Running a healthy business in a healthy society
Last week was unquestionably “corporate social responsibility week” as hundreds of CSR specialists gathered at a three-day conference to support the declaration that CSR is everyone’s business. With the League of Corporate Foundation (LCF) at the forefront of promoting and improving the practice of CSR in the country, the experts shared with beginners and students alike best practices and trends in both the local and international CSR arena.
As the LCF leaders stated, companies must reassess their role in society for businesses to survive and prosper in these challenging times. Faced with myriad social and environmental challenges — from rising food and oil prices to climate change — businesses must respond through collective and strategic action, since without sustainable communities we cannot have sustainable economies.
This view was echoed in the Philippine conference by Dr. Bradley Googins, executive director of the Boston College Center for Corporate Citizenship, when he said that around the world, more and more key opinion leaders from all sectors of society are reconsidering the rights, roles, responsibilities, and relationship of business to society. Leading companies, he revealed, have already begun to change their governance, accountabilities, performance models, and modes of engagement with society to reflect social and environmental concerns.
Googins explained that a new social contract is emerging wherein businesses and civil society are increasingly becoming central players in societal upheavals. He attributed this to several factors, namely: globalization, which has led to the growth of business’s power and influence; the declining capacity of government to address social changes; and the increase in non-government organizations (NGOs) as proxies for the public interest.
The Principled Way
Today’s companies deal with intense competition and demands from shareholders, customers and employees. They need to find ways to cut through and get noticed in a crowded business environment. Given such a situation, many companies are training their sights on corporate social responsibility as a way to stand out, protect their reputation and enhance their respectability. Business professionals are driven by their belief in the power of CSR involvement anchored on the mission and vision of their companies. Some top executives even oblige their managers and employers to get engaged in it, and communications practitioners see it as a public-relations and image or brand-marketing opportunity.
Corporate social responsibility is the principled mode of doing business. It is finding and supporting ways to make our society healthier, which allows our businesses to thrive more robustly. And for CSR to contribute positively to the company’s reputation, it is not enough to simply have a nice mission statement and core-value propositions, perform philanthropic work, donate to charity or even to have advocacy ads. The company must offer importance to all targeted publics (shareholders, employees, suppliers, consumers, community, government, etc.) through all of its plans, choices and deeds. This will lead to the externalization of the company’s ethical culture, high brand valuation, steadfast consumer loyalty, competitive capacity to hire and retain talents, positive financial results, and enduring corporate existence.
It’s very easy, although tricky and unsustainable, to format a publicity statement on social responsibility without having an honest-to-goodness commitment to creating a better future. If this is done, the company could be found out sooner than later and its publics will for sure get angry when they discover that they have been hoodwinked. Thus, the challenge for communication professionals and CSR is how to avoid mere lip service and set off an organization’s progression toward the practice of real corporate citizenship.
The company must know how to link social responsibility with the business and establish true corporate governance committed to serving all publics. In addition to social projects directly related to its expertise and business segment, it must engage itself in programs that benefit defined audiences that can likewise help to perpetuate its operation.
Embracing CSR
We have read about the case of HSBC, for example, which requires commitment from its partners to shun making loans to finance projects that may eventually lead to social and environmental damage, as well as transactions that may be used for money laundering or other unethical behavior. As a policy, the financial institution does not operate in countries under international sanction and involves its stakeholders in corporate responsibility projects in education, community development and the environment. It has been written that the group signed the UN Global Compact, supports the UN Millennium Development Goals and the Equator Principles, and is a member of the Dow Jones Sustainability Index. It is also ranked fourth in Fortune magazine’s “Global Most Admired Companies” list for social responsibility.
Nestlé is another story of a company that has embraced CSR. At one time, some groups, due to the perception that it discouraged breastfeeding in order to leverage its sales, boycotted it. Under such circumstances, Nestlé repositioned itself and has since recommended only breastfeeding for babies up to six months old. Every year, a report disclosed, the company invests in a big way in this program: 50 percent of the employees contribute monetarily, and 10 percent volunteer for the program, which helps over 70,000 children. Nestlé credits eight hours of work per month from the volunteers.
We have also seen some examples of CSR programs that aren’t integrated and holistic. What can we say about an oil company that supports environmental programs, but establishes less-than-strict procedures with regard to preventing oil spills? Can we trust a retail chain whose code of ethics preaches the pursuit of consumer protection, but evades the suggested retail-pricing scheme?
To ensure proper valuation of the company’s CSR programs, the communication group must respect the intelligence and critical thinking skills of its stakeholders. It must develop and implement materials that fit the needs of each target audience based on information culled from knowledge, attitudes and practices (KAP) surveys. In terms of messaging, the idea must always be presented as clearly as possible — the rationale for the investment, the figures, problems, and strategies to solve the issue at hand.
A CSR project must have an internal public buy-in. The employees must be communicated to about the project firsthand. They will support it only if they feel that the organization is ethical in its dealings with the workforce. If it is, volunteerism can be heightened, and their desire to support the project to its fruitful end will be pure. The company must also use all opportunities to communicate to its employees that involvement with the community is important to the company. Whenever possible, it is great to reward those who contribute, and those who make time available for volunteer work.
Immediately after project implementation, it is critical to measure the results and assess how it supports the goal of business perpetuation. We can determine the number of people involved, the budget invested, linkages made, and coalitions and partnerships established. The company must listen to the stakeholders before and after the actions, preferably through meticulous research. If the results generated matched the expectations, the company is probably on the right track. Otherwise, it will be necessary to remodel the CSR program. After all, unprincipled businesses will probably have little chance of surviving in tomorrow’s consumer-led world.
“More than profits, social and environmental issues are redefining the business models of corporations around the world. More and more, transparency, ethics, governance, the environment and other buzzwords that used to be the exclusive preserve of civil society and government are creeping into corporate boardrooms. Companies are beginning to leverage their assets and influence for the social good and at the same time beginning to recognize it as good business,” Googins elucidated.
Now more than ever, CSR is generating greater acceptance in the boardroom. A clear indication that to stay in business, the company must get itself engaged in making society a healthier society. Indeed, it is everybody’s business. After all, we cannot run a healthy company in an unhealthy society for long.
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E-mail bongo@vasia.com or bong_osorio@abs-cbn.com for comments, questions and suggestions. Thank you for communicating.
