“Great idea but it still doesn’t sell”. This is the knotty conundrum that taxed the minds of CSR managers at the first of Business in the Community’s Practitioner Dialogues on March 7.
After two decades of pushing forward the win-win mantra, low sales are a tough truth for the business case believer. But low sales are a world away from no sales. So take heart. The business case remains responsible capitalism’s best chance of beating off its rapacious variant. Why? Because it takes on modern day management at its own game; risk management, employee retention, product differentiation, customer loyalty, market positioning, cost effectiveness. These are terms sceptics understand. And they are terms which the CSR evangelists have been hawking around boardrooms with increasing success over recent years.
The board is a vital first sell. No question. To have the chief executive espousing the ‘whys’ and ‘wherefores’ of responsible business from the pulpit is a huge step forward.
But getting the sceptics in the pews to buy-in is the real challenge for the CSR salesperson.
Getting personal
So why is selling responsible business to the proverbial Mr Morris in accounts or Miss MacIntyre in marketing such uphill work? Just asking the question marks a subtle change of direction in the current debate about embedding CSR. To date, advocates of the business case have been keen to show how acting responsibly brings long-term benefit to the company as a whole. But what of the employee on the factory floor? What’s in it for him or her?
Conflict of interest
The frank reality is that, in the dayto- day world of production deadlines and target targets, obedience to the corporate cause of social responsibility may be in stark contrast to a manager or employee’s best short-term interests.
Take work-life balance as a case in point. The arguments against all work and no play – both for the business and for the individual – are copious and cogent. Yet, against the backdrop of a demanding boss or a pressing client, pushing for the promised nine-to-five may well shift Mr Morris’ or Ms MacIntyre’s dilemma to one of no work and all play.
Whistle-blowing is the example par excellence. “The 23rd is the day of your death”, read a recent email to Liu Shuwei, a Chinese researcher who exposed the exaggerated balance sheets of the firm where she worked before being sacked. This may be a little extreme, but “don’t expect thanks” is among the top hints that a support group offers those thinking of blowing the whistle. Hardly a winning advert!
The carrot approach
Clearly, there is a need for suitable incentive structures if the Mr Morrises and Ms MacIntyres are going to take up the call to responsible business.
This is easiest where there are immediate parallels between individual and corporate interest. So, helping her hit her retention targets may be the way to sell CSR to the human resources manager; to the marketing man, it may be the enhancement to his brands from social marketing; to the supply chain manager, greater reliability in meeting her delivery deadlines may be the clincher.
If the overall business case is really the prize-winning carrot that its advocates allege, then individualising it for the employee or manager is the logical step to selling it internally. See it as a slicing up of the corporate carrot.
The gentle nudge
To return to our work-life balance example, however, there are incidences aplenty where the apparent harmony between individual and corporate interests are somewhat muddied.
In such cases, artificially seasoning the carrot to make it more palatable is a legitimate option. Take corporate community involvement. For those whom the carrots of paid leave or volunteering award schemes do little to stir a sense of civic-mindedness, harderedged benefits such as learning new skills and meeting fresh challenges are used as gentle armtwisters.
In the environmental arena, for example, Northern Rock has set up a team of green reps to act as ecoefficiency champions in their respective departments. A monthly £100 prize for the most proficient acts as a stimulus to ensure that computers are turned off and stationery returned – all of which helps the company reach its 5% waste reduction target.
Linking responsible business behaviour into pay and promotion considerations is also increasingly common. At an executive level, social and environmental targets are slowly emerging as part of some remuneration agreements. Procter & Gamble, for example, links diversity performance to stock options for its top 30 managers. Where tangible performance targets are difficult, companies are tending to use 360-degree appraisal techniques and other similar evaluation models to judge performance. As part of the career development process at Johnson & Johnson, for example, every manager is evaluated by his or her junior and senior colleagues according to how well they live up to the company’s Credo. To the business case purist, such schemes might seem a little underhand. Sometimes, however, it takes a little sweetening of the carrot to convince the Mr Morrises and Ms MacIntyres that there is something in it for them.
The stick approach
Yet what of the persistent sceptics around the water cooler? You can follow the parental remonstration that “carrots are good for you” only so far. Some people will just never buy it – they either don’t really care about responsible business or they see it as contrary to their immediate interests. And let’s be honest, sometimes it is.
Take child labour. It remains endemic in so much of the working world not because employers are inherently irresponsible, but rather because children are cheap and their families need the money. The fact that denying children a full education will prevent the development of an educated workforce and ultimately stymie longterm commercial opportunities has little bearing when weighed against the cake of pure short-term interest. Bribery is an even clearer case in point. Receiving bribes from a supplier may be very much in the short-term interest of the employee.
There may be a compelling business argument underpinning responsible practice (bribery, for instance, is a twoway game; tolerating a bribes culture will eventually force companies into paying the cost of bribes themselves), but the enlightened long-term position will all too often lose out to short-term motives when there are conflicts of interest.
In such circumstances, the threat of getting caught acting irresponsibly needs to provide a greater incentive than behaving irresponsibly. In the real world, where Mr Morris and Ms MacIntyre work, wielding a hefty stick may be the CSR salesperson’s most effective means of sealing the deal.
Purchase by compulsion is hardly a winning sales technique, but think of it as mandatory hire-purchase; make the sale now and, if the business case holds true, by the time the final payment is due the benefits will be manifest.
Selling to the sceptic
As anyone who has fought it out around the water cooler will know, selling the business case for corporate responsibility to the individual sceptic is not an easy task.
Inconsistency between rhetoric and reality is one of the biggest obstacles for CSR advocates. If individual employees are to buy into the responsibility agenda, then responsible practice needs to be consistently lived out and actively supported by senior management.
At Nestle, for example, the chief executive personally considers any suggestion that the company’s position on marketing baby milk has been infringed. The message from the top doesn’t come much clearer. Management and employees also require continued communication and explanation of the company’s stated values. Dow, for example, recently introduced an ethics training programme for all its managers. A recent survey by the Institute for Business Ethics, however, shows such measure are the exception not the rule, with fewer than two in ten (16%) companies even explaining their codes of conduct to new recruits.
The elixir of self interest
Just as self-interest lies at the heart of capitalism, so too must the sales pitch for CSR. “Why should Mr Morris and Ms MacIntyre buy the CSR package?”, is where practitioner dialogues need to go from here. Answer that why, and the how of mainstreaming CSR will answer itself.
Corporate Citizenship Briefing, issue no: 63 – April, 2002
COMMENTS