Today’s corporate responsibility agenda emerged in response to growing public concerns that business had outgrown the control of governments, and as a result was free to act in ways that were not generally good for society.
Powerful global brands were perceived to be exploiting weak labour and environmental laws and operating above the law and outside of acceptable social norms. Corporate reputations were at stake, brands were at risk and modern-day reactive CSR was born. It’s what we call the ‘outside-in’ CSR approach. A brand new initiative, the Global Leadership Network (GLN), is proposing to change all of this.
Over two years, the network of ten companies, including Cargill and General Electric from the US, Mexico’s CEMEX, Diageo from the UK, and Omrom from Japan, have developed a framework for corporate citizenship, supported by an interactive tool that allows members to compare and benchmark performance. A four-part framework makes up an integrated model for managing corporate citizenship: innovation; learning; operational excellence; and the alignment of social, environmental and economic performance.
Together with IBM, FedEx, General Motors,3M and Manpower, the network has defined world-class performance in corporate citizenship as: “Excellent companies establish corporate citizenship as a core driver of business performance and thus fully align corporate citizenship to the strategic operations of the business”. The bottom line is that just like any part of a company, corporate citizenship activities should be about excellence and about quality and performance should be measured and constantly improved.
The GLN offers companies a welcome opportunity to work together on the citizenship agenda, sharing challenges and successes and so learning from each other, as well as benchmarking performance and competing for excellence.
But where does this leave external voices and initiatives? Clearly out in the cold. “Businesses need to innovate in peace and quiet”, says Simon Zadek of AccountAbility, which along with Boston College’s Center for Corporate Citizenship, is managing the network. The GLN says it’s time for companies to take charge, and have responsibility, for driving their own agenda, rather than being driven by the agenda set by others.
We certainly applaud companies that examine corporate citizenship from the ‘inside out’. Yet in reality this only works if the ‘outside’ is ‘in’: if external stakeholders are engaged and their concerns duly considered.
GLN could learn from the experience of the London Benchmarking Group (LBG). For 10 years the LBG has offered community investment professionals a forum for learning and sharing best practice, as well as a common model for quantifying the impacts of their programmes. Although the LBG is a business-membership group, the key to its success is that its members’ charity and NGO partners understand, accept and also value the model, giving it essential external credibility. As with LBG, GLN should ask companies to think clearly about their motivations for CSR activities. Are they aiming for 1) direct benefits to the business, 2) a ‘win-win’ for business and society, or 3) benefits for society, for the ‘common good’, or simply because ‘it’s the right thing to do’.
The network’s focus on aligning corporate citizenship with the business case should not ignore the value of activities that might not be top priority for business success, but could make a real difference to a stakeholder at no or minimal cost to the business. It all comes back to thinking about motivations: some choices will be solely business-driven; others will be ‘win-win’. And others might be simply a charitable action. Each can add value – both to the business and to society.
Michelle is leading The Corporate Citizenship Company’s operations in the USA, working with North American companies to develop a global approach to corporate citizenship. A US citizen herself, Michelle worked for The Corporate Citizenship Company in London for three years before relocating to New York City. Formerly an assistant editor of Corporate Citizenship Briefing, Michelle has developed and written CSR management briefings for clients including Marks & Spencer, Diageo, Vodafone and the International Center for Alcohol Policies (ICAP).
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