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New “standard” for CSR? ISO 26000 gets official November 2010

posted by Tara Knight

Last week, I had the opportunity to review the final draft of the International Standard ISO 26000, Guidance on Social Responsibility with Robert White, who sits as a Canadian Representative and Expert Member of ISO 26000 Social Responsibility Working Group. Approved in September, the ISO 26000 guidelines will be officially published in November 1, 2010.

If you haven’t been following the story, it’s been a long wait for this standard – ISO 26000 has been in development for well over five years. Given that CSR as an area of business concern is relatively new, rapidly evolving, and frequently difficult to accurately define, it’s no surprise that this document has been subject to vigorous overview and discussion. A multi-stakeholder effort, 400 people took part in developing the standard, which makes it ISO’s biggest working group to date.

So what is it? ISO 26000 sets out an international consensus on definitions and principles of Social Responsibility (SR); identifies seven core issues to be addressed, and provides guidance on how to integrate Social Responsibility throughout the operations of an organization. Significantly, the standard has been intentionally written to be accessible to non-specialists, and unlike many other ISO standards, it is a voluntary guidance standard, meaning it is not eligible for certification.

You can review an overview of the contents of ISO 26000 here. If you are looking for the ‘quick hit” version, ISO 26000 defines seven core principles of Social Responsibility, as: Accountability, Transparency, Ethical Behavior, Respect for Stakeholder Interests, Respect for the Rule of Law, Respect for International Norms of Behavior and Respect for Human Rights.

Under these principles of SR, the guidelines lay out an additional seven core subjects to consider in integrating Social Responsibility in an organization. These are organizational governance; human rights; labour practices; the environment; fair operating practices; consumer issues; and community involvement and development. Economic aspects, as well as aspects relating to health and safety and the value chain, are dealt with within each of these core subject areas.

Final word? For organizations that feel daunted in even considering or initiating a Social Responsibility program, or processes, ISO 26000 will provide valuable structure and guidance in helping to shape and define Social Responsibility for organizations big or small (or just smaller). For those organizations already leading the way, ISO 26000 may help illuminate areas where Social Responsibility governance or practice is not as developed as it could be, and provide guidelines for improvement. In short – there is something here for everyone to learn.

Which organizations do you think are already leading here? Are “the leaders” too far ahead to benefit from this guidance? I am very curious if organizations that do not currently track their CSR policies/programs will choose to take advantage of this effort and utilize the ISO 26000 guidance standard prior to implementing CSR reporting or policies.

@TaraKnightHK

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Sustainability Being Given the ‘Old College Try’

posted by Andrew Cuneo

By Andy Cuneo, Senior Account Executive, Washington D.C.

As a former student at Boston’s Northeastern University, our institution’s former president, a man I respect and admire, would work tirelessly to build Northeastern’s reputation on the U.S. News & World Report college rankings. He succeeded in moving NU from high 150’s into the top 100.

A new ranking, reported on by the Washington Post, takes into account a new standard ranking produced by Washington Monthly that looks at three distinct categories when rating institutions: Social Mobility (recruiting and graduating of low-income students), Research (production of cutting edge scholarships and PhD’s) and Service (encouraging students to give something back to their community).

You’ll see in the report that public colleges fair amazing well – far better than private institutions. But what I really like about this rating system is that it’s not just an alternative way to view success and opportunity in higher education institutions, but rather what prospective students are now looking for in their college experience. In July, USA Today’s Trevor Hughes illustrates that point here.

In addition, more institutions are making the most of their opportunity to become more sustainable. We’ve written on this blog work being done by our local universities here in DC. 

There is a growing enthusiasm from our next generation. I remember stepping onto campus for the first time more than 11 years ago, ambitious in thinking I could change the world. And these people are doing it!

Supersizing Responsibility, Not Portions

posted by Chad Tragakis

by Chad Tragakis, Senior Vice President, Hill & Knowlton, Washington

Hard to believe that the end of another summer is upon us.  Earlier this month I was on Cape Cod, enjoying a week of vacation, which included eating a lot of fresh seafood.   The menu included cod (of course), clams, flounder, haddock, lobster and scallops.  All of it was delicious, but with every bite there was a little remorse.  Ever since I first read the United Nations Environment Program’s (UNEP’s) prediction that the world’s fisheries could be depleted by 2050, I have suffered a tinge of guilt with every plate of broiled scrod, every cup of seafood stew, every lobster roll.

According to UNEP, 30 percent of global fish stocks have already collapsed – meaning that they now yield 10 percent or less of their previous potential.  I also know full well that some one billion people around the world, most of them from developing countries, rely on seafood as their primary source of protein and a major source of their sustenance.

Responsible fisheries management and improved practices here in the U.S. and around the world are a good start and help alleviate some of my guilt.  Fish farms also have a role to play in meeting the world’s growing demand for seafood, but they are not without their challenges or critics.  And while I’m intrigued by the promise of genetically altered fish, there are many unanswered questions and many associated risks still to be addressed.

Although my concerns about the health and vitality of the world’s fisheries are rooted in a desire for ecological sustainability and preserving biodiversity, a connection between overfishing and societal health and wellness (in America at least) is becoming increasingly clear.  I’m talking specifically about portion sizes and how (and how much) we consume.  The seafood platters I saw this summer were huge – as big, or bigger, than I can ever remember.  This trend isn’t limited to fish, and it certainly isn’t limited to Cape Cod.

A new report from the Center for Science in the Public Interest (CSPI) shows that at restaurants across the country, “regular” portions are now super-sized:  two, three (or more) times USDA and FDA recommendations.  No surprise then that CSPI believes this is contributing directly to the two-thirds of adults and one-third of children who are obese or overweight.

The same nation that now heralds the organic, fair-trade and locally-grown food movements is the same one that spawned the massive portion trend and the “endless,” “bottomless,” “unlimited,” “all you can eat” buffet.  I’m no expert on the economics of running a restaurant, but I’ve never understood how these buffets can be profitable.  Nor do I understand how such limitless consumption – of seafood or any other food – can be sustainable.

Businesses must make a profit, but there is increasing evidence that they can do so by encouraging sustainable consumption on the part of their customers.  From the television programs we watch, to the clothes we wear, to the toys we buy our kids, businesses play a major – maybe even a central – role in conditioning us as consumers.  Businesses help us define what constitutes value and normalcy in the products and services we consume. 

This is a discussion that every company in every sector should be having and many are, encouraged and aided by a great Business for Social Responsibility report – The New Frontier in Sustainability: The Business Opportunity in Tackling Sustainable Consumption.  Clearly, it’s bigger than restaurants – but food (and seafood in particular) is great place to start.

More often than not this summer, my wife and I shared the huge seafood platters at the restaurants and clam shacks we frequented.  If any of them had offered half-sized portions for half the price, they would have seen a lot more of my business.  Don’t tell them, but I would even have paid a little more than half.

Bill Novelli on CSR

posted by Andrew Cuneo

By Lauren Wilson, Account Executive, Washington D.C. Office

Washington Women in PR hosted a brown bag luncheon last week at the National Education Association  where Bill Novelli served as guest speaker on Corporate Social Responsibility (CSR).  Does the communication firm Porter Novelli ring a bell? Bill Novelli founded the agency that bears his name and left the company in the 90s to pursue a slew of non-profit and CSR roles including: Executive Vice President of CARE, President of theCampaign for Tobacco-Free Kids, and CEO of AARP. Currently, Bill is a professor in social responsibility at Georgetown’s McDonough School of Business.

Corporate Social Responsibility, the idea of incorporating responsible practices in daily business operations, has emerged as a strong focus over the last few years with companies restructuring their operations and making this practice a top priority.  Through Bill’s role at Georgetown, he discovered that there is a high student demand to learn about CSR and to pursue this work after the completion of their graduate studies.  In fact, many of his students and their peers are willing take pay cuts to work in a CSR role. Bill’s goal is to help students and communications practitioners understand the value of this responsibility so that they can serve in roles that produce social change, which will ultimately lead to the betterment of our society.

One member of the audience asked: How do you move organizations to adopt CSR practices in a down economy?  “It is important to convince your organizations to act socially responsible because that is often the expectation from its constituents and stakeholders. Organizations that have strong CSR campaigns often exude more confidence and uplift employee morale,” Bill responded.

Bill also noted that in this down economy, volunteerism has risen.  According to the Corporation for National and Community Service (CNCS), volunteerism jumped by 1.6 million last year, the largest increase in six years. Over 8.1 billion hours of volunteer service was donated by Americans last year. Corporate Social Responsibility has emerged as a sustainable practice and organizations often have success when they participate in this practice over time.  This audience was very receptive in learning about  Bill’s current role as a CSR enthusiast and many expressed how they felt empowered to challenge their organizations to adopt CSR initiatives. If each organization did their part to implement a CSR program, then the idea of “doing good” would eventually be seen as normal corporate practice.

[Disclosure: Hill and Knowlton represents CNCS]

 

Echoes of Bhopal in BP

posted by Chad Tragakis

by Chad Tragakis, Senior Vice President, Hill & Knowlton, Washington

“Business started long centuries before the dawn of history, but business as we now know it is new – new in its broadening scope, new in its social significance.  Business has not learned how to handle these changes, nor does it recognize the magnitude of its responsibilities for the future of civilization.”

        Wallace Donham, Dean of Harvard Business School – 1929

I love this quote.  Sadly, it rings as true today as it did 80 years ago.  Business had not yet learned how to handle the changes that were happening then in terms of the real impact the sector had on society.  And while incredible progress has been made in the decades since Donham’s prophetic observation, it’s clear that business still does not recognize the real power it holds in shaping the future of our planet and its people.  There are great models of responsible, sustainable corporations and glimmers of hope from enlightened enterprises.  But there are too many BPs out there – companies with lots of promise but little execution.

As someone who used to live in the Gulf Coast region and who holds a solemn respect for our natural world, the BP spill—coming to me live via 24/7 spillcam—continues to crush my spirit.  As a communications professional, it continues to astound and amaze me.  There are many important communications, public relations and corporate positioning lessons to be learned from the BP saga (no doubt, detailed analyses and dissections of the event are already appearing en masse in the PR and communications trade journals).  But the longer term story here is that BP’s spill now joins the annals of corporate communications landmark events – the flashpoints in our collective consciousness that create lasting legacies, sometimes good (think Tylenol) but usually bad. 

Every individual has their own mental list – and what’s on it depends a lot on where you live, what you do and when you were born.  For some, the list begins with watershed, game-changing books like Rachel Carson’s Silent Spring or Ralph Nader’s Unsafe at Any Speed.  For others, it is a laundry list of mismanagement, malfeasance and missed opportunity – Barings Bank, Bridgestone/Firestone, Enron, Parmalat, Societe Generale, Toyota, Tyco, WorldCom…  Exxon’s Valdez oil spill ranks high on most of our lists, but for many, the list is topped by Union Carbide’s 1984 gas leak in Bhopal, India.  More on that in a moment. 

Plenty of companies have slow simmering issues and scandals that play out over time, but I’m convinced that the ones that are largely event-driven are more powerful to the human psyche – regardless of their actual impact.  As a result, these legacies live on sometimes for generations.  Some may argue that Prudhoe Bay or the Texas City refinery explosion would already have landed BP a place on the list, especially because of how antithetical those events were to the culture of responsibility and environmental stewardship that the company (through the voice of Lord John Browne) spent a decade building, or at least talking about.  That may be true, but those events—as unfortunate as they were—were nothing compared to the disaster in the Gulf of Mexico.

Some consumers have short memories, but many more do not.  I know people who are still punishing Exxon for the Valdez spill – going out of their way to another service station even if the price is a few cents higher per gallon.  And this brings me back to Bhopal.

Bhopal remains the world’s worst industrial disaster.  It also remains one of the early, principal milestones and demarcation points for when the world woke up to what it should expect of corporations.  And while Bhopal may still top our mental lists, until recently, it was largely a talking point in CSR speeches and a footnote in text books.  Dow, which bought Union Carbide in 1999, has maintained a quiet microsite on the event and resulting settlement, but the tragedy hasn’t been much of an issue for them, at least publicly.  That changed a few weeks ago, when sentences were finally handed down in the long running case.  Although seven former employees of Union Carbide were found guilty of death by negligence, their two year prison sentences have been hailed by survivors and their advocates as a slap in the face, prompting a torrent of fury and protest.  And there are renewed calls for Dow to do more in terms of site remediation and accepting greater responsibility to compensate victims and bring about true justice.

A full 25 years later, and Bhopal is still generating community outrage, criticism from NGO activists and a robust online campaign, pointed media coverage, interest from policy-makers and reputational risk for Dow.

So, if the recent echoes of Bhopal are any indication, it appears that the very actions by which BP hoped to save a little time and a little money are going to cost them plenty more of both.

Night vision goggles, energy efficiency and a tip

posted by Andrew Cuneo

By Tara Knight, Hill & Knowlton in Vancouver, Cananda

Chad Tragakis highlighted an article for me about the City of Boston deciding to use infrared (the technology in night vision) to scan the city’s buildings to determine how energy efficient the buildings are (article: http://bit.ly/Boston-infrared). Infrared detects the heat signatures of beings or objects. You are likely familiar with infrared’s use in night goggles or if you traveled through those big fever-detecting infrared scanners in popping up in airports during flu epidemics. The technology is tremendously adaptive, and its use is growing for consumers and business especially as a cost-effective, non-invasive process to determine a building’s heat efficiency.

Boston’s Mayor plans to have the infrared scans cover every square foot of Boston, and claims it will be the first of their kind in a major American city. It’s an ambitious goal. Buildings use 40% of the world’s ‘final’ energy according to the World Business Council for Sustainable Development. In fact, the Council recently released a report that shows how energy use in buildings can be cut by 60 percent by 2050 – essential to meeting global climate change targets (for those of you who like to challenge your landlord, the Council’s report is available online here.) Of course, this technology is already available to interested organizations and consumers who want to be on top their energy consumption.

However, you don’t have to start big- we all know each of us can take a little action and make a difference. Google has a neat little personal tool – Google powermeter – a free energy monitoring tool to monitor your home’s energy consumption.  According to their blog “one Australian restaurant recently learned that something as easy as turning off their coffee pots each night would save them $3,000 dollars per year.” If every city like Boston and each of us starting tracking our energy use, it’s a safe bet we could save more than that.

Remembering C.K. Prahalad

posted by Chad Tragakis

by Chad Tragakis, Senior Vice President, Hill & Knowlton, Washington

 

“What is needed is a better approach to help the poor, an approach that involves partnering with them to innovate and achieve sustainable win-win scenarios where the poor are actively engaged and, at the same time, the companies providing products and services to them are profitable.”

 

                   C.K. Prahalad – From The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits

 

I’m often asked – by colleagues, friends, clients and prospective clients – what is the value of CSR?

 

I am always happy to run through the now well-established list of how different dimensions of a genuine commitment to corporate responsibility can impact the bottom line, directly and indirectly.  From stronger relationships with communities and an enhanced license to operate to increased profitability through operational efficiency gains and materials and resource management, to management of risks and improved relations with the investment community, enhanced employee relations that yield better results and cost savings with respect to recruitment, motivation, retention, learning  and productivity, to improved reputation and branding, and qualification for billions of dollars in screened business, the business value of and return on investment in CSR is increasingly clear.

 

In addition to these many benefits, some of the world’s largest companies have found that embracing CSR can also provide access to new “aspirational” consumers and new revenue streams in emerging markets, which in turn can foster significant product and business innovation.  Recently, we lost a visionary man who made truly game-changing contributions to the world through his research, observations and recommendations on these aspects of corporate responsibility and global citizenship.  Coimbatore Krishnarao “C.K.” Prahalad died last month after a brief bout with a lung ailment. Sadly, he was only 68.

 

Born in Chennai India, Prahalad earned degrees from Loyola College in Madras and the Indian Institute of Management, and later a PhD from Harvard Business School.  He would go on to consult for some of the world’s leading multinational corporations in a variety of industries, but he is best know as a distinguished professor at the Ross School of Business at the University of Michigan, where he pioneered and popularized the “bottom of the pyramid” concept.

 

While his theory that the world’s poor should be viewed as consumers is more firmly established today, it was still a radical and unorthodox notion even 10 years ago. 

 

The numbers speak for themselves – 4 to 5 billion underserved people representing more than $13 trillion in purchasing power.

Whether detergent and household products, cement and home building materials, microfinance and financial services products, or cell phones and consumer technology products, Prahalad proved to Fortune 500 companies that they could satisfy market needs, help address social problems, improve the quality of life for millions and make a profit. 

Companies across the business sector – from Unilever to Motorola to CEMEX, among many others – have now embraced Prahalad’s idea of “inclusive capitalism,” and have benefitted through increased sales, tax exemptions, and increased brand awareness.  This last benefit is significant for companies doing business in emerging economies, where it is important to cultivate consumers who may not be able to afford your products today, but who will demand them tomorrow.  Establishing brand preference and loyalty early on can pay huge dividends over a consumer’s lifetime.

And it isn’t always developed countries selling to the poor.  On occasion, innovations in products, services and business models developed in and for emerging markets have applications in established economies, providing still more benefits for enlightened global firms.

C.K. Prahalad was on my mental list of people I would love to meet at a conference or cocktail party some day.  He died too young, and I’m sure he had at least one or two more books left to write, and many more innovative ideas to share with those of us working in the corporate responsibility arena and those in the broader business and public policy communities.  While I’m deeply saddened by his loss, I’m appreciative of the fact that so many around the world are benefitting and will continue to benefit from the ideas and approaches to business and corporate responsibility that he pioneered.  His impact will be long-lasting, his legacy is secured.

 

The Next Generation of Responsible Business Leaders

posted by Chad Tragakis

by Chad Tragakis, Senior Vice President, Hill & Knowlton, Washington

 

Recently, I hosted a group of graduate students from Syracuse University’s Maxwell School.  I also spoke to a group of undergraduates at George Mason University.  I was struck by the questions they asked me and their responses to the questions I asked of them.  They wanted to know about the linkages between ethics and business performance; they asked about the risk management dimensions of social and environmental responsibility; and they hold crystal clear points of view on corporate reputation, respect for customers, and the value and impact of strategic philanthropy and employee volunteering.

 

These interactions reminded me of the numerous survey findings suggesting that young people prefer to work for companies that are socially and environmentally responsible.

 

§  Research recently conducted by PricewaterhouseCoopers found that 88% of millennials say they will choose to work for companies whose corporate social responsibility values reflect their own. 

 

§  A survey by Kelly Services found that nearly 90% of respondents say they are more likely to work for a company that is ethically and socially responsible and 80% are more likely to work for a company that is environmentally responsible.  The same survey found that 46% of Generation Y, 48% of Generation X and 53% of Baby Boomers would be willing to forego pay or promotion to work for an organization with a good reputation.

 

§  A MonsterTRAK.com poll found that 80% of young professionals are interested in jobs that have a positive impact on the environment, and 92% are more inclined to work for an environmentally friendly company.

 

§  A poll by BT found that a third of those surveyed felt that working for a caring and responsible company was more important than the salary they earned, and 44% said they would discount an employer that did not have a good reputation in terms of social responsibility.

 

§  Clearly, to land top talent, HR execs should pay heed to all this.  And it doesn’t seem to change once employees are onboard.  A survey by the St. James Ethics Center found that 77% of employees would leave a company if it acted in a way that contradicted their core principles.  The PwC study of millennials found that 86% would consider leaving a company if its CSR values no longer matched their expectations.

 

In some ways, it’s not surprising that young people have an interest in social and environmental responsibility – after all, they’ve grown up in an age when service-learning is an increasingly common concept in schools.  And they’ve been bombarded (in a good way) with eco-consciousness courtesy of Earth Day, Al Gore, and the green marketing prowess of Madison Avenue.

 

But is this ethos of responsibility sustained as these young people grow up?  Does the spirit of sustainability stick with them as they enter the workforce and deal with the real-world pressures that come with families and mortgages?  I would like to think so, but I haven’t seen any longitudinal studies that have attempted to test this.  If it is sustained, why?  And how can we apply those learnings to other populations?  If it isn’t, what can we do to recapture and then perpetuate that sensibility as young people grow into adults?  I am hopeful that enlightened sociologists and social psychologists may soon explore the answers to these questions.  Until then, we should find new ways to tap into and harness this interest and optimism.

 

Incidentally, next week, in conjunction with my company’s volunteer efforts around the 40th anniversary of Earth Day, I’ll be speaking to a group of first graders.  I can’t wait to hear what they have to say!

 

 

Treat the Earth well.  It was not given to you by your parents, it was loaned to you by your children. 

 

Native American Proverb

Bulk Groceries Notwithstanding, Seattle Hung Out to Dry

posted by Andrew Cuneo

By Susan Champlain, Vice President, H&K Seattle

Seattle prides itself on its environmental stewardship.  In a city surrounded on the west by Puget Sound and the rugged Olympic Mountains and on the east by Lake Washington, Mt. Rainier and the Cascades, reminders of nature’s treasured resources are everywhere.  Recently named America’s second least wasteful city” by Nalgene, Seattle is at the center of the green movement. Cycling, recycling and reusable water bottles are a badge of honor here, along with brown lawns in the summertime.

But second place?  To many here, losing to San Francisco is embarrassing and incentive to do better.  Seattle ranked first place in throwing out fewer than two bags of trash each week, thanks to the city’s aggressive composting efforts.  We ranked first in buying bulk food to avoid extra packaging.  And, despite the failure of the city’s bag tax initiative in 2008, we ranked first in using reusable grocery bags.

So where did the city fall short?  Seattle’s lowest ranking was 15th for hanging clothes out to dry.  We do live in the rainiest corner of the country.  Maybe we should get a pass on that one.

With light rail now up and running, a new state sales tax on bottled water and efforts by our thousands of coffee shops to offer reusable or recyclable cups, San Francisco better look out.  Damp fleece may become a fashion statement. 

Fortune Brainstorm:Green – Plenty to Wow Audience

posted by Andrew Cuneo

By Andrew Cuneo, Senior Account Executive, Washington, D.C.

 

I had the fortunate opportunity to attend Fortune’s Brainstorm: Green conference in Laguna Niguel, California this week. A number of attendees really wowed the audience, capturing ideas, reasoning and strategies around renewable energy, energy conservation, fossil fuel and electric vehicles.  But one person really stood out in my mind as being the most impressive – William McDonough.  Please see the blog post I wrote for Hill & Knowlton’s technology blog in Washington, D.C. “Tech & the District.”