In the coming week, a number of high-profile events in New York will focus on corporate social responsibility (CSR), sustainability and "shared value." The United Nations Global Compact (UNGC) Leader's Summit kicks off first, followed by the Annual Meeting of the Clinton Global Initiative (CGI) and the Social Good Summit. It's a week when world leaders and organizations are grappling with the daunting, exciting task of taking stock of global development goals and setting a new agenda moving toward 2030. Participants and observers will have the opportunity to witness both sides of CSR at work: amplification and action.
On the side of amplification will be communicators who hope to make corporate investments in "good-doing"' more broadly recognized. On the side of action will be NGOs, governments and forward-looking businesses seeking partners for "doing good." Both amplifiers and those taking action have different roles to play. Yet they are united in their pursuit: to make sustainability relevant, impactful and within reach. As of today however, their partnership isn't getting the job done. Change and adoption on a mass scale are a planet away.
My firm's research suggests that the time is now to widen the net to focus on the mass conversion of key stakeholder groups that are, more than ever, necessary to embed sustainability into businesses: investors and purchasers/consumers.
Consider the following:
- 58 percent of respondents across 26 countries in the Edelman Trust Barometer believe business integrity (ethical business practices, taking responsible actions to address an issue and transparency) is the second most important driver of trust. At 59 percent, engagement comes in first.
- 48 percent of respondents in the same study rate purpose (protecting the environment, addressing society's needs in everyday practices and partnering with NGOs and government to address societal issues) as the fourth most important driver of trust.
- 48 percent of consumers across eight countries in a study we will release next week say shared values (transparent sourcing, giving back to communities, not compromising my principles and sharing my beliefs to help the world) is the most important behavior they seek from brands they buy and recommend.
The question is how do we convert this interest to action? I propose an Engagement Manifesto, a three-step call to action for business and organizations and those they serve.
Step 1: Make the Investor Case to Capital Markets. We need to demonstrate that businesses can be competitive and profitable, yet meet society's needs. We are well-armed to do that, with evidence from the U.N. Global Compact and, "The Consequences of a Culture of Sustainability on Corporate Behavior and Performance" (Eccles, Ioannou and Serafeim, 2011), as well as recent reports from Accenture, MIT Sloan School of Management and the Boston Consulting Group, among others. The information in these reports is crucial. Even more so, however, is ensuring that decision makers across the investment community see the cause-and-effect value of their evidence -- and act on it.
Step 2: Engage Consumers in Their Language and on Their Terms. A new report from The World Economic Forum and Accenture says that fewer only 28 percent of consumers know what the words, "sustainable," "responsible," and, "green," mean. Therefore to build awareness and secure consumer participation we must engage them with authentic, involving and persuasive storytelling. We need to overcome their perception that sustainability is for elites only by demonstrating how it relates to their lives. We need to talk about value and quality in simple, down-to-earth language. Finally, we must use both word and deed to convince them that business is their partner on the road to sustainability.
Step 3: Invite Investors and Consumers to the Table Because Companies Can't Do It Alone. If we want to truly change behavior, we must engage both investors and consumers in a consistent and compelling manner. We can accomplish this by using dynamic approaches to collaboration that source input from these stakeholders and can lead to new products or solutions that advance progress in sustainability and promote economic growth. We need to foster open and transparent dialogue with investors to address the competing pressures of short-term corporate performance and long-term sustainability benefits to grow markets responsibly around the world."What we're really talking about is the virtuous cycle that comes from making money in ways that strengthen communities, improve the wellbeing of customers, replenish natural resources, etc.," FSG's Mark Kramer, the co-father with Harvard's Michael Porter of shared value, wrote to me in an email last week.
The premise is easy to understand. To make progress, we have to move from enthusiasm and acceptance to broad-scale engagement. The Engagement Manifesto is a roadmap for more inclusive action. The business world is ready to make this kind of bold move to embed sustainability into the mainstream. The world's most urgent challenges require greater commitments, innovations and more diverse actors -- financial and human. And, in our connected world today, perhaps most importantly, customers and communities have made it clear that engagement is part of the world they expect and demand from all of us moving toward 2030.
These profits are better because they ultimately feed back into the business and improve its operating conditions over time. Subprime mortgages may give you short-term profits, but if people can't pay back the loans, you're undermining your future business. So, too, if you make food products that make people unwell.
This week is a celebration of progress and discussions regarding deepening efforts and scaling solutions for the future. We encourage the UNGC, the CGI and their members to extend their efforts and vast resources to engage investors and consumers to finally bring them onto the playing field. There is so much to gain.