The Council defines Corporate Responsibility as a company’s belief that the true measure of its wealth is directly linked to its efforts to better its employees and the communities in which it does business. Actions driving corporate citizenship are fluid and effortless as they are embedded in the organization’s value system. While many companies’ CR efforts started with a focus on environmental sustainability, this is only one aspect of CR. A holistic approach to CR embodies consistent work in the following areas: Diversity & Inclusion, Environmental Sustainability, Governance, Global Enrichment, Organizational Health, Philanthropy, and Supply Chain Integrity.
Diversity & Inclusion
In order to be effective, Diversity & Inclusion (D&I) ‘programs’ cannot be treated like ‘programs’. A healthy appreciation for differences is simply a part of doing business today. Differing points of view and opinion is crucial to workplace success as differing opinions, points of views, and ideas can make a company more dynamic and able to adapt to an ever changing work world. Those companies that insulate themselves from a diverse workforce only serve to insulate themselves from a larger pool of ideas that could ultimately benefit them. The D&I conversation extends far beyond issues of race, ethnicity, and gender, however. Companies that are leaders in this realm are proactively addressing business dynamics caused by: the aging workforce, generational differences, sexual orientation, creative solutions to disability accommodation, and diversity of thought and communication styles.
Many of the most successful companies in the world employ a diverse workforce throughout the company, understanding that a diverse workforce is one that understands the market in which it sells its product or services. Companies such as PepsiCo and AT&T are highly successful due in large part to their diverse workforce and inclusive atmosphere or business. As these companies have shown, being a good corporate citizen is good business.
At its core, Environmental Sustainability is about the creation of harmony between humans and our earth. It is the commitment to utilizing the earth’s resources in responsible ways that ensure our planet survives and endures. Many organizations are leading the way for sustainability through the creation of eco-villages, minimizing pollution creation and output, research into green technologies, decreasing their carbon footprint, and developing viable sources of renewable energy.
Tesla Motors developed and produces and a line of cars fueled exclusive by electricity and serves as a good example of environmental sustainability. By devoting their company to the development of alternative fuel sources for cars and actually producing a viable option for emissions-free travel, Tesla Motors shows corporate responsibility through environmental sustainability.
A staunch commitment to Global Enrichment is a key aspect of mature corporate citizenship in the 21st century. Many organizations are investing in villages and communities far beyond their domestic operations. These programs are empowering people to create a better way of life for current and future generations. Through the establishment of foundations, many businesses are playing pivotal roles in the enrichment of human life through the funding of research to cure diseases and the championing of human rights causes.
An organization known as Fair Trade is a good example of a global enrichment initiative. Fair Trade aims to encourage businesses to deal fairly with their suppliers and workers, mostly in Third-World nations, by giving farmers and producers a wage higher than what is normally given to them. Often time’s poor farmers and workers abroad are paid lower wages by foreign companies in order to make a higher overall profit; businesses that follow Fair Trade initiatives instead pay wages equal to what a western farmer would receive for the same product, thereby enriching their local communities with much needed funds. This business practice, in turn, makes Fair Trade businesses more appealing, both to Third-World farmers and workers, and to foreign investors and consumers. A responsible, fair company is an attractive company, and that is what global enrichment is all about; good corporate citizenship is good for business.
Governance is the way in which a company chooses to do business. So while a formal policy book, mission statement, and code of ethics provide insight as to what a company values, governance reflects how leaders enforce those values. Policy is the talk; governance is the walk. Effective governance serves to drive high levels of performance, encourage trust at all levels of the organization, and sustain an environment of servant leadership and employee empowerment.
Governance is highly important because without proper governance corporate citizenship initiatives may and will often fail to take shape. Corporate citizenship means nothing without the enforcement of a company’s policy and value system by devoted leadership across the board of a company. With proper governance, corporate citizenship initiatives within a company can take shape and begin to make a difference.
Companies that have been consistently rated as “best places to work” have higher market values and employee morale, along with lower than average employee turnover. The Council for Corporate Responsibility defines Organizational Health (OH) as an organization’s ability to grow and thrive while making the needs of its employees and community its first priority. Companies with strong Organizational Health have environments that encourage trust at all levels of the organization, and embrace the precepts of servant leadership.
As a best practice, The Council recommends that OH assessments are conducted on an annual basis. While every company may have uniquely tailored OH assessments, the areas of measurement are similar. They include: 360 communication effectiveness, employee morale, unilateral support of company mission and values, team work, availability of resources for success in current position along with access to promotional opportunities, coaching and mentorship support, visible execution (and leadership support) diversity & inclusion, work life balance programs, encouragement of community involvement, and a health and wellness focus that emphasizes whole living*.
*Whole living is the extension of traditional healthcare benefits provided by companies through programs designed to impact the mind, body, and spirit. Whole living is supported at work and home. Increasingly common workplace examples include healthy food options during meetings, smoking cessation and weight loss programs, ergonomic support, innovative work life balance programs inclusive of unique child care, elder care, and pet care options.
Philanthropy in its simplest form is a financial contribution to a cause. Philanthropy is important to companies as a means to not only improve the community around them but to make the companies appear more attractive to business investors and consumers; good corporate citizenship is good for business, and any company that is socially responsible and gives back to its community is seen as being a preferred choice for consumers. Today, the gift of money is often matched or surpassed by the gift of time. Community outreach should be connected to the core values and competencies of the company, and systematically evaluated, assessed, and communicated to stakeholders. The Council routinely recognizes businesses and individuals that actively seek to provide creative solutions for community needs.
Supply Chain Integrity
Responsible supplier choices are critical to every business. While a healthy supplier diversity program is important, supply chain integrity is more comprehensive. It involves the extension of the company’s values and high performance standards to those it chooses to do business with. These companies hold suppliers accountable for safely producing quality product, while complying with applicable laws and exceeding standards related to human rights and environmental sustainability. Many companies are working with farmers to develop responsible growing practices, and have an unprecedented commitment to the use of natural, organic product ingredients that are safe and beneficial.
An example of what happens when supply chain integrity fails is the recent poisoned Chinese toys scare. In mid-2007, several Chinese-made products, including children’s toys, were recalled from the market due to high levels of lead contained in the product. Somewhere down the line the toy manufacturer’s supply chain integrity failed as the supplier of the toys did not follow safety regulations and ignored the dangers to human life. Supply chain integrity works when a company monitors where their supplies come from and do not ignore laws and regulations designed to safe guard the public; protecting consumers while providing a safe product should be a golden standard in the minds of a company’s leadership and employees all the time, always.
A good example of supply chain integrity can also be seen in Fair Trade initiatives, mentioned in the Global Enrichment pillar. Fair wages to poor farmers not only enriches their community but makes better business sense as workers will most likely wish to work for a company that pays out higher wages rather than low wages.