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Corporate social responsibility

Consumers Want Transparent, Honest, Socially Responsible Brands

socially_responsible_brandsEarlier this year, I wrote a post here on the Corporate Eye Blog called 2010 – The Year of Brand Transparency, Honesty and Trust, and now, research is in that supports that prediction. Weakened economies and uncertainty have caused consumers to be less naive in terms of simply believing marketing messages, and the power of the social Web in boosting global communications to new heights of access and information sharing has created a new world where consumer expectations are less accepting and more “prove it to me” than ever before.

According to an article on Brandweek, A new study by Landor Associates, Penn Schoen Berland and Burson-Marsteller reports that, “75% of consumers believe social responsibility is important, and 55% of consumers said they would choose a product that supports a particular cause against similar products that don’t.”

The study also revealed some opportunities for brands to differentiate themselves from the competition not just with cause marketing and socially responsible programs but through education.  Many consumers still don’t understand what “corporate social responsibility” is.  At the same time, many consumers in the aforementioned study revealed they would be willing to pay more for products from a socially responsible company — as much as $10 more.  The opportunity to educate consumers about a socially responsible brand, differentiate it from the competition as such, and attach a premium price to it could be significant.

Furthermore, 50% of 18-34 years olds surveyed in this study claimed that they would be willing to take a pay cut to work for a socially responsible company.  That leads one to believe that socially responsible brand messages could have a bigger effect on brand building and sales in specific, younger demographics.  Again, this is an opportunity to craft effective messages for specific audience segments.

Consumers have changed over the course of the past few years.  Your branding and marketing messages need to change with them.

Ten Principles for a New Economy 3/3

(This concludes the Ten Principles for a New Economy series, based upon the New Economy Network publication Principles for a New Economy“.  Part one and part two looked at the Ten Principles in detail; this post looks at four things a new economy should NOT be.)

The first two posts in this series looked at Ten Principles for a New Economy and how these could fit into today’s business environment.  This last post looks at four things a new economy should not be.

The Ten Principles document states that:

“the purpose of an economic system is to organize human activities in ways that support healthy and resilient communities and ecosystems for both present and future generations”

It then goes on to describe how current global, regional, national and global economies have failed.  In today’s language the economy is largely made up of for-profit businesses, so if there is any fault to be found in the economy then it also points to faults within how businesses conduct themselves.

These failures show that businesses, along with the wider economy, are currently: [Read more…] about Ten Principles for a New Economy 3/3

Ten Principles for a New Economy 2/3

(This post follows on from Ten Principles for a New Economy 1/3 and covers the second 5 principles in the New Economy Network’s Principles for a New Economy (PDF) )

Taming Finance

“All monetary systems and financial institutions shall be regulated as essential public utilities for the benefit of society as a whole, and for nurturing the real economy.”

The two key phrases here are “essential public utilities” and “real economy”.

One core reason there was a financial meltdown in 2008 was because the real economy (the actual production of goods and services) had become secondary in financiers’ and politicians’ minds to the buying and selling of shares, options and positions on the financial markets.

This is like expecting a car to drive as fast as possible irrespective of the engine put into it.

Another core reason, and arguably a much more important one, is that finance remained essentially in the hands of a few people even though it’s almost impossible to survive in today’s capitalist society without getting into debt.  It is, in effect, a utility required by society in order to function correctly, and so should be treated as one.

This is a good moment to pause and reflect on why these Ten Principles are actually “good stuff” and worth taking on board.  They’re not anti-capitalist or pro-socialist … there’s no mention in there of nationalising banks, and there’s no concept that capital investment wil always be for society’s good.

Like sustainability, these Ten Principles push businessmen and economists beyond the left/right wealth and class arguments of the past century and look instead at how politics and finance can be shaped in a way which reflects today’s multi/social media society .. not the society of our great-grandparents who barely knew what a letter or an automobile was.

Enhancing Fairness

“Significant economic inequality shall be understood to be inherently and profoundly antihectical* to achieving human and ecological well-being, and shall be rapidly reduced.”

One of the deep flaws of the market economy is that it relies upon economic inequality.  This is why we’ve had cheap goods from China for so long and where there is now a rush to market at the “Bottom of the Pyramid”.

There will always be social and economic inequality .. that’s the nature of the beast.  However whether that inequality translates to unfairness is a different matter.  There are plenty of examples around, from a privately educated child who’s expected to write 10 pages on the solar system vs a publicly educated one who’s expected to write one sheet of A4 on one planet, through to the withdrawal of the Colombian candidate from the race to be President of the IMF because he felt the contest had become politicised.

Equality has to mean equality of opportunity, not equality of income, wealth or social standing.  It is how the economy is run and regulated which allows people to make their way according to their desires and abilities, not their background, race, gender or class.  Today financial return is allowed to trump these equitable considerations,  and that makes the economy profoundly unfair.

Providing Fulfilling Livelihoods

“Individuals shall be assured of substantial opportunities for decent paid work, employee ownership, and the right to organize in the workplace, and shall be accorded proper recognition for work performed outside the formal wage economy owing to its fundamental role in enriching community and family well-being.”

In other words: no more slaves, no more servants.

Many people’s quality of life has deteriorated significantly over the past 50 years or so.  Gone is the suburban commute of Reggie Perrin (or even the consummate breakdown) and in are long working hours, evening and weekend toil and the sacrifice of personal fulfillment over professional advancement.

Employees at all levels must have a significant voice in how the business is run, have opportunities made available to them as they arise and should be able to count their professional training as part of their working day.  This is the only way in which a proper work-life balance can be achieved.

Fostering New Values

“Economic values shall be redirected, by all fair and reasonable means, away from excessive materialism and shifted towards values that prioritize flourishing communities, individual happiness, and a healthy and resilient world based on lower material flows”

The economy, through consumerism and capitalism, has become an engine through which luxury is sold to those who can least afford it, no matter where on the income scale those consumers sit.  This emphasis on luxury means that people are encouraged to get into debt in order to gain more material possessions.

In the meantime pubs and corner shops are closing, effective working hours are increasing and social media is exploding. There is no halcyon of yesteryear which we should try and restore, but we need to look very carefully at how the need for stuff is driving us apart and causing us misery.

The values which are being inculcated into our communities are driving us apart, reducing our ability to meet each other face to face and driving brand-orientated wedges between sectors of society who could otherwise get on with one another.

A new set of values are needed which will put the community at the forefront and enable people of disparate background and wealth to view one another as equals.  These are the new values of the new economy.

Redefining Globalization

“International economic relations shall rest upon the same principles enumerated above that apply to economic activities within nations, such that economic justice also becomes embedded in such relations.”

Globalisation, like capitalism, is a fact of life today.  Get over it.

However globalisation, like capitalism, has to date been driven by the near medieval need to make profit and dominate communities.  Thanks to the liberal policies of yesteryear this trend has also gone hand in hand with a desire to educate and enlighten the local population, meaning that people around the world now realise they have been taken advantage of, used and abused in order to make a few people at the top even more wealthy.

I’m not going to say “this has to stop”.  To do so would be like condemning a farmer for sowing his crops because he then has a monopoly on selling his farm’s produce.  Out of his own effort he has produced the basic nutrition upon which we all rely.  Of course he has a right to retain power and control over his own farm, but he would rightly be condemned for withholding produce on the grounds of who could pay for it and would be doubly condemned for making healthy sustenance a luxury item.

The simile extends quite happily into the economic environment.  Any part of the economy should address the public need and provide tangible benefit to the community addressed.  This is where globalisation has gone wrong.  Big brands, from sports goods manufacturers to peddlers in nicotine and financial advisors, see nothing more in globalisation than an opportunity to sell their product or service for a centralised profit.

It may be their only community involvement is that they’ve brought their brand into a new community which will better that community because, um, they’re now buying that brand.  Or, perhaps, a vanishingly small proportion of the profit made from selling in that community will be reinvested in it. Wonderful!

Globalisation needs to be redefined, and with it the very premise of capitalism.  The use of capital to support and invest in businesses should be primarily to build a a more equitable and resilient economy for the good of all concerned. This is the change of values which is needed, and globalisation should see it propagated the world over.

*antihectical is a remarkably obscure word, even for an essay on economic principles.  I’ll leave to you to look up for yourselves, but suffice to say its meaning is self evident by its context

(This is part 2 of Ten Principles for a New Economy.  Part one can be read here; part three will look at the four things a new economy should NOT do)

Picture Credit: Meeting image from the New Economy Network website

Using Assurance Data To Create Website Content | The Future Of Sustainability Assurance

I heard an article on the radio the other morning about how Starbucks has launched its own brand of instant coffee (here in the UK anyway). The fun bit was the instructions: place the powder in a mug, pour over just-boiled water etc.

You may think it’s stating the bleedin’ obvious but with us all so stressed about where the next buck is coming from, doing the simple things can sometimes escape us in the maelstrom of survival.

Take sustainability assurance, for example. This increasingly popular pastime among the larger companies uncovers a wealth of data which can have a very useful second life when published on a corporate website.

What’s more, small and micro companies need not feel left out as many assurance standards allow them to set their own benchmarks in a meaningful way as well. [Read more…] about Using Assurance Data To Create Website Content | The Future Of Sustainability Assurance

Kick Ass Sustainability Professionals Reach Critical Mass

Critical mass is the name for a global network of bicycle-based mass protesters. They assemble in cities in huge numbers and pedal through the streets in order to demonstrate that they, too, are traffic.

Am I suggesting that sustainability professionals should join their ranks? Er, no.

Critical mass is also the minimum amount of fissile material needed to create a sustained nuclear chain reaction. Once the chain reaction has been started it will carry on with only the addition of fuel to keep it going.

Am I suggesting that a certain number of sustainability professionals have “gone nuclear”? Certainly not!

However, this month’s launch of the International Society of Sustainability Professionals (ISSP) is a critical moment in recent history, allowing a mass of sustainability experts around the world to reach out to one another for the very first time ever. [Read more…] about Kick Ass Sustainability Professionals Reach Critical Mass

Celebrating the FTSE 100: action on the breadline

Blog Action Day 2008Despite the recent financial madness, most FTSE 100 companies aren’t on the breadline … but many of them try to help those who are.

There are a few whose social involvement statements are a little like the beauty queen’s vapid ambitions to work for world peace – all motherhood and apple pie; and a few whose statements go no further than that they support health and education projects.

Don’t get me wrong: health and education projects are essential, and perhaps these companies subscribe to the view that charity should be conducted secretly, and don’t want to brag … but others provide a bit more detail, and if we dig a bit, we can see that there is some great work being done to try to alleviate poverty.

And surely these big companies are ideally placed to help, if anyone can.

How can big business help pull people out of poverty?

There are several different ways that businesses provide assistance to individuals or to smaller businesses.

By donating cash or goods

Some companies donate hard cash or goods in kind to charities aimed at particular problems, such as disaster relief and homelessness. This is a direct route to alleviate poverty, but doesn’t necessarily solve a long-term problem.

  • For example, Sainsbury’s donate food that is past the display date but before the eat-by date to various charities. This avoids waste and provides food for those in need – definitely a win-win.
  • Or ICAP, who donate money to VSO – in 2007, this was enough to send two teachers to Nepal, where “a single volunteer shares skills with people who go on to train hundreds more, and eventually change the lives of thousands”

By donating time

Some companies donate time by allowing their staff to volunteer in work time to support charities. This type of action is often local and small-scale: one-off barn-raising type events, or fun fund-raising events – but can be regular literacy sessions at a school, for example. And there is no doubt that education is one of the best ways out of poverty. Again, this is a win-win game: staff feel good, the company gets credit, and the people they help get the benefit – and that could be several children who improve their literacy skills, and therefore their life-chances.

By donating expertise

Some companies donate expertise to build entrepreneurial abilities – a great way to lift people out of poverty.

  • Several provide support for small entrepreneurs, such as:
    • BG, who supported women in Brazil in developing their business skills and marketing their craftwork
    • SABMiller, who work to develop a culture of entrepreneurship among young people in South Africa by providing training, grants, mentorship and assistance during the set-up phase of a new business
    • and Compass Group, who helped improve a Colombian fish breeding programme by teaching best safety practices and handling procedures.
  • Others provide financial support for entrepreneurs, such as Shell and AngloAmerican, both of whom support micro finance schemes.

What else could be done?

Here are some places where people are coming together to try to work out how business can help solve some of the issues around poverty:

  • Transforming Business is a research and development project based at University of Cambridge and is looking at how “the creative forces of free enterprise be effectively applied to the most pressing social, economic, and moral challenge of our time: the elimination of poverty”. It has an impressive array of advisers from big businesses, including many FTSE 100 or other multinationals
  • Business Fights Poverty is smaller scale, but is “a network for professionals passionate about fighting world poverty through good business”
  • University of Cambridge (again!) offers a training programme called Business and Poverty Leadership. It’s not cheap, but is intended for Directors and Senior Managers with responsibility for business development, CSR, or business units in emerging economies (some scholarships available)

Not FTSE 100? Not even close?

Here are some initiatives that you could consider as an individual or very small company (big ones welcome too):

  • Mentori – (online) offer time as a business mentor to an entrepreneur in a developing country
  • Skills Venture – (offline) offer time as a business mentor, combined with a holiday, as a working holiday or as a sabbatical – even as a team-building venture.
  • Kiva – offer micro loans to individual entrepreneurs. There are many of these organisations, but Kiva is perhaps the best known.

How can your organisation help? Something for us all to ponder, I think.

Last year’s Blog Action Day post, on the environment: Techniques for enticing the green investor