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Four Emerging Trends in Corporate Social Responsibility

Alison Monahan | Thursday March 15th, 2012 | 1 Comment

Emerging Trends in CSR (SXSW)TriplePundit is at SXSW this week, bringing you the latest thinking on CSR, social media, and more.

New Media and CSR: Communicating Corporate Good, moderated by TriplePundit’s very own Nick Aster, identified four major emerging trends in Corporate Social Responsibility in a free-wheeling discussion between:

It’s CSR 2.0 — rife with risks but full of opportunities.

Here’s the bottom line:

ONE: Your brand is decreasingly under your control
In the brave new world of social media, your brand is decreasingly under your control. You can publish all the fancy CSR reports you want, but it only takes one ill-timed (or ill-considered) tweet to generate a firestorm of negative publicity. What’s a company to do?

You’ve got to be in the game, engaging with stakeholders and addressing the tough questions. Hard to stomach, perhaps, but, as Seventh Generation’s Chris Miller put it, “To sit it out is more risky than playing.” The goal, according to Mitch Baranowski of BBMG, is to hold space for a conversation about your brand. The sustainable brand of the 21st Century, he says, has three dimensions: practical usefulness, a beneficial social and environmental dimension, and a tribal dimension that connects people to shared values.

To tell a 21st century story about how you’re solving 21st century problems, you need 21st century tools. For interesting examples, Dale Hart of Methodologie suggests Coke’s “Arctic Home” project, and RecycleBank.

But, like it or not, the tools of CSR 2.0 require an often unpredictable dialogue — not a simple broadcast message. Which leads us to the second trend.

TWO: Transparency is terrifying, but authenticity is the reward
All the panelists agreed: Complete transparency is terrifying to companies. They’re simply not used to it, and the lawyers really, really hate it.

Too bad. As Alcatel-Lucent’s Christine Diamente noted, people want to know where their products are coming from, and companies can’t hide. If you don’t provide it, they’ll get the information somewhere else. Do you want your customers to find out about the working conditions in your factories on Frontline? Probably not.

Ironically, being transparent — even about your faults — can lead to increased stakeholder engagement. For example, Patagonia’s “Footprint Chronicles” provides useful information on the environmental pros and cons of different items. It’s generated great buzz, and customers love it. It many ways it’s highly transparent, but inevitably it leaves some things out. What’s the total carbon footprint of the company? Who knows? But I can see a cool video of the childcare facility in their Mexican factory, and find out how far my new jacket traveled to get to me!

While Patagonia’s approach isn’t completely perfect, it’s great at connecting the back story to the brand story, a tactic endorsed by Baranowski. Of course, you can’t put lipstick on a pig, but you can increase your perceived authenticity by being generally transparent about your good stories, and your bad ones. (In other words, be “Flawesome” — awesome by exposing your flaws.)

Fine, you say. That’s all well and good for a company like Patagonia that takes pride in their sustainability. My company’s not based on those ideals, and we’re not going to deal with this transparent CSR 2.0 stuff!

THREE: CSR is a business imperative
If that’s your attitude, it’s time to reconsider. As several panelists noted, CSR is a business imperative.

  • Potential partners want to work with a sustainable company for wholly practical reasons: to save money via decreased resource consumption and to avoid the potential for damaging bad publicity.
  • Employees want to work for a company that’s making a difference, and, when the company is under attack, they need relevant information so they can advocate on the company’s behalf.
  • Potential employees look to CSR reports and other information to get a sense of the corporate culture. They’re reading the reports and asking hard questions — before coming on board.
  • Finally, dialoguing about the tough problems with stakeholders can generate good solutions from the crowd. At Alcatel-Lucent, Diamente revealed, it’s not just about “being good” — it’s about stepping up to solve hard problems, and asking for help (internally from employees or externally from customers and other stakeholders).

FOUR: CSR pressure is increasingly bottom up, not top down
As you can see from several of the preceding examples, the pressure for CSR 2.0 isn’t necessarily coming from the top. It’s bottom up, from increasingly engaged and vocal stakeholders.

How can organizations manage this new pressure?

Baranowski offered several suggestions:

  • Don’t silo CSR communications from other corporate communications. It’s important to have a unified voice across the company.
  • Your CSR reporting needs to be dynamic. A static report generated once a year isn’t sufficient to respond to constantly changing conditions.
  • Your message should be one of shared values. It’s about the stakeholders, not just about the company.
  • Consider a shift to “company AS cause,” not “company PLUS cause.”
  • Pay more attention to engagement and empowerment, and less to information and education.

Diamente further emphasisized the importance of really listening. To formulate their CSR strategy, Alcatel-Lucent used an internal social network to solicit solutions from thousands of employees. The suggestions were compiled, and employees were asked to weigh in again on what the company’s top priorities should be. After this discussion, three key areas were selected, which form the basis of Alcatel-Lucent’s current sustainability strategy. The result: engaged employees who feel like their concerns are being addressed.

Similarly, customers who care about CSR are twice as likely to reward a company for their sustainability activities. However, they’re also twice as likely to punish a company when they’re disappointed.

It’s a new world out there, and companies have to engage. If they don’t, someone else will tell their stories for them!

*****
Alison Monahan is a web developer, turned lawyer, turned entrepreneur. She runs The Girl’s Guide to Law School and co-founded the Law School Toolbox. You’ll find her on Twitter at @GirlsGuideToLS.


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