Goodbye Corporate Social Responsibility, Hello Corporate Sustainability

I read an interesting article today in the Wall Street Journal called Good Intentions. It addresses the fact that 1/3 of companies cut their corporate social responsibility (CSR) budgets in 2009 and corporate philanthropy fell by 8% in 2008. While just looking at the numbers this may appear to be a great setback, the article discusses how it’s actually not such a great loss because random acts of corporate giving and marginal initiatives are not enough to alter corporate behavior. What’s needed is corporate sustainability.

Will Marre, CEO of Realeadership Alliance, agrees. He states, “Business is not just about making a profit anymore; it’s about creating a sustaining business culture that energizes employees, creates a unique profit edge and makes a positive impact on humanity and the environment. Anything less is a waste of valuable time and resources we need for a sustainable future” (See Leadership Development Speaker, Will Marré, Trains Business Leaders for the Future). So what exactly is the difference between CSR and corporate sustainability? The WSJ article quotes Scott Beaudoin, director of cause marketing at MS&L in Boston, who says: “Companies are asking how they can be socially responsible in a way that also moves the business forward. It’s no longer about having one corporate social responsibility guy who is supposed to be the moral compass for the company, like a chaplain in an Army regiment. It’s about making sustainable business the standard operating procedure.”

Corporate sustainability, according to Wikipedia, is “a business approach that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments…Unlike the other phrases that focus on “added-on” policies, corporate sustainability describes business practices built around social and environmental considerations.”

A huge driver of sustainability rather than responsibility is innovation. Corporate Sustainability—It’s About Attitude discusses a paper by BT and Cisco, “A New Mindset for Corporate Sustainability.” It discusses the limitations of CSR thinking, “namely an attitude that these practices are costly to business, inhibit growth and negatively impact the bottom line.” Sustainability, on the other hand, is a catalyst for innovation. It gives ten steps companies should take to drive innovation via sustainability. Some are 1) Make innovating for sustainability a part of your company’s vision, 2) Formulate a strategy with sustainability at its heart, 3) Embed sustainability in every part of your business, and 4) Walk the talk (actions speak louder than words).

A new study, Why Sustainability is Now the Key Driver of Innovation, also discusses the mindset of sustainability. It states, “Sustainability isn’t the burden on bottom lines that many executives believe it to be. In fact, becoming environment-friendly can lower your costs and increase your revenues. That’s why sustainability should be a touchstone for all innovation.” It continues, “In the future, only companies that make sustainability a goal will achieve competitive advantage that means rethinking business models as well as products, technologies, and processes.” The paper goes on to give a five-stage process in becoming sustainable.

Marre, who has long been changing the phrase, Corporate Social Responsibility, to Corporate Social Opportunity, discusses in New Leadership Training for Strategic CSR Announced by Will Marre how business has gone through three phases of CSR. The first was the mandate for businesses to remove the toxic processes and impacts from their operations. This included practices such as eliminating pollution and labor exploitation. Phase two has been to embrace sustainability and contribute to the community. Sustainability practices have yielded huge cost savings as waste is being eliminated from core business processes. Corporate philanthropy has also become increasingly important to promote brand reputation.

Marre even takes it a step further. He says that as good as these initiatives are, phase three is a “quantum leap” in creating strategic business value for companies who see that helping humanity and healing the environment are far bigger opportunities than stopping bad practices or polishing a corporate reputation. Phase three of the CSR revolution is socially strategic leadership that unites a 21st century leadership paradigm, business models and EverGreen™ innovation to create unique value.

According to Marre, “Reinventing the world to be sustainably abundant is the greatest economic opportunity in history.” The possibilities are indeed endless for those who move beyond business-as-usual and embrace the challenge of changing our future. CSR make way for corporate sustainability.

Social Enterprise is the Wave of the Future

We live in an exciting time.  Boundaries are blurring between business and philanthropy like never before, and the result is radical new social enterprises that are taking on the world’s problems with new innovation and sustainable solutions.

In her speech, You Are the Future of Philanthropy, Katherine Fulton discusses the exciting changes in philanthropy inspired by the entrepreneurial spirit.  She calls it a democratization of philanthropy in which the average person has more power than at any other time in history to make a difference.  She explains five categories of new philanthropy: mass collaboration, online philanthropy marketplaces, aggregated giving, innovation competitions, and social investing.  She states, “I’m hopeful because it’s not only philanthropy that’s reorganizing itself.  It’s also whole other portions of the social sector, and of business, that are busy challenging ‘business as usual’….There is a new moral hunger that is growing.”

Leadership speaker and expert, Will Marre, in Social Enterprise: How to Save the World and Grow Your Business at the Same Time, also discusses the changes in philanthropy and business with the rapidly emerging trend of social enterprise.  He explains how social enterprise is enterprise that incorporates the efficiencies, disciplines and rewards of for-profit business with the broader interests of directly solving humanitarian and environmental challenges. 

Marre believes that social enterprise is the future of both business and philanthropy because as he states, “They can grow steadily and produce abundant profits, they are often market leaders, they reward their employees, offer meaningful work and personal growth, benefit their communities, and improve the environment––all at the same time.” 

Marre concludes, “Reinventing the world to be sustainably abundant is the greatest economic opportunity in history.  It is exciting to be at the beginning of our new future.”     

Isn’t this the kind of enterprise you want to be a part of? 

21st Century Sustainability

Sustainability is a word that vibrates with multiple meaning. There are some who insist it is code for a green company to rip away our comfortable lives and force us into granola-eating consumers. For others it means eliminating waste from the way we make and consume things, reduce toxic pollution, wear clothes made of recycled plastic and drive hybrid cars. But increasingly it means something far more valuable to a new emerging group of business leaders, economists and far-sighted consumers. For them sustainability means a whole new intention of business leadership. When leaders decide they are going to harness the imagination of all their stakeholders to create as much value as they can, the world changes. It’s about time.

The Gap Does More Than Set Fashion Trends

I recently came across The Gap’s social responsibility website. I was quite impressed and wanted to give a shout out to their efforts. While their contributions to Project Red and their stand against child labor are more well known, what I was most impressed with is their dedication to employee involvement in their CSR initiatives. Some of their initiatives include:

• 2000 employee community leaders who organize company-sponsored service events and act as ambassadors for their work in the company and the community.
• In 2008 alone they donated $10.3 million in employee-driven community investment.
• Their Money for Time program provides a $150 grant to nonprofits for every 15 hours of employee volunteer time.
• Their Take Five program offers exempt corporate employees five hours of paid time off to volunteer each month, or 60 hours per year.
• In Action Days are events organized by employees of Gap Inc. brands to provide local volunteer opportunities. Thousands of employees have participated, dedicating hundreds of hours to a wide variety of projects.
• Team Grants support employee team projects. When at least three store employees spend 25 hours volunteering with a nonprofit that supports underserved youth or women, Gap Inc. provides a $250 grant to that organization. Each store receives an annual grant budget based on store volume. Since the program began in 2006, it has grown significantly, increasing from 220 team projects in 2007 to 723 in 2008.

Will Marre, leadership expert, is a huge proponent of employee involvement in CSR initiatives. In “Personal Social Responsibility Drives Employees to More Deeply Commit to Their Organization’s Success” he cites research that reveals that 93 percent of American employees say it is important for their companies to provide them with opportunities to become involved in social issues, and 72 percent want their employers to do more to support a cause or social issue. Marre believes that the best way to engage employees and create deep loyalty is to provide them with opportunities to make a difference in their community. He calls this Personal Social Responsibility.

Gap Inc. is a great example of Personal Social Responsibility. On their website it states, “We see a direct connection between our employees’ volunteerism and their commitment to Gap Inc. Engaged employees deliver strong business results, which is good for the community and our company. In a 2007 employee survey, nearly all respondents said it is important for them to work for a company that invests in the community. Studies also show that when a person is emotionally connected to a cause, giving is related to positive emotions and personal happiness. The bottom line: volunteering makes people happy, and happy people make better employees.”

Personal Social Responsibility is indeed becoming the new trend of CSR. As Marre states, “In the real world organizations are finding success by transforming a paternalistic paradigm of CSR into a launch pad for inspired employees to “save the world” right where they are.”

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 Will Marre, Leadership Expert, on How Green Business Is the New Revolution of Business Strategy 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 Social Enterprise: How to Save the World and Grow Your Business at the Same Time, “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.

 

Why Do We Work?

On average Americans work 52.2 hours a week, 261 days a year resulting in 2,088 hours a year.  Wow.  That’s a whole lot of time spent working.  So this brings me to my question…..

Why do we work?

In What People Want From Work Susan M. Heathfield states, “Whatever your personal reasons for working, the bottom line, however, is that almost everyone works for money. Whatever you call it: compensation, salary, bonuses, benefits or remuneration, money pays the bills.”

In Why Do We Work? One Career Changer’s Answer Lisa Cullen gives the definitive answer….PASSION.  She goes on to give an example of a Kinko’s executive who gave up the big career to pursue work that aligned with her passion of walking.

In Why do we work? Brian Dumaine states, “When Fortune asked scores of managers, from CEOs to warehouse supervisors, why they worked, the three most common reasons cited besides paying the mortgage were to make the world a better place, to help themselves and others on their team grow spiritually and intellectually, and lastly, to perfect their technical skills.”  The article goes on to give the example of Tom of Tom’s of Maine, an environmentally focused company that makes toothpaste and other personal items, who set out to make his work more fulfilling and better the world.  The article also explains how an insurance CEO found his work to be a worthy profession because “life is unfair, bad things happen to good people, and insurance is a way to help those good people for whom fate dealt a bum hand. For him, something as seemingly mundane as insurance took on great meaning.”

In The Future of Work:  Engaging Employees to Drive Innovation Will Marré asserts that employees want to work for reasons beyond a paycheck.  He cites research that indicates over 85 percent of workers want work that contributes to a better society and a healthier environment.  They want to work to benefit society.

All of us have our own reasons for working.  But the truth is more and more of us work for reasons besides just the money.  Let’s face it.  We work 2,088 hours a year.  Why not spend that time doing something that makes the world a better place and brings us something more than money?

Does Employee Engagement Come Down to Social Responsibility?

There is a crisis in the workplace today—employee disengagement.  In fact, Disengagement has reached what many would call a crisis level encompassing over 70% of the workforce and over 50% of management (Towers-Perrin Global Workforce Study).  Disengagement manifests itself in a lack of commitment to an organization’s goals, absenteeism, low performance, cynicism, low trust and chronic complaints of being overstressed.

The High Cost of Employee Disengagement reports that “actively disengaged” workers are costing US businesses $300 billion a year in productivity losses.  $300 billion!
Measurable costs such as product failures, customer service failures, and absenteeism are huge, but immeasurable opportunity cost associated with lack of innovation and execution are likely even larger and are manifested in loss of market share, margin, growth and even survival.

So what’s the answer?  It might surprise you.

According to Will Marré, acclaimed expert, in The Future of Work:  Engaging Employees to Drive Innovation asserts that disengagement stems from employees not having their needs met at work.  Marré refers to research that indicates that employees today long for three things: 1) meaningful work that contributes to a better society and healthier environment, 2) flexible working arrangements, and 3) personal growth.   The article states, “What 21st century employees want is to be engaged in meaningful work that benefits society.  This is the biggest driver of engagement.”

Tony Robbins agrees that a sense of fulfillment is important for our happiness and wellbeing.  In the TED video, Tony Robbins Asks Why We Do What We Do, he states, “When it comes to fulfillment, that’s an art.  And the reason is, it’s about appreciation and it’s about contribution.”  He further discusses the importance of our need to make a greater contribution.  Of six basic human needs, according to Robbins, our sixth need is to contribute beyond ourselves.  He states, “We all know, corny as it sounds, the secret to living is giving.  We all know life’s not about me, it’s about we.”

Social Responsibility Boosts Employee Engagement also agrees that a company’s social responsibility can lead to more engaged employees.  The article quotes Douglas Klein, President of Sirota Survey Intelligence who states, “”Businesses that recognize the importance of social responsibility often have employees who tend to be more satisfied with their jobs, adopt similar values, and become more committed to achieving success within the industry.”

Furthermore, Corporate Social Responsibility Pays Off reports that 70 percent of North American students surveyed in the 2003 CSR Monitor by Globescan said they would not apply for a job at a company deemed socially irresponsible.  What’s more, the survey found that 68 percent disagree that salary was more important than social responsibility.   The article also states, “Instead of just cutting a check to a foundation, companies find that the connection between CSR and employee engagement is deeper if employees are directly involved.”

The bottom line is we want to have meaningful work that makes a greater contribution to humanity and the environment.  It’s not just about a paycheck anymore.  It’s about a sense of fulfillment and a purpose beyond our own.  We want to make a difference.

My Case for Cause Marketing

Cause Marketing—good or bad?  Let’s see…

Will Marré, branding speaker, is a strong proponent for cause marketing and in Author Will Marré Says Nike’s Livestrong Campaign is Compelling Case of Why Businesses Worldwide Should Adopt Cause Marketing Today discusses how cause marketing can be beneficial for everyone involved if the cause perfectly aligns with the brand and taps the six sources of brand energy: physical, emotional, mental, social, spiritual, and emotional.  You can see Marré speak on the subject on YouTube.

In Cause Marketing Matters to Consumers Kim T. Gordon also makes a case for cause marketing.  She states, “There’s a strong connection between entrepreneurship and giving.  The challenge is to make your socially responsible efforts a winning proposition for the nonprofit group you support, the community and your business.”  She gives these five steps for a strong cause marketing campaign: 1) Give from the heart, 2) Choose a related cause 3) Contribute more than dollars 4) Formalize your affiliation, 5) Mount a marketing campaign.

One creative website refers to cause marketing as Selfish Giving whose punch line is, “A cause marketer’s musings on doing well and good.”  The website is a great resource and proponent of cause marketing.

While cause marketing can be widely successful and positive for all involved, it’s not without its criticisms.  Referring to cause marketing as consumption philanthropy, Angela M. Eikenberry states in The Hidden Costs of Cause Marketing, “Consumption philanthropy individualizes solutions to collective social problems, distracting our attention and resources away from the neediest causes, the most effective interventions, and the act of critical questioning itself. It devalues the moral core of philanthropy by making virtuous action easy and thoughtless. And it obscures the links between markets—their firms, products, and services—and the negative impacts they can have on human well-being.”

Marré even admits to the downside of cause marketing in his blog, Cause Marketing is the First Step in A More Virtuous Business World, stating, “Of course there is a lot of fake cause marketing going on, companies that pretend to be green when they are brazenly toxic or businesses who spend huge sums promoting their connection to a cause and little on the cause itself.  Of course I have found myself rolling my eyes more than once at yet another cause marketing campaign such as Exxon Mobile’s mosquito net commercials during the Olympics.  I have also come across a website, Think Before You Pink, that calls out “pinkwashing,” or companies that are attached to breast cancer cause marketing and actually contribute to the disease they’re supposed to be fighting against.”

Okay, Okay.  So while cause marketing isn’t 100 percent positive, I still lean towards “good.” I guess my attitude is…it doesn’t hurt to try.  I think it’s good to see companies doing something outside their own bottom line, and if it helps contribute to the bottom line in the process, right on.  So even if the motivation is selfish, as “Selfish Giving” infers, it’s still giving, and I think we need to take everything we can get.

I think Marré states it best in his blog, “When I get close to many of my clients’ motives, what I am finding is a genuine movement toward social good.  What may have started as sponsorship or don’t-want-to-get-my-hands-dirty philanthropy is rapidly transforming to well-funded business innovation…Cause marketing is a Trojan horse to get inside the strategic walls and retake the intellectual power of business leadership.”

Nike’s Courage to “Just Do It”

I was in France recently, and there is definitely a different feeling about Lance Armstrong in that country. Before, he was despised for what many considered a kind of over competitive arrogance, and others just think it’s sour grapes. Undoubtedly, some of the softening towards Armstrong has to do with his age; age makes any athlete an underdog, and secondly his very public and passionate commitment to cancer research. Armstrong’s LiveStrong campaign with Nike has made worldwide reverberation, and as I’ve written before, it is Nike’s most successful promotional program. It is a promotional program with a general purpose. The money really does go to cancer research. In fact, 100% of all the profit that Nike makes off their LiveStrong products are finding their way into research labs. So we wish Lance well in his quest to win a bicycle race and admire Nike for having the courage to, “Just Do It.”