This post is another of my “long ones” based on a presentation. This one has been given to numerous university audiences over the last couple of years, aiming to discuss Corporate Social Responsibility.
The title “Being Responsible” communicates from the start that we are concerned here with what and who people and organisations are, before we are concerned with how we communicate that responsibility.
The context for this discussion is a moment in time when trust in traditional institutions has fallen to all-time lows, particularly thinking about the business world post credit-crunch and recession with a generation coming into key decision-making and influencer roles who have none of the old loyalties, but plenty of ideas about how things should be done.
The millennial generation is creating a change in how work gets done, as they work more in teams and use more technology. Their social mindset, however, is also a significant factor.
One commentator has observed: “One of the characteristics of millennials, besides the fact that they are masters of digital communication, is that they are primed to do well by doing good. Almost 70 percent say that giving back and being civically engaged are their highest priorities.” (Leigh Buchanon Meet the Millennials.)
We are also at a point when some of the old concepts developed over 30 years ago like CSR are being rediscovered and reinvented for this new generation, with an evolution of the concept most notably into CSV. But also a time when plenty of clients still ask for a bit of CSR as though it is something to be bought off the shelf.
The argument that runs through this module is that you can’t buy a reputation for social responsibility – an organisation either is or is not socially responsible.
I will reference and discuss the concepts described by these five terms:
- Corporate philanthropy,
- Corporate Purpose, and
- Social Enterprise
Let’s start with a look at philanthropy.
Sponsorship of the arts, sports, or local communities has its place. It is a good thing for businesses to think about doing – but they should be clear why they are doing it and what they expect to achieve.
It might make people think more kindly towards us, but it will not fix a problem.
Let’s start with a look at philanthropy. Sponsorship of the arts, sports, or local communities has its place. It is a good thing for businesses to think about doing – but they should be clear why they are doing it and what they expect to achieve.
It might make people think more kindly towards us, but it will not fix a problem.
It is no coincidence that the founder of McDonald’s Ray Kroc’s first hire as an adviser was a young Al Golin, founder of the PR agency Golin.
Famously (at least for McDonald’s people) Al’s first advice to Ray was “Build trust today or lose your market tomorrow. He reprised this in his book called “Trust or Consequences” (2004) explaining how he invented the concept of “The Trust Bank”.
This concept was simply that in order for companies to draw on goodwill to their brand when things get tough, they need to earn trust in the good times. Basically – paying into the Trust Bank before you can draw out.
He called this earning trust credits, and this was the thinking behind much corporate philanthropy, particularly in the USA where wealthy individuals and institutions most often saw their generous donations as a sound investment.
This is still relevant today, not least because people and businesses still mistake this kind of giving back for CSR activity. It can be an element of CSR, but it is not on its own CSR.
A bit of the history…
It’s surprising how many people still talk of Corporate Social Responsibility as if it is a new idea. That is perhaps indicative of how few people and organisations have embraced it fully, even as it has in many senses moved from being voluntary to mandatory as a business control.
In fact CSR is a very mature concept. The phrase itself is thought to have first appeared in the 1950s. Some authorities cite a paper published by US writer Howard Bowen in 1953. But it is not until the 1980s and 90s that the issue reached much beyond academic campuses.
The ground-breaking piece of work was a paper called Our Common Future in 1987 – a report of the World Commission on Environment and Development. At that time the focus of work in this area was heavily skewed to the environment and sustainability and it was this which the Harvard Business Review featured in its spotlight on sustainability in 1997.
The corporate world really only started to sit up and take notice after the environmental and human rights issues which hit Shell in 1995, although when I was working with Shell in the 1970s these were topics on the boardroom agenda back then.
Although set in the pre-internet age when issues developed more slowly and when PR people used to still talk about “controlling the message.”
Shell started to take these attacks seriously when a Greenpeace campaign hit the media, which they may have weathered, and was then compounded by more damaging international consumer boycotts.
Only two years later they published the first CSR report ever issued by a major multinational called “People, Planet and Profits”, a title they had borrowed from environmentalist John Elkington who first formulated the “3Ps” test in 1995. (In fact the first CSR report by any company was published by Ben & Jerry’s in the same year – but at that time a relatively small brand).
The Shell report set out stakeholder expectations of Shell and outlined a programme of change ‘taking CSR into the corporate DNA” following much of the thinking outlined by Elkington and developed further into what he termed “triple bottom line reporting” in his book “Cannibals with Forks” in 1997.
Elkington’s thinking was that companies should be required to produce audited reports of their social responsibility in the same way as they audit and report financial performance. He saw three priorities – social, environmental and financial.
This became accepted across the world as a “nice to do” approach in the years that followed and at the beginning of this century we started to see governments and institutions, most notably including the EU, take this up and enshrine in legislation and regulation the “nice to dos” as must dos.”
A whole raft of ISO standards now set out expectations of good practice in these areas.
The key to triple bottom line thinking is to understand the positive and negative impacts a corporation, or any other organisation, has on the world – socially, environmentally and economically.
It is the assessment of this impact that has been the focus of much CSR work.
If CSR is about the impact made by corporations, then the next evolution of this thinking is about value, when in this decade a new concept called Creating Shared Value was defined in the Harvard Business Review.
In a 2011 article called “Creating Shared Value” Professor Michael E. Porter and Mark R. Kramer identified three ways in which shared value can be created:
Reconceiving products and markets – Defining markets in terms of unmet needs or social ills and developing profitable products or services that remedy these conditions.
Example: Becton, Dickinson (BD) – medical suppliers – developed a new type of safety syringe to reduce healthcare worker needle-stick injuries. This product innovation grew to $2 billion, approximately a quarter of the company’s revenue.
Redefining productivity in the value chain – Increasing the productivity of the company or its suppliers by addressing the social and environmental constraints in its value chain.
Example: By reducing packaging and improving delivery logistics, Walmart saved $200M in distribution costs while growing the quantities being shipped. Another example would be McDonald’s recycling of used oils from the kitchens to power their trucks.
Local cluster development – Strengthening the competitive context in key regions where the company operates in ways that contribute to the company’s growth and productivity.
Example: Cisco reduced a key constraint to growing its addressable server market by launching the Networking Academy to train over four million network administrators globally.
Shared value is not about redistributing value created through philanthropy or about including stakeholders’ values in corporate decisions.
Rather, shared value focuses on the creation of meaningful economic and social value – new benefits that exceed the costs for the business and society. This is about the role of the corporation in relation to society. A society which now has very different expectations.
The Shared Value framework defines a new role for business in society that goes beyond traditional models of corporate social responsibility. Rather than focus on mitigating harm in the company’s existing operations, shared value strategies engage the scale and innovation of companies to advance social progress.
At the same time, shared value offers new ways for other societal actors to engage with corporations in delivering social impact:
- NGOs can evolve their strategic priorities in order to more effectively partner with companies on shared value strategies
- Philanthropic and government bodies can find new ways to incentivize private sector investment in solving pressing social issues
- Investorscan gain insight into companies’ future growth and profit potential by understanding how shared value strategies address social issues that directly impact performance
- Individual practitioners, academics, and studentsaround the world can deepen the understanding and application of shared value within their companies, social enterprises, and academic institutions
While shared value is still early in the adoption cycle, the approach has been embraced by many of the world’s most respected companies, to address social problems at scale as a core part of their corporate strategies.
In summary, this is another HBR sourced analysis looking at the evolution of philanthropy through CSR to CSV. In this succession one does not replace the other. Each concept builds on and adds to the one preceding it.
So now we could find examples of activity in the business world which could still fit into each of these three classifications. There is still stand-alone philanthropy that is perfectly valid without it growing into CSR or CSV.
The key to deciding which of these is most appropriate comes with an analysis of the last concept on my list – Corporate Purpose.
The last concept to define – Purpose, is not so much concerned with what the corporation does but what it is and why it exists.
Corporate purpose tends to gain in importance most at a time of organisational transformation – following a change of leadership; following a merger and re-establishing and refreshing a brand.
These were key findings in Burson-Marsteller/PSB research into this subject carried out over a number of years.
My agency, B-M worked with a group of market leading global corporations and an external sustainability organisation (IMD). In the fifth iteration of the work in 2013 this finding leapt out from the survey involving these companies – that “40 % of a company’s reputation is determined by its purpose and 60 % by its performance”, and “that companies who deliver on purpose and performance are viewed as role models and are also more trusted.”
The inspiration for the B-M work started with the approach taken by the then new Chairman and CEO of PepsiCo, Indra Nooyi in 2007. She took a radical look at the way her company does business and introduced a “purpose driven business strategy.”
In an Economist article she was quoted as saying that “Performance with a Purpose is based on the belief that companies can – and must – achieve business and financial success while also leaving a lasting and positive imprint on society.” This represented an understanding of the three concepts we have already discussed being defined in terms of what the corporation stands for – why it exists.
Evidence increasingly demonstrates the ROI for companies whose corporate purpose and strategy take account of all their impacts on society be they supply chain, environmental, human rights, employee engagement or consumer concerns.
The Burson-Marsteller Corporate Purpose Practice was set up as a distinct offering to help clients navigate the challenge of identifying, implementing and communicating their corporate responsibility story by Identifying and developing Corporate Purpose, Auditing existing communications, Engaging with stakeholders (NGOs, employees, citizens, policy-makers, media, investors), and Reporting Developing EMEA-wide communications strategies.
One of the strongest influences on Pepsico was the thinking of Gurnek Bains and his “Meaning Inc.”
Drawing heavily on the ethos and behaviours of Tata in India, an old corporation with a strong sense of purpose in its DNA, Bains took a new look at the changing expectations of corporations and defined these four dynamics as a crisis of commitment, customer judgement, new ways of working, and societal attitudes towards business.
This was 10 years ago now in 2007.
Think about how the world has changed since then, and how trust in big business in particular has been damaged by events since.
The Meaning Inc thinking focused heavily on what we describe as Purpose and what I defined earlier as Shared Value. That concept of CSV was also at the heart of the Tata culture and as a very old institution, it has now served as a model for what some describe as the “21st Century Company”, one which is focused on achieving positive change in society.
The founder of the Tata Group, Jamsetji Tata, was one of the world’s first and most successful social entrepreneurs. Tata built a business empire that defined its purpose as creating both profits and social value. Tata, who died in 1904, said “In a free enterprise, the community is not just another stakeholder in business, but is in fact the very purpose of its existence.” Tata has described as “an allegory for entrepreneurial value creation.”
It is interesting to note that one of the best examples of a corporation committed to the fashionable concept of CSV is such an old one.
Some corporations may even go so far as to define their purpose in terms of the contribution they make to society. These are corporations established with a clear social purpose as their first priority – in the UK we call these Social Enterprises. They have different names in other countries.
Social Enterprise UK is the organisation set up as an umbrella for such new companies. They describe Social enterprises this way –
“Have you ever bought the Big Issue? Read it over a bar of Divine chocolate with a cup of Cafe Direct coffee? Watched Jamie Oliver’s Fifteen? Visited the Eden Project? Shopped at the Co-op? Well, then you already know a bit about social enterprises: businesses that are changing the world for the better. Social enterprises are in our communities and on our high streets – from coffee shops and cinemas, to pubs and leisure centres, banks and bus companies. Social enterprises trade to tackle social problems, improve communities, people’s life chances, or the environment. They make their money from selling goods and services in the open market, but they reinvest their profits back into the business or the local community. And so when they profit, society profits.”
In conclusion, and to pull these different aspects together, here is a reference I’d make would make to one of my “business bible” books – Simon Sinek’s 2009 book “Start with why.”
He formulated what he describes as the “Golden Circle” with the key insight that “People don’t buy what you do – they buy why you do it.”
The learning from the Golden Circle approach is – when you move from the outside of the circle inwards, you can only ever follow what others do. When you move from the inside-out you create a sense of meaning which is empowering for people and a differentiator for organisations and their brands.
Even just a quick look at the language here shows the origin of some of the early thinking on corporate Purpose, Shared Value and Social Responsibility.
A lot of critics of big corporations (and for that matter of governments) assume that they are led, managed and motivated out of greed and conspiracy. When things go wrong, the assumption is often that the nefarious activity was by design and the exposure of it was the corporation being caught out.
This was certainly the case for BP, Barclays and ENRON as illustrated on my earlier slide, although how culpable BP were in their crisis is a matter of debate. In Barclays and ENRON’s case there is no doubt.
In my experience however, things going wrong are much more often the product of cock-up than conspiracy. Nobody sat around a boardroom table and decided to do the wrong thing.
Much more likely is that they hadn’t realised they were doing the wrong thing.
Their culpability, and sometimes actually their crime, was not knowing.
Let’s take an example from real life. Imagine you are at your desk, the phone rings, it’s a new business opportunity.
A household brand name company is in trouble. They say they’re being accused of having something in their products which shouldn’t be there and although the press coverage has been light they expect this to go big, and – good news for you – they’re not happy with their current agency and hear we’re the “go to” people in a crisis. Good news (for us)? We talk to them some more.
They reassure us that the media haven’t got any evidence to back up their claims. We take them on as a client.
Then it’s the front-page story (or more likes breaking as news across social media). What do we do – apart from brilliantly manage the media and develop a world class crisis plan? What is the question we ask our new client?
The answer is to ask … IS IT TRUE?
But if the answer to us was that it was not true. And then that is shown to be untrue with further elements of the story breaking in different parts of the world and on different media in different ways.
Now, this is not a post to discuss crisis management, so not a place to go into what happens next, or happened as this is not a fictional scenario, it happened to me. My purpose in using this story here is simply to illustrate that good reputation is built on trust, trust that someone is telling the truth and that what they say is what they do.
A break down in or loss of that trust is often caused by a gap between those things.
This was the dilemma in each of those similar moments in recent years for FIFA, Barclays, Volkswagen and BHS.
Their bosses might be said to have suffered from a difference between their claims, the expectations of others, and the reality of what they were found out to be doing.
In cases like these, there are what can be described considerable “reality gaps.” This is a useful way of testing what people know inside an organisation and there why they think and act as they do.
Knowing is at the root of understanding corporate social responsibility. That “knowing” is the starting point for understanding corporate responsibility (CSR/CSV).
Back in pre-history when I was first working with McDonald’s in the 1990s I develop this approach to help the board understand why they had reputational challenges in some areas of the business and to start them thinking about their corporate social responsibilities.
We framed the question as the “4 Ps”.
These were –
- Purpose: why the company exists,
- Promise: what we say we do,
- Practice: what we actually do, and
- People: what people thought we did.
When these criteria were applied to a situation we looked for gaps between any of the 4Ps – these we called The Reality Gaps.
These gaps were what earned the company reputation – both good and bad.
Through implementation of the “Reality Gap” approach in McDonald’s at board level, we followed through with a number of “stakeholder group” sessions. The first was held in the UK and then across Europe in many other countries, with an EU dedicated session held in Brussels.
The idea was to bring in McDonald’s fiercest critics, and sit them around the table with CEOs and other top executives from the company and the with leaders of the franchisee community, to debate the reality gaps identified.
The sessions were facilitated by a neutral consultant, Steve Hilton then running an agency called “Good Business”, now better known as former guru to David Cameron and author of “More Human” (both books are thoroughly recommended). Steve wrote his first book, called “Good Business” drawing on a number of corporate case studies, McDonald’s being one of them.
The first issue put before the UK Stakeholder Forum meeting was McDonald’s use of battery farming produced eggs.
The issue had been raised first in the long-running “McLibel Trial” and then in a succession of activist campaigns and publications.
At a Forum it was raised by Compassion in World Farming and People for Ethical Treatment of Animals. Neither had started direct action against McDonald’s yet, but others had. The end result of these debates was a decision by the McDonald’s UK board to change it’s “sourcing” policy and to start the creation of a new free range egg supply chain.
Five years later when they were able to buy free range eggs 100% McDonald’s announced the switch to the world.
I use this example, although an old one now partly because it’s my story so you know it’s authentic, but mainly because I think it’s a particularly good example of a company deciding to be socially responsible by changing something which it’s stakeholders had attacked after reviewing their criticisms and deciding that the company agreed.
It was also a socially responsible act to restrain themselves from “PR-ing” the decision until they not only identified a “reality gap” but had closed it.
Arguably my McDonald’s eggs story is an example not only of corporate responsibility but ventures into the next evolution – creating shared value, because the immediate benefit was not for the company or brand, but for the hens.
In fact when McDonald’s made the switch customer research showed high disapproval ratings because people assumed that this was a ploy to put the prices up.
McDonald’s had acted in response to pressure from largely, if not wholly, non-customer stakeholders. It took a few years for customers to respond positively. In that time the issues landscape changed and free range became the norm expected for the industry broadly, not just as a quirky animal rights fringe issue. Arguably McDonald’s helped to change the industry itself.
A leading animal welfare campaigner told me at this time “we know McDonald’s is not the worst offender on animal welfare, but you are the market leader and a major brand. When we attack you, it puts the whole industry on warning and hopefully if you change, they will follow.”
I have however not described the egg story as CSV – because the societal benefit was not in our minds when we set out to make the change. We were trying to fix a reputation issue, get activists off our backs, and to act more responsibly. But the creation of shared value wasn’t then on the agenda.
Microsoft started from much the same place. Of course the Bill & Melinda Gates Foundation is the biggest philanthropic fund in the world – but that is their own money being given back. In addition to this Microsoft has grown it’s own philanthropic giving over the years and it’s contributions are significant.
They call this philanthropy and do not pretend it is anything else, or seek to “PR” it to say “look aren’t we great.”
They have kept this as quite distinct charity and other not for profit directed support activity. Microsoft characterise their “journey” this way. They started with what they call “naïve” philanthropy and aim to keep it that way – locally focused and un-strategic. Since the time I was there from 2005 this evolved into an increasingly business focused and more strategic approach.
What Microsoft terms “Corporate Citizenship” has since built into what is recognisably the creation of shared value.
This started in 2005 with the writing of a Corporate Purpose statement. Then identifying societal, environmental and technology trends. Mapping those to implications for public policy and the focus of governments and institutions. And finally creating ways to share value between the corporation, its people and wider society… the issue I’ve ringed here was the first prioritised for direct action…
This was the Microsoft Unlimited Potential Community Technology Skills Program. This took (and still takes) societal challenges like employability, workforce upskilling, and country economic planning – and relates core Microsoft skills, expertise and experience to the challenges – sharing value created by Microsoft freely with governments and local communities.
I attended the launch of the first of these programs which was in Cairo. I’m not sure Cairo would be such a welcome environment now. Then it was identified as a place where Microsoft could help girls in particular to get IT skills and to provide them with ways to help them into future IT jobs.
What lifted this activity from being philanthropy (in giving money and time), and corporate responsibility (by addressing a real societal need) was the way in which this then and since is seen as a way to the value Microsoft has created for itself as a business and to share it.
Another example of this, also involving Microsoft, and many other companies including BT, is the Internet Watch Foundation.
This is a powerful case of very diverse industry players uniting to work with government and law enforcement authorities to address a serious issue.
The challenge was the considerable criticism over the internet’s impact on the production and distribution of child pornography – and increasing demand for better web filtering and protection of children.
The Internet Watch Foundation was first established to provide the UK internet Hotline for the public and IT professionals to report criminal online content in a secure and confidential way.
Then it grew and over 110 companies worldwide supported the fight against online child sexual abuse content through the IWF.
Working with law enforcement, government, and international partners, the internet industry takes action to minimise the availability of this content online. The IWF must be one of the biggest collaborations of industry players and working together they have significantly impacted this issue.
The result is that governments and law enforcers now see the industry as part of the solution – not part of the problem.
In 2015, Burson-Marsteller EMEA launched a new study which, for the first time, identifies the key drivers of authentic corporate purpose.
‘Keeping it real – How authentic is your corporate purpose?’ developed with IMD business school, shows how companies can assess themselves to discover and define their corporate purpose.
The study, based on a quantitative survey and interviews with business leaders, shows a widespread understanding by business leaders that having a well-communicated corporate purpose is not enough to benefit reputation. It has to be real and authentic and embedded in corporate strategy.
This makes living an authentic corporate purpose a challenge as companies seek to balance short-term financial considerations with their long-term values and identity.
‘Keeping it real’ identified 12 drivers of authenticity, divided into those that relate to identity and those that relate to image. Drivers range from how transparent and open to self-regulation a company is, to its long-term orientation and consistency.
B-M can create workshops for clients using this methodology to identify their corporate purpose.
Having identified that purpose, it’s a priority to live up to it. Think back to my example of “Reality Gaps” and the way in which fine words can be lost in practice.
I referenced Social Enterprises earlier. Perhaps the best known and the oldest social enterprise in the UK is the Co-Operative Movement.
Perhaps the best and worst, contemporary example of a business with a clear purpose and then spectacularly failing to live up to it is provided by the Co-operative Movement in the UK and the recent scandals caused by financial mismanagement and the behaviour of the Co-Op bank and its successive CEOs.
The Co-op was founded in 1844 in the English northern town of Rochdale by weavers in local mills who became known as the Pioneers. They laid down eight principles concerned with democracy, participation, good governance and fair shares which governed the first retail shops. The Co-op expanded into other areas including funeral services for which it is perhaps best known. More recently it went into banking.
The Co-Op has a special place in both British political history has well. Since 1918 Co-Op Party MPs have sat in parliament. After 1927 they became Labour Co-Operative MPs. There are currently (August 2016) 25 Co-Op MPs and 15 Co-Op members of House of Lords.
The purpose for which the Co-Op was established is very clear and its reputation has until recently been stainless. In recent times they extended their operations from retail (and funerals) for which they are best known into banking as a “mutual society” and last year they were plunged into chaos when a £1.5bn financial hole was revealed in the banks finances following massive mis-selling scandals and in 2013 they announced first half losses of £559m.
This was followed by a series of scandals including the disgrace of their then CEO who is a Methodist preacher and turned out not only to have no qualifications for the job but have a serious drugs problem and followed by revelations that their new CEO had taken large bonuses as he was starting on a restructuring exercise when people would lose their jobs. He then resigned as well.
Lord Myners who headed the investigation into the debacle said “What I think I have exposed is that the Co-op is not a democratic organisation and has a deeply flawed governance structure… with shocking levels of debt, some of which was hidden by complex property deals.” It is difficult to imagine an organisation that has strayed so far from its founding purpose.
The strength and clarity of its purpose was the foundation for the Co-Op’s success and growth over 170 years. The betrayal of that purpose makes their fall all the more dramatic and shocking. A clear lesson that if you make promises you have to deliver.
When it is top of the agenda like that and when an organisation has such a clear purpose which helps to drive their performance, the single most important thing of course is that they have to live up to it.
Another example of the importance of living purpose once you’ve defined it comes from Google. Not a social enterprise, but one which has been known since its foundation for a strong sense of ethics and doing the right thing. At least until recently when their tax affairs have put them into the spotlight for all the wrong reasons.
Corporations with a strong sense of social purpose are damaged even more than others when the politicians say things like this about them.
A reason why corporate purpose as a whole and social purpose within it is so important to the success and sustainability of corporations in this decade and beyond is because there has been a very significant shift in the expectations of this and the next generation of employees, customers and other stakeholders.
It is well documented that the millennial generation is more purpose driven and a lot less loyal than its predecessors.
One leading survey of opinion in this field is the annual Deloitte Millennial Survey.
In 2016 it is titled: Winning over the next generation of leaders. It concludes on loyalty that Millennials, in general, express little loyalty to their current employers and many are planning near-term exits.
Deloitte comments in the report that this absence of allegiance represents a serious challenge to any business employing a large number of Millennials, especially those in markets—like US – where Millennials now represent the largest segment of the workforce. However, because most young professionals choose organizations that share their personal values, it’s not too late for employers to overcome this “loyalty challenge.” Forty-four percent of Millennials say, if given the choice, they would like to leave their current employers in the next two years.
A perceived lack of leadership-skill development and feelings of being overlooked are compounded by larger issues around work/life balance, the desire for flexibility, and a conflict of values.
What is of most interest in the context of this session is the finding that Millennials appear to be steered by strong values at all stages of their careers; it’s apparent in the employers they choose, the assignments they’re willing to accept, and the decisions they make as they take on more senior-level roles.
Deloitte conclude that the best way to recruit and retain people is to provide a sense of purpose. Here they really mean social purpose, but we can apply this more broadly to our subject today.
The survey finds that while they continue to express a positive view of business’ role in society and have softened their negative perceptions of business’ motivation and ethics compared to prior surveys, Millennials still want businesses to focus more on people (employees, customers, and society), products, and purpose—and less on profits.
Deloitte surveyed nearly 7,700 Millennials from 29 countries during September and October 2015 to learn more about Millennials’ values and ambitions, drivers of job satisfaction, and their increasing representation in senior management teams.
An awful lot of activity which people think is CSR or CSV is in fact just PR.
By saying “just” I don’t intend to demean PR work in any way at all but simply to draw a distinction between the doing and the talking, between the action and the communication. I also want to explain why PR is so important.
If we are talking about client programmes which are thought leadership surveys, product or brand positioning, stakeholder briefing, sponsorship or branding and the like – then these are public relations activities. They are usually offered to clients of PR agencies such as the one I work for as a way to achieve positive media coverage or influencer commentary.
When we showcase studies of such programmes and projects, the measurement is invariably media coverage – or hopefully influencer and decision-maker impact and behaviour change.
By contrast, CSR/CSV activities should not be measured by media coverage or other internal/external communication metrics which show who knows about it and how favourable they are.
The right measurement for CSR/CSV is not a communications metric at all – it should be a business and societal one, measuring the change that has occurred and the difference made through the business practices and policies of the corporation – not through special or one-off activities designed to create publicity.
In the examples I gave earlier, the McDonald’s free-range egg policy should not be measured by media coverage, customer opinion or sales statistics, but by metrics which show improvements in animal welfare.
In the Microsoft IT skills example, the measure should not be branding of, or favourability to the company, it should be the number of young people upskilled and the number getting into jobs they would not have without the action by Microsoft.
Where PR comes into this is in communicating the story.
As an agency, Burson-Marsteller is able to counsel executives and leaders to understand and find their purpose, to help organisations develop corporate philanthropy, CSR or CSV work to take their business forward – and then – to “PR” it so the world knows about it.
Thinking back to the examples referenced at the beginning of our session, the important thing to understand about CSR/CSV is that this is not “doing some CSR” to make a problem go away or even worse to cover it up.
When I started my career in PR this was not an uncommon request from both internal (employers and colleagues) and external “clients.”
When the crisis storm was raging, the request from across the boardroom table was quite often to “get PR to fix it” or “make it go away.” My view back then and even more strongly now is that CSR is not a mere tool for PR. It is not a “sticking plaster” to help organisations out of a crisis. It is not something to be done to balance out bad deeds with good ones.
Over recent decades – the 30 or so years in which CSR has been seriously on the table for discussion by corporations, many organisations moved from Trust Bank and “License to operate” thinking, to embrace CSR in this way and have embedded it into the way they do business.
A few have gone further and have realigned their whole business strategy to support the ethos of Creating Social Value (CSV). This is not necessarily the way for every company.
It is of course a requirement if they are a Social Enterprise or if they are driven by a Co-Op or Tata style legacy and heritage, but a company can still be considered to be a good Corporate Citizen and to be socially responsible without going this far.
The key determining factor is to define a clear Corporate Purpose which expresses the clear meaning of the why the organisation exists.
It is crucial to be able to ask that existing or potential client (or an employer) the right questions – informed by an understanding of each of these concepts: philanthropy, responsibility, value and purpose.
Because in each case these are something that a corporation does not merely have or do, it is something they have to be.
When asked if an organisation has or does CSR, my answer is always to pose another question back – is the company socially responsible? CSR is not something you do, it is something you are (or not).