Creating Shared Value – Tips for Making the Case in Your Company

Several weeks ago, I had the opportunity to present as part of an FSG webinar entitled Creating Shared Value: Making the Case in Your Company.  As I mentioned yesterday, we have worked closely with FSG over the past year and a half to develop our CSR strategy.  During this time, FSG was developing the concept of Creating Shared Value (CSV).  Whether you see this as the next point along the continuum of CSR or a distinct, new idea is probably a conversation for another day, but regardless, I love the way Michael Porter and Mark Kramer, and the FSG team in general, have framed this concept, and I think it is absolutely the right way to think about CSR (or whatever you want to call it).  If you aren’t familiar with the concept of CSV, stop reading this post right now and read this instead.

The purpose of the webinar was to go beyond the “what” of CSV, to focus on the “how”.  Specifically, how to you make the case for CSV to your company, well outside the walls of the CSR department?  How do you build buy-in and embed this approach throughout your business units?  For years, as corporate philanthropy became strategic corporate philanthropy and then CSR, the group that works on social issues has had to become decreasingly siloed in order to succeed.  A well-run CSR department collaborates closely with other business units, addresses issues of importance to the rest of the company, and may have a matrixed org chart.  With CSV, though, active participation from other business units isn’t just about doing the job well – it’s about doing it at all.  CSV doesn’t happen within a department, it’s embedded in a company. That means that, in order to be successful, the CSR team simply must succeed in making the case for CSV to the rest of the company.  FSG put together this webinar to share insights from companies that have been making that effort; I thought it might be useful to share and flesh out the key points from my presentation here. 

Overall, there are two big things I think we’ve done since the beginning, which have been critical to what successes we’ve had in making the case.  One, we’ve focused on engaging senior leaders.  We engaged a wide range of senior executives (34 internal interviews) during the strategy development phase, and our CEO was the primary customer for our proposed strategy.  We sought to understand their strategies and needs, so that we could identify the key issues within their areas of responsibility that could benefit from a CSV approach.  We’ve worked with business unit heads to flesh out and implement the CSR pillars most aligned with their particular groups, with the goal of co-creating our activities.  Two, we treat our company’s executives as our clients.  We seek to build relationships, we lead with the fit between our work and theirs, and we strive to act as a service organization to other business units.

What does that mean in practice? Here’s my top-ten list for making the case for CSV:

1.     Appoint a high-ranking executive to lead your CSR group:  We have found it critical to develop close relationships with our business unit heads, so that we can be a trusted partner.  Having a CSR leader who is a peer to those executives has been so important in building those relationships.

2.     Invest time in making the case; it’s an iterative process:  We’ve had three CEOs (one left, we had an interim, now we have a permanent one) since we started this process, so for turnover reasons alone, you can’t assume your job is ever done in bringing leadership on board.  Furthermore, we’ve found that business unit heads are more or less engaged depending on what else is going on in their business, so you have to continually track their needs and objectives, understand how you can support that, and tell them. I think that selling the value of the CSV strategy, rather than just the value a CSV initiative, might be a good way to address this – if you buy into the principle, that won’t change as individual projects become more or less relevant.  However, it’s harder to get time on someone’s calendar to talk about a business strategy than it is to discuss a concrete initiative, so I haven’t yet figured out how to strike the right balance on this one.

3.     Work to understand deeply what your business units do and need: If you are going to help your colleagues to address social issues that could maximize or limit their business success, you have to really and truly understand what your colleagues do and what their problems are.  That sounds obvious, but it’s harder than it sounds.  We need a real general management skill set and we also need to be a continual student of our organization and our industry.  (If you have tactics for succeeding in this ongoing education, I would love to hear them.)

4.     Focus on what is important to your business units, not you:  If you work in a CSR group, you presumably care about your company’s social impact.  That’s integral to CSV, which seeks to address issues that are important to both society and the business.  However, that’s not what most business unit leaders are charged with doing.  They’re charged with addressing just the business unit side of that Venn diagram.  The social impact is nice, but not necessary.  That shouldn’t be a problem for you, though – if you’re really engaging in CSV, you are addressing an issue that is of core importance to your business.  The social impact is why your group is involved, but it probably isn’t why the company is involved.  As such, sell your business unit colleagues on the part that will help them to achieve their goals.  If you are picking the right issues, not selling your colleagues on the social impact won’t make the social impact any less powerful.  (I should note that this is a little different at my company – because we are an education company, we have the benefit of working with people who ARE charged with driving social impact, in our case educational achievement.  The fact that we have to focus on the piece of the puzzle that is most important to our business units remains, though.)

5.     Make your colleagues’ lives easier; consider focusing on under-resourced units:  We’ve found that business units that don’t have sufficient support in areas where we can add value, like R&D, marketing, relationship-development, and business development, are really eager to work with us, and they move straight to integrating us into their work.

6.     Be comfortable acting both strategically and tactically – both have their place:  We’ve generally found it easier to position ourselves as a partner through tactical initiatives, rather than strategic initiatives.  We can often make an introduction, or draw media attention to a business activity, and those are great, but they aren’t creating shared value.  That said, I think this is an appropriate interim stem for a company that is new to CSV.  These small, lower-impact activities are helping to position our group within the company, helping other  units understand who we are and how we can engage with them, and helping us to build the relationships we need to create shared value successfully.

7.     Tell the CSV story coherently, frequently, and throughout the company:  I think we’ve had the perspective that we’ll start telling our story when our strategy is fully in place, but celebrating success is key to building buy-in, to helping people understand what you are about, so I think it’s important to celebrate the small landmarks along the way.

8.     Focus on the good, not the perfect, to go after quick wins:  For the same reason, go after quick wins; find examples that you can celebrate in order to educate the company about CSV.

9.     Be clear that you are a change agent, not program manager, from the start:  This is a distinction that FSG draws in its report, sponsored by HP, "Creating Shared Value: A How-to Guide for the New Corporate (R)evolution", and it is one of the elements of CSV that I struggle with most.  With CSV, you aren’t carrying out CSR activities but are instead changing the way your company does business.  You aren’t developing projects that the CSR department will run on an ongoing basis – you’ll have done your job when they just become part of how the company does business.  But that also means that, when you identify an opportunity, you can’t just do it – you have to convince whole group of other people, with other objectives and ways of operating, to get onboard, and I think that’s really, really hard. 

10.     Develop a strong network within your company:  There’s obviously a common theme running throughout this post – to implement CSV, you must work through your colleagues throughout the company.  But unless you are very lucky, those colleagues probably aren’t seeking you out.  As such, you need to figure out which of your colleagues you can help the most, and you need relationships in place to be able to work with them.  You also need to understand the twists and turns that you company is facing and adapting to on an ongoing basis.  That means you need a strong network within your company, so you can figure out what is going on, who is doing what, and where you might fit in.

These tips are based on our challenges to date as much as on our successes – this isn’t easy work.  But I think Porter and Kramer are right about CSV – it does drive business success, it does drive social outcomes, and it is the right approach.  It just makes so much sense that I’m confident we’ll see more and more companies Creating Shared Value.

Welcome Back!

Welcome back to Reimagining CSR!  This isn’t the first time I’ve said that, but things have changed a bit around here, and I’m finding myself very much in need of this space to work out my ideas about CSR.  I hope those changes will also make this blog more useful to you.

A little over a year ago, I joined the brand-new CSR department at a large education company.  There were just two of us to start, and then for awhile I was the only employee in the group, but we also worked very closely with a consulting team from FSG.  For the first half of 2010, when I was working with my now-employer as an independent consultant while finishing up a fellowship, we focused on the big blocks of strategy: identifying the key social issues that impact our business, figuring out which departments we would be collaborating with, laying out the core pillars of our CSR strategy.  I joined the company full-time in summer 2010, and we started working to bring that 30,000 foot picture down to about 10,000 feet – we weren’t implementing, for the most part, but we were exploring partnerships, developing pilot projects, and otherwise figuring out how we were going to bring that big picture strategy to life.  In early 2011, we hired an SVP to run the group (hooray for having a senior leader for the CSR team!), and we really started building our team’s infrastructure.  We figured out what kind of team we needed to implement our strategy, we fleshed out the budget, and we started to develop the processes we needed to work effectively as a department.  Then finally, starting around late spring, we staffed up and really started implementing.  We are absolutely, 100% still a work in progress, but what started out as a giant PowerPoint deck a little over a year ago is slowly but surely coming to life.

What does this have to do with Reimagining CSR?  When I started this blog, I was in the last semester of my MBA, and I used it to refine my ideas about what CSR could and should be.  I’d previously been a corporate philanthropy consultant at Changing Our World, an intern with the MAC AIDS Fund (the foundation at MAC Cosmetics, part of Estee Lauder), and the corporate philanthropy editor at onPhilanthropy.com.  While I was still blogging regularly, I started doing research on CSR for Jane Nelson at the Harvard Kennedy School’s CSR Initiative.  I’d also been a student of the subject matter, taking one business school class specifically on CSR and several others that touched on the issue.  I’d approached CSR (mostly strategic corporate philanthropy, but other aspects as well) from a range of angles, except one big one: that of a day-in, day-out full-time CSR manager in a company’s CSR department.  I learned a massive amount in those other roles – particularly consulting, where I had the chance to work with the CSR groups at a number of companies and to research and profile hundreds more – and they prompted me to mull over questions and offer opinions about the big picture of CSR, of CSR an ideal.

This job is different.  Now, for better or for worse, I don’t spend three months perfecting an ideal strategy, distill it into a beautifully formatted report, and then hand it over.  Instead, that nice, big PowerPoint is where my job begins.  That leads me to think about a really different set of issues – issues of implementation, issues of structure.  I’ll probably still mull the ideal – that’s just my nature – but I’ll spend more time wondering about the balance between ideal and reality, about the tactical how-tos of getting even a little bit close to perfect.  Some of my questions are probably common in any business unit – how do I get the business units that I work with to care about my objectives?  How do I get senior management involved in the issues that matter to my team?  Others are pretty similar to the issues I addressed when I first started this blog – for instance, now that I’m not regularly researching and profiling best practices in CSR, I find myself feeling out of touch, so I’ll use this blog to profile interesting practices and people.

As always, this blog is part personal learning journal, but I also hope it will be helpful to other people.  If there are issues you want to analyze, practices you want to learn more about, people you want to see highlighted, please don’t hesitate to email me at reimaginingcsr@gmail.com. 

Less blog-related, but the other change around here is that I got married and changed my name – I’m now Jessica Hubbard, instead of Jessica Stannard-Friel.  Simpler, right?  At least, once I figure out all of the million places I need to change it – they seem to be multiplying daily…

By the way, I’m writing this from a plane as I fly out to the BSR conference.  I plan to tweet extensively – you can follow at @JessSF.  If you’re there, too, let me know.

Thanks so much for joining me as I jump back into blogging!

Join Me in Exploring the BCCCC Conference!

Welcome back to ReimaginingCSR!  It's been far too long since I last posted.  Since then, I've moved into an in-house CSR role, as a Senior Manager in the brand-new CSR department at an education company.  I joined the company as a consultant when it started working on its CSR strategy last February and then came on full-time when it created a CSR department over the summer.  It's been a very exciting process, and it has also exposed me to all sorts of new challenges and ideas that I hope to explore by getting back to blogging.

My impetus for restarting this blog today is that I'm currently sitting in a hotel room in Minneapolis, where I am attending the Boston College Center for Corporate Citizenship conference.  I just got back from the opening reception and dinner, where I very much enjoyed talking about CSR theory and practice with people who really get it!  Tomorrow, I am excited to attend a range of great sessions - you can see the agenda here  (breakout sessions in detail here).  At the moment, I'm leaning toward attending the following panels:

• Make the Connection: Play the Role of Corporate Citizenship Change Agent (with panelists from ARAMARK, Himle Horner Inc., Wells Fargo, and Net Impact) - My colleagues and I are really interested in the role our team can play in helping the company through the major changes happening in our industry, so I hope this session will help me think through that opportunity.
• From Volunteering to Involve-a-teering (with panelists from the Center for Corporate Citizenship, Morgan Stanley, General Mills, and PwC) - I am leading the build-out of our volunteerism program, which will focus on skills-based volunteerism.  I am very interested in how we can think not just about employees volunteering their time, but also about the company volunteering its employees' expertise.  I am also interested in how we can use volunteerism to foster employee learning and professional development.  I hope this session will help me explore these issues.

Throughout the conference, I plan to tweet (@JessSF) and blog.  I want this communication to be as helpful as possible to those of you who aren't able to be here in person.  I'd therefore love to hear your thoughts on the sessions above.  What questions do you have on those topics?  What issues within them do you want to explore?

Thank you so much for joining me as I jump back into blogging and for working through these critical issues in our field together.  I am thrilled to be re-starting our conversation!

6 Questions with CECP Director Margaret Coady

After a long lull, I’m very excited to be getting back to posting on Reimagining CSR.  I’m especially excited to introduce a new feature, entitled “6 Questions with…”  On a periodic basis, I’ll be sitting down with (ok, probably emailing with) intriguing people in the world of CSR.  We’ll have the opportunity to learn about their career paths and their day-to-day experiences as CSR professionals, their insights into trends and challenges in the field, and the interesting activities with which they’re currently involved. 

I hope to capture the diversity of this field by interviewing people in a range of positions – working in-house at companies, at consulting firms, at industry associations, and at nonprofits; in corporate philanthropy, in socially-responsible business, in cause marketing, and in environmental roles; who spend their days thinking about the supply chain, about financials, about key stakeholders, or about compliance; and the many other niches that make up the world of CSR.  If there’s anyone in particular that you would like to see featured, please email me at reimaginingcsr (at) gmail (dot) com.  I know that this blog tends to be a bit skewed towards corporate philanthropy, as that’s where the bulk of my experience and network lie, so I would particularly appreciate requests for or recommendations of professionals in other areas of CSR.

We’ll be starting this feature by talking with Margaret Coady, the Director of the Committee Encouraging Corporate Philanthropy, which bills itself as “A network of global CEOs committed to corporate philanthropy.”  I first met Margaret when I was a corporate philanthropy consultant at Changing Our World, and she was a wealth of information about whatever facet of the sector we happened to be researching on a given day.  Margaret and I kept in touch when we both started business school (she while continuing to work full time!), bonding over our shared experience learning all about cranberries.  (Did you know they bounce?)  Margaret sits in a fascinating place in this world, with visibility into the work of many of the country’s top corporate philanthropists – and increasingly, as the organization expands globally, the world’s.  She was kind enough to share that view with us here at Reimagining CSR.

Jessica: How did your career and life experiences lead you to the field of corporate social responsibility and to your current position?

Margaret: I began my career as an information technology consultant with PricewaterhouseCoopers, immediately followed by two years as a technology product manager at an Internet start-up in San Francisco (the first year epitomized the spirit of dot-com invincibility; in the second year, everything came somewhat unhinged).  Missing the cultural life of NYC, I moved east and became the Assistant Director of a prominent mid-town art gallery.  That was a great experience (my friends have heard plenty of behind-the-scenes stories), but I wanted to get back to a career with more of a corporate twist. 

Although CECP is a nonprofit, our membership consists of over 150 leading corporate CEOs and we also work closely with the senior giving professionals at those companies.  My first role at CECP was as the Research Specialist, charged with growing our proprietary Corporate Giving Standard benchmarking system, which now contains over $60 billion in detailed giving data.  This challenge put my IT, sales, marketing, and product strategy skills to great use (as well as my undergraduate liberal arts degree).  I was promoted to CECP’s Director, under Charlie Moore, within a few years.  In 2009, I graduated as valedictorian of the Executive MBA program at Columbia Business School; the learning from those courses has been worth its weight in gold in my new strategic role.

Jessica: What do you do all day?

Margaret: In addition to day-to-day management, the short answer is that I draft the strategic course for CECP’s research publications, events, and programs.  After all, CECP is only relevant if our work fills the immediate unmet needs of our member companies.  Yet it is important for CECP to keep an eye on the horizon, too, since it is a luxury for companies to look too far into the future given increasing pressures on their time. 

Recent projects of mine include: crafting a definition and dollar valuation for pro bono service (with our partners at the Taproot Foundation); working alongside the U.N. Global Compact to draft Principles of Responsible Social Investment (to be announced this summer by the Secretary General); shaping the content agenda for CECP’s newsletter, The Corporate Philanthropist, and our CEO conference series; writing the latest edition of CECP’s benchmarking report, Giving in Numbers, and managing the selection process for CECP’s Excellence Awards in Corporate Philanthropy.  However, CECP is fundamentally a roll-up-your-sleeves organization, so I spent an hour today stuffing invitations for a special dinner we are hosting at the House of Lords in London before our first CEO conference abroad.

Jessica: What is one of the most exciting trends that you observe in the world of CSR?

Margaret: The most important and inspiring trend that I see across our corporate membership is the commitment to proactively engage in problem-solving on tough issues. The walls that separate funders, grantees, governments, multilaterals, activists and others are falling away as each change agent instead focuses on bringing its skills and resources to bear on today’s most difficult social challenges.  Specifically, I see the work that Nestle, and Mark Kramer and Michael Porter, have done on the concept of “shared value” starting to take root more deeply among companies.  This philosophy advocates for not simply aligning giving strategy with business strategy—but synthesizing the two.  Essentially the idea is that companies must focus on social issues that directly touch the value chain of the business.  By concentrating their efforts on social issues that create opportunities (or obstacles) to corporate growth, businesses simultaneously help society and their bottom line.  In other words, corporate philanthropy is no longer a complementary function—it is essential to the company’s growth and wholly intertwined with the broader objectives of the business.  We’re very excited to discuss this concept in more depth at our upcoming Corporate Philanthropy Summit in June, and have tried to take some of these ideas further for our corporate CEO audience in our latest research.

Jessica:  What big challenge is currently facing CSR professionals and/or companies?

Margaret: Corporate organizational charts do not always position philanthropy and CSR professionals to actualize the full potential of their roles.  These functions can deliver immense value, but not when they are in a silo, understaffed, or improperly staffed.  The strategic nature of these roles has only recently begun to be broadly understood, and many companies have yet to fill them with the right talent to get the job done—or to empower that talent to get results. 

Jessica: What's one interesting thing that your organization is up to?  (Go ahead, brag a little.)

Margaret: One of CECP’s judging criteria for our Excellence Awards is a commitment to measurement (the others are innovation, CEO leadership, and partnership).  We believe measurement is essential to effective giving (the adage ‘what gets measured, gets managed’ applies here), which is why we invest so heavily in research and systems that allow companies to track and benchmark their giving.  This year, with the help of the U.N. Global Compact and partner organizations around the world, we are working to expand our measurement framework to be applicable internationally—essentially, we are striving to build a global measurement framework for corporate philanthropy.  Our vision is to create a common understanding of what is considered corporate philanthropy, and how contributions should be valued.  With this in hand, we can paint a rich portrait of global corporate giving and track its evolution over time.  I encourage anyone with insight in this area to email my colleague Alison Rose.

Jessica: CECP recently celebrated its 10th anniversary.  How has corporate philanthropy changed in past the ten years, and how do you hope it changes in the next ten years?

Margaret: At CECP, we decided to celebrate our 10-year anniversary not by looking backward, but instead by challenging ourselves and our membership to consider what the world—and the environment for corporate philanthropy—could look like in the year 2020 if we proactively adopt a solutions-oriented mindset on local and global social issues.  We needed help to do this, so in addition to interviewing numerous thought leaders ourselves, we enlisted McKinsey & Company to work with us to outline the game-changing trends (demographic, environmental, technological, and geopolitical) that will shape the business landscape in 2020.  This work outlines what companies need to do to prepare for the certain (and somewhat less certain) forces headed our way.  I won’t preview our conclusions here, but instead invite anyone who is interested to download a free copy of the report from our website when it is available in late May 2010: http://www.corporatephilanthropy.org.

Corporate Response to the Haitian Earthquake: Update, 1/13/10

The US Chamber of Commerce's Business Civic Leadership Center is tracking the corporate philanthropy response to the earthquake in Haiti here. Other great sources of such information include CSRWire and PRNewswire. Know something about corporate involvement in relief efforts that isn't included on those sites? Please share it in the comments below.

Earthquake in Haiti - How Companies Can Help

As I’m sure you’ve heard, a big earthquake hit Haiti today. While details are relatively limited at this point, it seems clear that the earthquake has taken a major toll. In the wake of such disasters, companies often step up with offers of support, but in the confusing hours and days after such an event, it can be hard to know how to help.

Just after the 2004 tsunami, I wrote this article for onPhilanthropy about how companies can best contribute to disaster relief efforts. While it’s several years old, I think the advice is still relevant, so I’m posting it for those of you who may spend Wednesday working on your own company’s response.

Here are a few other resources that might be useful:

The U.S. Chamber of Commerce Business Civic Leadership Center has a website focused on supporting companies around issues of disaster relief. The page has a ton of great information, including a phone number specifically for companies that “Need help responding to … a disaster”. Tomorrow, as information (hopefully) starts coming out quickly, the best way to stay up to date might be Twitter – follow the Center @chamberbclc or its Executive Director, Stephen Jordan, @scjordan.

The Council on Foundations published a guide called “Disaster Grantmaking: A Practical Guide for Foundations and Corporations”, which you can find here. (Note that this link is to a PDF.)

The Committee Encouraging Corporate Philanthropy also has a website dedicated to resources for companies engaged in disaster response efforts.

I find information sharing to be critically important in times like these, so if anyone comes across specific information about how companies can be helpful in responding to this particular earthquake, I’d really appreciate it if you’d share it in the comments below. Similarly, please share any resources you find that may be helpful for companies considering whether and how to help. Finally, if your company makes a donation, or if you hear about a company that does, please share that, as well, so that we can begin to track the corporate response to this earthquake.

Thank you, and good luck to everyone involved in this effort.

Goldman Sachs Update - Employee Giving

Happy New Year! Yesterday's New York Times had a bit of an update on the Goldman corporate philanthropy story we've been following here on Reimagining CSR (see past articles here, here and here). WSJ.com has a round-up of related stories here.

According to the paper, "As it prepares to pay out big bonuses to employees, Goldman Sachs is considering expanding a program that would require executives and top managers to give a certain percentage of their earnings to charity." The article goes on to say, "While the details of the latest charity initiative are still under discussion, the firm's executives have been looking at expanding their current charitable requirements for months and trying to understand whether such gestures would damp public anger over pay…"

The most recent article doesn't provide much new information, other than what the paper reported on the same subject this past fall, beyond demonstrating that the concept is apparently still alive. However, it does compare the concept to an employee-giving program at Bear Stearns: "The charity idea would be similar to a decades-long program at the failed investment bank Bear Stearns, which required more than 1,000 of its top workers to give 4 percent of their pay to charity each year and then checked their tax returns to ensure compliance." It then goes on to estimate the impact of such a program, "Assuming a similar percentage and level of participation."

Granted, that's a big assumption - the article doesn't give any definite information about the number of workers or percent of pay that would be involved in a Goldman program - but the Bear Stearns program is still useful as a benchmark. If the company were indeed to implement an employee giving program along the lines of what's being discussed, and if the numbers looked something like Bear Stearns', my question is this - would this program actually have any impact on the overall giving by affected employees? That is, do the company's top earners (elsewhere in the NYTimes article, we learn, "For their work in 2008, 953 Goldman employees were paid more than $1 million each") currently donate less than 4% of their income?

Of course, the answer to this question doesn't necessarily change whether the program would achieve Goldman's aims. Theoretically, if this initiative could indeed influence public perception about the bonuses, it matters less whether employees' donations are increasing and more whether the company has a strong story to tell about how generous its employees are with their large paychecks. In that case, the company could get as much value simply by gathering information about its employees' existing donations and their impact and sharing that information. I'm not sure it's relevant for the company to set a mandatory giving hurdle when the hurdle is relatively easy to reach.

On the other hand, perhaps the Goldman Sachs program, if it indeed becomes reality, will be nothing like the Bear Stearns program. Perhaps it will require that employees (or at least the highest-earning employees) donate a significantly higher figure, a percentage that would seem far above what the average person would expect even from a million-dollar earner - for the sake of argument, let's say something like 25%. Would that change perceptions of the program? Would that make the general public - if that's in fact the stakeholder Goldman would be trying to influence - change its attitudes toward the company, such that this solution (employee giving program) actually impacts the problem (public anger at big bonuses) it seems designed to solve? I'm not sure - but it would definitely break through the clutter of expected actions.

Of course, maybe the lackluster reactions to the idea - as evidenced, for instance, by the comments to the NYTimes story (admittedly not a representative sample, but the comments are really negative) - will convince Goldman Sachs decision-makers that this proposed solution won't, in fact, address the problem in question. Regardless, I look forward to the next installment of this story, which continues to help us think more deeply about causal relationships in the world of corporate philanthropy.