#SharedValue & Sustainability: In Conversation with Nestlé Waters North America
09 Wednesday Jul 2014
Posted CSR, CSR reporting
in09 Wednesday Jul 2014
Posted CSR, CSR reporting
in09 Wednesday Jul 2014
Posted CSR, CSR reporting, CSRwire, ESG
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aman singh, Brand Management, Business, corporate social responsibility, CSR, CSR reporting, CSRwire, Disclosure & Transparency, environment, Environment, ESG, extended producer responsibility, heidi paul, kim jeffery, nestle waters, nestle waters north america, Net Impact, packaging, Philanthropy, recycling, shared value, Stakeholder Engagement, Supply chain management, Sustainability, sustainability, transparency, water conservation, watershed management
When a company labels its Annual CSR Report as Creating Shared Value, you have to stop and wonder if they’re responding to the latest buzzword in the market or leveraging its potential by truly embedding it into their reporting and cultural framework.
In its third cycle, Nestlé Waters North America’s [NWNA] latest Creating Shared Value Report attempts to accomplish the latter. Among its headlines:
To gain some firsthand perspective and background on these goals and the accompanying challenges for North America’s largest seller of bottled water, I reached out to EVP for Corporate Affairs Heidi Paul [Join us for a Twitter Chat today, June 18th, at 1:00pm ET to connect with Paul directly at #SharedValue!].
Among my questions: how does the company balance criticism for selling bottled water while promoting healthy choices, what it is doing to shift its supply chain and use of plastic, its well-acknowledged work in the area of Extended Producer Responsibility, and how her team plans on including consumers in its drive for sustainability.
Paul started the conversation by setting the record straight on the company’s definition of what’s quickly gained momentum as a replacement for CSR: Creating Shared Value.
“We define CSV as a strategic way to achieve triple bottom line sustainability. In other words, be financially, environmentally and socially sustainable. At the end of the day, Nestlé seeks to create shared value in those areas where we can make the most impact and that are material to our business. Globally, that is in the areas of Nutrition, Water and Rural Development. For our bottled water business in North America, our focus is on healthy hydration, packaging responsibility and watershed management.”
Has the terminology helped NWNA’s citizenship team – 28 people strong across the company – integrate its sustainability goals more effectively within its business units?
“It has done wonders. When you’re looking at philanthropy unconnected to business, it is not really sustainable. CSV focuses our engagement on the three critical topics and asks the whole company to see what can be improved for society and ourselves. We get the benefit of input from our supply chain, employee groups, community partners, etc.,” she said.
Let’s get to NWNA’s main product then: bottled water. Does it feel the twinge of irony every time that is said in the same sentence as “shared value”? Paul chose to answer that with some data:
“Seventy percent of what Americans drink – according to the Beverage Marketing Corporation – today comes from a package, not from a cup or the tap. In fact, our research indicates that if people don’t have access to bottled water, 63 percent say they will buy some other beverage from a package instead, often a sugared or caloric drink with a greater environmental impact.”
“We play a key role in increasing Americans’ consumption of water, which is the healthiest beverage choice. As the data indicates, there is a crucial role that bottled water plays in consumer choice. Everywhere there is a high-calorie sugary, packaged drink available; we want to make sure there is water as well,” she emphasized.
Does the company’s sales data support Paul’s emphasis? “The volume sales increase for 2012 for the bottled water industry was 6.2 percent. And per capita consumption reached nearly 31 gallons, up more than 5 percent from 2011. Further, 51 percent of people who stop drinking sugared soft drinks are switching to bottled water. In fact, bottled water is outselling sugared soft drinks in grocery stores in eight major markets across the country,” she supplied.
At the end of the day, Paul believes, the company’s job is to talk about why bottled water is a choice – an amply available one – and why it should be available anywhere packaged beverages are being sold.
That brought us to the next obvious thread: the plastic being used to produce the bottles. Recalling a keynote given by former NWNA CEO Kim Jeffery at a Net Impact conference years ago, I asked Paul how the company handles its fiercest critics regarding its use of plastic.
In a jungle of facts, fiction and emotions around environmental issues, Jeffery confronted the audience back in 2009 with a firm and resolute stand: we sell bottled water and we are doing everything we can to make that process sustainable.
Where there was a finality of “take it or leave it” to Jeffery’s remarks four years ago, Paul took a more nuanced approach to respond.
“Limited resources need to be used again and again. We have taken the mantle of becoming part of that solution. The larger point is there are billions of servings of beverages being sold everyday in some sort of package. Some populations are getting most of their calories from bottled drinks. And every time they choose water over a different drink, they’re making a more healthy and environmentally friendly choice,” she said.
And is a goal of reaching 60 percent recycling ambitious enough considering the climate and environmental challenges we face?
“At the time we were setting the goals, the nation was at a 28 percent recycling rate for PET plastic and thought that a goal to double that rate was ambitious and would require big changes. We had a lot to learn. We began to study recycling programs and the patchwork of policies and systems that were in place but were not moving overall recycling rates very much. There are big opportunities for increasing recycling by improving collection in public places, business and industry and in urban residential buildings. Today, however, there is no money going to fund this expansion of infrastructure.”
“There is also the issue of competing systems. Bottle bills for example do raise the recycling rates for bottles and cans, but actually reduce the efficiency of curbside because it is taking the most valuable commodities, which reduce the revenue, potential from curbside. Our goal was to work with others and find the most efficient system with the highest impact,” she emphasized. “
Of course the plastic of the bottled water we consume is bad for the environment. But so is almost every other product and consumer packaging we use in our day-to-day lives as study after study has shown.
Turning the argument on its head though, would we be wasting as much or filling up landfills as quickly as we are if we didn’t have the choice of bottled water to begin with? Where does consumer choice end and producer responsibility kick in?
Identifying that as another area for impact, Paul picked up:
“If bottled water isn’t available, people routinely purchase another packaged drink, one with calories and with a heavier environmental footprint. The availability of bottled water in times of natural disasters, where often tap water can be compromised, also creates a role for bottled water that goes beyond most product categories. Bottled water provides a reliable second source of water in these situations – that’s something everyone in our company is proud of.”
So when your business model is set around selling a product that is healthy and encourages nutrition while understanding and targeting its impacts through a well laid out sustainability strategy – as Jeffery succinctly put it in his exit interview with Greenbiz Publisher Joel Makower earlier this year – is it fair to be labeled an environmental villain?
Perhaps, perhaps not.
As Paul reiterated, the journey of tackling facts vs. reality has been full of challenges and continues to be an uphill task. “Like anything else, our work in the area of recycling, water conservation and reducing our social and environmental footprint has been a constant education,” she said, citing the lack of modern and efficient recycling system as one of the company’s top challenges.
“Not too many people understand the current system in place. There are numerous questions like who is funding what, how does it work, who are the middle men, how do we get to the next stage, where can we build in efficiencies, etc. And if the goal is to accept our responsibility as a producer to recycle efficiently toward a goal of zero waste, then we need answers to these questions.”
“We’ve always said we’re open to options, and so far the option that we have seen with the highest potential to be low-cost and efficient is a well-constructed EPR system, run by industry. What makes this complicated is there are a dozen different ways EPR has been implemented globally. Many of those are not efficient. This uncertainty about the ability to do it “right” makes others in the dialogue want to take more of a “wait and see” approach. Even if you convince people who, done well, EPR in the form being proposed is the best solution, there are doubts about implementation across the board,” she said.
Other challenges?
Paul cited the potential of collaboration in building more sources for wind and solar energy, as well [“we’re not there yet but this is definitely on our radar”].
There is also a need for collaboration in the area of water stewardship. “Improving watersheds will require collaborations among the various stakeholders within a watershed, be that users, scientists, environmental groups or government. Nestlé Waters North America manages the watershed areas around the 40 springs we use that are overseen by our 10 Natural Resource Managers. We have also made a commitment to collaborate on two watershed projects per year,” Paul said.
And what about NWNA’s consumers? How does the company leverage its brand to shift consumer behavior?
“In the 1970s, recycling meant ‘putting it in the bin.’ Today, this is old news. What motivates people now is when they understand its benefits. If a consumer recycles a water bottle after use, the greenhouse gas impact of that bottle is estimated to be reduced by more than 15 percent.”
“Also, we need to close the loop on what happens to the bottles after they are recycled. They are not trash; they are a resource that can be used again and again. Right now our 50 percent r-pet bottles in our Arrowhead, Deer Park and Resource brands shows consumers what happens when they recycle. It becomes a new bottle. The visibility of this message on our bottles helps us tell the story that we need much better recycling to become a more sustainable world.”
The company’s top challenge moving forward?
“At the end of the day, you want zero impact, but is that possible? Our challenge is to keep finding those ways to improve when it feels like you’ve reduced the impact to the minimum,” she said, finishing with a flourish: “You need to find the next frontier every time – that’s the goal. And the challenge.”
Originally written for and published on CSRwire’s Commentary section Talkback on June 18, 2013.
09 Wednesday Jul 2014
Posted CSR, CSR reporting, CSRwire, ESG
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Business, carbon, community, Consumerism, CSR, CSR reporting, CSRwire, Disclosure & Transparency, energy, environment, Environment, ESG, ghg, iirc, integrated reporting, Philanthropy, recycling, shared value, supplier responsibility, supply chain, Sustainability, sustainability, technology, verizon
Verizon recently released its second Integrated Report, combining the company’s financial and non-financial data and metrics into one clean look at its overall performance.
While the technology giant has been publishing its environmental, social and governance results for almost a decade, integration with the firm’s financial performance is relatively new. And Verizon saw several significant changes in 2012 to its approach to sustainability and shared value – which Verizon calls “shared success” – including a reformat of its Foundation’s model.
In a recent webinar, I had the opportunity to discuss the report, Verizon’s goals, challenges and a whole host of issues with Verizon’s CSR and sustainability chiefs Kathy Brown and Jim Gowen, along with an engaged audience.
Here are excerpts – and a link to the webinar recording.
Whether you’re eager to learn more about Verizon’s approach to sustainability or what the future holds for integrated reporting and sustainability standards, the webinar will provide you with exemplary context, insights into one company’s efforts to reduce its impact, and how a multinational must pick a strategy that is holistic, focused and measurable.
Kathy Brown: “When Lowell McAdam became our CEO a year and a half ago, he brought with him a set of principles by which he inspired us to live. It is a value-based approach to our work in the market. We deliver outstanding communication and technology for our communities and country. And we are to share our success with the community. While Michael Porter gets a deep bow for creating Shared Value, these pillars – solutions, service and sustainability – state our mission and our version of shared success.”
“We want to achieve measurable social impact. We can do a number of things at one time because our technology is powerful enough for us to find a way to do well for our shareowners and stakeholders, communities and countries in tackling the world’s problems…Specifically, we are focusing on how technology can bring transformational change in education, healthcare and energy management. The platform is our fiber network [and] our wireless network. Through these [networks] we are able to reach millions of users and applications that can literally change the world.”
Jim Gowen: “Our sustainability program includes aggressive targets, follow-up and our people [who] really do make the difference. In September 2009, when we created the Office of Sustainability, one of the challenges was how were we going to make an impact on a business that [in many areas] is growing exponentially. So we set the Carbon Intensity Metric as the way to grow most efficiently. We set an objective by 2020 to improve our carbon efficiency by 50 percent. Since 2009, we have driven our carbon efficiency 37 percent.”
“But as I often tell my employees, that was the easy part. Now comes the tougher part. We’ve taken care of all the low hanging fruit. How do you keep that momentum going? For example, e-waste is one of our biggest impacts. We’ve set a goal of collecting more than 2 million pounds of e-waste by 2015. That’s no small feat.
We’re doing that internally as well as externally with our Recycling Rallies.In the last two years, we’ve held 36 of these [across the country]. That objective is very important to Verizon and our customers.”
Jim: “Our environmental footprint is quite large. Supporting hundreds of millions of customers takes a lot of work. We operate 42,000 cell towers, 31,000 facilities globally, and [a] 38,000 private fleet of trucks and vans, etc. We had to concentrate on our own resources and see how to become sustainable.”
“We focus on four key areas: making our networks more efficient; expand[ing] our renewable sources of energy; run[ning] our fleets more efficiently; and reduc[ing] the lifecycle cost of ownership of how we operate. From purchasing to logistics and sustainability – they all match up nicely.”
Jim: “How do we make our packaging more environmentally-friendly? How do we handle the end of life for that? We asked our OEMs to make their equipment more energy efficient – 30 percent more than legacy equipment. Then we looked at our consumer stores: 131 stores have been LEED certified so far with the U.S. Green Building council, and a pilot is underway to increase that number across our markets.”
“We recently launched our Magic Bus program. The idea was generated by one of our line managers in New York who suggested that, instead of driving our own vans around very congested areas of New York, why couldn’t we drop off our employees with their equipment to provide service to our customers?”
“From that originated a three-month pilot where we used vans that could host eight to 10 technicians with their equipment and inventory on board, and we started driving them around areas of Manhattan. We would pick [up] and drop them [off] and provide service to them throughout the day when they needed it. The benefit was significant – for our customers and our employees. We’ve now started 25 of those Magic Buses in New York and removed 250 of our vans off the roads of New York City.”
Jim: “There is no silver bullet and no magic button. It’s going to take a lot of trial and error and a lot of commitment. While we think and look at our lifecycle approach, we’re still in our immaturity stage, and the opportunities ahead of us are so powerful that we can have a significant impact”
Kathy: “Our Shared Success Council is made up of senior executives across the company – including marketing officers, product managers, general counsel, etc. – who are clearing the strategy for growth and in the process, sharing the idea of Shared Success. The report recognizes these efforts.”
“The process involves a lot of collaboration between executives and the folks on the ground. We focus a lot on our data, and we don’t see this journey as involving any one data point. It’s a journey of doing business, and the report reflects that. We’ve shown enormous efforts and growth, and the information is easy to read and use for our stakeholders across the board.”
Jim: “The report also helps us tell our story concisely. Our customers are asking, as are our investors. They are asking how we’re measuring ourselves? What are our goals – people want to invest in sustainable companies – and how are we incrementally achieving those?”
Kathy: “We need to work on reducing costs on factory delivery systems and improv[ing] patient outcomes. Think about what you have on your iPad or phone today. We believe we can, in a more systematic way, think of security and identity issues for patients, fast connections, and [the] ability for patients and doctors to talk to each other in a secure environment through our technology, etc. We call this Powerful Answers.”
Kathy: “Internally, the audience is our employees who can have sense of our values as a company. Externally, people want to do business with companies with a heart but also have the technology and wherewithal to solve their problems. Beyond individuals, this includes communities [and] governments who take on big ideas about congestion, smarter cars, health care, etc. This report does a good job [of] painting the bigger picture for this audience.”
Jim: “[The] hip market that will change the world [is] using our technology, and this report helps them see first-hand the choices they have. Sustainability at Verizon is driven by our employees and our communities, not just one executive.”
Jim: “Over the last couple of years, we have queried our top 200 suppliers, which represent 80 percent of our total spend, to ask them how they manage their CO2 and greenhouse gas impact. What goes into the products they supply to Verizon? And we were very surprised at the answers we got back and tallied them up and graded them.”
“Whether they’re early adopters or much more mature with their sustainability strategies, we’ve set ourselves a 2015 goal: to operate with over 40 percent of our suppliers that have targets and greenhouse gas emission goals. That impact is significant, and we’ve already seen that through the innovation they’re bringing to us about how they can become more sustainable and continue working with us.”
Kathy: “We get all sorts of consumer indicators of how we’re doing in our community. We know how they use our network, what they think of it, etc. Once we start asking consumers how we’re doing in terms of impact, the responses have been very good. But it has been a challenge to do that in a broad way across many segments.”
For more insights from Verizon, listen to the webcast.
Originally written for and published on CSRwire’s Commentary section Talkback on April 18, 2013.
08 Sunday Jan 2012
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aman singh, aman singh das, Brand Management, BSR 2011, citizen journalism, corporate citizenship, corporate social responsibility, CSR, CSR communication, CSR journalist, CSR reporting, CSR strategy, economic value, employee engagement, In Good Company, mainstream media, net impact 2011, Occupy Wall Street, shared value, social media, sustainability, sustainable business, sustainable business practices
The WordPress.com stats helper monkeys prepared a 2011 annual report for this blog.
Here’s an excerpt:
The concert hall at the Sydney Opera House holds 2,700 people. This blog was viewed about 9,500 times in 2011. If it were a concert at Sydney Opera House, it would take about 4 sold-out performances for that many people to see it.
While I won’t bore you with the stats, here are the top three winners of 2011:
Thank you to all of you for a tremendous year! I value your support, trust, readership, comments, courage and enthusiasm to say, do and compel others toward the right action.
Here’s to expanding our “small world” of CSR and sustainability slowly but surely, one person at a time in 2012!
– Aman
07 Monday Nov 2011
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Al Gore, aman singh, aman singh das, Anheuser Busch, Bea Perez, brand management, Brand Management, Brian Dunn, BSR 2011, Business, Carlos Brito, cause marketing, Coca Cola, corporate citizenship, corporate social responsibility, CSR, CSR communications, CSR reporting, CSR strategy, ethical leadership, Events, Hanna Jones, hyper transparency, Liz Maw, Management, net impact 2011, Nike, Occupy Wall Street, Ofra Strauss, PR, radical transparency, risk management, Scott Wicker, shared value, Social Enterprise, Social Responsibility, Sustainability, sustainability, sustainable business practices, transparency, UPS, Vail Horton
There couldn’t have been a better way to end 2011 than the ambitious and cheerful Net Impact conference followed by Business for Social Responsibility‘s (BSR) annual conference.
Last year marked the inaugural year for my participation in both conferences. I came back encouraged, informed and enthused about the work ahead of us. [See: Can MBA Students be Taught Humility? and The Sustainability Jobs Debate] This year – perhaps because I have been deeply immersed in the CSR space – I feel a bit bereft, despite invigorating conversations and inspiring keynotes.
Don’t get me wrong.
While the Net Impact panels once again illustrated an incredibly knowledgeable student body set to graduate in coming years, BSR attendees and speakers showcased high aspirations and a deep understanding of the complexity of issues that face us today.
Throughout the seven days, I was continually questioned: Did you learn something new? What trends have you identified from all that you have heard? And each time I thought, what’s missing? Why am I not coming up with any articulate answers? Is my brain fried or is it something else?
On Friday, finally, sitting through a six-hour flight back to the east coast, it hit me. The CSR sector had grown up.
As a receiver of information, I was among familiarity, maturity. While last year the conferences motivated and inspired, this year the conversations focused on strategies, case studies, examples, successes and failures.
As Dave Stangis, VP of CSR for Campbell Soup articulated at a panel on Blue Sky Thinking during NI11, “CSR is no longer about identifying the business case. Today, we have evolved from questioning why to answering how.”
The Net Impact panels focused on nuts and bolts, dos and don’ts, a far cry from years past. The BSR roundtables featured honest evaluations, admittance of failure, collaborative statements of success and practical tips for newcomers.
Here then, are the top five trends I observed at two of the year’s most well-attended conferences on corporate social responsibility, innovation and sustainability:
Michael Porter’s “creating shared value” has appealed to the corporate sector like no other concept in recent years. Not corporate social responsibility or corporate sustainability, citizenship or conscious capitalism. There seems something so potent about shared value that CSR and sustainability executives cannot stop talking about it! A year ago, they would tell me “CSR is embedded in our DNA.” Now that statement has evolved to “Our culture has always been about creating shared value.”
Point is, CSV offers us nothing more radically new than the concept of CSR. It dictates the same concept of stakeholder engagement, mutual benefits, holistic bottom lines. But it has resonated by removing the morality that responsibility instantly dictates. For CSR and sustainability executives who have to make the business case to their C-suite, creating shared value provides them with their business case.
I found several attendees tell me how repetitive some of the sessions were, that they didn’t learn too much that was new or revolutionary. Perhaps it was because the same folks were attending the conferences every year? Earlier this year I wrote on Forbes’ CSR blog that instead of attending the conferences every year, we should send a colleague the following year so that we can actually widen the net of information and inspiration.
This continues to hold true: Chances are, every year there will be some common denominator at these conferences. With issues like energy conservation, water scarcity, poverty, community relations and employee engagement remaining the overarching topics, why not let one of the non-converted/uneducated learn next year?
Lesser chance of you suffering from conference fatigue.
In September, Ellen Weinreb, a prominent CSR and sustainability recruiter, released a report titled CSO Back Story*. Essentially, the report tracks every executive with the title of chief sustainability officer among the U.S.’s publicly traded companies. Her research points to 29 such individuals. While it omits the many hundreds of officers holding a wide breadth of titles ranging from CSR director to VP for sustainability and social responsibility, the report pinpointed several best practices and the continuing lack of standardization on how companies define, prioritize and implement corporate responsibility.
But I digress. [See what Corporate Secretary had to say about the report or download the complete report here.]*
Point is: Only two of the 29 CSOs Weinreb identified were in attendance at BSR: Coca-Cola’s Beatrice Perez and UPS’ Scott Wicker. Both were named CSO sometime this year. Where were the others? Wasn’t the conference meant for CSR and sustainability executives to come together for three days of knowledge sharing and benchmarking? What happened this year?
Both conferences featured wonderfully articulate keynote speakers, including KaBoom’s Darryl Hammond, Keen Mobility’ Vail Horton, Nike’s Hannah Jones, Al Gore, Strauss Group’s Ofra Strauss, Anheuser Busch’ Carlos Brito and Best Buy’s Brian Dunn.
While they discussed CSR and sustainability from their unique pedestal, the common denominator was the emotional connection they demonstrated with their cause, their brand, and their philosophy.
Hammond discussed how his childhood taught him the importance of play in a kid’s life. Strauss emphasized how her consumers and conflict-ridden Israel continues to teach her the right way of conducting business, of stakeholder engagement, of business being the real power in solving social problems.
Dunn on the other hand, focused on humility, responsible leadership and the importance of connecting with employees and consumers.
While last year’s speakers evinced more pragmatism, a businessman’s stoicism, this year the air held tension, an unspoken worry that things were going wrong too quickly, that we all needed to wake up. Quickly. The speakers were talking of soft – un-businesslike some would say – attributes: Social responsibility, connecting, respect, and the human condition, even destitution.
What had happened?
Let’s see: A recession that instead of leveling off, seems to be spreading across generations and countries for starters; a growing understanding that each of our actions – and inactions – impact many others in the world; a disastrous lack of trust for business; and a generational divide that seems to be holding the current decision makers accountable for their decades of excess.
Is business leadership finally waking up to their societal stakeholders?
Almost every keynote brought up this mass of undefined protestors that have continued to expand beyond American borders. Net Impact’s Executive Director Liz Maw opened the 2011 conference by asking attendees to “Occupy Wall Street but from within.”
Al Gore said, “Business must respond,” and that “it wasn’t a question any more.”
Ofra Strauss showed a three-minute video of the protestors equating them to civil unrest and a grassroots movement of discontent that business has to recognize and address.
At my BSR panel on hyper-transparency I brought up this commonality in one of my responses and posed a question for the audience: Will business ever think of these protestors as stakeholders? To my surprise, Jeff Mendelsohn from New Leaf Paper said that he and fellow attendees had, in fact, invited the Occupiers during a recent conference and that “The dialogue proved very productive for business and the protestors.”
Will anyone else follow?
*Full disclaimer: I worked with Weinreb on the report.
02 Wednesday Nov 2011
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aman singh, aman singh das, Brand Management, Business, business case for sustainability, CEO, CEO Network, cooperative, corporate social responsibility, CSR, Events, green, green products, Leadership, leadership, Management, Net Impact, net impact 2011, REI, Sally Jewell, shared value, social responsibility, supply chain, Sustainability, sustainability, sustainable business, sustainable business practices, women CEO
My latest post on CSRwire’s Talkback: Sustainability is a Team Sport.
25 Tuesday Oct 2011
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Accountability, aman singh, aman singh das, Apple, Business, capitalism, careers, consumer education, corporate citizenship, corporate social responsibility, CSR, jobs, Leadership, michael moore, Occupy Wall Street, occupywallstreet, OWS, responsible capitalism, shared value, social responsibility, Social Responsibility, transparency
Interesting segment of Piers Morgan Tonight on CNN with Michael Moore in the hot seat and a live town hall to discuss Occupy Wall Street. Some of the highlights that made me think:
MM: One hundred percent corporate America. I don’t blame the government because corporate America funds and rules the government. The politicians act as their funders ask them to so blaming D.C. isn’t going to help anyone. The root cause is corporate America.
MM: Depends on who you ask. For students, this is about the debt they have when they graduate. For the parents, it’s the mortgage they owe on a house that is worth less than half of what they owe in debt. For many others, it is unemployment, lack of affordable health care, the manipulative bank industry and so much more.
MM: Part of the problem yes but do you know how much debt a student has when he/she graduates from Peking University? Zero dollars. American students? An average of $35,000.
It all started when General Motors decided that making $4 billion in profits wasn’t enough. That they had to stretch it to $5 billion and to do so, they would have to migrate tens of thousands of jobs to China.
And guess what, if Steve Jobs and Steve Wozniak were two entrepreneurs trying to start Apple today, they would have received no help from their local or national banks. That’s the America we are living in today.
——————
Also on my radar, the excellent coverage on CSRwire’s Talkback lately re: Occupy Wall Street:
Occupy Wall Street Considers A New Economy
Is the Occupy Movement a Call for Sustainability?
For Responsibility, Occupy Government as well as Wall Street
19 Wednesday Oct 2011
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Earlier this week I was at the annual PRSA conference in humid and beautiful Orlando, Florida. Before you think that I have switched tracks from journalism to PR, stop right there! I was on site to speak on an interestingly personal topic: Sustainability: Walking the Walk.
Joining me on the panel were CEO of CSRwire Joe Sibilia and Executive Director of Ethical Markets Rosalinda Sanquiche. Sibilia started off the panel by talking about Occupy Wall Street. Not because he wanted a room full of dissent but because for Sibilia, as he emphasized on a recent Fox Business show, OWS goes to the heart of corporate social responsibility: A responsible capitalist system that takes into account a business’ social, economic and environmental stakeholders.
From a room of roughly 45 attendees, almost everyone raised their hands. However, when he followed up by asking how many understood what the protestors are demanding, the hands fell to a single digits. So, before I go any further, here’s a two-part question for you:
And:
Here’s the thing: Because so many continued to disagree with the holier-than-thou voice of CSR, claiming it is another cost business doesn’t need, a burden, not a business priority, so on and so forth, Michael Porter gave us an easier concept to embrace: Creating Shared Value.
Many more understood the economical efficacy offered by shared value than the tardy, accusatory and undefined acronym of CSR. But CSR as well as creating shared value are concepts spearheaded by economists, business leaders, researchers and activists.
Now we are all being forced to recognize and acknowledge a movement created by the average Joe (no pun intended!) demanding business to be more responsible, equal and just.
They want to be able to work, to have a home, a family. They want the right to live comfortably.
In other words, corporate social responsibility.
Yes, it’s one and the same thing, except now it’s not the activists or the bloggers taking up the case but an undefined mass of people who come from different backgrounds, experiences and age but are commonly united on one front: Fairness.
Regardless of whether you physically join the Occupy Wall Street protestors, it is far more important that you understand their message and recognize that this is your one chance to make things right.
So, go ahead: Nudge your boss to offer job sharing opportunities to candidates.
As a job candidate, question the recruiter on the company’s mission, values, priorities. As a student, ask your faculty to discuss business cases in context of economic recessions, environmental degradation and social upheaval.
Ask the tough questions, the right questions. As Michigan’s Ross School of Business Professor Aneel Karnani recently said, “You get the kind of government you vote for.” We as professionals and students get the kind of corporation we choose to work for.
This is your chance to influence business as an employee, a manager, and as a prospective candidate. For the longest time we have been told to vote with our dollars. Now it is time to vote with our expertise and professional skills.
Question is, are you up for it?
04 Tuesday Oct 2011
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How is a social enterprise born? Is it born out of a recognition that some thing needs to change or is it much more complex than that?
For Sameer Hajee, the decision to give up a lucrative career as a micro-process engineer in Silicon Valley was a simple one. “After working for four years, I needed a change in geography,” he tells me over a recent Skype call. A few months later, he was working for a telecom operator in Afghanistan.
Six months in the war-torn country offered Hajee a unique perspective on the impact of energy in one of the most impoverished regions of the world. “Afghanistan opened my eyes to how impactful appropriate energy use can be. I decided right then that this is what I would focus on after business school,” he recalls.
Hajee is the founder and CEO of Nuru Light, one of five winners of this year’s Powering Economic Opportunity: Create a World That Works competition co-hosted by the eBay Foundation and Ashoka Changemakers. Nuru Light is a social enterprise based in East Africa, built on the simple premise of hyper-local economic communities.
But Hajee’s story isn’t as intuitive or linear as it might seem in hindsight. After completing his MBA at INSEAD, Hajee went to work in Kenya as a member of the United Nations Develop Programme (UNDP). Then, in 2005, the social enterprise trend was growing and market-based solutions were becoming the latest tactic for the socially conscious.
In Kenya, my role was of a convener. A small group based out of the United Nations was trying to work with multinational companies to create pro-poor for-profit businesses and it was my job to see where the opportunities were and to connect the folks.
This not only meant a lot of nuts and bolts groundwork in one of the world’s poorest nations but also skillfully lobbying for regulations, increasing capacity, ensuring quality of local products and much more. “These private public partnerships exposed me to a lot of different business models and industries. I was able to see firsthand what was working and what wasn’t.”
Next stop: Free Play Energy. “I was starting to get frustrated with the bureaucracy within the UN. When Free Play approached me to help them market crank radios and other products to the camping market in rural Africa, I decided to jump ship,” he says. Hajee worked for Free Play Energy for two memorable years.
The experience was incredible.
We found out, for example, that these off grid products would be very valuable to the poor but the delivery model was completely ineffective. It was taking $20 to produce something and by the time you got to the consumer, the price had jumped to $50. The value chain is so convoluted in Africa that the end customer is always given a very expensive product.
His team’s solution: A donor model with help from the UNDP. “Free Play became a viable business but we didn’t have control of our products now,” he says.
And he was itching for something new. Again. So in 2008, along with two colleagues, Hajee left Free Play to start Nuru Light.
“Human power as a hand crank wasn’t going to work for very long. We knew that then, it gets old very quickly. But the immense power of human energy has been untapped and compared to solar or other alternatives is much more appropriate,” he says.
With initial funding from the World Bank, Hajee spent two months living in Rwanda to understand specifically what “they need energy for what they were currently using.” “Remember that these are the poorest of the poor populations. Their needs are basic. My research identified four specific needs: Cooking, lighting, mobile phone charging and radio,” he says.
Essentially, what Hajee realized then was that most of us use energy for specific tasks, especially those that don’t have a continual power source. We learn to adapt and make the most of our resources.
“The fact is that the power required to power these things wasn’t a lot. It all came down to tasks: the entire room did not need to be lit up. They just needed enough task light, as long as it was multi-use and multifunctional,” he emphasizes.
What also emerged was a need to pool resources and share. “Some of them said they would like to have room lighting for visitors. So why not have multi-use lights that can be connected for such occasions?”
The hyper-local model Hajee discovered has been successful for a long time in India. With a significant percentage of the Indian population still living well below the poverty line, these sachets have gone a long way in helping those with limited disposable income afford basic necessities.
For the African poor, Nuru Light, a basic, rechargeable light, has similar potential and meaning.
But how do you take it to market?
First, you need seed investment. For Nuru Light, this meant a complete initial dependence on grant money to get through the first two-and-a-half years of research and testing. “We were completely funded by grants. It took every penny of the $500,000 we raised to make this work in Africa.”
“One of the ways to eradicate poverty is to offer economic opportunity. So we thought, why not put this into the hands of micro entrepreneurs who could set up recharging stations for these single, handheld lights?”
So, a lot like the successful domestic business models like Netflix and Zip Car, the Nuru Light micro entrepreneurship model was born. What made the idea instantly sellable were two factors: Setting up the business required minimal funds and the profits would be significantly steep than what the community was making.
The following months began to show concrete results with most of the micro entrepreneurs paying off their initial setup loans within six months. “They were making $1.50 for 20 minutes of charging. That’s what they made earlier by working the whole day,” he explains.
As for customers, the value proposition presented by Nuru Light was equally attractive. According to Hajee, a recharge costs 30 cents, which typically provides for with about 10 days of lighting.
A whole month’s supply? No more than one dollar for most.
While the product was an instant success with customers who really felt that their needs had been understood and the solution affordable, things were not as smooth running internally.
Our revenue model really evolved through those initial months. From low margin and a high volume approach we went to carbon credits. In fact, we are the third registered carbon credit company in Africa.
They also needed to figure out how to ensure that Nuru Light was sustainable for and with their team of micro entrepreneurs. “The fee from the recharging stations was a significant third stream of revenue that we had anticipated early on. But turned out, we were spending much more on fielders doing the rounds to collect the money than was worth it,” he says.
Next challenge: Automating the process. The answer, Hajee realized lay in mobile money. A lot like the rechargeable pay-as-you-go mobile phone system, the micro entrepreneurs were set up with prepaid energy credits that could be refilled, by purchasing 20-digit pin numbers. Now, the flow was corrected, in place, much more easily manageable and yet simple.
The social inequities and empowerment that Nuru Light has been able to demonstrably address aren’t lost on Hajee.
In fact, what caught my eye on the Nuru Light website is the “Impact” section. I asked Hajee to discuss how he believes Nuru Light is helping the African community besides fixing a basic need for light.
Our product helps reduce the use of kerosene, a significant cause for respiratory diseases. We’re helping the local environment by removing the fumes and toxicity of kerosene from the air. We are creating job opportunities for the community. Plus, for the first time the kids in the community now have the ability to complete schoolwork at their leisure, freeing up for time for play and extracurricular!
As a technology, Nuru Light, of course, presents a win for Hajee who recognized a severe need coupled with crippling factors of few resources and economic underdevelopment.
Now with new support – financially and otherwise – from the eBay Foundation, Hajee is ready to work on his next venture: The rural population in India.
In fact, Nuru Light has had ground troops in Mumbai and Delhi doing initial research since 200, he told me.
“It took all of the $500,000 we raised for Nuru Light to work in Africa. We now have the same amount to invest in our model in India. And eBay has shown a real commitment to help us scale our business by offering us their resources way beyond the financial support. Their approach has been starkly different from other donors and we’re lucky to have that,” he says.
If Africa took a few months, why was the Indian market proving such a hard nut to crack? “The reason it is taking us so much longer is that no one is working on provided microfinance opportunities in India. So off grid products like ours end up remaining largely, off grid,” he admits.
But the roadblocks in India are more convoluted and will require a whole new round of rethinking and perhaps, even a regurgitating of Nuru Light.
We have learned a lot in the last two years and now know what can work.
The research is complete and the funding is in. That success story is yet to be written for Hajee and Nuru Light, but his recent accomplishments leave me with little doubt.
Passion, a clear sense of business responsibility and market-based solutions drive Sameer Hajee. What will it take to motivate you?
Connect with me @AmanSinghCSR or leave a comment.
29 Thursday Sep 2011
Posted CSR, HR, Uncategorized
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Connecting the dots between Business, Society & the Environment
Connecting the dots between Business, Society & the Environment
Connecting the dots between Business, Society & the Environment