The Evolution of CSR by Georgetown University's Center for Social Impact Communication

The Evolution of CSR Issue 1 | Spring 2016

B CORPS The rise in the B Corp community and what it means for the future of corporate social responsibility

TRENDS IN CSR An in-depth debate about the benefits and disadvantages of corporate social responsibility

EMPLOYEE ENGAGMENT Not just a buzz word. How companies like Dell are revolutionizing employee engagement in CSR

MEET THE CSIC STUDENT EDITORIAL BOARD ERICA BACA

BRYNN BIDDLE

Erica Baca is a student in Georgetown University’s master of professional studies in Integrated Marketing Communications and works in development in the Washington, DC fundraising office for St. Jude Children’s Research Hospital. Prior to St. Jude, Erica worked for the U.S. Hispanic Chamber of Commerce and taught English in Lille, France. Erica graduated from American University with a major in Public Communications and a minor in French Studies. She lives in Washington, DC with her husband and Chihuahua-Terrier named Cabo. Erica is a representative of the Integrated Marketing Communications program on CSIC’s Student Editorial Board. You can follow Erica on LinkedIn and Twitter @erica_m_baca.

Brynn Biddle is a student in Georgetown University’s master of professional studies in Integrated Marketing Communications. Brynn just completed a semester long internship at KRC Research, a sister company to Weber Shandwick. Prior to moving to moving to DC to pursue her masters, Brynn worked in corporate social responsibility for Microsoft and in marketing for Susan G. Komen. With a breadth of experience in the corporate social responsibility space, Brynn is thrilled to be serving on the Student Editorial Board for the Center for Social Impact Communications. Brynn is a representative of the Integrated Marketing Communications program on CSIC’s Student Editorial Board. Connect with Brynn on Linkedin.

VASSILIS COUTIFARIS

SARA DAL LAGO

Vassilis Coutifaris is a student in Georgetown University’s executive master of professional studies in Global Strategic Communications and is a Foreign Policy Program Manager at The Brookings Institution. Vassilis is a representative of the Global Strategic Communications program on CSIC’s Student Editorial Board.

Sara Dal Lago is a international student in Georgetown University’s master of professional studies in Public Relations and Corporate Communications. Currently, she is working as an intern for the Social Impact team at Weber Shandwick, working at the intersection of CSR, sustainability, and social impact Prior to moving to Washington D.C., she worked at a sales marketing agency in Munich, Germany. She speaks five foreign languages and is very passionate about cross-cultural and international communications practices in general. Sara is a representative of the Public Relations and Corporate Communications program on CSIC’s Student Editorial Board. Connect with Sara on Linkedin or on Twitter @saradallago.

DANIELLA KEITH

KEVON PAYNTER

Integrated Marketing Communications

Global Strategic Communications

Daniella Keith is a student in Georgetown University’s executive masters of professional studies in Global Strategic Communications. She is a Communications and P.R. specialist with five years of experience in the non-profit sector. Her previous work includes the Costa Rican Investment Promotion Agency, a Costa Rican organization that promotes economic development through the attraction of foreign direct investment, and the Impact Hub Minneapolis, an innovation incubator for social collaboration. She currently resides in Minneapolis and holds bachelor’s degree in International Affairs and Italian from American University in Washington, D.C. Daniella is a representative of the Global Strategic Communications program on CSIC’s Student Editorial Board.

Integrated Marketing Communications

Public Relations & Corporate Communications

Journalism

Kevon Paynter is a student in Georgetown University’s master of professional studies in Journalism. Kevon is a representative of the Journalism program on CSIC’s Student Editorial Board. Connect with Kevon on LinkedIn.

ADITYA VEERA

DEEMA ZEIN

Aditya Veera is a student in Georgetown University’s masters of professional studies in Public Relations and Corporate Communications. He is a communications professional with international consulting experience. He has helped small and medium businesses in the Middle East tell a compelling and authentic story to source capital. Adi is also an ambassador for the PRCC program, and a member of the PRSA. Within the social impact space, Adi is interested in the way corporations are constantly reinventing CSR. Adi is a representative of the PRCC program on CSIC’s Student Editorial Board. He is always keen to learn from fellow communication professionals – connect with him on LinkedIn.

Deema Zein is a student in Georgetown University’s master of professional studies in Journalism program. Deema is a representative of the Journalism program on CSIC’s Student Editorial Board. Connect with Deema on LinkedIn.

Public Relations & Corporate Communications

Journalism

A LETTER FROM CSIC’S DEPUTY DIRECTOR What you hold in your hands is a labor of love. The Evolution of CSR magazine is the result of the collective brainpower – not to mention heart – of eight smart, socially-impact minded students from across Georgetown University’s graduate division of professional communications. The magazine is a manifestation of the big thinking from current (not to mention, future) leaders within the corporate social responsibility (CSR) field: communicators, marketers and journalists who believe that the private sector can be a force for good in the world when organizational strategy and communication – in its many forms – collides with genuine altruism. Georgetown University’s Center for Social Impact (CSIC) is about encouraging and activating this collision – especially through the integrated lenses of marketing, communication and journalism. We couldn’t have asked for a more spirited student editorial board to make that vision come alive. From a spirited debate about the hottest trends in CSR from Aditya Veera and Sara Dal Lago, two students within our public relations and corporate communications program, to a video about the power of virtual reality storytelling from journalism student Kevon Paynter, The Evolution of CSR tracks the past, present and future of the rapidly evolving sector. Let us know what you think about the magazine by emailing us at csic@georgetown.edu. Happy reading!

John Trybus Deputy Director, CSIC

About CSIC The Center for Social Impact Communication at Georgetown University (CSIC) is a research and action center dedicated to increasing social impact through the power of communicators. Launched in 2008, CSIC aims to educate and inspire socially responsible communicators and marketers within Georgetown University through innovative courses and engagement opportunities. 3

HOW TO DO CSR T H E T E C H

Apple makes a correspondingly bold statement: “We don’t want to debate climate change. We want to stop it.” Even though Apple is manufacturing and shipping more products than ever, its carbon emissions per product have been dropping since 2011. Moreover, 100% of Apple’s US operations run on renewable energy, while 87% of global operations run on renewable energy. Apple has partnered with the Conservation Fund to create and protect forests. Moreover, Apple has an extensive reuse and recycle program that applies not only to its own manufacturing facilities, but also to those of its suppliers. What’s most revolutionary is that green practices are embedded early in the product design process, foreseeing opportunities to recycle and reuse. Suppliers are held accountable through factory audits and component testing.

W A Y

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he largest companies in the technology space by market capitalization are Apple and Google. They have a combined market value, at the time of writing, of over $1.1 trillion dollars. Let’s put that number in context. If we sold just these two companies and distributed the proceeds to the entire population of the US, each person would receive $3,500. That’s more than 5% of the wages the average American earns in a year. With great value comes great corporate social responsibility. Not only are these companies expected to lead the pack in financial results, but other companies will look to them as an example to follow in CSR practices. What makes their CSR programs unique? Let’s examine the lessons Apple and Google have to offer.

2. Integrate corporate social responsibility initiatives into products or core business. Did you know that for every mile you drive with a car, you consume enough energy to power the provision of Google services to one individual for a month? We should all just use Google and stop driving! But seriously, the company has done a fantastic job with data centers that save energy, as well as buying and investing in green power initiatives to reduce power usage.

1 . Tackle big problems and causes. Apple integrates respect for human rights into its supply chain. In 2014, Apple conducted over 600 in-person audits of labor Problems like climate change and environmental deg- practices along its supply chain across 19 countries. It partradation are big and complicated, with no easy solu- ners with its suppliers to reduce non-compliance with Apple’s tion in sight. Big companies ought to have the imagi- standards, which span labor human rights, health and safety, nation, vision and grit to take on the greatest problems environment, management systems and ethics. In rewarding we face – in addition to tackling small local issues too. new business, Apple takes audit scores into consideration, And it’s not enough to have a position: the most ef- and when working with new suppliers, it conducts detailed fective advocacy is action. Putting money, time and risk assessments. In 2014, Apple reviewed 459 suppliers and human capital into solving the problem is critical. . factored their responsibility performance into business deci4

sions. Apple also works on location with suppliers to help them investments in 2.9 GW (equivalent to the electricity usage address labor and human rights issues before they surface. of 500,000 homes) of large-scale wind and rooftop solar. 3. Reduce a complex and fuzzy problem to a concrete and measurable goal.

Moreover, Google products help customers cut energy usage. Google Maps, for example, directs cyclists in over 200 US cities, Canada, Australia and 12 countries in Europe. People can get detailed bike trail information they can use to get to their destination. Maps also enables use of public transit by providing live data people can use to plan their routes, stops, schedule and fares. Navigation in Maps reduces driving in circles or driving through traffic.

Facing the problem of climate change, Google reduced the problem to a clear goal: Let’s be carbon neutral. Let’s contribute zero to climate change. Thinking outside the box is the norm for Googlers, and carbon neutrality is no exception. The organization has pursued a number of carbon offsets, including paying landfills and Apple didn’t stop with addressing human rights and labor livestock farms near data centers to reduce emissions. practice abuses along its supply chain, but also provided and expanded eduOnce accused of cational opportuunfair and abusive nities for workers labor practices, in its supply chain. Apple reduced a Its Supplier Emseemingly unconployee Education trollable issue (how and Development suppliers treat their (SEED) program workers across a has educated more globally diffused than 861,000 supply chain) to a workers since 2008 controllable probwith free courses lem by conducting in subjects ranging audits and partfrom economics to nering with supEnglish. In 2014 pliers to correct alone more than violations. By cre379,000 workating uniform labor and environmental standards suppliers ers participated in SEED, easily exceeding the enrollcould be held accountable to, Apple clarified not only its ment of the 10 largest colleges in the United States. own ethical position, but also made compliance easier for SEED started with traditional classroom based learning, suppliers. For example, by stipulating a maximum 60-hour but is now expanding to include educational technolworkweek, Apple was able to generate 92% supplier com- ogy such as iPad based learning programs. These edupliance with this guideline. (With non-compliant suppliers, cation programs offer workers both the opportunity to Apple continues to assist them towards compliance). Not advance within the factory or transition to a new field. only are the guidelines available to all suppliers, but Apple publishes them on its site for the whole world to see. By tackling big social problems, integrating solutions into products and core business, measuring progress and going beyond expectations, both Apple and Google have provided 4. Go beyond expectations. a clear CSR template that other companies can put to use. n Though its carbon footprint – once you account for carbon offsets and its use of renewable energy – is zero, Google wants to do more. It has invested more than $2 billion in renewable energy projects tthat create more energy than Google consumes as a company. These include 5

day? What is good for the global community? The discussion around the relationship of CSV and CSR is a new one, but one that is useful and important in today’s global world. What is Corporate Social Responsibility (CSR)?

C O R P O R AT E

In a Heifer International paper by Carol Moore, she noted it well when quoting Jane Nelson from the Harvard Kennedy School, “Corporate social responsibility encompasses not only what companies do with their profits, but also how they make them. It goes beyond philanthropy and compliance, and addresses how companies manage their economic, social, and environmental impacts, as well as their relationships in all key spheres of influence: the workplace, the marketplace, the supply chain, the community and the public policy realm.”

SOCIAL RESPONSIBILITY What then is Creating Shared Value (CSV)?

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V A L U E S

It is nies that lems

a business management style focused on compacreating value by making a traditional profit but additionally engages and addresses social probas an integral intersection with their business.

Both CSV and CSR have gained credibility and usage within the last decade as the public demands that companies become more socially conscious. No longer an exception, the importance of social consciousness is moving mainstream in corporate America. Both strategies, CSV and CSR, are being used to make positive changes to help create a better world. So what’s the difference between the two? To break it down, CSR is incorporating corporate responsibility into a business model as an initiative to do better, spending company profits to benefit the world; including but not limited to recycling, philanthropy events, charity events, volunteerb y D E E M A Z E I N ing and donations. It is an external expression (outside the company) of support for social good. CSV is focused more on making an environmental and social impact by hen it comes to a successful company, does corintergrading it into the company practices; every company porate social responsibility (CSR) and creating shared values decision is made with the end result of benefiting society. (CSV) go hand in hand? Or can a company adopt only one strategy at a time? Is it a growing trend and amongst who? One difference that highlights the distinctions can be found How are these management styles relevant to companies to-

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in the way each strategy considers its profits. In CSR, the company looks at the bottom line in a traditional way, checking its costs against revenue to determine profits. In a CSV approach, the strategy looks at triple bottom line returns…. a way to look at profits in a more well-rounded way, taking into consideration not only money profits, but costs to the community as well. Using the 1989 Exxon - Valdez oil spill as an example, when looking at their year-end bottom line, using a triple bottom line return, they would have included all costs to the community for clean up before accessing the profits. Traditional bottom lines dictates examining profits made, regardless of any costs to the community as a result of generating those profits. With CSR, the triple bottom line return is not relevant.

CSR and CSV prevails, some important corporations remain slow to engage in socially responsible management styles.

As the demand for CSR and CSV grows in the global community, businesses slow to make that progressive jump are a cause for concern. Pharmaceutical companies, in particular are sluggish in incorporating CSR and CSV management styles. Pharmaceutical companies are consistently among the most profitable companies, yet the public outcry for cost control on the exorbitant prices has had little impact on tempering profits and encouraging pharmaceutical companies to adopt more aggressive CSR or CSV management styles. A head turning example is Martin Shkreli, CEO of Turing Pharmaceuticals who bought a lifesaving drug that treats deadly infections commonly found in HIV/AIDS and CanIn engaging CSR and CSV styles, differences can also be cer patients and raised the price 5,000 percent. More recent found in the corporate culture. CSR is usually initiated by incidents can be seen in the price rise in the drug called Darathe Marketing/Corporate Communications or a specific di- prim, which treats infections, one most commonly known vision within a company. It finds its home in one department as Malaria. Turing Pharmaceuticals bought the drug in Auof the company rather as part of the overall corporate culture. gust of 2015 and immediately prices increased from $13.50 CSV is led by a CEO or executive team member and radiates to $750 per tablet, costing patients hundreds of dollars. throughout the company, establishing itself as an integral part of the “way” the company does business. In its actions, One would think pharmaceutical companies would place the company reflects a socially conscious state of being. the goal for high profits second to cure rates and public health. It is ironic that companies entrusted with public While CSR is an accepted style, it can be argued that the health seem less likely to consider public health needs in positive impact of this approach on developing communi- their management style choices. Multiple incidents where ties can be artificial and self-serving. For example, a com- pharmaceutical prices on new and existing drugs are set pany like Coca Cola sells its products in Africa and gener- at extremely high prices have devastating effects on comates a profit. They engage in philanthropy and offer social munities. As a society, it is important to continue to push programs dealing with HIV. These social programs main- for ways to change these absurd corporate behaviors. tain a positive image for Coca Cola. On the other hand, Coca Cola aggressively markets their soda product, which In short, CSR and CSV are management styles being forced has high sugar content and could impact diabetes and oth- on companies by the public and by the global communier ailments associated with high sugar diets in poor com- ties. Both strategies represent a level of social responsibility munities already burdened with health issues. A complaint and giving back to their communities. In the environment amongst Africans, a continent which experiences water where world wealth is concentrating more and more in the shortages, is that Coca Cola “mines” water in their coun- hands of a few, companies will need to incorporate CSR tries to create soda. When companies support community management styles. Perhaps it is likely that as the demand for social welfare programs while simultaneously promoting social conscious behavior placed on corporations becomes unhealthy products or exploiting resources, is the overall more amplified, that the more integrated and all-encomimpact a positive one? Likewise, if a company maintains passing of the two socially conscious focused management poor work environments or offers low wages for workers in styles will become more popular and therefore be ultimately the same communities, is the overall impact a positive one? utilized. Would a move in that direction benefit the business and global community in a mutually beneficially way In both CSR and CSV management styles, a company decides by easing the transition and confusion brought on by two to promote management strategies that have global benefits. similar yet different socially conscious business models.n Whether through CSV or CSR they are taking steps in some level of responsibility towards humanity, consciously and positively impacting our world. Sadly, while the trend towards 7

DEMOCR ATIZING CSV:

This new trend leads to three big questions: What does CSV represent for big corporations? In the face of ever-changing consumer expectations, what can SME (Small and Medium Enterprises) bring to the CSV table? And is there a converging space?

S C A L I N G S O C I A L I M PA C T

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n 2011 the world was introduced to a revolutionary concept: Creating Shared Value (CSV). Michael Porter and Mark Kramer were the first to coin the term and predict a massive migration from traditional Corporate Social Responsibility (CSR) to CSV in the years to follow. So what exactly is CSV?

Multinational companies, which have been stealing the spotlight for a while, have several advantages when it comes to aligning their business operations with CSV. Having a long trajectory and the seniority companies can rely on their sound financial structure to inject capital and sustain long term alignment, even though the return on their investment won’t be immediately visible. These same large companies can utilize their economies of scale to decrease costs, build on established relationships with customers and have insight into consumer data that has been accrued over the years. All these provide corporations with a solid base upon which they can build their Shared Value vision.

CSV refers to an operating model in which companies align their core social mission with the bottom line of their business in order to engage in best practices that have social and financial purpose. This steers away from traditional CSR practices that allocate resources towards causes or activities that are external to the company’s core business and focuses In the case of SMEs, this shift represents a challenge, but on an internal restructuring that aligns to embedded causes. one in which they might ultimately have some competitive advantage. In an article by the Shared Value Initiative, AnEver since the concept was introduced, big household drew Kassoy, Co-Founder of B Lab, argues that size is defibrands have begun evolving their CSR programs to bet- nitely an advantage that SMEs can exploit. “SMEs are more ter align with the CSV method and many have been quite agile and can quickly adapt and incorporate new practices, successful. It is not uncommon to read about the magnif- whereas larger organizations often struggle to make meanicent work that Coca Cola, Unilever and IBM, to name a ingful change at scale. For a small or medium-sized enterfew, are doing in areas such as water conservancy, bottom prise, it is also easier to get a full picture of their footprint: in of the pyramid access and bridging the technology gap, the case of a large company with an extensive supply chain, respectively. Thanks to the emergence of CSV, consumers it is hard to establish if their sourcing practices are sustainare understanding how businesses have the capacity to ad- able every step of the way, down to their last contractor.” dress big social and environmental issues and have started shifting their expectations. Now more than ever, companies Additionally, because of their size, SMEs are betare being held to a higher standard of doing right by their ter at accurately measuring the impact of their inibusiness but at the same time doing right by the world. 8

tiatives, as opposed to a larger corporation where bureaucracy comes largely into play, argues Grant Young, Director of Innovation for Zumio. Not to mention their upper hand with the creation and activation of a corporate culture that aligns with the CSV program, ensuring buy-in from all levels of the corporation, including leadership. No matter the size, companies have to understand just how valuable CSV can be for their business. According to the report “Doing Well by Doing Good,” consulting firm Nielsen found that 55% of consumers worldwide are willing to pay extra for products and services produced by companies that are socially responsible. In the face of ever-changing expectations, what is the intersection where SMEs and big corporations converge? Collaboration is the key. In his book Building the Impact Economy, Maximilian Martin proposes “Super-Tankers” to foster collaboration between small businesses and industry leaders. SMEs provide the grassroots insights, the creative methods and the innovative solutions while multinationals provide the capital, the working space and the business knowledge to foster achievable results. Bringing the best that both worlds have to offer in order to tackle social and environmental issues in a cohesive and inclusive manner . Super-Tankers have already begun popping up in a variety of industries. The Unilever Foundry, AARP’s Innovation Lab and Lowe’s Innovation Lab are just some of the pioneers of this uncharted territory and will soon start rolling out awe-inspiring products, services and initiatives that could have only been achieved by a combination of the two perspectives. In the words of Steven Anderson, leadership expert, “Alone we are smart. Together we are brilliant.”n

Unilever Foundry Ideas Platform -- Collaborate with us to create a #BrightFuture 9

panies can truly differentiate themselves from the crowd.

THE HOTTEST TRENDS IN

C S R by ADITYA VEERA & SARA DAL LAGO CAPITAL IS MOVING TO B-CORPS AND VENTURES CENTERED ON SOCIAL IMPACT.

Aditya Veera: The B-corp focuses on how doing good and making profits can be combined legally, seeking a broader mandate than the profit motive. But it is much more interesting to ask how companies can make profits by doing good. What is required is not so much a legal expansion away from profit, but instead a change in the way profits are made. The idea of shared value provides a solution. Value creation, Michael Porter of Harvard Business School argues, is broader than short-term financial performance. Shared value is the generation of profits by meeting social needs. This connects a company’s success to social progress. The advantage is that a corporation needn’t change its constitutional structure to do good. Adidas can manufacture a low-cost shoe that protects wearers in Bangladesh from diseases. Novartis hired community health educators and built a distribution system to 50,000 rural clinics in India, not only creating a channel for selling pharmaceutical products but also achieving the behavior change of seeking effective healthcare solutions. COMPANIES - AND THEIR LEADERS - ARE INCREASINGLY TAKING A STAND ON SOCIAL ISSUES.

AV: It is clear that all companies ought to take a stand on Sara Dal Lago: B-corps model is a win-win for social issues. No 21st century corporation, for example, both the poor and the multinational corpora- can fail to be against poverty. The question is whether cortion and should be adopted by more businesses. porations ought to take a stand on controversial issues. Certified B Corporations (or B Corps) are to business what Fair Trade certification is to coffee or USDA Organic certification is to milk. By meeting rigorous standards of social and environmental performance, accountability, and transparency, these certified for-profit companies spearhead a global movement of people using business as a force for good. This legal model is rapidly growing, with over 1,600 Certified B Corps, including Etsy, Patagonia, and Warby Parker, from 42 different countries. According to Fast Company, we are actually seeing the first signs indicating that major corporations themselves could become B Corps. As stated by Paul Polman, Unilever’s CEO, “The B-corp movement is a critical part of the shift to a more inclusive and purpose-driven economy, which is unquestionably needed.” Moreover, as highlighted by Forbes, consumer demand for corporate accountability is at an all-time high. By being accountable not only to their shareholders, but also to the entire community, com10

What does public opinion say? A majority of Americans believe it is appropriate for companies to stand up for what they believe in politically, regardless of whether or not it is controversial. But does that entail taking on unnecessary risk that shareholders shouldn’t have to bear? Does it impose a burden on enterprises and their employees (including CEOs)? CEOs are chosen primarily for their ability to run a company. Moral and societal leadership on matters of controversy may be well beyond the scope of their duties. We are often carried away by our enthusiasm for stances we agree with. It sometimes takes an unsavory stance to help us see why businesses ought to stay focused on uncontroversial social responsibility. One stance that sparked media outrage and popular disagreement, particularly within the LGBT community, was Chick-fil-A’s president Dan Cathy’s comment on marriage. In 2012, Dan Cathy voiced his “support of the traditional family” to Baptist Press. He went on to

elaborate that “I pray God’s mercy on our generation [that has] the audacity to try to redefine what marriage is about.”

By making a 2% philanthropic contribution from net profit compulsory for all enterprises that generate more than 10 billion rupees of annual revenue, InIf we wish that CEOs speak up on controversial so- dia has positioned CSR as a standard benchmark. cial issues, then we must be prepared for instances where those opinions - and the corresponding The law has released much-needed funds into urgent probphilanthropic contributions - are unsavory to us. lems such as poverty reduction, education and healthcare. Private sector charitable spend rose from 33 billion SDL: Companies can benefit by taking strate- rupees in 2013 to 250 billion in 2015. That’s a sevengic stance aligned with universal social goals. fold increase. Moreover, the CSR law requires companies to set up a CSR board committee to oversee and ensure According to a study published by the Social Science Re- the annual allocation from net profit. This is a good way search Network in March 2016 entitled “Do CEO Activ- to phase in a culture of universal giving, promoting CSR ists Make a Difference? Evidence from a Field Experience,” from the periphery of corporate activity to the boardroom. CEO activism has been proved to influence public opinion and consumer attitudes. By conducting a field examining But the law is not a panacea for development. Largthe impact of Apple CEO Tim Cook’s public statements er charities have garnered the bulk of the increase in against a pending religious freedom law against same-sex corporate giving, as small charities struggle to prove couples, researchers were able to show the CEO’s power themselves as credible partners. Corporations also seek to sway public opinion as much as a prominent politician. large projects based geographically close to their place Additionally, as stated by the research team in a New York of business. This reduces the probability that worthTimes article, consumer gains exceeded losses, who expressed while small charities and their causes will be promoted. a greater intention to purchase Apple products after being prompted by Cook’s opposition to the discriminatory law. There is also the concern that philanthropic activity will be seen as all there is to CSR. Voluntary commitments may A prime example of CEO activist is Paul Polman, Unilever sustain greater momentum, as well as build public-priCEO. Since when he took on the role in 2009, Unilever has vate partnership capacity in unexpectedly innovative ways. become “the exemplar of the “good company”, the poster child of sustainability,” wrote The Economist. In 2010, But for all the caveats, compulsory CSR has gotten off to a he launched the Unilever Sustainable Living Plan, aimed at good start in India. For a country with urgent socio-economic doubling the size of the business by 2020, while reducing en- needs in need of immediate funding, a mandatory CSR law vironmental footprint and increasing positive social impact. is an imperfect but necessary tool of incremental progress. What is most surprising is probably the timing when Polman started outlining his vision for the organization, in the middle of the financial crisis in 2009, and presenting it to his shareholders. In an interview with Forbes, when asked about his decision to stop quarterly reporting, Polman said that “in order to solve issues like food security or climate change, you need to have longer-term solutions.” Polman has always been faithful to his mission for the organization, taking stances that were at times controversial, such as disinviting shareholders and sticking to his vision of “making sustainable living commonplace.”

SDL: CSR should not be mandatory. The question should actually be: “What are the options to mandatory CSR?” A mandatory CSR model follows an outdated version of CSR called philanthropy. Companies should instead be thinking about shared value and go further, integrating social value into their core activities, and finding the intersection between social purpose and economic profit.

As stated by Vikas Goswami, head of Godrej Industries’ sustainability program, “for most organizations, the discussion at board level is now not about what we do, but SHOULD CSR BE MANDATORY? does it count as CSR and does it meet the legal requirements.” As a result, the business motives of corporate AV: Whether CSR ought to be mandato- responsibility are highly jeopardized (The Guardian). ry depends on the economic and political conditions in which business is conducted. Last year, Fortune introduced its new Change the World 11

list, spotlighting companies that have made substantial contributions to the world’s greatest problems as part of their core business strategies. Urged by socially responsible consumers and idealistic employees (and not forced by laws - I would add), these companies were able to leverage new ways to prove the power of capitalism to address social issues (Fortune). As perfectly resumed in the article, “companies that are making genuine efforts to change the world for the better should be encouraged. The future of capitalism—and the future of mankind—depends on it.”

“revive” the future of CSR (if we still should call it that way) would be, according to Klein, a shift from CSR-based investments toward more innovative technology-based solutions.

He is not alone. Dr. Wayne Visser, a thought leader in CSR, identifies 3 pitfalls of conventional CSR. First, when faced with large and urgent problems, we continue to pursue incremental progress. Second, CSR is still peripheral at most organizations i.e., it is not integrated with the core activities of the corporation. Third, markets still do not consistently and proportionately reward sustainable behaviors.

There is room for both. The world needs both companies that make sustainability and social impact the core of what they do, and companies which treat it as an additional activity to their core business. n

Author, academic instructor, and CSR expert Wayne Visser has identified trends for the future of CSR for the next ten years. While CSR codes, standards, and guidelines will be necessary yet insufficient, cross-sector partnerships will become an integral part of all CSR approaches. Additionally, companies will be increasingly expected to follow universal principles - such as the UN Global Compact - and, at the WHAT THE FUTURE HOLDS: IS THERE A BETTER same time, show responsiveness to local issues and needs. WAY THAN CSR? CONCLUSION AV: John Browne, chief executive of British Petroleum from 1995 to 2007, claims CSR is commercially irrele- There’s an old saying that applies to CSR: Don’t fix what vant. CSR is not enough, he says, because it splits the ac- isn’t broken. CSR has made giant strides over the last few tivities of a corporation into CSR and not-CSR. Moreover, years, and it is no longer a question of whether companies CSR is often aimed more at improving employee morale do it; it is a question of how. While there are excellent exthan it is at society’s concerns. Instead, Browne calls for amples of corporations that undertake revolutionary steps, companies to pursue connected leadership i.e. to engage let’s not abandon the momentum of incremental progress radically and sustainably with the world in all they do. by aiming for something radical for every corporation.

A sustainable future is one that improves the current iteration of CSR and moves us into CSR 2.0. Dr. Visser identifies five ways in which CSR 2.0 is transformative. First, it is creative. Second, it is scalable enough to tackle the biggest problems we face. Third, it is truly responsive to stakeholders. Fourth, it meets local needs while applying global principles. Fifth, is it circular? Does it approach zero environmental impact? SDL: I believe there will the way we define and

be a shift in think of CSR.

Paul Klein, CEO of Impakt, a social change agency, identifies one big challenge of today’s CSR, i.e., the business’ inability to find a common description. Corporate social responsibility, corporate citizenship, cause marketing, sustainability, corporate responsibility… How do companies describe their efforts? The term CSR has become ubiquitous, he says in an article in the Stanford Social Innovation Review, which makes it harder for further progress to happen. A solution to 12

A HISTORIC AGE TO BE AN ENTREPRENEUR How companies today can incorporate philanthropy into their business plans.

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t is pretty difficult to ignore the fact that philanthropy has taken Corporate America by storm. Whether today’s businesses decide to support any number of nonprofits through employee volunteer hours or through financial contributions (or a combination of ), supporting causes is a trend that seems to, thankfully, be sticking. As with many trends, innovative ideas have also been swooping in to the scene, breathing in a new burst of energy to how businesses take on their own Corporate Social Responsibility (CSR) strategies.

A NEW LANDSCAPE FOR CSR Zuckerberg and Chan’s charitable promise comes with criticism (implications of tax evasion tactics, for example, due to how the initiative was created); however, this act paints a dramatic photo filled with expectations and opportunities for future and current businesses and how they approach CSR. Zuckerberg and Chan’s intentions are to do good and also encourage others to do good like a massive wave all

members of the world can also ride and conquer with positive social change at the shoreline. Like in Facebook’s case, financial success first knocked on Zuckerberg’s door. Years AN ACT THAT MAY BE WORTHY OF YOUR “LIKE” later, he was able to write such a promise-filled letter to his newborn daughter. However, in 2016, companies now have In late 2015, Facebook’s Chief Executive Officer and an additional option in how they approach CSR even as Founder, Mark Zuckerberg and his wife Dr. Priscilla Chan they begin the process of dreaming up their business plans. announced the birth of their first child. On December 1 of the same year, in a publicly posted announcement (fit- A couple of months prior to Zuckerberg and Chan’s antingly through Facebook), the couple dedicated a letter nouncement, Founder and CEO of Causecast, Ryan Scott, to their daughter Max along with the introduction of a wrote about the “new landscape of corporate social renew charitable promise. In this letter, Zuckerberg, solidly sponsibility.” Beyond the scope of community engagement ranked #16 on Forbes’ list of the world’s billionaires, and programs and encouraging volunteerism in the workplace, Chan shared their belief that they have a “moral responsi- Scott formulates an introduction and summary of innovability to all children in the next generation.” The initiative tive opportunities for how new businesses can build their will operate with 99% of their corporate models with charity Facebook stock, a sum curin mind from the very beginrently sitting at $45 billion in ning. Behold The Founders worth. As a result, their daughPledge: a “program of Full ter Max was born alongside Circle Fund that engages the Chan Zuckerberg Initiastart up founders to pledge tive, a charitable undertaking at least one-percent of comcreated with the intention “to pany equity toward positive join people across the world to change in their communities.” advance human potential and - goal of the Chan Zuckerberg Initiative promote equality for all children in the next generation.”

“To join people across the world to advance human potential and promote equality for all children in the next generation.”

WHERE ‘HEART,’ COMMUNITY, AND THE ENTREPRENEURIAL SPIRIT MEET Promising one-percent of your future company’s equity is a step toward positive local and global change, but the company at the helm also becomes a part of a larger community of entrepreneurs looking to make the same impact on society. For example, once companies decide to join The Founders Pledge, they automatically become part of the larger and growing international Pledge 1% community that the Salesforce Foundation is building. Another network called the Social Capital Markets (SOCAP) is similar in nature in that is also serves as a network of social impact leaders looking to advance non profits and share innovative ideas on the global stage. As Ryan Scott describes in his article, it is a “historic time in corporate philanthropy.” It will be fascinating to see its continued evolution particularly as advances in technology continue to facilitate, highlight, and promote altruistic endeavors. Who truly knows the impact we could make if every business pledged their one percent. From the beginning. It’s certainly a motivating thought worth spending your time on. n

GREENWASHING AWAY CORPORATE RESPONSIBILITY

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reenwashing is a term used to describe a company that utilizes advanced marketing and persuasive PR to deliberately misguide consumers into believing their products are eco-friendly. A result of high consumer demand for earth friendly products, greenwashing is increasingly used in corporate America. It’s heart-wrenching to discover how companies promoting many everyday products use greenwashing in their ad campaigns. Worse, is the way in which profit motive trumps Corporate Social Responsibility.

An excellent article by Sins of Greenwashing breaks down the seven sinful ways greenwashing occurs: first is the sin of the hidden trade-off, then the sin of no proof, the sin of vagueness, the sin of irrelevance, the sin of lesser of two evils, the sin of fibbing and the sin of worshiping false labels. Sins of Greenwashing offers consumers a thorough guide for double checking a product against eco-friendly advertising claims. To my surprise, some of the world’s most beloved companies are getting away with greenwashing by deceiving customers with misleading claims and false advertising, misrepresenting a commitment to eco-friendly business practices throughout their supply chain.

left open for anyone to claim they are serving sustainable beef.

The McDonald’s chain is guilty of more than the greenwashing sin of vagueness. The Sin of the Hidden Trade-Off was committed when the company changed their foam cups to paper ones, advertised the change as “eco-friendly,” and embellished their success in recycling and reduced package waste. While their cup change is eco-friendly, what about everything else? Their lids, straws, and several other items continue to be made out of plastic. McDonalds commits the greenwashing Sin of Lesser of Two Evils when it aggressively advertises its unhealthy fast food by talking about going green and an all-natural burger. Customers are misled into thinking McDonald’s fast food is not so bad for your health. McDonald’s food is not healthy because it is processed and One example is McDonnot all natural produce. Until the day that McDonald’s food ald’s, a fast food chain is improved, “green” advertising is distracting the public from known to all that recently understanding the true quality of the food they are putting came out as “going green;” in their bodies. While the eco-friendly steps McDonalds but how green is green? has taken should be acknowledged, the hope is that more Their revamped website now embellishes their commitment substantial changes continue to be made towards a green to being eco-friendly with a green background and farm- world and a more socially responsible corporate culture. like figures. An earthy stamp-like drawing placed front and center on the page showcases an underlined “Planet” in The changes that have been made are good, but they are bold print. Consumers may easily assume from the website not the same as the commitment to the principles of gochanges that McDonald’s is, in fact, going green. When looking green, offering healthy foods, nor do they demonstrate ing closer, which sins have the popular chain committed? a commitment to the ethics of CSR. Unlike McDonald’s, new fast food chains such as Elevation Burger, are driven by The Sin of Vagueness is described as making a claim so a passion for good food that’s organic, sustainable and fresh, poorly defined it is easily misunderstood by the consumer is one of the many sins McDonald’s has committed. McDonald’s claimed by 2016 “many” of their beef burgers would be made with “verified sustainable beef.” Which begs the question: what classifies as verified sustainable beef and by whom? The Global Roundtable for Sustainable Beef (GRSB) is a multi-stakeholder group, created for the advancement and improvement of the global beef chain. Here’s

where

gets

good.

One of those multi-stakeholders just happens to be industry giant McDonald’s. Wouldn’t McDonald’s better prove its commitment to sourcing sustainable beef if the third-party setting and verifying its sustainability benchmarks were independent of McDonald’s? In a 2014 news release, 23 NGOs such as Friends of Earth call out the GRSB and McDonalds on their greenwashing due to the lack of standards, methods and guidelines for businesses providing sustainable beef. The 23 NGOS claim the door is 15

a motto their company believes in. Their website is created so simply easing customer’s search for information on their products, the opposite of McDonald’s cluttered and confusing site. Elevation Burger offers an immense amount of information on exactly how they are environmentally sustainable, organic, all natural and a humane company. As a result, Elevation Burger is a company whose refreshing honesty doesn’t need greenwashing to boost them up in sales. Elevation Burger stands as an example of a company committing no greenwashing sins, an honest and ethical CSR company. What role, if any, does corporate responsibility play at McDonald’s? McDonald’s websites claim they work directly with their suppliers to make sure they meet the requirements of the “Three Es,” ethics, environmental responsibility and ethical viability. A corporation’s responsibility is to sustain ethical behavior while positively benefiting the community, environment and economy. In an attempt to increase customers and boost sales, McDonald’s is engaging in greenwashing tactics which ultimately cause it to lose credibility with the community. That loss of credibility, in turn, does not demonstrate good social responsibility towards the community McDonald’s serves. At the end of the day, McDonald’s and corporations like it, are washing away corporate social responsibility by partaking in greenwashing. As McDonalds website states, “We take our commitment to the people and the communities we serve very seriously.” Though their greenwashing sins prove to be a contradiction to the website’s claims and commitments to be socially responsible to those communities.n

IS YOUR COMPANY CONSIDERING CONSCIOUS CAPITALISM?

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ome cynics believe “corporate programs to fund social and environmental programs are nothing more than public relations campaigns to boost brand reputations, often disproportionately to the effort itself.” These naysayers must grow to understand that “mutual benefit is not only a reasonable objective, it is also required to ensure long-term success.” US and UK companies in the Fortune Global 500 spend $15.2bn a year on corporate social responsibility (CSR) activities, according to the first report to quantify this spending. These companies, most of which are publicly traded, could not justify these extraordinary levels of investment without some type of measurable return on investment (ROI).

There stand

are two things before choosing

critics must to condemn

underCSR:

1. CSR has evolved. True leaders in the space no longer write big checks only after a banner sales year, then send out a press release to congratulate themselves. Rather, the best CSR practitioners leverage their business expertise to create long-term, strategic plans to address some of society’s biggest problems. 16

2. Improved brand reputation is not always the return CSR practitioners seek. Other benefits include increased employee morale, decreased environmental impact and heightened awareness of societal issues – not even the most skeptical can argue that these are smarmy reasons to implement CSR.

sense. Companies can save money in the long term by making production more efficient and environmentally sound. They can positively differentiate their brand in the eyes of consumers (TOMS® Shoes is founded on this principle). They can engage customers by providing education on societal issues. They can increase employee engageBetter practices and motives aside, many still shun CSR ment by inspiring their workforce to work for something because it is not backed by altruism and anonymity – the bigger than themselves or the company. The list goes on. basis of true charity in some people’s minds. Top executives may subscribe to these ideals in their personal lives, Let’s stop arguing about the motives or philosophibut the reality is that altruism and anonymity have no cal rightness of corporate social responsibility and agree place in the corporate environment. Businesses exist to that what is good for society can indeed also be good make a profit and, in turn, to create value for shareholders. for business. There is nothing wrong with a win-win. Thankfully for today’s nonprofits, businesses have come to realize that CSR and “doing business in a more sustainable way sells.” Many nonprofits would struggle to thrive, or even exist, if it weren’t for corporate donations. Take the Special Olympics for example. Coca Cola is a founding partner of this organization and has been an ongoing supporter since 1968. Many consumers have brand loyalty to Coke, and for some, it’s their commitment to “open happiness” for 4.5 million athletes with intellectual disabilities that fosters that loyalty. Can one really condemn Coke for donating millions to the Special Olympics and creating increased understanding of intellectual disabilities to in return increase Coke’s employee engagement and increase brand loyalty?

To better describe this win-win, some companies such as Whole Foods Market have begun attributing their efforts to “conscious capitalism” rather than “corporate social responsibility.” Some may chalk this difference up to mere semantics, but there is a distinct and important difference. Conscious capitalism refers to “businesses that serve the interests of all major stakeholders—customers, employees, investors, communities, suppliers the environment.” Corporate social responsibility on the other hand is, a “business practice that involves participating in initiatives that benefit society.”

At their core, these two approaches to doing good by doing well are vastly different. CSR is clearly a “discretionary business practice” that companies choose to implement. ConCSR is a gray area because the philosophical ideals of char- scious capitalism, on the other hand, embeds its financial, enity and the realities of the business bottom line do not vironmental and social impacts as part of “business as usual”.

always seem to be in alignment. Maybe the solution is to stop trying to make them align. At its core, the term corporate social responsibility is misleading. Corporations do not have have a responsibility to be charitable, they have a responsibility to create value for their shareholders. Participation in CSR programs is completely voluntary.

Corporate jargon may need some time to catch up, but one thing is clear: the companies making the biggest impact on societal issues are practicing “conscious capitalism” whether they know it or not. Let’s adjust our mindset. Let’s adjust our vocabulary. Let’s accept that altruism does not need to be at the root of a donation to make it impactful. Let’s embrace conscious capitalism and the shared value opportunities it creates as the business model of the future.n

It’s no coincidence that the first result for the Google search, “reasons to implement CSR,” yields a Forbes article – a leading business magazine. Companies voluntarily participate in CSR because it just makes good business 17

DOCUMENTARY: VIRTUAL REALITY STORYTELLING Georgetown Students Experience Virtual Reality at the Gelardin New Media Center

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the private sector to have an impact on global challenges, by contributing resources, scaling up initiatives and sharing expertise. In order to make public-private partnerships truly successful, Møller claims governments need to create a favorable environment by providing companies the right incentives to engage in such partnerships, by ensuring, for instance, that tax systems are fair, infrastructures are adequate, and skills and expertise are well-coordinated across sectors.

GLOBAL GOALS FOR A GLOBAL CSR Why it’s good for the world and for your business too

How can businesses get involved?

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What are the Global Goals?

There are many different ways businesses can get involved and support the Global Goals.

Unlike initiatives such as the UN Global In September 2015, the UN Compact - the world’s adopted a new set of 17 Suslargest corporate sustainable Development Goals tainability initiative (SDGs), also known as the - companies do not Global Goals, which serve as need to apply or fora roadmap to create the world mally sign a commitwe want by 2030. These aspiment to the princirational goals aim to solve the ples in order to join. world’s biggest problems, such Businesses can simply as ending poverty, combating choose to publicly climate change and fighting express their support injustice and inequalities, and for the Global Goals. reflect a universal consensus The Goals Resource about what the world’s priCentre offers a toolkit orities should be. While not containing useful resources for companies and organizations legally binding, they call for collective action from governments, the private sector, civil society and individuals. aligned with the 2030 Agenda, such as brand guidelines, social media ideas, and icons and logos to feature on their website. It’s good news for the corporate commuBusinesses might also want to become involved in joint nity! Why? collaborative initiatives, such as the Impact 2030 coaliWhen talking about sustainable development, big corpo- tion - the only business-led effort that advances corporate rations and private companies are not the first thing that volunteering efforts to achieve the Global Goals. Member comes to mind. But that’s exactly what makes this moment organizations commit to mobilize all employee volunteer in time an unprecedented opportunity for businesses to actions toward the achievement of one or more Global align their CSR strategies with the 2030 Agenda, adding their voices to a global movement for social good. As highlighted by Forbes, the Global Goals represent clear business opportunities to show responsibility through innovative products and services. In this sense, these Goals will significantly influence the way companies do CSR at a global level. As stated by Michael Møller, Director General of United Nations Office at Geneva, there is enormous potential for

“The SDGs provide a platform to show responsibility, pursue opportunity and innovation, and inspire other businesses to get on board.” Lise Kingo, UN Global Compact Executive Director

Goals. Indeed, the first funding partner, The Ritz-Carl- In conclusion, businesses have the unique opportunity to ton Hotel Company, is an organization that has made share their expertise, resources and, in the case of mulits human capital its biggest resource and brand value. tinational corporations, their global reach to solve the world’s biggest problems. Joining the bigger conversaEstablishing strategic partnerships is another great way tion and showing support is not only a way to do good, businesses can support the Global Goals. The Partnerships it is also a smart business decision. Acting as overarching for SDGs online platform aims to foster global engagement guidelines for CSR strategies, the Global Goals are leaving around multi-stakeholder partnerships by enabling organi- ample room for the private sector to choose how to align zations to register their initiatives in support of the Global themselves to the global 2030 Agenda, while tailoring Goals. The platform will also allow for ongoing monitor- the approach that makes most sense for their business. n ing of the progress toward the achievement of the Goals. Examples of corporate support for the Global Goals Many corporations publicly support the Global Goals. Some of them may decide to engage with all the 17 Goals, while others may focus on the ones that mostly align with their business values and field of industry. MARS, for example, publicly stated its support on the day of the Global Goals’ adoption and has demonstrated its commitment to all 17 Goals by showcasing its support and linking existing initiatives to the corresponding Goal. Unilever asked a group of leaders and experts to write letters to the future, exploring the pathway we could take to get there, focusing on issues such as sustainable consumption and production (Goal 12), hunger (Goal 2), life on land (Goal 15) and clean water and sanitation (Goal 6). Paul Polman, Unilever’s CEO, also reiterated the company’s commitment to sustainability as a key business driver through innovations that can help people solve the biggest challenges around the world.

“It won’t be easy. I hope that business will be the vanguard of this movement, but to reach our goals it will be vital that we redefine how we work with one another.” Paul Polman, Unilever CEO

WHAT ELVIS CAN TEACH US ABOUT CSR Plato, Rockefeller and Elvis’ philanthropic footprints

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t first glance, it might seem that Plato, John D. Rockefeller, and Elvis don’t have much in common. Separated by generations and even centuries, the three have their own unique (and substantial) chapters in the history books. They each spark drastically varying reactions and emotions. And perhaps only one has a name that causes an immediate and unnatural jerk of the lip. There is, however, a common theme embedded in each of the footprints they left on the world and society. Philanthropy.

PLATO, AND THE DOCUMENTED BIRTH OF PHILANTHROPY Philanthropic activity can be traced as far back as 347 BC, around the year Plato is known to have died. Though benevolent people most certainly have always existed, Plato formally organized generosity to create a stream that would flow even after his own death. He did so by leaving specific instructions in his will on what was to hap-

pen to his farm, left in the hands of his nephew. The money from the sale of Plato’s farm was to help provide for the faculty and students of the Academy he founded. Though initially an informal association of intellectuals, the Academy (named after the garden meeting point for the group, which bore the name of a local hero) lasted for 900 years and allowed many bright minds to shed light on the world. Aristotle and Socrates were amongst the power line-up.

sity, formerly known as the Rockefeller Institute for Medical Research. In 1913, the Rockefeller Foundation, still alive today, was founded “to advance the well-being of mankind.”

THANK YOU, THANK YOU VERY MUCH, ELVIS

We are catapulted into the 1950s where a young Elvis Presley arrived on stage and shook the world at its knees. Elvis quickly became one of the most influential cultural THERE’S NOTHING STANDARD ABOUT ROCKEFELLER’S icons of his century and his music, to this day, rocks the PHILANTHROPIC IMPACT airwaves. His generosity, though, also deserves a mic drop.

Fast-forward to the 19th Century, the birth of the oil in- If on a visit to Memphis, Tennessee, you have the opportunity to visit Graceland Mansion, home of Elvis Presley, you’d undustry saw the rise of a young and derstand that grandeur and unique tastes in design were cerindustrious John D. Rockefeller, tainly a part of this musician’s core. One particular section of who became one of the richest the house, though, was not in action during his living years. men in the world (and AmeriA visit today would leave you staring at a room wallpapered ca’s first billionaire) as founder of with check donations, awards and photos, all proof that the the Standard Oil Company. As “King of Rock and Roll” reigned with a compassionate hand. Rockefeller climbed the corporate ladder, his business tactics rested Elvis’ rise to fame also led to a rise in his gift giving. He once under a watchful eye and faced stated that he would “never get so famous he would forget much criticism and legal battles. what it was like to grow up in need.” For numerous years, Criticism followed him into his acts of benevolence, with Elvis donated $50,000 to each of 50 charities in the Memmany questioning if Rockefeller’s philanthropic model phis area. He performed benefit concerts, donated cars, promoted separation of the classes and was made possi- wrote out checks all in support of countless Memphis-based and national charities. Half a century later, the Elvis Presley Charitable Foundation continues his legacy of giving.

“When I was only making a dollar a day, I was giving [away] five, ten, or twenty-five cents.”

John D. Rockefeller ble only through “tainted” money from unethical business practices. What is indisputably etched into the history of philanthropy, however, is the vast sum of funds he donated to charitable efforts spanning anywhere from public health campaigns, education, biomedical research and religious institutions. Approximately $540 million of his $11 billion worth was donated to charities by the time of his death in 1937 (six weeks before turning 98!). This philanthropic spirit preceded his riches. “When I was only making a dollar a day,” Rockefeller once noted, “I was giving [away] five, ten, or twenty-five cents.” Of his most notable contributions, Rockefeller’s riches helped to build Spelman College, the University of Chicago and Rockefeller Univer-

Plato, Rockefeller and Elvis each left their own legacy on humankind, but their philanthropic decisions planted a separate and deep-rooted seed – philanthropy weighs heavily on one’s personal brand. Today, brick and mortar brands fully grasp this centuries-old phenomenon, making Corporate Social Responsibility a concept that is in full force in 2016. Elvis might be proud that present-day Corporate America embraces his lyrical vision…”a little less fight and a little more spark, close your mouth and open your heart.” n

citizenship is not about giving more money and more product, it is about transforming businesses to operate responsibly.”

THE RISE OF THE

B CORP COMMUNITY

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So what has lead to this new trend? One factor that pushed for a change in the business mentality is the integration of Millennials and the soon-to-come Gen-Z into the work force. These generations are looking to make a difference and to work for a cause they believe in. In order for companies to capture and retain (in as much as possible) better talent, they must adapt their modus operandi as employers to meet the expectations of their employees.

Another reason is that new findings in behavioral science have only reinforced that humans are irrational creatures who base their decisions on emotions, and how we choose our laundry detergent is no different. According to Simon E I T H Sinek, well-known writer on leadership, customers are attracted to the “Why” and not the “What” that companies are selling. Companies are starting to realize that market share is better captured when there is an authentic, larger reason that goes beyond profits. The only problem is that most of the time consumers are skeptical about CSR campaigns and social responsibility claims that big corporations make.

he 90’s and early 2000’s saw a rise in the creation of NGOs as a response to the antagonization of business being the root of all that was wrong in the world. Companies, in turn responded with very Enter B Corp Community one-dimensional campaigns to endear customers with their social efforts. Big checks Created in 2009, B Corp Community is an organization to philanthropic causes were given left and right and that looks “to redefine success in business so that one day all enforced volunteer days were the talk of the town. companies compete not only be the best in the world, but the best for the world.” With already more than 1,000 compaWe have come a long way from those days. Someone stopped nies, from Ben & Jerry’s and Patagonia to Etsy and everything and thought for a minute, “What if we shifted our strate- in between, they have presence in 60 industries in more than gy? What if we keep doing good for our business but engage in better practices that will also be better for the world?” This is what is known as Triple Bottom Line: people, planet and revenue. Kathy Pickus, Senior Vice President for Global Citizenship and Policy at Abbott, said, “Corporate 22

30 countries. Their online presence on social platforms has been worthy of digital strategy textbooks. The #BtheChange hashtag has been used an astounding 8.6 million times. B Corp Community works in collaboration with B-Lab, a sister non-profit that provides the metrics and engineering tools necessary for companies to: A) get certified, and b) keep benchmarks and monitor their businesses so they can aim for best-in-class practices. This organization is not only a stamp that certifies a company is complying with governance best-practices, but a platform to lobby for new legislature and a data base for companies to construct reports and get market insights. Not to mention that it has also worked well as a marketing strategy. It is reported that 28% of B Corp companies are more likely to have women and minorities in management and 47% more likely to use on-site renewable energy. These are just two amazing facts that make consumers and employees prefer companies like Catchafire or Kleen Kanteen over the competition. (For more information on B Corp Community visit www.bcorporation.net) It is difficult to predict what the next trend will look like, or how long this new model will be operating. But looking back, there is a clear pattern for improvement and evolution. The days where thought leadership, shareholder value and social impact interweave are fast approaching and when that day comes, everyone will be a winner. n

SUCCEEDING AT EMPLOYEE ENGAGEMENT

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mployee engagement – it’s easy to dismiss these two words as the newest corporate fad or as meaningless buzzwords. Don’t do it; it could be one of your company’s most costly oversights. According to a recent Gallup poll, just 30% of American workers are engaged at work. This lack of engagement costs the nation $450-$550B annually in lost productivity.

Companies big and small are beginning to recognize employee engagement shortfalls, but few know how to begin addressing them. It is imperative to first understand what employee engagement is. Kevin Kruse, author of Employee Engagement 2.0 defines the phenomenon as, “the emotional commitment the employee has to the organization and its goals.” The ultimate goal of employee engagement is to motivate employees to expend “discretionary effort” – an elusive level of effort above and beyond the call of duty. Engaged employees are productive employees. The former CEO of Campbell Soup, Doug Conant, said it best, “To win in the marketplace you must first win in the workplace.”

It’s important to note that the word “happy” has not been mentioned in this conversation about employee engagement. Too many employers mistake happiness for engagement and simply throw money at the issue. No amount of free lunches or nap pods will bolster engagement – even employee perk legends like Google or Facebook have disengaged staffers. So how can a company address its costly lack of employee engagement if even REI’s “Yay Days” can’t solve the problem?

Following the discerning results of Gallup’s employee engagement survey and the consensus that happy ≠ engaged, thought leaders in venues such as Forbes, The Huffington Post and Inc. started doling out advice. The tips varied by author, but one point was consistent throughout nearly all – make work matter. This succinct advice encourages companies to implement and/or expand corporate social responsibility (CSR) efforts. By its most simple definition, CSR refers to a “business practice that involves participating in initiatives that benefit society.” The team at The Huffington Post summed up the reason to implement a CSR program best, “If your company is focused solely on increasing sales, your employees will be in constant danger of burnout. They’ll work harder and be happier if their work has meaning.”

company stand out from the crowd? Tim Mohin, Director of Corporate Social Responsibility at AMD, acknowledges the challenge, stating, “CSR has become such a common practice, we believe no one is really paying attention anymore”. There is one big caveat to Mr. Mohin’s statement. People may not be paying attention to companies’ messages about CSR, but they are certainly tuned into friends’ passions. These passions are more easily shared than ever thanks to social media. Is your company encouraging employees to “get social” on its behalf? Likely not, since only 33% of U.S. employers currently encourage social sharing. It’s time to embrace this ever growing trend. Empower your employees to become an army of brand ambassadors, marketers and recruiters.

There is an innate fear in corporate America that allowing employees to discuss work on social media could expose negativity, or worse yet, sensitive information. These fears are valid, but the truth is that 50% of employees already post content about their employer – whether authorized to or not. Stop fighting the inevitable, have faith in your team Time is of the essence. Start implementing your CSR pro- and capitalize on the fact that employee-shared content (as gram now to not only better engage your current work- opposed to traditional marketing, advertising or sales conforce, but also to attract the future leaders of your com- tent) can increase reach 10x and engagement with a brand 8x. pany. By 2020, Millennials will be 50% of the workforce. This generation is the most socially conscious yet. Studies The adage, “trust is earned, not given,” perfectly describes show that recent MBAs will work for a significantly lower an ideal implementation of social media in the workplace. salary if they truly believe in what they are doing. More- Let your employees earn your trust by training them on over, 80% of 13-25 year olds want to work for a company the “dos and don’ts” of social media. Dell, Inc. was one of that cares about how it impacts and contributes to society. the first companies to implement a social media training Companies are paying attention to the beliefs of Millen- program for employees. Since 2011, Dell has been offernials and their younger counterparts and the future working a voluntary, eight-hour training on social media to its force’s requests for CSR programs. As early as 2011, 60% 100,000-person workforce. Employees can become certified of companies surveyed by Forbes either strongly agreed or by the company’s Social Media and Community University. agreed with the statement, “Philanthropy and volunteerism are critical for recruiting younger qualified employees.” The goal of this program is simple, “If Dell’s employees understand how to best use social media, not only It’s wonderful to see the ever increasing buy-in for CSR efforts, will that help them, it will help the company as well,” but this statement of agreement also raises a major concern said Sean Carey, lead facilitator of the trainings. This for companies investing in the creation or growth of CSR has had a profound effect on the company – since programs to attract top talent. If so many companies have its inception, Dell has not only seen increased brand begun engaging employees through CSR efforts, how can a building, but also a drastic increase in employee re24

ferrals. A big part of what Dell’s employees post about is – you guessed it – CSR. Do a quick search for #Dell4Good and tell me you wouldn’t be inspired to work for such a community-driven company! The task of overcoming dismal employee engagement stats can seem daunting. It should not be. If companies remember three simple words – make work matter – they can better engage current employees and attract new talent. To successfully make work matter, companies must establish, or grow, meaningful CSR programs. Once in place, companies should showcase their philanthropic efforts, but avoid using dated outreach methods – CSR reports or press releases. With about 40,000 CSR reports being released annually, it’s time for your company to take that leap of faith to make its CSR efforts stand out from the crowd – encourage employees to get social on your company’s behalf. Take a note from Dell – empower your employees to build both their personal brand and your company’s brand by offering social media trainings. Well-crafted, employee created social media content could be the best and most cost-effective marketing/recruitment campaign your company ever runs. n