THE MOVEMENT
There is a growing worldwide movement afoot with no name, leader or headquarters. Found in every city, town and culture, it organizes from the bottom up, is extraordinarily creative, flies under the radar and includes Nongovernment Organizations (NGOs), village-based organizations, foundations, churches, institutes, citizen-based groups and more.
This movement directly addresses social justice and environmental issues and is estimated to comprise more than 1 million organizations, populated by more than 100 million people. Collectively it constitutes the single biggest citizens movement.
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TAKING ACTION
Activist NGOs are the “trained militia” serving this global civil society, yet businesses often turn a blind eye, or take note too late, learning the hard way that external engagement – particularly with opinion-forming NGOs – can devastate their corporate reputation. But by welcoming their advocacy they can actually enhance and protect corporate interests. This is especially true in the digital age of activist blogs, e-mails, and video that goes viral around the world in mere seconds. The result Consumer boycotts of your products, damaging public media campaigns and sometimes protests at your facilities. However this happens, corporate executives must face the issue head-on, accept that a campaigning NGO with public credibility has the means to bring much harm to a company’s brand and reputation and educate themselves on how to respond should they elect to target your company’s operations.
ENGAGEMENT
Leadership companies no longer see stakeholder engagement as an option, but as a critical part of their business strategy. In many cases, companies are using the opportunity to enter challenging markets, resolve or head off confrontations with activists, and understand where business and SUSTAINABILITY strategies ought to be headed. This interaction often requires significant amounts of time, money, and other resources, and may require a level of openness, disclosure and collaboration, which your company may be unaccustomed to or find uncomfortable. However, if you are operating in the global market, you’ll find that whether you like it or not you must engage with activists, be it in conflict or consensus.
WHERE TO BEGIN
How can companies work more effectively with NGOs and how can NGOs recognize the ways that business can help them accomplish their goals.
STEP 1: Open Up Dialogue Early
Face-to-face interaction and the ability to develop individual relationships with NGOs is the most effective approach to rebuilding the trust and credibility of a company. This important first step will get a dispute out of the public domain, out of earshot of customers, employees and policy makers who will be paying attention and could misinterpret the situation.
Don’t be blinded by the company’s closely held ideas. Invite and involve those with differing perspectives. It doesn’t take much if you’re in a listening mode, intent to fully hear the concerns of all stakeholders.
STEP 2: Accept that NGO's are Savvy
Don’t underestimate the information and expertise an NGO has about the company’s business and product sector.
Know that they have done their homework about the company, are knowledgeable about the industry and are prepared to go the distance.
STEP 3: Understand Global Culture
Consider and integrate crucial national differences such as how the roles of business, government, religion, culture and other important institutions are viewed in different countries.
STEP 4: Consider All Issues
Nothing is off the table. Affirm and acknowledge stakeholders’ legitimate and heart-felt demands, even if later they are limited by what the company can and cannot undertake.
STEP 5: Get Help From Experts or Organizations
Affirm and acknowledge stakeholders’ legitimate and heart-felt demands, even if later they are limited by what the company can and cannot undertake.
STEP 6: A Word of Caution
Before engaging with an activist group, do your homework. Find out more about the organization, its programs, its mandates and what it regards as its bottom line. This will help determine whether potential exists for a long-term, mutually beneficial relationship.
Likewise, NGOs should learn your business: where it operates, what risks and opportunities there are in the supply chain and how, by working together, they can be part of creating great change. The key is, start talking (and listening); learn about each other, and build trust. With any luck, groundbreaking strategic partnerships will emerge.
HOW TO GROW YOUR BUSINESS WITH SUSTAINABLE RESOURCES IN MIND
Sustainable Development, Corporate Social Responsibility, Sustainability and Environmental Footprint Reduction are all hot current topics for discussion. But what do these issues really mean for your business? Depending on your industry, the best way to address these issues will differ. Whether it’s chemical manufacturing, agribusiness, grape growing, winemaking or coffee farming, there is a common thread: respecting and addressing the social, environmental and economic needs of the communities in which you operate, while ensuring benefits for other stakeholders (employees, customers and investors).
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At SBI we are passionate about improving the world and believe that private enterprise can, and should, be a major and effective player in this. So what can you do to make your business more sustainable? It starts with one thing, commitment. Commitment to…
- what the company buys
- whom it buys from
- what it manufactures
- who makes the product(s) and
- Social and environmental practices throughout the chain.
- To assist in determining materiality, the formation of a sustainability report review committee is crucial. Committee members should have expertise in: labor, human rights, environmental, social, economic and diversity issues.
- A materiality assessment for what should be included in your annual sustainability report means identifying issues that reflect your company’s significant economic, environmental and social impacts, or substantively influence the assessments and decisions of stakeholders. In this process, consult a variety of resources, both internal and external. They should include:
- papers on company objectives, strategies, policies, programs and risk factors
- employee surveys and input gathered through various other feedback mechanisms
- customer-contact feedback
- shareholder resolutions and anecdotal feedback
- input gathered through stakeholder dialogues
- informal input from suppliers
- media coverage and blog discussions of company issues
- stakeholder feedback about the company’s past sustainability reports
- Global Reporting Initiative’s Guidelines,
- Reporting is not an end in itself. It is only useful if it discloses publicly and formally how your sustainability strategy includes corporate action and facilitates change.
MATERIALITY & CORPORATE RESPONSIBILITY
Materiality is a concept within the auditing and accounting fields where information, taken on the basis of financial statements could influence decisions of investors, regulators and suppliers. According to international accounting standards, information is “material” if its omission or misstatement in financial statements could influence the economic decision of these users.
Materiality depends on the size of the item or error judged in the particular circumstances and whether a reasonable person, relying on this information, would have been influenced by the omission or misstatement. Thus, materiality provides a threshold or cut-off point to guide companies in making decisions about what information to disclose.
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The main driver for discussing materiality in the context of sustainability is the increasing importance of sustainability reports. Studies indicate that publicly reporting social and environmental performance issues keeps a business on its toes: the process of building a public report is the single most important driver of change in how these issues are managed, because it increases organizational knowledge, facilitates reflection and transforms policies and practices. Under the annual deadline for submitting metrics and numbers for a sustainability report, the business manager focuses on the commitments made the year before and the pending public disclosure of how things have improved or not.
However, transparency and the communication of material information are not confined to an annual sustainability report. A materiality assessment is equally critical in setting a company’s sustainability strategic direction.
SANDRA TAYLOR: The Shaping of Corporate Social Responsibility
As the recipient of the 2015 Johnson Institute Exemplary Leadership Award at the University of Pittsburgh, Sandra Taylor’s career is the subject of a case study used to teach sustainability leadership at the graduate school level: University of Pittsburgh Case Study Series | Fall 2017. “The widely used term Corporate Social Responsibility (CSR) refers to an enlightened philosophy about a corporation’s responsibilities to the public.
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In general, CSR embraces the notion that corporations need to be proactive, not just reactive, in improving their impact on society.
For maximum impact, a vibrant CSR program must be embraced by top leaders in the organization and fully integrated into the firm’s mission, operating values, and business strategy. The CSR philosophy invites corporations to create ways to simultaneously meet their own business goals while doing what is right for communities, nations, and the world in which they work.
SEE MORE here: Johnston Institute
THE FUTURE IS NOW
At SBI we help companies reduce their environmental footprint and develop valuable relationships with communities and stakeholders, no matter where they are on their journey. Whether you are a recent entrant/adopter of sustainability priorities or want to be a sustainability leader, SBI can provide guidance and work closely with you to:
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- Develop a viable corporate responsibility and sustainability strategy
- Engage with community leaders, activists and employees for the good of all
- Identify opportunities for corporate giving, strategic philanthropy and social investments
- Design communication tools including sustainability and sustainability reports aligned with your business goals.
An essential first step in sustainability strategic planning is to identify the material issues that senior management must consider in order to minimize environmental risks and maximize opportunities. A first-rate strategy provides a structure for managing all sustainability challenges and impacts, and puts responsible practices at the core of business planning. This includes supply chain accountability, environmental impact assessment, governance, stakeholder engagement, social community commitments and transparency.