local charities and use local suppliers.  All that’s good, but wholly insufficient to save the world.  It’s giving aspirin to a cancer victim. Good Capitalism is based entirely on a new leadership model.

What is needed today is a new form of capitalism.  I call this Socially Strategic Enterprise.  The imperative is to create your core business model, the way you make money as a “Socially Strategic Enterprise.”  This means your products or services will cause 1) human wellbeing and 2) save our planet.  To make money by saving the future.  It demands a whole new way of thinking of how to produce your product or service and how it is used or consumed.  It starts with the challenge of creating infinite, one-of-a-kind value and zero waste. Social Strategic Enterprise is scalable.  It isn’t limited to woodsy, mom and pop, organic enterprise. Socially Strategic leaders seek to enrich billions of lives and solve huge challenges.  They don’t seek to limit ecological damage; they seek to heal our planet.  You get the idea?

The four ideals of Socially Strategic Leadership is what I call the REALeadership Model:

1. Be Responsible…for everything you do. The fact is, we are responsible.  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.
2. Be Ethical. To be ethical is to be moral.  The highest level of morality is beyond the Golden Rule of doing unto others as you would have done to you.  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?
3. Create Abundance. Abundance requires more than innovation.  It demands invention.  It requires creating something with unique value and constantly recreating more unique value.  Unique value puts in an “uncontested marketspace”  that enables you to also enjoy a unique margin advantage.
4. Create a 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.  If you aren’t going to save the world then get out of the way.  Make room for someone who is.

What’s the Greatest Thing We Can Do?

Adopt the Realeadership Model for Our Businesses, Our Work and Our Personal Lives.

Clemson University Debate

I have spent the week at Clemson University in South Carolina.  The Entrepreneur Institute has named me “Entrepreneur-in-Residence” and invited me to lecture to students in the business school.  I must say it’s been an opportune week to contrast socially-strategic capitalism with the old fashion greed-is-good version that is sending serious shivers through the world’s financial structure.

These students are the salt-of-earth.  Sincere, open-minded, and determined.  They are also nuts for Clemson football.  All they wear is orange and there are tiger footprints all over the streets and sidewalks.  It’s nuts!

But, my sunny stay is about to change radically.  Tonight, I am “debating” John Allison the CEO of BB&T Bank about the merits of my version of social capitalism against his Ayn Rand, social darwinism version of it.  I am told he is thoughtful, nice man with strong convictions that the free market is a moral market.  Of course, I disagree.  I’ve never seen a truly free market because all markets are gamed by those who have any advantage.  And capitalism isn’t moral or immoral, it’s leaders who choose to serve a human purpose or their own.

My stomach is churning!

Spielberg’s Hair is on Fire

I sat there in a morning meeting of local non-profit leaders, foundation heads and business leaders listening to a vice president from Cone Marketing tell us that the entire world of consumers and employees are insisting that non-profits be more effective and businesses more responsible.  “This is hardly breaking news,” I think.  It’s ironic that the decades of me-first-and-only capitalism have led us to a financial collapse.  But then again that’s what unrestrained greed will do for you.  As I look across my table I see Spielberg’s (a nickname I immediately gave him upon entering the meeting), a promoter of save-the-world social documentaries, hair catch fire.  He’s mouthing words to me, words like “duh”, and then he drums his fingers with impatience.  His eyes look at me like a laser guided missile and mouths, “We need to talk!”  I nod slightly, trying to douse his fire before he tips something over.  When the meeting ends with a sincere and rousing challenge to get all of us to work together to radically improve San Diego, Spielberg leaps up and pulls me out in the hall and begins, “This is a presentation of the past.”  Words are flowing now like a waterfall dumping a million gallons of melting snow.

The problem,” he says, “is not that business doesn’t contribute enough money to non-profits…it’s that non-profits are bureaucracies that exist to perpetuate themselves.”  He was rolling now.  “They love to offer relief to the suffering but don’t do enough to stop the cause of suffering.

Then he goes on to describe a future where non-profit and for-profit distinctions end into a new world of social enterprise that makes money by solving the root causes of suffering, pollution, violence, poor education…his opportunity list was pretty long.

I must say I love Spielberg’s passion.  I told him to keep pushing the envelope.  After all, microfinance is now a half-trillion dollar industry of loaning money to super-sub prime borrowers with a 96% repayment rate.  (When people aren’t greedy they can make some real money.)  So I say, “Spielberg, maybe we need both.  We need non-profits to relieve suffering now, and we need new social enterprises to radically change the way business serves humanity.  Let’s form a working group to promote your radical brand of social enterprise within our Forum.”  He smiled.

I’m off to my next meeting with a Bulldog.  It seems there’s a Bulldog who wants to save the world.