Is CSR dead? Long live CSR (and Shared Value)! #BarclaysDebate

CQv4qacWIAAmh7kThe Barclays Debate, chaired by Matthew Tayor, Chief Executive of the RSA, pitched John Elkington, Founding Partner and Executive Chairman of Volans, originator of the “Triple Bottom Line” against Mark Kramer, CEO of nonprofit consulting firm FSG, and co-author of “Creating Shared Value” with Michael Porter to discuss, “Is CSR dead?”.

A virtual poll of the audience revealed the split was fairly even at the start of the evening.  I was for #TeamMark, surely corporate social responsibility of old has quietly passed on to more productive pastures?  CSR teams as an outpost of corporate affairs, staffed with communications professionals, set CSR firmly outside of core business operations.  As such, many totemic activities were scythed in cost-cutting exercises during the economic downturn.

Mark Kramer framed the debate as the choice between the responsibility of “doing less harm” and the strategic opportunity of generating economic value in a way that also produces value for society by addressing its challenges”.  Kramer honed in on the role, and definition of profit, “I think John believes we need to reinvent the model to take into account things that have no monetary value – the use of natural resources, the welfare of people – so that we can present them to companies as a bottom line that frankly is fictitious.” Externalities are out of the equation.  Companies respond to reality, the real incentives of the bottom line, government policy and the regulatory framework context.

IMG_0038 (1)The “Triple Bottom Line” accounting framework with three parts: social, environmental (or ecological) and financial, or people, planet, profit, was coined by Elkington in 1994.  Acknowledging the complexities of valuation, the framework has been a powerful tool to reveal the full cost benefit analysis of doing business.  However, the framework separates people and planet from profit, perhaps reinforcing the sense that CSR sits apart from core operations.  With his opening comments, Elkington expanded this narrow frame of reference, and influence, from within to without an organisation: “CSR is a deep rooted, ongoing conversation across sectors about the role of business in society. It is about transparency, accountability and sustainability.”  Shared value, Elkington counters, may provide limited win-wins, but will not deliver the breakthrough capitalism we need, described in his latest of 19 books, “The Breakthrough Challenge: 10 Ways to Connect Today’s Profits with Tomorrow’s Bottom Line”, co-authored with Jochen Zeitz, and central to the B Corps movement that launched in the UK last month.

Elkington did question whether CSR is fit for this greater goal of systemic change.  As the mutual dependency of people, planet, profit is increasingly recognised by the mainstream, so CSR is facing serious problems.  Resource scarcity has risen up the business risk agenda, so activities that may have been within the CSR remit, are now considered part of core business, but the question of intention remains.  Citing that day’s news of John West’s woeful performance on sustainable fishing, Elkington said, “John West promised to get to 100% pole and line caught tuna by 2017 – it’s currently at 2%. Does that completely wipe out CSR? Absolutely not. It means John West are semi-criminal”.  John West and the VW emissions scandal are examples of an absence of integrity and values.

Janet Voute, Global Head of Public Affairs, Nestle, in her opening remarks as #TeamMark seconder, quoted Nestle’s CEO as saying the corporate sector has had a values crisis.  At Nestle there is no ‘Shared Value’ department, rather Voute asserts the values of Nestle are aligned across the organisation with the Ten Principles of the UN Global Compact, looking to create shared value, and value for shareholders, over the long-term.  The time horizon is a vital disclaimer, echoing Kramer’s caution that companies short-term incentives may conflict with shared value. The externalities of environmental, social and governance factors getting squeezed out by short-term profit and pay incentives.

A quick show of hands revealed most of the audience agreed that capitalism itself needs a serious health-check.  Patrick Thomas, Chairman of Board of Management of Covestro, joining the debate as #TeamJohn seconder, was fresh from meetings with fund managers: were they won over by Covestro’s products or their commitment to the triple bottom framework? Hermes Investment Managers latest paper on Responsible Capitalism and our Society finds that while awareness of environmental, social and governance (ESG) issues amongst institutional investors is growing, it is not being reflected in decision-making. Saker Nusseibeh, Chief Executive of Hermes Investment Management, said “Today’s siloed and short-term investment approach is the antithesis of responsible capitalism. Change is necessary, if we are to ensure today’s savers and their children will be able to enjoy a fruitful world in the future”.

IMG_6226Finally, as a coalition of 19 investors with over £625 billion in assets under management has written to 11 major automobile companies calling for improved reporting of their public policy interventions on emissions standards, we need greater transparency of the relationships between business, regulators and policymakers.  The air quality in our cities is testament to the current system failure.

#TeamJohn won the vote, but the consensus in the room was that rather than either CSR or CSV,  we need both.  A revitalised CSR agenda to build momentum for systemic change, and shared value to reconnects businesses and all their stakeholders. A panellist at a Harvard Kennedy School Leadership dialogue in 2007, said “CSR is dead! Long live CSR.”  In eight years hence, I hope we have met the breakthrough challenge.

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Celebrating the Inglorious at Designs of the Year 2015

inglourious_fruits3To whet my appetite for this year’s London Design Festival, I headed to the Design Museum to see see the Designs of the Year 2015.  This year’s awards focus on designs that deliver change, enable access, reflect current trends, and extend the boundaries of design practice.  Sustainability, and consideration of environmental impacts, is rising up designer’s priority list: it is not just about product form, but also life-cycle function.  Designing for the Sixth Extinction, by Alexandra Daisy Ginsberg for the Science Gallery, Dublin, set an apocalyptic tone exploring how synthetic biology could replace natural species or protect against pollution, disease and biodiversity loss.

After the sombre start, Inglorious Fruits could not fail to crack a smile.  To reduce annual food waste of 300 million tonnes (57% of which is due solely to appearance), Intermarché, the 3rd largest supermarket chain in France, decided to sell imperfect fruit and vegetables at a 30% discount.  The ‘Inglorious Fruits and Vegetables’ campaign, designed by Marcel, reached 21 million people in a month creating a new business line for Intermarché, providing the customer with the same quality food for less and paying growers for produce previously wasted.  A welcome nudge that reminds beauty is found within.

One effective way to create positive behaviour change is to capture young hearts and minds.  To that end, some inspiring educational projects are among the nominees.  ext001_aerial_©xia zhiThe Garden School, designed by OPEN Architecture, for the Changyang Government, Fangshan District, Beijing, aims to become the first triple green star rated school in China.  The architects designed multiple levels above and below ground in a branch-like shapes creating undulating landscapes that allow more light into classrooms, and open spaces.  The roof of the upper building is an organic farm, with each of 36 classes having their own plot.

320 million people on the African continent lack access to clean drinking water, and yet the majority live in regions where it rains more than 600mm per annum.  Waterbank Campus at Endana Secondary School in Kenya, designed by PITCHAfrica for the Annenburg Foundation, is a working model for rain-harvesting school for semi-arid regions.    Seven ‘Waterbank’ buildings are designed to harvest, store and filter high volumes of water using low-cost materials to provide drinking water and irrigation.  Four acres, of the ten acre site, are devoted to irrigated conservation farming. At the centre of the campus is a rain-water harvesting football and volleyball stadium, with the aspiration that football will be catalyst for environmental education, and reduced ethnic tension.  The school may even make use of the BRCK, a robust, portable, mobile WiFi device developed by Ushahidi, in Nairobi.  Cloud-managed, the BRCK will automatically search and reset to a stronger signal, and the eight-hour battery life means a steady connection even when there is a power surge or cut.  With an built-in global SIM the BRCK could be deployed in disaster response situations.

With a throw back to the beginnings of Carefully Curated, Marjan van Aubel (a 2013 nominee with James Shaw for the Well-Proven Stool) has again been nominated this year for her Current Table designed with Solaronix.  The elegant table is made of glass-topped, copper-toned dye-sensitised solar cells (DSSC), an efficient form of photo-voltaic cells.  The dye absorbs light, even when diffuse indoors, and creates energy through photosynthesis.  The table has two USB charging points, and a battery to store the energy.  The only snag is whether the people round the table will be able to turn their attention from device to dinner.

Field Experiments Indonesia, a design collective exploring often overlooked aspects of sustainability, those of culture and authenticity.  Souvenirs are often ‘made in China’ and disconnected from the destination. I recently saw ‘Aboriginal’ Australian sculptures, made in China, for sale in a service station on the M6.  Field Experiments provides an antidote of more than 100 objects made by designers and traditional craftspeople sharing knowledge, culture and materials over a three month period in a nomadic studio in a farming community outside Ubud.

The drum-roll is reserved for Ocean Clean-Up, Digital Design of the Year Winner, and at the time of my visit, the runaway winner in the People’s Vote.  There are 5.25 trillion pieces of plastic trash in the world’s oceans, and each year, 8 million tons of plastic are added to the count, according to a report from the Ocean Conservancy.  This bold project is leveraging the power of digital communications to gather funding and know-how for large scale clean-up projects of our seas. Ocean Clean-Up’s feasibility work suggests using a single 100 km cleanup array, deployed for 10 years, will passively remove 42% of the great pacific garbage patch.  As tabloids predict chaos at the arrival of a 5p charge for single-use plastic bags in England, perhaps this long overdue nudge will prompt people to realise there is no away in ‘throw-away’.

And finally, my personal post script, the Double O bicycle light, designed by Paul Cocksedge, solves a personal pain-point.  The two lights snap together magnetically and the circular hole in their middle means you can slip them on to a D-lock. The LED light is designed not to dazzle other road users too. Simple, and safe.

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