Today’s companies face substantial pressure from stakeholders—both internal and external—to monitor and report on a variety of environmental metrics. The benefits to the company are clear, as research shows that successfully managing a company’s environmental footprint can strengthen a firm’s financial performance[i], help them maintain that performance over the long term[ii], improve the company’s image,[iii] and identify and mitigate potential risks to operations.[iv]
The following is excerpted from The State of Corporate Citizenship 2017. To learn more about how you can prioritize the corporate citizenship issues that are most important to your stakeholders and business context, consider joining online from February 20-April 17, 2017 for our Materiality: Determining Priorities for Corporate Citizenship Strategy and Reporting course.
While the 2017 State of Corporate Citizenship shows a declining interest in formal stakeholder engagement among executive respondents, engaging with both internal and external audiences can be an important component of any corporate citizenship program. Through stakeholder engagement, companies can fully understand their social, environmental, and economic impacts, and prioritize the issues that are most important to both stakeholders and their business context.
Many companies, like CBRE—the world’s largest commercial real estate services firm—use the insights they gather from stakeholders to inform a materiality assessment, creating a roadmap for more strategic time and resource allocation, and more comprehensive reporting.
Who matters most: shareholders or the people? Around the world a revolt seems under way. A growing cohort—perhaps a majority—of citizens want corporations to be cuddlier, invest more at home, pay higher taxes and wages and employ more people, and are voting for politicians who say they will make all that happen. Yet according to law and convention in most rich countries, firms are run in the interest of shareholders, who usually want companies to use every legal means to maximize their profits…executives fear that they cannot reconcile these two impulses. Should they fire staff, trim costs and expand abroad—and face the wrath of Donald Trump’s Twitter feed, the disgust of their children, and the risk that they’ll be the first against the wall when the revolution comes?... Or do they bend to popular opinion and allow profits to fall, inviting the danger that, in the run up to their 2018 annual general meeting, a fund manager…will topple them for underperformance?
Schumpeter, "Six sects of shareholder value," The Economist, January 21, 2017
All corporate citizenship work is about change. Every environmental or social investment made by a company is about using the assets of business to change our operating context for the better. This should be a no-brainer, right? Isn’t any change for the better, well…good? The rhetoric put forth in The Economist’s Schumpeter column earlier this month presents with wry humor a range of six corporate responses to the question it proposes and highlights the conflicts that arise from competing social and economic perspectives.
Helping communities rebound from a traumatic event or natural disaster requires multi-level and cross-sector effort. There are immediate needs to be met—such as trauma support—and in the case of extreme weather events—food, water, and shelter. To make the most of their disaster relief programs, corporate citizenship professionals must partner internally and externally to make the best possible use of all available resources, from community involvement efforts like corporate giving and volunteering to more operational activities like security, logistics, and supply chain management.
Disasters, no matter what their scale, have economic ramifications in addition to the social and environmental consequences. According to the United Nations Office for Disaster Risk Reduction, wildfires, floods, droughts, and other natural disasters were responsible for more than a trillion dollars in economic damage in 2015 and that number is only expected to increase as climate-related natural disasters become more frequent.
Since 2003, the Boston College Center for Corporate Citizenship has examined in the State of Corporate Citizenship study how executives view corporate citizenship and their firms' performance in the environmental, social, and governance dimensions of business. Over the past 14 years, we’ve seen executives come to fully appreciate the vital role that corporate citizenship plays in achieving key business goals.
Each year, the Corporate Citizenship Film Festival provides companies with an opportunity to demonstrate how they have utilized video as a tool to communicate their environmental, social, and governance efforts. In this year’s competition—sponsored by FedEx—companies are showcasing how they are making a positive impact in communities on their corner and around the world. Community involvement, economic development, and environmental stewardship are just some of the topics which were touched on by the 2017 participants.
The following is excerpted from a recent issue of The Corporate Citizen. To learn more about how you can connect with essential partners to make the most of the risks and opportunities present throughout your value chain, consider joining online from February 20-April 17, 2017 for our Integrating Corporate Citizenship Through Your Supply Chain course.
At EILEEN FISHER, the vision for fashion’s future is an industry where human rights and sustainability are not the effect of a particular initiative, but the measure of a business well run. To achieve this mission, the women’s clothing company has created an ambitious new model, entitled “Vision2020,” to guide the way in which their products are sourced and produced—and has ensured that its tenets are embraced at every level of its supply chain.
“To improve is to change, to be perfect is to change often.”—Winston Churchill
Investment in a stable and prosperous society is an investment in future business performance. We’ve seen corporate commitment to this ideal in action during the development and ratification of the 2015 Paris Agreement, the adoption of the Sustainable Development Goals (SDGs), and in the fight for U.S. marriage equality. More and more, companies are vocalizing their support of environmental, social, and governance (ESG) issues—and are executing strategic plans to create the change they know is required to achieve a sustainable economy.
The emerging U.S. policy agenda could make the work even more challenging than it has been for the last decade. Especially if it is in conflict with the policies of global market economies in which your company likely operates. So what is to be done? Cling tightly to your coffee mug that reads, “stay calm and carry on” and do just that. There is overwhelming scientific consensus that climate change is real and human induced and socio-economic research that underscores the social ills that accompany inequality. The companies that have the courage to be among the first to make real commitments to improving the environmental and social conditions in their operating environments are the ones that have the opportunity to use those commitments as positive differentiators with institutional investors, customers, and the general public.
At the Boston College Center for Corporate Citizenship, we have been busy finishing the analysis of our 2017 study on the executive perspectives about corporate citizenship, and expect the final report to be released in January 2017.
The Center has been surveying executives and reporting on the role of corporate citizenship in achieving business success in our State of Corporate Citizenship study since 2003. Over the past 14 years, much has changed. The global economy has recovered from two historic recessions, markets have become increasingly connected and electronic, and the threat of climate change has come to the forefront of popular consciousness.
Every year, the Boston College Center for Corporate Citizenship holds the International Corporate Citizenship Film Festival to celebrate not only the great work that companies are doing to achieve social, environmental, and business value, but also the creative methods in which they communicate their efforts. Public voting for the 2017 Film Festival—presented by FedEx—is now open. Vote for the winning video before February 17, 2017. Winners will be announced during the 2017 International Corporate Citizenship Conference, held in Boston on March 26-28.
For the 2016 competition, the Center introduced competition categories for the first time to recognize a wider selection of terrific programs. The award ceremony, sponsored by Mary Kay Inc., was held during the 2016 International Corporate Citizenship Conference in Atlanta. There, Kirsten Gappelberg, director of corporate social responsibility & sustainability at Mary Kay, shared the mindset that enables her team to create award-winning videos that increase engagement around their signature cause—domestic violence.
From left to right: Jamie Mercurio of athenahealth, Catherine McGlown of Humana, Chandra Gruber of St. Jude Medical, and Sarah Andersen of Thermo Fisher Scientific.