Tag Archives: Stakeholder Engagement

Marsh & McLennan’s 2010 CSR Report: Holistic, Aspirational, But Lean on Data

07 Wednesday Sep 2011

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“Our corporate social responsibility is our best kept secret.”

What compels a company with 52,000 employees and with over 140 years of systems in place to publish a CSR report?

For professional services giant Marsh & McLennan, as CSR Director Christine Salerno put it, there was an urgency “to put a stake in the ground.” The company, following shortly on the footsteps of a rebranding initiative [from Marsh to Marsh & McLennan], released its first CSR report, complete with a press briefing at its New York headquarters, late last month.

At first — and second — glance, the Marsh CSR report is 21 pages of text and very little data. What the executives present at the briefing, however, had to say, was far more enlightening and worth noting.

After Silvia Davi, head of corporate communications and brand introduced the panel — an all-women team of Chief Sustainability Officer Elizabeth Barry, Chief Diversity Officer Kathryn Komsa and Salerno — Barry started off with some forward-looking statements.

1. Sustainability

“We were doing a lot [in sustainability] but we needed structure. Now we can gain much more from the same efforts by implementing them as part of a long term strategy,” she said, adding that, “This is not about today, this is about tomorrow.”

Our work in CSR is our best kept secret. Now we have decided to collaborate and communicate our successes and challenges because colleague education and engagement are key to the success of our sustainability strategy.

Pointing to a slide that charted key accomplishments since 2010, Barry noted that a majority of the data points were yet to occur. For example, the company is set to launch an internal “Green Traveler” program aimed at helping employees’ cut down their carbon footprint by educating them on telecommunication alternatives, etc. Also to follow later in the year: A “Paper Reduction Campaign” as well as a “Sustainability 101 Training Program.”

“I want everyone in the company to know that they are committing to a longterm strategy,” she emphasized. “Sustainability starts with people and our behavior and if every colleague made one tiny change, the impact collectively can be huge. It’s not a quick process but it is truly more sustainable.”

2. Diversity & Inclusion

The mission for CDO Komsa, who started in her current role in 2009, was “to create an enterprise-wide diversity and inclusion strategy.” “Our challenges are finding the right talent, resources, and the right market share in a multicultural world,” she said, adding a common refrain among the B2B sector, “Our raw material is our people and a diversity platform becomes a great way of creating shared value.”

Komsa also touched on an issue that has had insurance companies scratching their heads in recent years: How do you make a career in insurance sexy and attractive?

Noting that this is a big challenge and opportunity for Marsh, Komsa emphasized that her, “Team’s leading initiatives in coming months will be to tie in the four companies [Oliver Wyman, Marsh, Guy Carpenter and Mercer] and rebrand the insurance industry by emphasizing how we source our talent.”

3. Community Relations, Volunteerism, Philanthropy

Marsh and McLennan's 2010 CSR ReportSalerno who is an ex-investment banker chose to begin with a review of past challenges: “This is something that has always been done. What has been missing is the communications piece. There has been no cross collaboration internally within the units.”

“Our business case is to make sure that our CSR activities are creating impact in the communities we operate in and for our employees,” she added, noting that, “An engaged employee wants to stay. We want to make sure we are attracting the right people.”

The connection between CSR and recruitment is an increasingly acute problem for recruiters, especially in the B2B sector, where the commodity for sale isn’t so much a physical unit but organizational culture, intellectual growth and innovation. How do you leverage CSR as a recruitment strategy? [Join me at one of eight breakfast sessions on analyzing this very question starting next month.]

“Students coming out of college want to work for companies that are doing the right thing. Our strength is our people. So how do we use our biggest assets to create maximum impact?” Salerno responded.

4: Climate Change

In response to Business Ethics Publisher and veteran journalist Michael Connor’s question about setting goals on climate change, Barry pointed to the unique challenges of operating in cities like New York, where most companies don’t own their real estate. “Goals are hard for a professional services company. And when you add a lease to the equation, it becomes even harder. In most cases, we are in the middle of 10-year leases so in the interim, we are finding other ways to set goals, like how to reduce our real estate portfolio altogether.”

5: What Does Successful CSR Look Like for a Fortune 250 Company?

Employee engagement has always been a huge component of my blogs in the past because I truly believe that getting your employees on your side is half the battle for most companies struggling with reputation issues. They can be your best brand ambassadors and I asked the Marsh team what success looked like for all their CSR and sustainability efforts: A significant decrease in air travel, a certain number of LEED certifications, an internally set women and minority retention rate, or something else?

Repeating that they launched the CSR report as a way of putting a stake in the ground, Salerno emphasized that, “Employee engagement is a crucial piece and trying to quantify our efforts and rolling out a system to measure our activities has them talking.”

“We’re getting the information out there and they are discussing it,” she said, to which Komsa added that, “piles of resumes have been pouring in because the work we do aligns with someone’s values. That means our employees are talking, which is a huge win for us.”

Barry, however, might have put it best:

“This report doesn’t have as many foundations but it is an important story to tell. We don’t have all the answers but we do want to get started on finding them.”

At the end of the day, Marsh isn’t looking to solve the water crisis or achieve a zero carbon footprint. Their goals are moderate and their CSR report reflects a forward-looking attitude that is encouraging.

That they have a team in place approaching CSR strategically — and a lot more holistically than many other companies — is the right start.

Revisiting the PR Take on CSR: “Corporate Responsibility is Not Public Relations”

30 Tuesday Aug 2011

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Last year, the Better Business Bureau hosted an event titled Good Business 2010, where the day-long agenda was to analyze the increasing confluence of public relations (PR) and corporate social responsibility (CSR). Here’s what I wrote then on Vault’s CSR blog:

A Belief System For Your Company

Edelman’s EVP for CSR-New York, Michael Holland while highlighting his firm’s approach, emphasized that corporate responsibility was emerging increasingly as an indelible part of brand management for companies, although North American companies, while initially slow to embrace it, were quickly getting on board.

Defining CR as “A belief system for a company” he broke its significance for companies into three segments: 1) the social and legal aspect; 2) its immersion into the operational model; and 3) how to leverage it for competitive share in the marketplace.

What is the ROI for corporate responsibility?

Citing a recent survey conducted by McKinsey, Holland said that the business case for corporate responsibility had never been clearer for companies. “Companies that paid attention to CSR in the last three years reported an increase in their share price of 43% against a 12% increase for those who didn’t.” At the same time, profits for the first segment of companies increased by 16% versus 7%. I’ve often noted that metrics and numbers speak louder than words. These then, need no further explanation. See more results from the McKinsey survey.

Noting that the pressure for accountability was no longer the voice of a few dedicated advocates and had shifted to mainstream demands from all stakeholders for a company, Holland stressed that the tipping point was already here: “CR cannot be ignored any longer. Shareholders, employees and clients are demanding it.”

What is corporate responsibility all about?

Holland, interestingly, chose to answer this by focusing on the key misconceptions about corporate responsibility. Funnily enough his counter-intuitive tactic worked, bringing up several questions from the audience. He put it like this:

CSR ≠ Green
CSR ≠ Strategic Philanthropy
CSR ≠ Public Relations

CSR isn’t PR, it’s About Your Business Strategy

I have discussed in the past the huge difference between conducting brand management and reputation-building and immersing CR as a culture of change into your company’s strategy. I asked Holland how he advises clients to walk that fine line.

“First of all, it needs to start from the top. Secondly, it needs to part of a company’s communication strategy. And finally you need to define what it means to track the progress of your corporate responsibility. The problem is that the marketplace believes that CSR is cause marketing and philanthropy. Our task is to overrule that and teach them that actually it’s about business strategy.”

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Now, with several communications firms announcing CSR practices, where are we headed with the confluence of PR, brand management and CSR? I turned to the latest entrant in the field, Ruder Finn. Take a read.

CSR and Sustainability in Mainstream Media: Citizen Journalism Or Simply Shared Value?

18 Thursday Aug 2011

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One of my most common complaints, after “Why Don’t Executives ‘GET’ CSR?” is why mainstream media hasn’t been giving due diligence to sustainability, corporate governance, employee engagement, social responsibility, the confluence of business, society and the environment, and everything else that connotes CSR.

2010: Professor Aneel Karnani’s Case Against CSR and Michael Porter’s Creating Shared Value

In 2010, there were a few noteworthy attempts. Aneel Karnani’s editorial in The Wall Street Journal on The Case Against Corporate Social Responsibility, which evoked numerous blogs, response pieces, live panels and tremendous conversations.

[READ: Why There Is a Case for Corporate Social Responsibility, Despite WSJ’s Obituary]

Then came Michael Porter’s piece on Creating Shared Value in Harvard Business Review. Not only did Porter start a flurry of debates, white papers and panels, the report even introduced new hashtags for Twitter users: #CSV and #sharedvalue; and a new hangtag for consultants.

Everyone understood shared value, they could contextualize the term, even measure it, and therefore, make a better case for business and social responsibility.

Debating Semantics: CSR vs. Sustainability

At Vault and more recently at Forbes, my effort has always been to highlight issues that needed addressing, questioning, cajoling, and analyzing. Soon after Porter’s piece, I asked two experts in the field to take on the debate, which often gets lost as semantics: Henk Campher, SVP for CSR and Sustainability with Edelman, and Alberto Andreu, Chief Reputation and Sustainability Officer with Telefonica accepted the challenge.

Campher took us through the evolution of the term “CSR,” concluding that corporate social responsibility, does indeed, fit best.

Here’s an excerpt:

We should look at the description of CSR itself. Why do we use these very specific three words to describe what we do? I would argue that the concept is actually a very good description of what we do today. Here’s why:

Corporate implies that this is about business.

  • It not only describes that we are busy with a discipline involving business but goes deeper.
  • It is about profits – how we make them and how we can make more of them today and tomorrow.
  • It is not about charity.
  • It is about building a sustainable business model that will continue to deliver business results for stakeholders – especially shareholders.

Social tells us this is about society.

  • It is about the impact business has on society and how we can manage this impact to ensure both business and societal benefit.
  • Even the environmental part of CSR is about society – how we can minimize environmental impact to benefit society in the end of the day.
  • The new developments in CSR – sustainability – further continue to prove that CSR is about a mutually beneficial relationship between product and service development, and societal value chains.

Responsibility reveals that business does carry a responsibility in this world–to do business in a way that benefits both business and society. Further, this responsibility gives business the opportunity to create new solutions to the needs of society. I would even argue that it is their responsibility to develop these new solutions and benefit by capturing new avenues of sustainable profit.

All three concepts—Corporate, Social and Responsibility—tell us exactly what we do today. CSR is also the perfect reminder of the relationship between business and society, and the responsibility they have towards each other. None of the other concepts proposed today actually tell us what we are doing and what we should be doing.

Andreu on the other hand, prefers sustainability over CSR. His key points:

Using CSR as an expression is not an academic problem but one that has very tangible consequences for companies.

Organizational: The classic case of the left hand not knowing what the right is doing. Most of the time, the rest of the company doesn’t know what the CSR team/executives do.

Defined functional areas don’t suffer from the same vagueness. HR is dedicated to people, the finance team crunches numbers, the operations team is in charge of systems and back up, etc. But how do you identify the team dedicated to such a vast array of duties, i.e., diversity and inclusion, environmental management, climate change, ethics, corporate volunteer management, social sponsorships, entrepreneurship, multistakeholder engagement, transparency, SRI, reputation, and human rights?

What we get instead is a big mess.

Structural: If CSR is about philanthropy, management will accordingly participate in sponsorship, PR and communications exercises because their objective is maximizing the return of investment in reputation building, not responsible and ethical business. For most companies, in fact, it is common practice for the CSR manager not be associated with evaluating social and environmental risk.

Budgetary: Let’s be honest. We all know that it is much easier to ask for a budget to implement philanthropic programs than for mapping out a business’ core environmental risks, or implementing an ethics code, or auditing the supply chain. Even in the best case scenarios, other areas of an organization will manage these issues as part of their day-to-day work but the reality is that when something is difficult to communicate, resource allocation becomes a much harder task.

Management: It’s easy to measure the impact your donations are having by stringing out the appropriate key performance indicators (KPI) for any given year. But what KPI efficiently summarizes responsible behavior? The resulting scorecard is usually so large and convoluted that even the most dedicated executives give it up because of its sheer confusion and lack of focus.

His conclusion:

The concept of CSR has been exhausted, we have to expand it for effective impact, and for that, we have to adopt sustainability. And that’s why I say, “It’s sustainability, stupid!”

The reason these debates work is because they compel people to chime in, share from their own experiences and research, and crowd-source solutions that everyone can agree on. While the debate elicited several comments on Vault, the tweets, comments, advice and feedback continued to pour in for weeks after publication.

Citizen Journalism Or Simply Responsible?

At the end of the day, media — and journalists — have a responsibility to business, to society, and to a global audience as well. Back in India when I was making the leap from kindergarten to first grade, it was The Times of India and other newspapers that became my primary sources of reading, grammar, comprehension and GK (a common monicker for ‘general knowledge’ used by school kids, at least in those days!).

Today, journalists are expected to inform and engage a vocal audience of readers. Bring in social media tools and you have a vocal and ready consumer base willing and confident to discuss, debate and make choices in real time with you. And this is where the CSR debate with Campher and Andreu did well.

For me, as a journalist and a resolute CSR practitioner, it is indeed heartening to see that those small, infrequent attempts are now becoming frequent analogies and commentaries within the circles of mainstream media.

In fact, here are three reports in recent weeks that came to my attention:

While I give kudos to Light, Lahart and Lohr for highlighting these, we — the journalistic community — must evolve to a state of journalism where good and bad business practices and sustainability are part of everyday reporting and dialogue.

The incredible work of Alice Korngold and Ann Charles on Fast Company, my fabulous co-contributors on Forbes’ CSR blog, and Marc Gunther at Fortune must become more commonplace, much more grassroots, more mainstream.

Some call it citizen journalism. For me, it’s just plain professional responsibility. We owe it to our organizations, the economy, future generations, our planet, and at the end of the day, to ourselves.

More:

The 2011 CSR Debate: CSR is an Evolution, Not a Revolution
The 2011 CSR Debate: “It’s Sustainability, Stupid!”

Social Media and Leadership: Are Twitter and Facebook 21st Century Necessities?

12 Friday Aug 2011

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There is a lot of love for social media among many in the corporate social responsibility (CSR) and sustainability community. [Take this short survey and have your say: Useful, necessary engagement tool or hate it and a complete hassle?]

Lucy Marcus, founder of Marcus Venture Consulting, for example, posted a blog today on Harvard Business Review, that talks about a particular Groupon deal that annoyed her enough to tweet about it and how that rose several eyebrows and an eventual resolution.

David Connor recently wrote about his love for Twitter, calling it a fascination and being constantly impressed by the simplicity of engagement and the tangible sense of community the platform provides. In his post, he alluded to a recent confession of mine, simply titled: In Defense of Twitter: 5 Reasons Why I am a Mad Tweeter, which was a response to an alternatively headlined Wall Street Journal article.

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For those interested, here is a recount of my top five:

1) Community: Twitter has provided me with a very diverse community of individuals who are eager to engage, argue and collaborate.

2) Soundboard: Without the 20 odd tweets I send out every day, I wouldn’t get any work done. Sounds counter-intuitive, I know—but it’s true. You’ve got to go where your audience is. They have a voice and they like to use it—and as a blogger, hearing what’s working and what’s not is inarguably essential.

3) Collaborations: And of course, without Twitter, I wouldn’t have made HR Examiner‘s Top 25 HR Digital Influencers for 2011 or named among the Top 100 Thought Leaders by Trust Across America. Nor would I have been able to successfully put together the recent panel on responsible business with Carol Sanford, Jeffrey Hollender, Sarah Murray and Bank of America, or been able to interview thought leaders like Campbell Soup’s Dave Stangis, PwC’s Shannon Schuyler, EMC’s Kathrin Winkler and many others while at Vault—and collaborated with enterprising students like Ashley Jablow, Catherine Chong, entrepreneurs like Myles Lutheran and the EDF Climate Corp fellows, or published the much-referred to series on job hunting in CSR.

4) News: Believe it or not, Twitter has become a significant source of my daily news. With the help of coordinated lists, I can scan the morning news in one stream all at one source.

5) Innovation: How many times have you read an 800-word article in one the mainstream newspapers and thought “Wow, that’s interesting, I wonder how I could learn more” or “I’d love to get involved” but haven’t known what to do next? Well, because it’s so easy to connect with others on Twitter without having to jot down strenuous emails or phone calls, now you can!

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But Connor also brought up transparency and corporate accountability.

And here is where most companies struggle with the plethora of choices available today under the domain of social media: Facebook, Twitter, LinkedIn, Quora, Digg, StumbleUpon, Reddit, and the new kids on the block BranchOut and Google+, to name just a few.

So, how helpful are these channels? BRANDfog, a social media and CSR consulting firm launched a survey last week that begins to dig deeper into some of these questions.

Social Media and Leadership:

Should CEOs be engaging on Twitter for example? Does that help gain trust with customers, loyalty with employees, or raise the bar on transparency?

Recruitment Decisions:

Has social media become a benchmarking tool for prospective candidates in their recruitment decisions?

CSR and Sustainability:

And does a presence on social media help companies illustrate their brand values, mission and corporate citizenship?

What do you think? Take this short survey and have your say. Is social media emerging as the differentiator in today’s crowded market of jobs, business, and consumer loyalty?

The Convergence Economy: A New Reality For Business (Sustainability) and Nonprofits

10 Wednesday Aug 2011

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If ever we needed proof that conventional development approaches are failing to address poverty, disease and malnutrition, the 10 year checkpoint for the UN’s Millennium Development Goals provided it.

The shortfalls in achievement in parts of Africa and South Asia cruelly expose the limits of our current efforts. Debate has recently turned to how business, governments and NGOs can work together in ways that align commercial self-interest with societal value. But the emergence of a ‘convergence economy‘ will disrupt incumbent development providers and ask many questions of businesses.

The Good News… and The Bad News

The good news is that the struggle against seemingly intractable problems such as malaria, drought and extreme poverty coincides with a time when global companies are looking for new markets. It’s no surprise, therefore, that NGOs and the private sector are increasingly working together. But all too often this collaboration is for one-off projects and conducted at arm’s length.

Business provides funds and NGOs deliver solutions. This may give business a license to operate in new territories, but it misses a large opportunity to transform communities for the long-term.

What is the Convergence Economy?

It is based on a merging of issues: Water, sanitation, education and disease, for instance, can only be addressed effectively together. It recognizes that the interests of NGOS do not run counter to those of business. And this results in a convergence of solutions, where it no longer matters whose logo is on the product or service that is improving the welfare of communities. 

We are all aware of how leading brands are supporting local communities and farmers, but beyond ethical supply chains and community based business practices, some businesses will have to consider more radical transformations of their operations.

Accenture's New Era of Sustainability 2010 Report

We can expect to see hybrid organizations that genuinely bring together NGOs and businesses in newly formed entities that have joint and flexible value chains at their heart. Danone’s collaboration with Grameen in Bangladesh illustrates this and has resulted in entirely new products to combat infant malnutrition. In some cases, we can expect the private sector to receive grants rather than NGOs.

The ‘convergence economy’ therefore requires businesses to create new business and operating models in local markets and to identify where they may have the best capabilities to ‘touch’ local communities in place of or in partnership with traditional aid providers. These new businesses or subsidiaries may be in joint partnerships with NGOs and other players.

For solutions to be sustainable, they will need to feed back local innovations into the broader business to maximize commercial benefit. To maintain their commitment, they will have to persuade shareholders that these commitments with longer term pay back periods are essential for future growth.

What does the convergence economy mean for NGOs?

According to our survey with the United Nations Global Compact of 766 CEOs, 27 percent of CEOs saw NGOs as key stakeholders in areas of sustainability in 2007. That figure fell to just 15% in 2010.

NGOs will still occupy a vital position in development—indeed they must, as they possess the local knowledge and knowhow, but they will see their role changing.

NGOs will act as coordinators, not just providers.

They will attract investment finance as well as seeking grants. They will support free markets as a tool for development. This means adopting new capabilities and, to some extent, a new cultural outlook. In the same way private sector companies are used to disaggregating their businesses and outsourcing non-core operations, NGOs will have to redesign their structure and purpose.

They will need a venture capital mentality to create conditions for investment.

The convergence of development and commercial enterprise is not therefore merely about ethical supply chains or profit seekers embracing a broader definition of value.  It is about a far deeper and more fluid operational collaboration across sectors. As multinationals enter new markets, they will have to redesign their models and assist NGOS to do the same.

Then, what could be seen as a marriage of convenience today can become a more committed and productive long-term relationship in the future.

–By Gib Bulloch, Executive Director, Accenture Development Partnerships

Gib is the Founder and Executive Director of Accenture Development Partnerships (ADP), a ring-fenced not-for-profit consulting group within Accenture, whose clients include many of the major international NGOs and development agencies. ADP’s main focus is bringing affordable business and technology expertise to the international development sector and promoting private sector engagement in sustainable development. In 2007, ADP was awarded the Management Consulting Association (MCA)’s CSR Award and in 2008, Gib was named as the Sunday Times sponsored Management Consultant of the Year in the Best Partner/Director category.

Gib has lived and worked extensively in developing countries and is a regular speaker on the role of business in development, corporate social entrepreneurship and cross-sectoral partnerships.