Posts tagged ‘Corporate Social Responsibility’
One corporation can make a difference. Can’t it?
I struggle with this question much like I struggle with the idea that one person can make a difference. I firmly believe one person or one corporation can make a difference. I have to. Otherwise, much of what I do, personally and professionally, would be for naught. When I am pressed on this belief I must acknowledge that it is my assumption that many others are also taking similar actions and thus collectively my actions, or a corporation’s actions, can make a difference. In essence I have faith that my actions are scaled up by the collective actions of many.
Alas, I am a scientist so my faith leads me to exploration and research. Fortunately as a research fellow with the NorthStar Initiative for Sustainable Enterprise I have the opportunity to research the scaling up of sustainability. To date we do not have an example of a particular sustainability action that has been scaled up globally, across sectors and countries. At NorthStar we have begun exploring the idea of globally scaling up a sustainability action through our research into financing energy efficiency improvements in global supply chains.
We are partnering with a company that is working with upwards of 10,000 factories to identify energy efficiency improvements, aggregate them and link them with large global investors. We are examining who all is involved in this financing of a “saved kilowatt hour” including the supply chain factories, the retail parent companies, energy service companies, financial institutions, etc. By scaling up one factory’s energy efficiency improvement project(s) to a portfolio of many factories’ energy efficiency improvements, large scale global investors can finance sustainability and institutionalize a system of global aggregation of sustainability actions.
Our financing a “saved kilowatt hour” project is only in its infancy, but once we have an understanding of what it takes to finance a “saved kilowatt hour” we can expand our research to explore a “saved gallon of water” or an “adverted toxic ingredient”. We can ask questions such as how to aggregate these sustainability actions? And whether the global financial world will provide the financing? This will then give a resounding “YES!” to the question of whether one corporation can make a difference.
In the meantime, I’d love to hear from you: Does your company have an aggregation story of a sustainability action occurring in your supply chain? Or all your worldwide offices? Perhaps you know of a global, cross-sector sustainability initiative that we have missed?
Dr. Jennifer Schmitt is a postdoctoral research fellow with the NorthStar Initiative. Her research is broadly focused how sustainability initiatives lead to improvements in environmental and social metrics. You can contact her at firstname.lastname@example.org.
Like millions of other football fans, I watched the Super Bowl earlier this month. Much was made of the story of Giants coach Tom Coughlin. Coughlin had been in the hot seat all season and it was widely perceived that his job was in jeopardy if the Giants didn’t make the playoffs. The story recounts how Coughlin did not waver in his coaching and management style throughout the season, despite the circumstances.
I think the real story about Coughlin’s management style happened a few years ago, after one of Coughlin’s initial years as Giants coach. He came to the Giants with a track record of success in both college and the pros. However, one of his first seasons with the Giants was not a good one and their season ended early. Instead of looking at his past achievements and pointing blame at others, Coughlin did just the opposite. He brought in players and asked them what worked and what did not work during the season.
He then took the input he received and adapted his management style to better reflect the team he was working with and his situation. He adapted his style to the situation – which is why he had the confidence to hold firm for this season. He knew his management style was the right one for his team. The results are clear: Two Super Bowl wins in the last five years.
Adaptive management is something that EHS professionals get quite proficient with throughout their careers. As service providers within our organizations, often times just as we start hitting equilibrium, then things change. We see new regulations, reorganizations or new interpretation of the rules. As companies and the general public become more sophisticated about environmental issues and sustainability, our role frequently changes from being an information source and reacting to situation to serving more of an advisory role and being proactive.
This lesson was brought home to me the following week during a meeting with my team. I had asked them during a breakout session to identify the greatest lessons learned during 2011. More than one group came back and shared that they had learned the necessity to interact and communicate with different internal and external clients in a more proactive way. They were learning to adapt their communication styles based on the information needs of the clients, and therefore, were able to address issues more clearly and efficiently. They consciously changed their style to communicate better and more fully to their clients.
To a certain degree, I think we all adapt our management style to changing conditions. But how many times do we examine our style and see if deeper changes are warranted?
Megan Lum, P.E. is the Director of Environmental Operations at Pacific Gas & Electric Co. In this capacity she is privileged to lead a team of about 30 professionals, who provide environmental compliance support for the company’s gas and electric distribution, fleet, materials management and real estate operations. She is a member of NAEM’s Board of Regents.
By Jim Spahr
Global Environmental Manager
As a college student in the early 90’s I thought I was in good shape as a communicator. I was pretty social for an engineer (nerd) and I wasn’t afraid to get up and speak in front of a large group. So, when I started my first job as an environmental engineer at a paper mill in the Deep South, I never expected communicating would be a problem. I was wrong. And I would learn some valuable lessons about cross-cultural communications.
First of all there was the language barrier. Yes they were speaking English but with that wonderful southern drawl. I love a southern accent but there’s a big difference between talking football and discussing a complex manufacturing process. I had to keep asking people to repeat themselves. Add to that the cultural differences and I was quickly developing a reputation as “that rude Yankee who don’t hear so well”. Luckily I gained a mentor who was both an engineer and a fellow northern transplant. Through him I learned the importance of learning the local culture, utilizing local resources and adapting for success.
My mentor explained the importance of small talk in the South. When you need data or information from someone you don’t dash off an email with: “Please provide x, y and z, by next Friday”. You walk down the hall to their office and you start off by asking them about their kid’s Little League team or how they hit the ball on the golf course last weekend. I was accustomed to the norms of the metro northeast; “Tell me what you need, tell me when you need it and I’ll get to you.” I could imagine how this new approach would have gone over when I was a co-op working in Pittsburgh.
Me: “Hi Bill, how’s your day going.”
Me: “How’s your son’s baseball team doing? Did they win on Saturday?”
Bill: “Why are you here and what the heck do you want?!?”
Yet it worked like a charm at the paper mill and although, as a Yankee, you can never be accepted as a true Southerner, at least I was considered a nice Yankee. I even starting using “y’all” every once in while.
Later in my career when I was tasked with supporting the construction and startup of a manufacturing plant in India this lesson in learning the culture would pay dividends. Before the project got underway I used the Internet to research Indian history, culture and business etiquette. I spoke with my Indian colleagues about the similarities and differences. I even boned up on the national sport, Cricket, and followed the performance of the local team. All of this paid off as I was able to develop good working relationships with the local staff and I avoided most of the pitfalls that tripped up some of my American colleagues on the project.
Now, as a Global Environment, Health and Safety (EHS) leader, I’m tasked with implementing corporate policies across multiple cultures. The lessons that I learned through my earlier experiences led me to three keys for success in working across cultures.
- Good translations: Google Translate might work well when you’re trying to decipher an email but don’t count on it for important documents. If you’re lucky, you may have an internal resource who is fluent in English and the local language but even this is risky. For important documents, always use a reputable translation service. They have multiple layers of verification to ensure your translations are accurate and complete. As an additional safeguard, even when I use a translation service, I always have an internal native speaker of the target language review the translated materials.
- Use local resources: While it’s important to do your homework, no amount of internet research can replace the insight to be gained from developing relationships within your business. Regions within a country and even business cultures from plant to plant can vary widely. Having a network of trusted colleagues across all locations will help you avoid mistakes. A good network can help you test ideas, develop local plans and facilitate projects.
- Adapt to the local culture: Different does not mean wrong. When working across cultures, a one-size-fits-all approach is a recipe for failure. Balancing the need for a consistent approach to EHS programs with the realities of local differences is critical to the success of your program. When developing global polices, standards and initiatives, I always try to leave as much flexibility as possible without compromising the imperatives of employee safety and environmental stewardship.
Utilizing these three keys to success is not always easy. This approach requires that you work with each region or site to develop their site-specific implementation plans. It also places greater importance on verification through internal auditing. But if you put in the effort the rewards will be many. Sites will take owner ship of their EHS systems. You will see faster adaptation to revised or new initiatives. Flexibility allows sites to develop creative best practices that can be shared across the organization. And in the long run you will see continuous improvement in your EHS performance.
At times it’s been difficult, but as I’ve gained experience and learned from my mistakes I‘ve come to treasure working in different cultures. It has enriched my personal life and has made me more effective as an EHS professional. I hope that when you encounter similar opportunities you will embrace them with open arms and an open mind.
Jim Spahr is an Operations EHS leader with 19 years of experience working across borders and across cultures to improve safety, health and environmental outcomes. His main areas of interest and expertise are Management Systems, Sustainability and International EHS Management. His passions are skiing, backpacking and spending time with his family (not necessarily in that order). You can reach him at email@example.com and connect with him at http://www.linkedin.com/in/jspahr
For more of Jim’s cross-cultural communication resources, please visit the Emerging Leaders group in NAEM’s online community.
As we turn our sights toward our upcoming sustainability conference in Atlanta, we sat down this week with keynote speaker Samantha Putt del Pino, Co-Director of Business Engagement in Climate and Technology at the World Resources Institute, to discuss her perspective on where sustainable business is heading.
GT: How would you describe the state of corporate sustainability, worldwide?
SPP: It’s hard to think about global business homogeneously. There is a wide range of environmental performance, even among those companies that ascribe to sustainability principles. On one hand, sustainability isn’t nearly as engrained into core business practice as we would like it to be. Some companies have not set themselves a very high bar for what it means to be sustainable. These are the companies that see sustainability as more of a niche issue, something that can help with public relations or to engage select customers.
But on the other hand, I think we are starting to see something interesting among leading companies, and that is the shift from using sustainability as short-term defense to using it for long-term offense. These companies see sustainability as essential to their long-term competitiveness. For example, some companies are aggressively investing in sustainable products and services and are seeing their revenues grow. Many have set revenue targets reflecting expectations of future growth. We also are seeing some companies factor sustainability into their mergers and acquisitions strategy, making decisions that can improve the company’s capacity to fulfill its sustainability objectives over the longer term.
GT: The World Resources Institute (WRI) is working on a new research project focused on the “Next Practices” in sustainability management. Why are best practices no longer the gold standard?
SPP: In today’s fast-changing, competitive landscape, we see an urgent need to innovate beyond best practices. Best practices are still important: Companies have made, and can continue to make, significant improvements in their environmental performance by pursuing best practices. However, companies can do more to understand how big trends, such as climate change or water scarcity create new risks and opportunities, and will shape the markets of tomorrow. Companies that proactively implement smart strategies today can gain an edge, both in terms of preparedness and in terms of accelerating progress, towards a sustainable future.
GT: What are some of the future forward issues U.S. companies should begin learning about (if not planning for) today?
SPP: There are several challenges companies face when looking for the next big sustainability issue. First, there’s no crystal ball. So, how do you anticipate future needs without trying to predict the future? Second, too often the “hot topic” of the day will shift with the political winds. How can you make a case for long-term sustainability issues if your colleagues are scrambling to address issues that come and go on a quarterly basis? And third, issues must be understood in terms very specific to each company. How do you engage your colleagues to understand big changes in the context of your company’s specific strengths and weaknesses?
These are the types of questions we are working to answer with partner companies in WRI’s Next Practice Collaborative. Many partners have told us they want to understand what other sustainability leaders see as issues of rising priority, such as water risk, life-cycle sustainability impacts, or ecosystem degradation. Oftentimes, the issue itself (like climate change) may not be new, but a new, more transformative approach is required.
WRI and its partners are working on a tool kit to help companies sort through the possibilities and connect these opportunities and threats with their core competencies. That can go a long way to making the case for action on issues on the horizon, or for tackling an existing issue with renewed innovation.
GT: Based on your knowledge of how corporate sustainability comes to fruition, what role do you think the individual leader can play in driving progress within an organization?
SPP: The most successful corporate sustainability professionals act as catalysts. They facilitate collaboration and generate excitement inside and outside the organization. They are the ones who can make a really good case to the company’s leadership for investments in bold sustainability strategies. This means making a solid business case and showing how investments create big opportunities or address big risks to the company.
Samantha Putt del Pino is co-director of Business Engagement in Climate and Technology at the World Resources Institute. As part of the Next Practice Collaborative, she works with companies to foster the transformative approaches needed to quickly close the gap between today’s best practice and the pace and scale of the climate challenge. She previously led WRI’s U.S. Climate Business Group, a cross-sector network of 36 Fortune 500 companies that developed strategies for companies to thrive in a carbon-constrained economy including building internal support for corporate climate change strategies, exploring emission reduction opportunities and technologies, and navigating the dynamic climate policy landscape. She will share insights on the state of sustainable business at NAEM’s 2012 Sustainability Management Conference on March 7-8 in Atlanta.
Stories about Henry Ford’s genius with manufacturing abound, though it’s rarely clear which ones are actually true. One of my favorites is his insisting that parts manufacturers deliver their products to his plants in wooden crates of his design, which he then dismantled and used as floorboards in his cars.
Supply chain management has grown in sophistication and importance since Ford’s time. The quality movement, just-in-time manufacturing, corporate responsibility initiatives, enterprise-wide information systems, environmental impact analyses like life-cycle assessments, and growth in transparency and public access to information have all brought about major changes in supply change management. Now a new design revolution is about to create an even bigger change in supply chain thinking. The change will come both from new materials and products and from new manufacturing technologies.
Radical new materials and products (such as the ones we feature in the dMASS Insights newsletter) will themselves disrupt traditional supply chain relationships. For example, there are composite materials that exhibit behaviors with the potential to replace mechanical appliances, tools, and other machinery – even entire factories. There are materials that can be used to generate electricity by movement, temperature differences and solar energy conversion. Others have the ability to interfere with the growth of harmful bacteria, actively transfer heat or emit light with minimal energy subsidy. The cumulative effect of new materials and products will be shorter and simpler supply chains.
New manufacturing technologies will be at least as disruptive as the products themselves. Nano-scale manufacturing technologies such as Additive Layer Manufacturing (including 3D printing) and bio-manufacturing (the growing of products) stem from recent advances in the scientific understanding of how nature organizes itself at the most fundamental levels of matter and energy. Similarly, biomanufacturing stems from new discoveries in the fields of genetics and micro-organisms. The common thread among each of these technologies is a growing knowledge of nature’s tendency to self-organize, and an ability to leverage this knowledge.
Three-dimensional (3D)printing, in particular, has the potential to drastically cut resource demands, costs and dependence on resource-intensive supply chains, as well as pollution and waste. Advanced computer-aided design (CAD) systems bring design down to the level of individual molecules. The entire downstream supply chain for a 3D-printed product can be a set of printer cartridges containing different chemical elements. When laid down in precise proportions, the atoms arrange themselves into material structures with the desired characteristics. Printing can often be done in small shops, portable facilities, or even in the home. There is little or no need for high-temperature smelting in parts manufacturing, high-speed grinding or stamping that produces manufacturing scrap, or glues, adhesives, staples, rivets and other parts to hold separate pieces together.
Henry Ford’s tactic saved resources a century ago by creatively taking advantage of existing supply chain resources and harvesting value from waste. Nano- and bio-technologies will radically transform supply chain management in a new way. Business success will increasingly require understanding these technologies and taking advantage of the changes they will bring about.
What are your thoughts? Have you begun to experience supply chain changes due to commodity prices or supply problems, or due to the availability of new materials, products, or technologies?
Howard Brown is a noted entrepreneur and the founder of dMASS.net, an organization focused on helping businesses improve resource performance. For more than 20 years, he was CEO of the consultancy RPM Systems, Inc. (Resource Planning and Management), where he worked with companies such as International Paper, Mobil, BP, Duracell, Avery- Dennison, Whirlpool, SaraLee, and Wrigley, earning a worldwide reputation for developing practical strategies that merge environmental and business goals. To learn more about dMass, visit: http://www.dmass.net/wordpress/
As part of NAEM’s 2012 Member Appreciation Week, we sat down with members of the NAEM Board of Directors to chat about trends in environment, health and safety (EHS) and sustainability management. Featuring Kelvin Roth of AMCOL International Corp.; Sandy Nessing of American Electric Power Co. Inc.; Pat Perry of CVS Caremark; and John Reichling of CDM Smith.
Recognized by PR Week as one of America’s top three most-important business rankings, Corporate Responsibility Magazine’s “100 Best Corporate Citizens List” evaluates companies on 325 corporate social responsibility data points. This week we caught up with Elizabeth Boudrie, Vice President of Research for SharedXpertise (parent company of CR Magazine) to learn more about the methodology behind the ranking.
GT: With all the rankings out there, why should companies pay attention to this one? What makes this ranking unique?
EB: From a methodological standpoint, this is an audit versus a survey. One of the frustrations that I think a lot of people have in the corporate responsibility (CR) space is that “We get so many surveys, we have to pick and choose which one we’re going to do and we’re not going to do yours.”
We have to explain to people that it’s an involuntary audit—you don’t have to fill anything out. What we do is the IW Financial folks go and look for essential 325 data elements that are publicly disclosed for all Russell 1000 companies. There are a few data elements that are performance -based, but for the most part they’re disclosure-based. I think that the biggest way [the ranking is different] is that it’s very broad. We’re looking really across a broad spectrum of issues as opposed to others that are very specifically oriented to environment, social and governance (ESG), human rights or specific issues, versus our seven different categories.
GT: How did you come up with those categories?
EB: We have a methodology committee comprised of industry folks and academics and folks who together help us oversee the direction of the data elements and the whole process. And back when they originally started the process – I think this is the 13th year — they looked and said, “Ok, what are the main categories that we think make sense, that we think should be important?” And these are the categories that they came up with.
And over time, we continue to review them. They’re weighted differently based on how important the collective group thinks they are and over time we continue to review them and believe that these are the categories that do capture a broad picture of corporate social responsibility (CSR).
GT: And 2012 is the 13th year for the ranking?
EB: Yes. 2012 will be the 13th annual list.
GT: In the absence of widely agreed-upon performance metrics, I understand that many rankings currently rely on transparency as a proxy for progress. Is this the best way to evaluate companies?
EB: I think all of us would love to get past disclosure as the main determinant of ranks– and we do have some elements within our 300-some-odd data elements that are performance-based — but it’s predominantly disclosure-based. There aren’t enough people who are disclosing enough as it is. We have lots and lots of companies who disclose next to nothing out of the Russell 1000. We think of disclosure as the low bar, but if it’s the low bar there are a lot of people who aren’t stepping over it yet. So from that perspective, there’s still a long way to go.
The other issue is that with so many different companies doing so many different things, it’s very difficult to find a reasonable performance standard that you can apply across company size, across company industry, across company type. And I think everybody is still struggling to find out what that is in every ranking. So I think it’s a reasonable proxy for now because it’s the best we can do but I don’t think anybody’s happy with that forever. And I think everybody’s looking for a better way.
GT: What does transparency tell you about a company?
EB: Transparency maybe doesn’t tell you everything, but a company certainly doesn’t talk about things it’s doing poorly, typically. To us the willingness of a company to be transparent indicates strong management, a willingness to be self-reflective, to understand what’s going on within their environment—both within their own environment internally as well as externally– and it just demonstrates connection to what’s happening in the world right now. I think they’re recognizing over time that people are more interested in exactly what’s happening and that means being transparent about what’s happening with your organization, whether that’s your human rights record, whether that’s your impact on the environment, your philanthropic giving, all the categories we might address.
GT: How many of your top 100 companies are ‘repeat achievers’? How much turnover do you see year over year?
EB: It changes a fair amount. The turnover changes over time, which sort of depends on the changes in the methodology, the data set. We try to limit that so there isn’t so much impact, but there can be an impact. One of our data categories is financial performance and with the recent economic downturn that really impacted some folks. So there can be some churn.
GT: How often do you update your methodology?
EB: We try to take an evolutionary versus revolutionary approach. You’d hate to see 80 percent of the list change because it wouldn’t be meaningful…Ultimately what we’re trying to do is drive people to be as transparent as they can be. So ultimately if a company is being even more transparent in 2012 than 2011 we don’t want to penalize them randomly because the methodology has changed. So we’ll try to be very careful in doing that. What you’ll find is because it’s a comparative methodology a company can do exactly what they were doing the prior year and still fall in the ranking if other companies are doing better.
GT: How does the audit process work?
EB: IW Financial, as part of their process, sends out a correspondence file, which is an opportunity for a company that they’ve audited to review the file and make sure that everything is accurate. We’ve added a separate, additional review for companies that are potentially going to be ranked so they can have a second review.
GT: When does the ranking come out?
EB: In the Spring. This year it will come out in early April.
GT: What is the circulation of Corporate Responsibility Magazine?
GT: Is the ranking publicly available information? Or is it sold?
EB:The ranking is public. And free.
Elizabeth Boudrie is Vice President of Research at SharedXpertise, where she oversees all global research efforts addressing topics such as corporate responsibility, and transformation and outsourcing of business processes. She will share more information and answer more questions about CR Magazine’s “100 Best Corporate Citizens List” during the NAEM webinar on Jan. 24.