Let’s do away with CSR

Maybe it’s time t0 do away with corporate social responsibility (CSR).

Not merely the words and the idea but the infrastructure: CSR departments, CSR reports, CSR conferences and CSR executives.

And, as long as we’re at it, let’s think about ditching the triple bottom line, the pursuit of shared value, corporate citizenship and especially, yuk, the idea that stakeholders deserve a say in how to run a business.

All of these are, at best, distractions and, at worst, ways of thinking about business that create a separation between a company’s core business and its impact on the world. Both ought to be life-enhancing. No more and no less.

I’ve been thinking about CSR and how to talk about it for years.  I wrote my first article on corporate responsibility for FORTUNE in 2003. It ran under an odd headline — Tree Huggers, Soy Lovers and Profits — because my editors knew that  words like corporate social responsibility turn off readers. I grappled with the meaning and terminology of CSR again in my 2004 book, Faith and Fortune, which explored connections between religion, faith, values, spirituality and business. The language of faith and values, I subsequently decided, wasn’t the best one to use when speaking to corporate executives about business and its impact. I’m now inclined to talk about sustainability. For all its vagueness, corporate sustainability is an idea that is both practical–no one wants to kill their company–and radical, because no company  is truly sustainable, at least as defined by the Bruntland Commission as promoting development in a way that “meets the needs of the present without compromising the ability of future generations to meet their needs.”

But the here goes beyond language. I was reminded of that when reading an excellent new book by Carol Sanford called The Responsible Business: Reimagining Sustainability and Success (Jossey-Bass, 2011). No, I don’t love the title or even her terminology. (One chapter is  called, yikes, “Stakeholders as Systemic Collaborators.”) But Carol’s arguments and insights (and the title wasn’t her idea) are spot on. Carol argues that the most successful and profitable businesses, over time, will not be those that “practice CSR” but instead those that rethink their purpose, reorganize themselves to draw upon the creativity and passion of all, and integrate responsible behavior into the way they do everything they do.

As Carol writes:

Responsibility isn’t a set of metrics to be tracked or behaviors to be modified. It is central to both the purpose and prosperity of a business and must be pervasive in its practices.

This may sound obvious but it leads her (and her readers) to new ways of thinking about business. Businesses, she says, should strive not just to minimize the harm they do, but to do good, to become restorative, to “improve and evolve healthy systems.” She explains: [click to continue…]

GE: Good citizen, but where’s the payoff?

“Responsible business,” says Bob Corcoran, “is good business.”

And what’s responsible business? “Make money, make it ethically and make a difference.”

Bob Corcoran

Bob is vice president for corporate citizenship at GE, a 30-year company veteran, and a good guy. We met in 2o04 when we traveled together in Ghana while I was reporting a story on GE’s values for FORTUNE. (See Money and Morals at GE.)  Recently we spoke about GE’s 2009 citizenship report, and about what GE has learned in the past five years from its corporate citizenship efforts, including its high-profile campaign around Ecomagination, which focuses the company, and its marketing, on products and services that help solve the world’s big environment problems.

Inside GE, Ecomagination is deemed a success, so much so that it has spawned a sister initiative (if you can spawn a sister) called Healthymagination, focused on profitably creating better health for more people. GE says that it expects Ecomagination product revenues to grow at twice the rate of GE’s overall revenue between now and 2015.

The logic behind both initiatives is simple, Bob noted. Big global problems demand big solutions from big companies. GE prides itself on “tackling the world’s most complex and pressing problems,” as chief executive Jeff Immelt writes in the report.

The trouble is, the payoff for GE’s shareholders have been disappointing. I didn’t realize just how disappointing until I put together this chart comparing GE’s stock-price performance to the S&P500 and to a couple of its conglomerate competitors, Siemens and United Technologies. [click to continue…]

For business, is health the new “green”?

A decade ago, few people would have thought that major banks, retailers or Internet companies would need environmental strategies. Yet today, they do–Bank of America has promised to invest $20 billion on sustainability initiatives over 10 years,  Wal-Mart’s aggressive environmental efforts are well known and eBay, while selling second-hand stuff, touts the idea of sustainable consumption.

This is largely because expectations of business are always rising. To pick another example: When I was a kid, we didn’t think about how or where or under what conditions our sneakers or T-shirts were made. Now brands that sell footwear or apparel maintain expensive and extensive efforts to monitor their supply chains, to avoid possible scandal around child labor or unsafe factories. Just as Nike or Gap.

So what’s the next big issue that companies need to worry about?

Edelman-Health-Barometer2The Edelman public relations firm says it’s health. Last month, after surveying 15,000 people in 11 countries, Edelman released what it calls its Health Engagement Barometer. The firm says health is emerging as a major corporate responsibility issue, not just for the obvious suspects–drug companies, insurance companies, the fast-food industry–but for companies of all kinds.

Of those surveyed, 69% said that

business should be as engaged in maintaining and improving personal and public health as it is in maintaining and improving the environment.

Respondents to the survey said they would be more willing to trust, do business with and even invest in companies that are engaged in health issues–by, for example, making available products that promote health, communicating the health risks of their products, helping their workers become healthier, helping address obesity or contributing to global health.

“Health is joining environment as a major sustainability issue and therefore a major issue for businesses that want to prosper in the future,” says Nancy Turett, global president for health at Edelman. [click to continue…]