Opening the channels of corporate responsibility communication can maximize share value.
By Karin Kane
Corporate responsibility (CR) has become a major concern of corporations and their shareholders, as a recent Thomson Financial survey of investor relations officers (IROs) and investors shows. The survey, which considered CR to include governance trends as well as social issues, found that over 82 percent of investors consider CR criteria when evaluating their investments. The survey, conducted in March, also shows that nearly 73 percent of shareholders and 59 percent of IROs believe CR impacts share price.
The high percentage of investors focusing on corporate responsibility, and the importance of CR to those investors, is not unexpected. Most industry followers would argue that at least some aspects of a corporate focus on responsibility, including risk management and talent attraction, are beneficial to investors.
Best practices in communicating corporate responsibility activities.
By Mindy Gomes Casseres
In July 2006, the Social Investment Research Analyst Network (SIRAN) announced that more than 75 percent of the S&P 100 had special sections on their websites dedicated to corporate responsibility (CR) reporting, a 34 percent increase from 2005. While reporting has become commonplace, CR information is not reaching those who have the greatest potential for furthering a company’s CR agenda through sales, operations and financial growth—customers, employees and investors. Many companies look to their reports as the primary vehicle for CR communications, but don’t realize that these vehicles are often inaccessible to key audiences due to their length and complexity. To better engage stakeholders, companies should make CR reporting part of an integrated CR communications strategy.
The following examples showcase some innovative methods companies have utilized to communicate with key audiences:
- Driving Responsible Purchasing by Consumers: In 2006, Marks & Spencer, the British retailer also known as M&S, announced its “Look Behind the Label” campaign designed to share with consumers the ethical purchasing stories behind some of its products, such as Fair Trade coffee, non-genetically modified foods, natural cleaning products and animal cruelty-free fabrics.
Advice from experts at BP, BSR, McDonald’s, Sun Microsystems and Xerox.
By Garrett Glaser
With a record number of companies around the world annually increasing staff and expenditures to publicize their corporate social responsibility (CSR) credentials, the time seemed right to survey some of the most experienced practitioners in the field about how they promote CSR achievements. The goal: to learn their dos and don’ts, the musts and must-avoids. Here’s a summary of what we found.
1. Don’t Stretch The Truth
The one question that elicited nearly identical answers was: “What should a company never do when promoting its CSR accomplishments?” The message was loud and clear: “Don’t exaggerate.”
Bob Langert, Vice President of Corporate Social Responsibility for McDonald’s: “There’s no place for fluff or exaggerated claims. CSR success depends upon tangible results, not rhetoric.
Before corporate citizenship can become a way of acting, it must be a way of thinking, and the only way to accomplish that is to embed it fully into your brand.
By Cheryl Heller
Companies like Timberland, Ben & Jerry’s, Patagonia and Seventh Generation were “born” with good genes for corporate social responsibility (CSR). Each company was founded with a mission that included responsibility to the environment and community. In fact, Seventh Generation’s CSR is so deeply embedded, it is the source of its name (to quote from their website): “We derive our name from the Iroquois belief that ‘In our every deliberation, we must consider the impact of our decisions on the next seven generations.’” And from its inception, Ben & Jerry’s did things like working with World Wildlife Foundation scientist Jason Clay to develop sustainable ways for Amazonians to produce Brazil nuts for its Rainforest Crunch ice cream.
Investors are listening—is your company’s investor relations team prepared to talk about corporate responsibility?
By Karin Kane
A recent thomson Financial survey showed that 89 percent of institutional investors rate corporate responsibility as a primary or secondary influence in their decision making. In North America alone, portfolio managers representing more than $13 trillion in assets take corporate responsibility concerns into consideration. With the investor relations department as the main point of contact for this group, investor relations officers (IROs) must be aware of current trends in corporate responsibility and be prepared to deal with investors’ concerns. Unfortunately, IROs are rarely aware of shareholder concerns in this area or how to address them when they arise.
In fact, although 66 percent of investment relations professionals believe their board is not paying enough attention to shareholders’ corporate responsibility concerns, few know what steps to take or how best to communicate the company’s practices in the area.
By Jay Whitehead
If you have yet to meet Fred Cook, CEO of multinational PR firm Golin Harris, you might want to put it on your to-do list. Don’t get me wrong. Fred is not bigger-than-life like his fellow Chicagoans Michael Jordan or Mike Ditka. In fact, he does not sport the broad shoulders of a power forward or tight end. He has more the whippet-like stature of a marathon runner. It’s not even that he’s as loud as his city-mates Harry Carey or Dick Butkus. In fact, Fred is rather soft-spoken, even quiet.
And it is not just that Fred’s firm won PR Week’s 2007 Editor’s Choice award. Or that his firm celebrates its 50th anniversary this year. (In 1957, when Ray Kroc was a mere upstart, founder Al Golin captured the McDonalds account.) Or that his firm has just published a seminal survey, “Corporate Citizenship Gets Down To Business” that ranks firms (the top 5 are Ben & Jerry’s, Target, Patagonia, SC Johnson and Gerber), and concludes that companies must do more and be authentic.
How to talk to your boss, and others, about corporate responsibility.
By John Paluszek
Many corporate responsibility officers and their colleagues in top management have been talking past each other, unnecessarily. With a little bit of “translation” the business case for corporate responsibility—that it’s smart business and often good for society—becomes undeniable.
The first step in this dialogue has already been taken. It’s the morphing of the long-held icon, “corporate social responsibility” into corporate responsibility. That development, in itself, has helped many private-sector corporate responsibility officers make progress with both the chief financial officers and chief executive officers who have been uncomfortable with the implications of a “social corporation.”
Finding this common ground, or common terminology in this case, is much more than a semantic exercise.
For one thing, “corporate responsibility” opens up a natural bridge with corporate governance.
How new language helps make the case for ethics.
Everyone wants the magic formula, how to make the value proposition for ethics,” Marjorie Doyle, chief ethics and compliance ofﬁcer for DuPont, said to me recently. What ethics ofﬁcers struggle with, she explained, is how to sell ethics to top management. “Things have gotten much too short-term, and I say that coming from a 200-year old company,” she continued. “Sometimes it gets to be silly season and companies are driven by day traders, which means they’re answering to the wrong people.”
Doyle isn’t the only one troubled by short-termism these days. In late November, U.S. Chamber of Commerce President Thomas Donohue gave a speech urging companies to stop issuing quarterly earnings guidance. “There is something fundamentally out of balance when short-term considerations become so dominant ... that the long-term view is lost,” he said. Short-termism has driven us to “dangerous new heights,” he added, when “we focus on a company’s numbers and ignore its business.
They’re changing rapidly—for businesses and a new breed of activist.
Futurist Alvin Tofler paints a vivid picture of a figurative 21st century highway filled with the heavy traffic of America’s major societal institutions. In the left lane, zooming along at 100 miles per hour, is American business, fueled by the power-ful forces of competition and technology.In the highway’s far right lane, sputtering along at three miles per hour, hard pressed to keep pace, are governmental institutions: the U.S. Congress, the White House and major political parties.
But wait, who’s that right behind business, speeding along at an astonishing 90 miles per hour?As Toffler describes it in a new book, Revolutionary Wealth, co-authored with Heidi Toffler, it’s civil society, “a burgeoning hothouse sector made up of thousands of churning and changing nongovernmental grassroots organizations (NGOs) — pro-business and anti-business coalitions, professional groups, sports federations, Catholic orders and Buddhist nunneries, plastic-manufacturing associations, anti-plastic activists, cults, tax haters, whale lovers and everyone in between.
Marketing corporate responsibility is a lot more challenging than that.
In the advertising business, Brands reign supreme. Brands, with a capital B, are organic. They grow, adapt, mature and, over time, become lasting material assets of the companies that own them. Often these Brands are “master brands” and as such are the one name behind everything the company does: Starbucks, Home Depot, Apple, and Timberland are good recent examples.
Brands like these are only now beginning to spotlight their corporate responsibility activities through marketing—in effect, using responsibility as a Brand differentiator. That’s a complicated and potentially risky undertaking. And, so far, consumers have not reacted to that message in large numbers. Why? As Jeff Swartz, President and CEO of Timberland (and a client) pointed out to me: “We haven’t made it relevant enough.
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