In 2010 Accenture produced a report in collaboration with the United Nations Global Compact titled, "A New Era of Sustainability: CEO reflections on progress to date, challenges ahead and the impact of the journey towards a sustainable economy." The major finding: that 93 percent of the 766 CEOs believed that sustainability will be important or very important to the future success of their company. That's the good news. The challenge is the reality of operationalizing this critical business strategy. As the report stated, "There are major gaps between CEO ambition and execution."
More good news: companies and brands of all kinds, in regions around the globe, recognize that they can no longer just make products and services and sell to markets. With globalization, instant communications, the power of social media enabling everyone to become "citizen" consumers, and expansive social and environmental challenges, commitments to sustainability, purpose, citizenship, or whatever we call it are here to stay.
The types of social/environmental engagement that companies and brands engage with fill a spectrum of actions. These range from short-term, marketing-driven, socially related promotions to long-term shared-value systems "that exploit the market in addressing social problems," says FSG principle Mark Kramer.
For the sake of moving the conversation along, let's not get stuck in the terminology. I've been doing this work for over 25 years and believe that there will be no clear winner in the nomenclature. Instead, let's take a look at the maturation of this business-social nexus and share some advice as to making efforts more effective.
From where I sit, we are in the middle of a typical adoption bell curve. In the earliest days the pioneers -- The Body Shop, Ben & Jerry's, Seventh Generation, Tom's of Maine, and Innocent Drinks -- were birthed with social/environment DNA coursing through them as they mirrored their founders' evangelism. They were small but mighty in their models of a new way to do business and engage with stakeholders.
Next were the early adopters, larger private companies and corporations with founders who felt that social and environmental responsibility was a critical to their visions. These companies included Home Depot, Timberland, Starbucks, Hasbro, Interface, Natura, and Target. They were purpose-driven in their evolved business models to deliver a triple bottom line of people, planet, and profit.
Next the early majority: companies that saw the benefit of social engagement for differentiation, relevance, and employee morale. They heard of the various terms -- sustainability, cause marketing, purpose, and citizenship -- and saw that engagement with social/environmental issues could put wind at their backs; inspire colleagues through product, policy, and market innovation; and even in some cases heal sullied business reputations. These companies included Avon, Walmart, Nike, P & G, Pepsico, and Tesco.
As "markets" mature, we now enter the vast middle of the bell curve, where the majority of companies touch upon this business strategy, knowing they must, but with diffuse commitments. These companies have been to the conferences, likely have CSR or citizenship reports, have done some cause marketing and employee volunteerism, even advertised initiatives, and have vibrant Facebook pages. They have high expectations, but results similar to those experienced by early adopters, and even the early majority, elude them. Why?
First, institutional will. (Ask my colleagues: it's my favorite phrase now.) Simply put, purpose/sustainability initiatives must be driven from the top of the organization, with a firm commitment to authenticity, investments, innovations, focus, and outcomes. Without institutional will, candidly, "the dog won't hunt!" Our recently released goodpurpose study found that consumers are calling for business leaders to genuinely embed "purpose" into their everyday operations:
- 56 percent believe CEOs need to create innovative products that are socially responsible
- 55 percent believe CEOs need to make a long-term commitment to address societal issues
- 55 percent believe CEOs need to publically support societal issues
Next: focus. Organizations in the middle of the curve often have tried too much with too little, suffering from diffuse actions (commitments to every social area: education, health, arts/culture, social services, youth development, the environment), with insufficient resources (human, financial, and in-kind), limited or non-existent stakeholder engagement and measurement systems, a siloed approach, and tepid communications. Does this sound familiar?
There are four major actions that can be taken to improve performance.
- Integrate. Move closer into the business by breaking down silos and building a cross-functional team to recreate strategy.
Start with a multi-faceted senior executive team to analyze core business and stakeholder needs. Is relevance the issue? Authenticity? Product innovation? License to operate locally and abroad? Analyze current initiatives and elevate those that can be aligned with business objectives.
- Renovate current programs with a clear focus derived from the hard analysis gained from the cross-functional team. Remember that "focus is your friend." Do a lot more with a lot less.
- Activate across multiple channels: NGOs and governmental partners, supply chains, citizen consumers, employees, local communities, on- and offline engagement, one-to-one, one-to-many. Build robust opportunities for employees, as they are your brand ambassadors. And please educate and activate them first.
- Communicate. Unfortunately, most initiatives do not break through. In our 2012 goodpurpose global survey, on average, only 6 percent of consumers in 16 countries worldwide could name, on an unaided basis, companies that had extensive social/environmental commitments -- yet 80 percent of global consumers say it is important for companies to make them aware of their efforts. You have permission to communicate, so make the most of it.
From Edelman's 2011 Trust Barometer, it takes three to five messages to believe in a communication. In today's world of communications bombardment, organizations need to tell their story uniquely tailored to key channels. We call this "transmedia storytelling," where stories are told in different fashions in four communications arenas: from social media (such as YouTube and Facebook) to hybrid media (such as The Huffington Post and CNN.com) to traditional media and a company's own communications channels (websites, videos, and mobile applications). Well-told stories can reverberate through these channels to gain higher levels of search-engine placement and captivate and engage audiences.
Citizenship. Purpose. Sustainability. Shared value. While there will always be a debate on the name of this practice, a well-developed business-social nexus strategy will align and propel organizations, public and private, large and small, to deepen relationships with core stakeholders for long-term organizational success.
Carol L. Cone is Global Practice Chair of the recently launched Edelman, Business + Social Purpose, the eighth global practice at Edelman, the world's largest public relations firm.