MARCH 2008
3/24/08. Disclosure: Gap, Nike, Timberland, Stonyfield, Now Patagonia, CSR Wire. With a website that tracks and discloses “the good and the bad” in Patagonia’s supply chain, the Footprint Chronicles builds on a other companies’ moves to transparency. Patagonia, like its predecessors, exposes the problems in hopes of partnering with its customers to create solutions.
- Gap in its 2003 Social Responsibility report set an early high water mark in transparency by disclosing violations of its Vendor Code of Conduct.
- Nike in its 2004 CR report took the next step of disclosing the names and locations of all its contract factories worldwide.
- Timberland's 2006 “Our Footprint” labeling program took a major leap forward by disclosing the environmental and community impacts of its products (as well as the factory where they were manufactured) right on the packaging, like nutrition labels on food. The next year, Timberland unveiled its Green Index labeling, which went further by disclosing climate impacts, chemicals uses, and resource consumption associated with its products.
- Stonyfield Farm in 2007 funded Climate Counts, a nonprofit that rates carbon emissions reduction strategies of companies on a 100-point scale (Nike came in second place with a 73, Stonyfield sixth with a 63, and Gap 25th with a 39--Timberland wasn’t rated.)
- Patagonia’s Footprint Chronicles borrows elements from all these initiatives, combining transparency (listing distance traveled as well as where its products are manufactured, CO2 emissions, waste generated, and energy consumed) with accountability (“The Bad” section admits its organic cotton supplier produces 95 percent conventional cotton.) In so doing, Patagonia is seeding the next generation in corporate transparency and accountability. Comment: The danger for the brands is that identifying suppliers and shortcomings opens them up to attack. It's easier to do if the brand is small and already identified as having a social mission. It's harder for Gap and Nike, which are much larger brands that were not historically built on a social mission.
3/20/08 MSN Money Joins the Call for a Credit Card Revolution. Citing tough new laws in the UK limiting what banks can charge for credit cards, Liz Pulliam of MSN Money calls for rolling back fees that are far above bank costs and time periods for repayment that are unreasonable. Comment: One writer says it all: "The party is over."
3/20/08 Starbucks CEO Warns of Tailspin, Commoditification, Reuters. Noting that the country is facing an economic "tailspin," Starbucks Corp (SBUX.O: Quote, Profile, Research) nonetheless outlined plans to turn around its U.S. business with new coffee machines and a rewards program. Investors didn't see it, and shares fell another 4 percent after a 40 percent drop during the last year. CEO Howard Schultz said there was no "silver bullet". The most recent quarter was the first quarterly fall in company history. Schultz returned as CEO in 2008 promising to reverse "commoditization" of the brand. Comment: The Starbucks idea is terrific but even terrific ideas reach a saturation point.
3/18/08 Target's Inner Circle, Fortune. Target continues to open about 100 stores a year, a feat made easier by the fact that it has thus far managed to avoid the barrage of bad press Wal-Mart has suffered. In part, that's because of Target's very public philanthropy (no good deed goes unpublicized here), but it's mostly because Target will never be the biggest target - Wal-Mart is six times its size. "Bentonville is a behemoth," Ulrich [Target CEO] says, with a wink. "We're just a nice, modest, little, average [company] trying to get to a reasonable scale so that we can take care of things for our guests and give them good value." Yet some have noticed that both Target's and Wal-Mart's average pay in Minnesota, for example, falls below the $12.24-per-hour that advocacy group Jobs Now calls a living wage. "We feel they are worse than Wal-Mart because they are masquerading as this benign employer," says Bernie Hesse, director of special projects for Local 789 of the United Food and Commercial Workers Union in St. Paul, which has unsuccessfully tried to unionize local Target employees (no Target employees are unionized). "They have gotten this pass because they have set up this foundation and have this chic look, and that's more cruel than Wal-Mart. Wal-Mart doesn't pretend." Comment: One moral here is the value of not being #1 in the industry sector.
3/17/08 Nestlé Releases Its First "Creating Shared Value" (CSV) Report, (CSRwire) Nestlé has  launched its first Creating Shared Value report, including new figures on the impact of its business activities on the environment and society across the world. In 2007, Nestlé reduced its direct greenhouse gas emissions by 16% compared with ten years ago, and its overall water withdrawal by 28%, while at the same time increasing the total volume of goods produced by 76%. In 2007, Nestlé invested more than CHF 100 million in environment-related industrial improvements, as well as around CHF 170 million in new production facilities in Brazil, Pakistan and China. The company also continued to provide free technical assistance to more than 600,000 farmers in the developing world, including CHF 30 million in micro-credits. The report was reviewed for accuracy by Bureau Veritas. Comment: A few years ago at Davos, the Economist Magazine celebrated Nestlé (which has long been a target of campaigners) as the lone holdout against CSR. The Economist has become more friendly to CSR in 2008 (CSR reporting is now increasingly becoming a matter of law as well as public expectation in Europe) and so apparently has Nestlé. CSR, CSV - a rose by any other name would smell as sweet. Contact: Nestlé. More information: CSR Profile for Nestle, CSRWire.
3/13/08 In the Game of Business, Playing Fair Can Actually Lead to Greater Profits, Knowledge@Wharton "The Apprentice" shows wannabe moguls trying to impress Donald Trump by preening, cajoling and conniving. The boss glories in firing people and squeezing every penny out of suppliers. But John Zhang and Jagmohan Raju, Wharton marketing professors, and Tony Haitao Cui, a University of Minnesota marketing and logistics professor, argue people aren't purely mercenary in their business dealings. They care about fairness, and doing so can maximize their profits. A manufacturer and a retailer can both end up making more money by setting prices equitably in their joint marketing channel as opposed to maximizing individual profits. The professors’ paper was published in Management Science as "Fairness and Channel Coordination." Comment: John Rawls attempted to reduce the concept of justice to one of fairness. Perhaps ethics is boils down to the same idea that is understood early in life in the kindergarten playground.
3/11/08 The State of SRI, CSR Wire. The Social Investment Forum (SIF)’s biennial report on trends in socially responsible investing (SRI) concludes that in 2007 SRI assets rose to $2.7 trillion, an 18 percent increase from $2.3 trillion in 2005. This increase was six times the pace of all managed investments. The report was covered in the WSJ, On Wall Street, GreenBiz, Pensions & Investments, and Financial Planning. Support for proxy resolutions on social and environmental issues rose to a record 15.4 average, from 9.8 percent in 2005.
3/10/08
More Shoppers Want to Buy Green, Edie. Retailers at Green Retail '08, a two-day UK event to help businesses address sustainability issues heard research by Ipsos Mori showing concern about the environment peaked in January 2007, when one in five people in Britain said it was one of the most important issues facing Britain.
3/7/08 Financial Women Say Glass Ceiling Still There, Crains New York. In a survey of the more than 250 members of the Financial Women’s Association, based in New York City, 96 percent say that they get paid less than men for comparable work. On the eve of International Women's Day, women are still getting shortchanged. Since the original protest on March 8, 1857, women have come a long way, but have had to battle for every step.
3/5/08 B Corporations, Inc Magazine. B corporations are social ventures - businesses with a social mission - that are certified based on a stakeholder approach in their articles of incorporation and a point system similar to LEED. They must achieve 40 out of 100 points on the B Rating System and pay 1/10th of 1% of revenue to B Lab. Two other rating similar systems are WISER and REVEAL. One difference between the B corporation and the certifications of SA8000 or Rainforest Alliance is that the B Corporation certificate is for the company whereas SA8000 applies to a facility (factory, farm, store) and Rainforest Alliance applies to a product and its source (farm), Comment: The hard part will be to get this information in front of the public. A start is being made at Shopping for a Better World.
3/5/08 How Companies Think about Climate Change. McKinsey Quarterly. Of global executives surveyed by McKinsey Quarterly, 60 percent regard climate change as strategically important, and a majority consider it important to product development, investment planning, and brand management. Comment: It’s encouraging to get this feedback that executives are keeping up with the news and that environmental issues are now part of the corporate bottom line. It was not always so.
3/4/08 CRO (Corporate Responsibility Officer) Conference March 27 in NYC. Attendance better than ever for CRO conference. CRO is meeting at the Union League Club in New York City. Comment: The organization is indeed growing fast and the motivation may be as much risk mitigation as a wish to save the world. But there is a respectable school of thought that it is less important what our motives are than what we do.
3/3/08 Unilever, P&G War Over Which Is Most Ethical, AdAge. The latest battleground may be the most surprising and intriguing -- a race to show who's best at saving the world. Comment: It is important that the rules of this race – the “ruler of responsibility” by which the winner is measured – be a good one.
3/2/08 Measuring Companies with a Ruler of Responsibility, Social Funds. Intel claims the top position in CRO (Corporate Responsibility Officer) Magazine's list of 100 Best Corporate Citizens 2008. The list highlights the top performing large-cap companies for their responses to environmental, social and governance (ESG) issues. This marks the second year that CRO has published the list and the ninth consecutive year the list has appeared. CRO partnered with IW Financial, a provider of ESG research and analytics, to compile the list. CRO and IW Financial looked at eight categories of corporate responsibility for the 2008 list: Climate Change, Employee Relations, Environment, Financial, Governance, Human Rights, Lobbying and Philanthropy. Comment: Some of the rankings shifted widely since 2007. Big companies don’t change that fast – what changed was the ruler. One difference between 2007 and 2008 is that environmental factors were weighted more heavily in 2008.
FEBRUARY 2008
2/26/08 100 Best Corporate Citizens List, CSR Wire. The List has migrated from advocacy-leaning Business Ethics to industry-leaning CRO--short for Corporate Responsibility Officer after Marjorie Kelly sold the magazine to Michael Connor who sold it on to current publisher Jay Whitehead. The sleection of companies has moved from KLD Research & Analytics, which covered companies in its Domini 400 Social Index (DSI) as well as the S&P 500 and Russell 1000, to IW Financial, which dropped DSI companies, which are smaller. Questions have already arisen about the inclusion of Monsanto (over child labor in India), Coca-Cola (over ground-water depletion), and Dow (over its Union Carbide legacy in Bhopal.) CRO discloses the methodology behind the list, which was “driven by the numbers. Period.” Companies make the list based on IW Financial’s analysis of the list criteria, so criticism should target the underlying structure of the list - or else IW’s analysis, which is based on "patented" environmental, social, and governance (ESG) ratings. CSRwire mentions the following companies on the list: Dow (13), Baxter (24), American Electric Power (69), and SPX (100.) The list does not include Fidelity, Barclays, Franklin Templeton, T. Rowe Price, or Vanguard--all mutual fund firms targeted by Investors Against Genocide with shareholder resolutions seeking portfolios free of companies supporting genocide, for example in Sudan. Comment: Gap fell from the top quarter to the second half of the list. The company asked why and was told that the new methodology double-weights environmental issues.
2/28/08 From Geeks to Greens, The Economist. Executives are switching from the computer industry to clean-technology firms. Shai Agassi was offered the CEO spot at SAP he said he was "much more excited" about his new start-up, Better Place, and its first challenge of switching Israel to electric cars. Another switcher is Elon Musk, who went from co-founding PayPal to chairing Tesla Motors, another electric-car start-up. Vinod Khosla, a VC, switched his focus from dotcoms to green projects. Silicon Valley entrepreneurs have had their social conscience energized and they think they can do very well by doing good. Market risk is declining fast. “Even the American government mandates big increases in renewable energy and energy efficiency.” Comment: A chance to achieve two Bay Area goals – doing well and doing good.
2/25/08 Sceptics Question Caring Face of Business at Davos, The News Corporation (News.com - Murdoch's Australian et al.). The World Economic Forum has long prided itself on showing the caring side of capitalism. But unnamed correspondents in a report from Davos mention unnamed critics as saying that corporate social responsibility issues like attacking specific diseases distract from global issues such as distribution of resources and incomes. Participants have also been criticised for raising big ideas on big issues in public, while actually spending most of their energy on making deals. Comment: Since 1970, CSR has been criticised primarily from the right as beng a diversion of resources from corporate managers' job of maximizing profits for shareholders. More recently, several critics from the left argue that CSR is a figleaf that takes the edge off corporate misdeeds and blunts the will of political leaders to crack down with tougher regulation.
2/21/08 Presidential Candidates' Staffs Briefed on Peak Oil, Culture Change Newsletter. Comment: Crude oil is hanging near enough to $100 a barrel and now going above it. [By the end of April it was up to $120 a barrel.] I remember three years ago I was criticized by a colleague for writing that the near-term outlook for oil prices would be above $50 a barrel. I changed it to "above $40 a barrel" but obviously with hindsight the worry should have been on the upside.
2/20/08 Business Should Learn from Government, McKinsey Quarterly. Richard Haass, President of the Council on Foreign Relations, argues that the newly assertive stakeholders in a changing global landscape make it essential for business to learn from governments how to adapt to interest groups represented by NGOs, who are taking on the character of co-regulatory bodies. Comment: A man-bites-dog reversal of the usual platitudes about how much more efficient business is than government,
2/12/08 Rating Agencies Balancing Competition with Harmonization, Social Funds. Users of CSR ratings are interested in more consensus on criteria, but the producers of ratings are conflicted because they wish to retain a competitive edge.
2/5/08 The Economics of Happiness: Building Genuine Wealth, CSR Wire. Why, in spite of economic prosperity, are many conditions of well-being in decline and rates of happiness largely unchanged since the 1950s? Why do our measures of economic progress not reflect the values that make us happy: supportive relationships, meaningful work, a healthy environment, and our spiritual well-being? Anielski proposes Genuine Wealth to measure the real determinants of well-being and help redefine progress. He shows how economics, capitalism, accounting and banking can be reoriented towards the pursuit of genuine happiness - and how to measure the five capitals of Genuine Wealth: human, social, natural, built and financial. Comment: It would be nice if wealth could be calculated in a better way. Here's another try.
2/8/08 Corporate Responsibility and Sustainability Report, Edelman. Key Findings: 1. CR must be a corporate priority emanating from the top • 2. Stakeholders often find communicating with companies to be difficult • 3 | Stakeholders expect companies to lead—not just manage risk—on key issues. • 4. Employees and socially responsible investors have emerged as key CR communications audiences. • 5. Companies often neglect an important CR communications audience: prospective employees. • 6. Transparency is a key indicator of a socially responsible company. Companies used as cases include Timberland, Gap Inc., IKEA, Chiquita, Reuters, JP Morgan Asset Management, GE. NGOs covered include Rainforest Alliance, Net Impact, World Business Council for Sustainable Development, Boston College Center for Corporate Citizenship.
2/5/08 Democrats Push Green Growth, Los Angeles Times. Democrats in Congress are seeking to add tax breaks for alternative-energy investment to the stimulus package.
JANUARY 2008
1/30/08 Human Rights at Davos, World Economic Forum. Global human rights are on the front burner. The United Nations is being looked to for progress and wants to make a difference.
1/25/08 Medical Ethics=Human Body Rights. Cadavers are necessary for medical training and research, just as organs are needed by hospitals. But the supply chain for cadavers (and organs) is fraught with ethical issues. Harvard Business School professor Michel Anteby explores corpse social responsibility.
1/14/08 Clinton, Obama Step Back from Race Flap, AP. Obama: "We share the same goals. We're all Democrats, we all believe in civil rights, we all believe in equal rights." Clinton responded that it is time to seek common ground, "and in that spirit, let's come together, because I want more than anything else to ensure that our family stays together on the front lines of the struggle to expand rights for all Americans."
1/11/08 The Climate Change Debate, Video. Oregon high school teacher Greg Craven lays out the options. I was apparently roughly the 4 millionth viewer of this impressive video
1/9/08 The Globalization of Ethics, Carnegie Council for Ethics in International Affairs. This republished short article by Hans Küng.argues that Asia has a well developed morality that may become part of an emerging common global ethic.
1/6/08 Mallen Baker Predictions for 2008-2012. Baker predicts that CSR will remain the centerpiece of discuss of corporate behavior and that the Chinese will challenge Western concepts of CSR.
1/2/08 Child Labor in the Cocoa Industry, written by Rodney North of the Equal Exchange Coop (the largest Fair Trade group in the United States) in early 2007, makes the case that chocolate manufacturers are not doing enough about child labor in the cocoa industry. In late December 2007 he reports that in his view the Cocoa Verification Board is not a strong enough response.
| MARCH 2008
3/31/08 (Blogspot) The Shop Local Movement. Every movement tends to inspire an equal and opposite movement. Wal-Mart exemplifies the advantages of economies of scale. Bigger stores and bigger chains mean that systems can be perfected, buying power is enormous, and widespread recognition of the brand makes it hard for competitors to make inroads. The Shop Local movement is a reaction to this. It is spearheaded by, for example, the American Independent Business Alliance (AMIBA). Their enemy is the big company. Evangelists for the Shop Local movement include Stacy Mitchell with Big Box Swindle: The True Cost of Mega-Retailers and the Fight for America’s Independent Businesses and Bill McKibben with Deep Economy: The Wealth of Communities and the Durable Future. Another evangelist, in his own way, is Ellis Jones and his Better World Shopper. I notice that on his comparisons of beers and fast-food chains, for example, the smaller brewers and chains get better ratings. The paradox of the Shop Local movement is that successful small firms get bigger. Surveys show that most Americans want to work in a small city or town, but in fact choose a big city because that's where the jobs are. We can savor the pleasures of shopping local, but economics will carry a successful company beyond its local market. For example, Gary Hirshberg, CE-YO of Stonyfield Farm Yogurt, is an exponent of Shop Local. But his path forward was selling stock to Danone, a very big company based in France.
3/25/08 (Blogspot) Anniversary of the Triangle Fire. The fire occurred in 1911 next door to the NYU Law School, which was then located to the east of Washington Square. The workers were on strike in 1909 but the Triangle owners refused to make any concessions. One requested concession was that doors not be locked (see Joan Dash, We Will Not Be Moved: The Women's Factory Strike of 1909" (Scholastic, 1996). On March 25, a fire took the lives of 146 girls who could not exit the locked doors. Most chose to jump to their deaths from windows rather than wait to be burned alive. This fire led to the creation of the first Department of Labor in New York State and then to the first Department of Labor and the first woman agency secretary and member of the President's Cabinet, Frances Perkins.
3/17/08 (HuffPost)Hops and Fears on St. Pat's Day. Hops are scarce and their price has been rising. Barley too. But you can't make beer without them. So be afraid of a beer drought at some small breweries. These fears are no joke says Alonovo. It's enough to remind you of Prohibition, the end of which was 75 years ago. From April to December 1933, the only legal U.S. alcohol was beer. For St. Patrick's Day, 2008, the question is: Which beer is greenest? Of the biggest three U.S. brewers, which is greenest? I think it's Anheuser-Busch. (But stay tuned - I have been promised more comparative data.) More: Alonovo, Anheuser-Busch, Greenest Beer, Hops, Molson Coors, SAB Miller, St. Patrick's. John Tepper Marlin, Huffington Post, Hops and Fears on St. Pat's Day.
3/8/08 (HuffPost) Today's 100th Anniversary of Women's Day. Today, March 8, is the 100th Women's Day - "International Women's Day" - and it has been little noted in New York City despite having been born here. One hundred years ago today 15,000 women workers marched down Fifth Avenue. Many of their goals were advanced by the largely successful 13-week shirtwaist workers' strike of 1909. The tragic Triangle Fire of 1911 sparked more progress and the suffrage parades in New York City and Washington in 1912-13 led via picketing of the White House in 1917 directly to woman suffrage in 1920. Despite these victories and the fact that women are better educated than men, working women are still trailing men in pay, and Wall Street women report that they are earning less than men doing comparable jobs. More: John Tepper Marlin, Huffington Post, Today's 100th Anniversary of Women's Day.
FEBRUARY 2008
2/15/08 (Thrive NYC): Tepper-Marlins. For a big-time New York City power couple, Alice and John Tepper Marlin seem suspiciously easy-going, considerate, and friendly. It’s a little hard to reconcile. What is it that allows these two veteran movers and shakers to keep it all in perspective and to remain just so darned nice? More: 2/15/08, David Gibbons, Tepper-Marlins, Vivid/Lives, Thrive NYC 2:6 (February 2008).
2/13/08 (CSR Wire): How Green Is Your Love? Can we send chocolates to our sweethearts in good conscience? The launch of the International Cocoa Verification Board promises greater social and environmental responsibility in West African chocolate production. With industry, government, NGOs, unions, and academics convened by the nonprofit supplier auditor Verité, the board is establishing a certification process to monitor and verify that cocoa is produced in Ghana and Côte d'Ivoire sustainably and free from child labor. The initiative has drawn comments from experts both impressed with its scope and concerned about its limitations "from the likes of John Tepper Marlin of CSRNYC, Rodney North of Equal Exchange, and Susan Smith of the National Confectioners Association". 2/13/08, How Green Is Your Love?, CSR Wire
JANUARY 2008
1/7/08 (HuffPost) Child Labor in Cocoa Production, West Africa. Some chocolate makers have long had a reputation for enlightened leadership. But this reputation is now being strongly challenged by labor conditions in the two countries that are the largest cocoa producers - the Ivory Coast and Ghana. 1/7/08 Huffington Post, John Tepper Marlin,
Valentine Chocolates: Child Labor Inside?
1/6/08 (Blogspot): Ecotourism in the Americas. Tourism can damage or (less often) restore the environment, depending on how it is handled. If you want to be part of the solution instead of part of the problem, look for a hotel/resort that supports local conservation of the environment - i.e., a place committed to ecotourism or sustainable travel. This kind of shopping for a better world is now easier with the second edition of Go Green! A SmartGuide to Sustainable Travel in the Americas. More: Blogspot, John Tepper Marlin, Ecotourims in the Americas.
EcoTourism in the Americas.
1/5/08 (Blogspot): Workplace Conditions in China. David Barboza is the NY Times economic correspondent in Shanghai. His article today, “Reform Stalls in Chinese Factories,” is based on a National Labor Committee report in December 2007 and covers half of front page and two-thirds of an inside page of the business section of the NY Times. His concluding paragraph is: "There is little that any Western company can do about those issues no matter how seriously they take corporate social responsibility - other than leaving China." But business is not leaving China any time soon. The only way forward, in the absence of better oversight of factory conditions by the Chinese Government itself, is for consumers to pay more attention to what they are buying and for them to avoid brands that do not have workplace standards, credible implementation systems and purchasing practices that reward supplier improvements and compliance with law. More: 1/5/08, John Tepper Marlin, Blogspot, Workplace Conditions: Why Consumer Action Is Needed.
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