Friday, July 31, 2015

CSR and Organizational Resilience: An Illustrated Guide

Hi Internet!
Today I want to talk a little bit about corporate social responsibility and organizational resilience. As I sit down to write this blog post, I’m very aware of the fact that I have a lot of thoughts and feelings that I want to convey in this post, and not a great idea about how I’m going to structure it.
Which is not a good sign! But if interested parties are willing to bear with me on this potential stream of consciousness, I promise to make it as engaging and organized as possible with visual aids, exclamatory punctuation and sheer power of will.
Cool? Ok.

bear with me
A lot of people assume that because I want to work in the private sector, I want to work in a corporate social responsibility (CSR) capacity. This is a very reasonable assumption, and for a while I definitely thought that’s where I would end up. Corporate social responsibility can, and by nature does, mean a lot of different things to a lot of different companies. The most inclusive definition I can come up with is that CSR is a company’s attempt at taking responsibility for its impact on society. This can manifest in a range of activities, from CSR departments ensuring corporate compliance with agreed upon ethical standards like the UN Guiding Principles on Business and Human Rightsto a pretzel company donating pretzels to a community experiencing a pretzel drought…or something….I dunno.

Silly drawings aside, at the heart of CSR is the concept of encouraging a positive or neutral impact on communities and stakeholders that engage with a given business on any level, from consumers to employees to investors to host communities and others. From what I’ve read, this is a term that has been around in some form since the 1960s, it’s a concept that has significantly changed over the years and continues to evolve.

In fact, most of the companies that consumers interact with implement some form of CSR to varying degrees of legitimacy and efficacy. But why has CSR become such a buzzy, if amorphous aspect of the modern corporation? Well…I would attribute this trend to the powerful, engaging, beautiful evolution of you! The consumer.

Listen, our favorite 60-year-old fierce diva-pop-star Madonna once said, “we are living in a material world.” And that’s pretty much true and universally applicable.
[Disclaimer: Some other Madonna lyrics are LESS TRUE AND UNIVERSALLY APPLICABLE but another blog post for another time my friends.]

We’re raised to be discerning and enthusiastic consumers from the time that we are old enough to need things and have an opinion: 

“Mommy, I would prefer the Lion King light-up sneakers instead of the Little Mermaid ones, please.” 
                                                                   – Me, aged 4.*

*I’m probably making this memory up.

Of course, as we grow, our tastes become more discerning and in different ways. Instead of choosing sneakers based on the superlative qualities of the Disney franchise they depict, perhaps we choose tomatoes that have been locally produced to cut down environmental impact, or fleece jackets that come from safely operated factories that pay workers a living wage. These seemingly small decisions, made quietly in grocery store aisles and dressing rooms, add up to something of great and meaningful power.
         According to a Nielsen study, fifty-five percent of global online consumers across 60 countries say they are willing to pay more for products and services provided by companies that are committed to positive social and environmental impact.
         This trend is especially noticeable in the “millennial” generation, which represents about $200 billion in annual buying power in America alone, according to Forbes Magazine. In a survey conducted by the publication, 75% of millennials reported that it’s either fairly or very important that a company gives back to society instead of just making a profit.

First of all, woah! 200 BILLION!? Clearly my fellow millennials are living off something a bit more robust than RA wages. And how cool is it that the overwhelming majority of global consumers are ready to put their cash towards companies that are willing to give back? What’s even cooler is that these socially responsible consumers are influencing market trends and investment behavior. According to the US SIF Foundation’s 2014 Report on Sustainable and Responsible Investing trends in the United States, as of year-end 2013, more than one out of every six dollars under professional management in the United States, (which comes out to be around $6.57 trillion or more,) was invested according to socially responsible investment strategies.
So now that consumers and investors are stepping up to the social responsibility plate, so to speak, there is no better time for corporations to do the same. And like I said previously, many companies are doing just that. Your cereal companies are donating food to those who need it, your computer companies are assisting with water security programs during drought seasons, your sneaker companies are lobbying governments on climate change issues. Even your beercompanies are recycling their by-product into fuel-grade ethanol. Indeed, when it comes to social responsibility in the private sector, it has been proven that there is more than one way to peel a banana.
But, are some methods of “being socially responsible” more effective than others? I tend to think so, and here is where we really delve into the realm of TAYLOR’S OPINIONS AND OBSERVATIONS NOT TO BE TAKEN AS FACTS CAUSE THEY’RE NOT.
So, largely in good faith, companies have seen socially responsible market trends and consumer sensibilities, and have decided to engage with some of the world’s toughest and most complicated issues, like hunger, labor rights, conflict, political instability, water scarcity, environmental degradation and poverty. And like most tough and complicated problems, these are issues that are going to require a diversified portfolio of responses from all sectors and many schools of thought. But unfortunately, it seems like many companies are laying all of these problems at the feet of their CSR department, and then going about business as usual.
By this I mean that many companies operate under the impression that if they have a CSR department that is doing SOMETHING, they are already doing everything they need to do to be socially responsible. However, I would argue that while CSR departments are doing incredibly valuable and important work, it is simply not enough and not always in the right way.
 I know what you’re thinking….that’s pretty big talk for a stick figure.
I know. But let me explain myself: When you look at different definitions for CSR, there are a few words that come up quite frequently. These are words like, “duty,” “obligation,” and “responsibility.” In many ways, social responsibility work is still an obligation, a chore to be completed parallel to the “real work at hand,” of selling sneakers or making beer or whatever a company is doing to meet their bottom line and keep the lights on. And chores are well and good, but I’m sure we all understand the space that they occupy in our own lives.
We water our mother’s plants regularly while she’s away on vacation because it’s the right thing to do, but then GAH! All of a sudden, our company is restructuring and we’re gonna lose our job and then we won’t have a salary and then we won’t have any money for food and ERRMAGAWD. In a crisis, the first priority that goes out the window is Mom’s ficus tree right? (My mother is sitting in a kitchen somewhere reading this like LOL Taylor has never watered a plant a DAY IN HER LIFE.) Ok Mom, true, but, here’s why I like this relatable, if highly improbable, metaphor.
Imagine this situation again, if you will:
Mom has asked you to water the plants while she’s away. You agree to do it because you’re the best.daughter.ever, but then you lose your job. You’re stressed out, no job means no money, no money means no groceries! No offense mom, but in the face of this crisis, forget that ficus tree! You’ve gotta go out and find some new way to make money and buy food…But wait! What if it wasn’t just the ficus tree that mom asked you to water. She also wanted you to tend to the garden full of vegetables! And, she said you could eat some of the vegetables because she wouldn’t need them all. Tomatoes for dayz! All of a sudden, your “chore” becomes something you want to do because it’s good for your mom, and need to do because it’s also good for you. And THAT, my friends, is how you use integrated approaches to build social responsibility programs with resiliency.

Right, so hopefully that metaphor wasn’t too laborious or overly simplistic. Basically, what I’m saying is that the world is crazy and complicated, and sometimes things come out of nowhere. The market booms and busts, certain products go in and out of style, and companies do what they have to in order to stay alive. This summer, I’m leaning about the oil and gas industry. Right now, the price of oil per barrel is at a six year low, hovering at around $50, down from a historic high of $145 per barrel, with many analysts saying the price could drop a lot more. In this situation, it’s very easy to see how a company could decide to cut out all or most “unnecessary” expenditures- including those incurred through philanthropy work and CSR activities.
However, working for IPIECA has allowed me to learn about some new answers to the CSR-resiliency dilemma. Local content initiatives, responsible security operations, and shared value strategies are just some of the many ways that businesses can structure their operations in ways that make social good an integrated and significant aspect of shareholder value. When this kind of proportional relationship is structured in the right way, it makes social responsibility work more resilient to unavoidable market fluctuations and unforeseen speed bumps- like the price of your commodity taking a nosedive, for example.
              Next week, I would like to pick things up with a chat about some of these integrated strategies, because I truly believe that it is possible to build companies that are socially responsible from the inside out, and I’m just bursting to buy a fleece jacket and some tomatoes from one of ‘em.