Why Spend Money on Being a Good Corporate Citizen?
(3BL Media/Justmeans) —The fifth edition of Ethical Corporation’s Responsible Business Summit in New York, was full of inspiration, encouragement for weary travelers on the road to sustainability, and a healthy helping of good old practical advice.
Baltimore Gas & Electric’s CEO Calvin Butler opened the event with the question that was probably ringing in most heads around the room. Why are we using money on being good corporate citizens? The next two days went a long way towards answering that question in a variety of convincing, sometimes familiar, sometimes innovative ways.
For Butler, it is both a matter of making a deposit in their reputation account and down payment on their commitment to make their community stronger. If nothing else the company has shown what endurance looks like after 200 years in business. It also helps that the investment banks the company works with, all want to know what they are doing about climate change.
Here are some other responses from Day One of the event.
The Ford Company Fund, having spent some $1.5B over the past 68 years certainly agrees with the sentiment, but for somewhat different reasons. For one thing, President Jim Vella says Millennials won’t stay without this kind of outlet. Sounding a grander theme, he cited the Ford founder who said you cannot have a sustainable company without a sustainable society. Among the many projects he described, the idea of building tiny houses for the homeless seemed particularly unique. Says Vella, doing nothing is “risking the future.” The world is demanding this.
Atlanta mayor Kasim Reed, said that, “When businesses lead, it gets you away from that Democrat-Republican paradigm.” Reed encouraged the business leaders in the room to partner with cities as an effective and immediate way to sustain progress on climate action.
Farooq Kathwari, CEO of Ethan Allen Global, talked about how being environmentally responsible pays off in the long term.
Tom Glaser of VF Corporation (parent company of Timberland. Jansport, Wrangler and others), said that, for them, maximizing shareholder value and investing in responsible business are one and the same, because as a result of such investments they are “using less water, less electricity, have less employee turnover, better products and reduced risk exposure.”
Christine Cioffe, SVP at Global R&D at PepsiCo, said, “because everything we do depends on water,” and because “larger companies are better positioned to play leadership roles.”
Erin Meezan, CSO at Interface, spoke of “aligning the company’s goals with solving the bigger challenges.” In their case, they’ve started a Climate Take Back program with an aim towards developing carbon negative factories
Franz Paasche, SVP at PayPal ,talked about “using your core competency for the public interest.” In their case, they provide financial services to the underserved, noting “how expensive it is to be poor.”
David Rosenberg of Aero Farms, is clearly responding to a need for more sustainable food production, particularly around cities. Their highly automated indoor vertical farms use 90% less water and 99.2% less land than conventional farms.
Oliver Campbell of Dell Computer, who is now turning ocean plastics into packaging for their top-of-the-line laptop, says, “when it’s done right, sustainability costs less.”
Charlene Wall-Warren, Director of Sustainability at BASF, spoke of being motivated by the UN’s Sustainable Development Goals. Wall-Warren says it’s crucial for CEO’s and companies to show leadership on this issue.
Jackie Sturm of Intel, says they invest because they, “want to be an asset to our communities,” and because, “we see ourselves as a major brand with an obligation to make the world a better place.”
Alain Turenne of Walgreens said that they are “playing at a level where everything we do matters.”
Of course, all these leaders had much more to say than this, but this speaks to why they came and how each of them responded to Butler’s opening question.