On Wednesday, October 18, Needle Consultants' Chief Instigator Marc Ross will be moderating a panel at the 2017 Cannabis Sustainability Symposium on Corporate Social Responsibility. Sponsored by the City of Denver, Department of Environmental Health and the Cannabis Certification Council, the panel will feature Liz Swanson (B Corporation), Dr. Elizabeth Bennett (Assistant Professor, International Affairs and Director of the Political Economy Program, Lewis & Clark College), and Laura Rivero (Yerba Buena). This panel will open the second day at 9 am. Tickets are available at: http://www.cannabissustainability.org/#tickets
Visions are wonderful sources of inspiration for all humans. If we can use our businesses in a way that incorporates a truly inspiring vision, and if it is implemented in a strategic, integrated, and authentic manner, than those businesses will not only help change the world, but inspire everyone they touch.
We all have visions of what would make a better world. Maybe it’s a world without hate or homelessness or disease. Maybe it’s equality for all regardless of gender, race, religion, or sexual orientation. Maybe it’s a planet that is sustainable. These visions may seem out of reach in the short term, but inspire long-term thinking, planning, and dedication. They are “dreams” that serve as a signpost or “North Star” directional finder so that we know the direction we want our lives to go. Missions, meanwhile, are the “doing” part – what your company is doing, who your company is serving, and how to accomplish this in a responsible manner.
Businesses that are fully engaged in authentic, strategic, and integrated Corporate Social Responsibility (CSR) programs often have a Vision for their company that is interconnected with the company’s Mission, set of Values, and the lens through which decisions are made. Corporate Visions contain real world aspirations for society, in combination with how a particular business will help to achieve those goals and change the world.
It should be no surprise to anyone that in this day and age of “purpose-driven” workers (especially Millennials) demanding more environmental and social responsibility from employers – that developing a company Vision, along with an authentic Mission and set of values, is a good place to start to keep workers engaged.
To give you an idea what a corporate Vision is, one only needs to look at the vision statements of some of the most recognizable companies and brands on the planet:
Disney: “To make people happy.”
Google: “To organize the world’s information and make it universally accessible and useful.”
Zappos: “Delivering happiness to customers, employees, and vendors.”
Instagram: “Capture and Share the World’s Moments.”
Amazon: “To be the earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.”
These are heady and heavy visions for an entertainment/software/Consumer Packaged Goods company. How does a company seeking to create an authentic Vision that will have traction begin and how is progress towards that goal get measured?
Visions can be developed primarily through two different paths: internal generation or external generation. Internal generation consists of the company tapping its own human resources to determine consensus on what is the important dream/goal that will be directly or indirectly, related to the business. If you are in the business of delivering a physical product, how can the development, design, manufacturing (especially supply chain), and/or lifecycle be related to your company Vision? If you can survey all employees, then you will have the greatest opportunity for buy-in and employee engagement. If you’re too big for that exercise, perhaps surveying representative employee groups can help generate/narrow choices. If you’re still in the start-up phase with minimal employees, then that would be the perfect time to get your CSR (mission, vision, values) baked right in.
External generation may come from some larger body of standards designed to create a more sustainable world. Many companies are now using the United Nations’ Sustainable Development Goals (UNSDGs) as a “northstar” for purposeful engagement. The UNSDGs are a set of 17 global goals designed to end poverty, protect the planet, and ensure prosperity for all. The intent is when governments, the private sector, and individual citizens take actions towards reaching these goals, the result will be a healthy environment enabling generations of humans to live in a sustainable way with dignity, equality, and a good quality of life. When looking to these “big picture” goals as a Vision for your company, I suggest adopting no more than one or two of the seventeen areas to address, lest your company’s Vision may get clouded.
As with a company’s Mission, when implementing Vision, you want decisions regarding the company’s operations, supply chain, philanthropy, community engagement, and employee engagement endeavors to be made through the lens of your company Vision. In other words, if you choose to have the “Zero Hunger” UNSDG as your Vision, then make sure all of your activities related to your business, your community, and your employees are driven toward this goal. Of course, the interim UNSDG targets can be converted into relatable targets for your company.
For example, one interim goal for Zero Hunger is: “By 2030, double the agricultural productivity and incomes of small-scale food producers, in particular women, indigenous peoples, family farmers, pastoralists and fishers, including through secure and equal access to land, other productive resources and inputs, knowledge, financial services, markets and opportunities for value addition and non-farm employment.”
If your company produces a food item or is a restaurant, then seek to match these interim goals in making your own supply chain business decisions – source your ingredients from small-scale producers, women-owned businesses, family farmers and others in alignment with the Zero Hunger goal.
Of course, to really get the most out of a strategic, integrated, and authentic Vision (or otherwise known as the “Outcome”) a company must measure the outputs that support movement towards the end goal. Someone either internal to your organization or an external technical consultant should be tasked with measuring and, at the very least, reporting internally progress on these goals. If you’re not measuring it or reporting it, then it might as well not be happening and your Vision will ring false with your employees, your community, and your consumers. It is best to track your company’s progress towards these “big” visionary goals and communicate that progress on your website, social media, and/or in an annual report.
Visions are wonderful sources of inspiration for all humans. If we can use our businesses in a way that incorporates a truly inspiring vision, and if it is implemented in a strategic, integrated, and authentic manner, than those businesses will not only help change the world, but inspire everyone they touch.
We all have a mission in life. Maybe your mission is to have a job in which you improve people’s lives. Maybe your mission is to raise the best kids you can. Maybe your mission is to make a lot of money early in your career so you can retire at an early age and dedicate your later years to volunteering, or sailing, or writing fiction. Mission is what drives us as humans. It’s what inspires us get out of bed in the morning and embrace the day.
Likewise, with an ever growing conscious and purpose-driven workforce, some businesses are using missions to drive their decision-making process. And the businesses that have developed a strategic, integrated, and most importantly, authentic Mission through which all business decisions are made, are actually outperforming the competition.
Meanwhile, some businesses believe they are too small to focus on “feel good” principles such as developing a mission, vision, or set of company values. They are focused on getting off the ground, developing a consistent product/service, marketing, repaying investors, and becoming profitable. To those businesses, I give a couple of examples (and there are many) of successful businesses that took the time to “bake in” mission in the early stages of an organization’s development.
One example is New Belgium Brewing Company – one of the most popular, mission-driven, craft beer companies in the world. As legend has it, before the company produced their first barrel of beer, co-founders Kim Jordan and Jeff Lebesch went on a hike to discuss what kind of company they wanted to be. They decided on their mission: "To operate a profitable company which is socially, ethically and environmentally responsible, that produces high quality beer true to Belgian brewing styles."
Then, there’s Starbucks. Despite the belief of many, Starbucks wasn’t founded to put independent coffee houses out of business and dominate the coffee market. Rather, before Starbucks opened their 2nd store, the founding owners (Jerry Baldwin, Zev Siegl, and Gordon Bowker) sat down and had a conversation about what kind of company they wanted to be. In Europe, the founders had seen how coffee shops were often THE community gathering places, especially in small towns; the places where family and friends met and socialized, where business people met to discuss business ventures, where people relaxed and recreated, and where cultural activities happened. And while large cities had coffee shops, in the 1970’s they were not as ubiquitous as they are now throughout the U.S. So, Starbucks’ owners developed their mission to create community gathering places throughout the country and: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”
Developing a mission statement is where it all begins. The best mission statements are not driven from the top of the company down, but are developed through an inclusive, democratic process that culls input from everyone in the company (or as many people as is practical for companies that are already established and are going back to develop a mission later in the business lifecycle).
Once you have the necessary people in the room to talk about your mission, there are four basic questions that need to be answered collectively:
1. What is your company’s mission? In other words, how is your business going to define itself vis-à-vis your industry, your competitors, and your community (both internal and external to your business)?
2. How do you create an environment within your business in which all decisions move through the lens of this mission? In other words, how do you build your business (or re-invent your business) so that your mission is intrinsic to every aspect of your business and procedures are put into place to ensure that screening?
3. How do you implement changes in your business or next steps in your business’ development that further advance your overall mission?
4. How are you going to measure success against your mission? In other words, what are the desired outcomes and outputs that you are looking to achieve by being a purpose/mission-driven company?
One last note on mission development:
Purpose/mission driven organizations only succeed to reap the demonstrable and historical returns on investment if there is buy-in across all channels of workers. In developing an organization’s mission, sometimes it is hard for internal resources, sometimes siloed but often times very close to an organization’s operations, leadership, and history, to see the forest for the trees. Other times, junior or new workers invited to participate may be hesitant or reluctant to fully engage in the process, deferring instead to senior management. For these reasons, it is advisable to utilize outside facilitation to assist with this process.
image: hr bartender
Studies continue to show that workers (especially Millennials) desire more than a paycheck. Job satisfaction can come from working in organizations that have meaningful and authentic social and environmental values. It can also come from a whole host of benefits beyond those traditionally found in the workplace for salaried employees, such as health care, dental, vision, paid time off, and retirement savings.
Here are a few of these “non-traditional” benefits that can lead to greater job satisfaction:
1. Unlimited Time Off
While there are a few companies that offer unlimited paid time off without restriction, other companies provide it for company-approved volunteer activities. The theory is that workers are adults and should be treated as such. In other words, if they can get their work done and still engage in activities that are meaningful to them, they will ultimately be more loyal to the company, perform better and more efficiently, be more energized and strive to exceed expectations.
Some of the companies offering unlimited paid time off (PTO) (without being restricted to volunteer activities) most notably include Virgin and Netflix. According to the Society for Human Resource Management’s research, this leads to a more engaged workforce because management is trusting employees to manage their own time in a way that serves their personal needs while still getting the work done. It also can be a BIG selling point in attracting talent. Finally, it can help a company cut down on the expense of tracking PTO.
Of course, unlimited paid time off, be it for personal growth, leisure, or volunteering, is not for every business. Some businesses (manufacturing plants, restaurants, small retail stores) require employees be available for set and regular hours. But in businesses that have the flexibility to offer unlimited PTO, the benefits can be profound.
2. Workplace Amenities
It used to be that employers would entice workers n private offices, an impressive holiday party, free coffee, and maybe tickets to see the local sports teams play or to the symphony. In the dot-com craze, when shared workspaces became the norm, video games, a ping pong table, free snacks (sometimes, free meals), on-site gyms, and a keg on tap were used to induce recruits. These days, some companies are taking work place amenities to a whole new level with nap rooms, meditation and yoga rooms, on-site child care, weekly happy hours, free concerts, alternative commuting options and public transit passes, and on-site health services.
Of course, having the amenities can attract talented candidates, but the key is also giving them the freedom (i.e. permission) to utilize the amenities without any negative repercussions.
An interesting development in some workplaces has been the use of fieldtrips for workgroups and teams. This type of collective activity allows for out-of-the-office bonding and has also been shown to improve performance, increase productivity, build morale, and relieve stress.
These collective experiences could be taking time off for a volunteer charity project, a sporting event (I recommend a baseball game given its length and flow that allows for conversation), a ski/snowshoe/snowmobile/surfing day, a nature hike, rock climbing (outdoor or indoor), a cooking class, or even group participation in an escape room. Outings that challenge employees physically and mentally can inspire creativity, build trust, and bring the team closer together.
More and more companies are realizing that providing the benefit of a sabbatical to long time workers, leads to more engaged, dedicated, and harder-working employees. It can also attract and help retain top talent, counteract burnout, and lead to new-found creativity and perspective for returning workers.
Sabbaticals are considered a time to recharge, a time to study, travel, or simply do something away from the rigors of the workplace for an extended period of time. In fact, Fortune Magazine’s “100 Best Companies To Work For 2016” list includes 20 well-known companies that offer fully paid sabbaticals. And, according to the 2016 SHRM Benefits Survey, sabbaticals are increasingly popular among today’s employees.
5. Summer Hours
Everyone likes to enjoy their summer – especially, those workers who have kids that are out of school. Accordingly, many companies implement “summer hours,” allowing workers to take Friday afternoons (or sometimes, the complete day) off. A recent survey of Fortune 1000 companies showed that this is the new perk--with 42 percent of companies participating, up from 21 percent in 2015.
Of course, encouraging summer hours also takes the confidence that workers will be responsible for completing tasks on time, fulfilling commitments, making up the time throughout the week, and not abuse the privilege. Implementing Summer Hours with a certain amount of flexibility is the key, as some workers will not prefer to work more during the week to have less time at the office on Fri; others might just want to leave work a couple of hours early on Friday.
In the end, as is the case with many of these benefits that cultivate employee engagement, workers want to be engaged on their terms around their own needs, interests and passions. If a company can tap into those things, then talented workers will follow.
It’s been demonstrated over and over again – companies that create and implement a strategic, integrated, and most importantly, authentic, Corporate Social Responsibility (CSR) plan experience better performance than their counterparts who do not. These companies not only differentiate themselves in the marketplace and experience larger profits than their competitors, they also attract and retain the best talent, are more respected in the community, have less employee absenteeism and theft, garner more market share, and better weather crisis events.
But what if that same strategic, integrated, and seemingly authentic CSR program is co-opted by some within the company for less than honest purposes? It risks tearing apart the entire fabric of authenticity that can take years to build and decades to recover.
Such is the case in two recent examples: DaVita and Volkswagen.
DaVita is the largest provider of out-patient kidney dialysis in the world. Headquartered in Denver, Colorado, the company enjoys a reputation locally as well as nationally and internationally as having a unique culture that puts “community first.” In fact, DaVita has a comprehensive CSR program which includes an honorable mission, a global vision, and an extensive set of values that respect employees, patients, and the planet. Combine this deep-seated values proposition with a unique culture (the company calls itself a “Village) that encourages fun, teamwork (“All for One, and One for All”), an iconoclastic leader (referred to as the “Mayor”), and a decidedly non-corporate feel to their headquarters, and you have a pretty remarkable employer. (Full disclosure – I have been so enamored with DaVita’s unique approach to corporate culture, employee and community engagement, and sustainability that I have actually applied for more than one position with the company).
But all of that has now been threatened by a series of events, unleashing a barrage of bad publicity, cutting to the heart of the company’s core values and demonstrating a use of the company’s CSR program for nefarious purposes.
As recently reported on John Oliver’s Last Week Tonight HBO show, DaVita has been involved in a series of questionable practices that undermine the progress it has made with its unique culture and in the marketplace. Putting aside the eccentricities of DaVita Mayor Kent Thiry, the company may be involved in improper and/or illegal administration of health services. It is not my intent to comment on those allegations. Rather, there is one particular element of these recent claims that made my stomach drop. It is with regard to the use, or rather the misuse, of the company’s CSR plan, the foundation of which is the concept of community. It’s one thing to embed a sense of community when it comes to treating patients, employees, and the environment well; it’s quite another when employees use this same bedrock value of community to counsel procedures in ways that reduce life expectancy and increase corporate profits.
The latter occurred in a secretly recorded taping of one DaVita employee trying to dissuade a patient from undergoing a life extending (but dialysis ending) kidney transplant, using a “family” analogy. As depicted in the Oliver segment, the employee advocated that some patients don’t undergo a transplant because they don’t want to leave the DaVita “community.” I was in shock, as I’m certain others were, who heard this chilling recording. Could a company that built a seemingly-successful CSR program upon a foundation of “community” really use that same community for less-than-honorable purposes? It certainly made me pause to consider the implications.
Another company that recently had its CSR programs called into question by using some of its core values to deceive customers is Volkswagen. For years, the German car manufacturer made claims that its diesel engines emitted less pollution, less greenhouse gasses, and burned “cleaner” than conventional petroleum fueled vehicles. Volkswagen promoted its supposedly “clean” cars through a high-profile marketing campaign that included Super Bowl ads, online social media campaigns, and print advertising, often targeting “environmentally-conscious” consumers.
Volkswagen promotional materials repeatedly claimed that its “Clean Diesel” vehicles had low emissions, reduced nitrogen oxides (NOx) emissions by 90 percent and had fewer emissions than gasoline cars. However, in fact, according to the Federal Trade Commission’s complaint against the company, Volkswagen “clean diesel” vehicles emitted up to 4,000 percent more than the legal limit of NOx — a dangerous pollutant that contributes to environmental harms and respiratory ailments. Further, the company installed “defeat devices” so that the cars would mask the true emissions output and pass vehicle emission tests.
Volkswagen ended up resolving a criminal case against it, pleading guilty to conspiracy, obstruction of justice, and other crimes, and paying a civil penalty of $1.45 Billion for the alleged civil violations of the Clean Air Act. In addition, tens of thousands of Volkswagen owners needed to endure the inconvenience of car recalls, repairs, and returns. This is not to mention the tidal wave of negative publicity that Volkswagen has had to endure.
In the end, it will remain to be seen whether Volkswagen will be able to recover its reputation, in particular, amongst those socially and environmentally-minded customers who were duped into the company’s “clean tech” claims.
As demonstrated in previous posts, when used in a strategic, integrated, and authentic way, CSR is a wonderful, brand-enhancing tool, that has the capacity to create legions of enthusiastic “fans”, supporters, customers, and employees many of whom will evangelize about the company and their products. Such companies can even weather normal crisis events better than companies that don’t have a thoughtful CSR plan. But when a company intentionally uses its values-based CSR programs for less-than-honorable or dishonest means, the road to gain back the public’s trust can be a bumpy one.
At a time when some in the business community are predicting a major shift in how and whether companies will continue to make corporate philanthropy a centerpiece of CSR programs, it’s time we talk about “smart” giving tactics. Simply giving money away, as well-intentioned as that might be and enabling businesses to check off a “community engagement” box in a CSR program, usually doesn’t result long-term results – for either the charity or the business doing the giving. In many ways, without a strategic and integrated program, tied directly to an organization’s overall mission, vision, and values, such giving can actually undermine a business’ authenticity when it purports to support societal improvement.
Most businesses that engage in philanthropy, simply give money away to a variety of disparate causes or perhaps a group of similar organizations within the umbrella of a particular cause (eg. homelessness, child education, environmental issues, veterans’ organizations, etc.). Unfortunately, maintaining this practice without some connection to one’s organizational mission misses a whole host of benefits that an organization could otherwise gain had the giving been more strategically made.
By example, last week I met with an owner-chef and restauranteur about trying to better direct their company’s philanthropy program. Like many in the restaurant business, entrepreneurial, owner-chefs are maxed out in both time and capacity to strategize their charity work. Most smaller, independent restauranteurs don’t have private foundations or dedicated community engagement staff. Often, responding to requests falls onto the owner themselves or a marketing person (who would otherwise be spending their time marketing the company), or sometimes even a spouse or well-intentioned, but untrained staff member.
As we discussed trying to better define the types of organizations to whom he would focus his charitable giving, we discussed different causes. I asked him what causes were high on his list for charity work. He replied that he had been thinking about focusing his giving on veterans’ organizations, to which I then inquired with a series of questions:
Ultimately, the answer to all of these questions was “no.” I, therefore, suggested that after we go through a mission/vision/values exercise with himself and the key folks in their company (partners, investors, restaurant managers), that perhaps we look to causes more aligned with the business.
For example, if one of the clear business imperatives is to support small farmers or urban farms, then the charity program could do the same. Similarly, if the preference is to buy local or organic, then focus the charity on local, organic farmers and their issues. If your restaurants favor vegetarian or vegan cuisine, then directing your charitable giving to programs that support education and work in those areas. Likewise, if you’re primarily a steakhouse, perhaps organizations that promote responsible (anti-cruelty) animal husbandry, free range, and free of antibiotics or recombinant bovine growth hormone (rBGH) is for you. If you’re known for your seafood, then organizations that protect our oceans and promote sustainable seafood would be a good place to put your charitable efforts.
Once you figure out “who you are” as an organization, building out a charitable giving program that “makes sense” is fairly easy to do. In addition, you can connect your employee and community engagement programs, as well as your sustainability program (supply chain, in particular) to your corporate philanthropy. That way your CSR program is much more strategic, integrated, aligned with your values, and most importantly, authentic to both your internal and external stakeholders.
While giving to charity to help out others in the world or within one’s community is a laudable and commendable endeavor, doing so in a way that aligns with your business and core company values leads to a much more effective and mutually-beneficial relationship with the charities with whom you partner.
About a year ago, I was speaking with a CSR director at a Fortune 150 company. During that meeting, much to my surprise, he suggested that the cannabis industry needed tremendous help with CSR. In his opinion, the cannabis industry completely lacked formal programs touching on the fundamental “four pillars” of CSR: community engagement, employee engagement, sustainability and corporate philanthropy. As I investigated the issue, met with dozens of folks in the industry, I found that, indeed, very little was being done in these areas and what was being done, almost universally, was being done poorly – without strategy and authenticity.
Although cannabis is spreading across the country like, well, a weed, with hundreds of millions of dollars in revenue, there is little evidence that cannabis companies are taking CSR seriously. Part of this is due to the fact that it is really an “infant” industry, rising out of an illegal, black market, where dealers and growers operated in the shadows, under constant fear of criminal prosecution. Part of this is also due to the onerous taxation regime put upon the industry in states like Colorado as well as the oppressive nature of IRS Code Section 280E which, generally, prevents cannabis businesses from taking ordinary business expenses and charitable donations as deductions. Finally, part of this, frankly, is due to the fact that the industry is just worried about survival in an uncertain time of mixed messages as to the threat of federal enforcement, a patchwork of shifting state regulations and laws, and allegedly thin profit margins (at least, that’s what most operators claim).
But in the infamous words of Bob Dylan, “The times they are a changing’.” Ivy-school minted MBA graduates and former Fortune 500 executives are recognizing exciting and lucrative business opportunities in this space and are becoming a new wave of professional “ganjapreneurs.” With these new arrivals, is a growing understanding that if the medical and recreational “high-THC” cannabis industry wants to normalize operations and legitimize its existence, CSR is a wonderful avenue to help further the cause. These companies need only follow the lead of their cousins in the hemp industry like Dr. Bronner’s and Nutiva, that have successfully made CSR a central tenet of their businesses. In addition, with $6.7 Billion (that’s with a “B”) in sales in 2016, and an influx of new players in both the industry and ancillary businesses every month, there’s clearly money being made.
But what I’ve seen as passing as CSR in the cannabis industry, is a confetti approach to corporate giving, ad hoc employee engagement, and some half-measured attempts at sustainability. As I’ve emphasized previously, in order to see the greatest Return on Investment with CSR, these programs absolutely must be built upon (and screened through the lens of) the foundation of company mission, vision, and values. Rarely have I found cannabis businesses that have undertaken this critical step to establish a social mission within their corporate DNA that strays beyond a vague commitment to health-based, pain-management, and/or chronic-illness issues (one exception is Bloom Farms, though there are a few others). Without this underpinning of mission/vision/values, it’s hard to build a strategic, integrated CSR program that passes the authenticity “smell” test or experiences any kind of measurable ROI.
What I have seen is cannabis industry executives talk about donating off-spec, excess, and/or unusable product to military vets, ostensibly to help alleviate PTSD, but without a “story” as to how doing so relates back to their business. I’ve seen other businesses sponsor charity events when asked without any reason for doing so other than some vague notion of “giving back” or the resulting publicity for doing so. I’ve seen some large scale, vertically integrated companies give money to a couple dozen different charities ranging from first responders to PrideFest to environmental conservation groups, calling it “community engagement,” but without any kind of strategy to their giving, and without truly serving the real needs of the communities to which they are giving and impacting. I’ve seen companies “volunteer” their employees for roadside cleanups so they can skirt advertising restrictions. I’ve seen other companies ask employees to volunteer in park cleanups around cannabis-themed events so as to prevent the industry from gaining a black eye. While these activities are laudable and can positively impact the community, seldom have I seen any measurable outcomes/impacts from these acts of charity or community engagement.
What I haven’t seen is the kind of strategic, integrated, and authentic CSR programs that other industries have. I haven’t seen paid time off for volunteer endeavors or company wide shut-downs for days of service or any kind of willingness to match employee donations to charity. I haven’t seen massive amounts of money placed into R&D to reduce energy usage or pesticide usage (save for a few companies that try to be as “organic” as is possible and a few public/private partnerships to advance concepts in sustainability to those who are willing to participate). Much of the community engagement I have seen has been too little, too late when a company has already adversely impacted neighbors. I’ve seen millions of dollars spent on lobbying and government relations and sparse dollars spent on community or employee engagement. And I’ve seen a tremendous amount of turnover in most cannabis companies, with low level workers moving from company to company as if in search of their dream employer who will value them for who they are and not what they do.
CSR is the way for smart businesses to get ahead of the pack, retain talent, and experience growth to the bottom line.
Some form of cannabis sales and usage is now legal in nearly 30 states and the market for various products is becoming increasingly crowded. Much like the micro-brewery craze, if companies want to start to distinguish their brands in the marketplace, become “employers of choice,” and become less susceptible to public and governmental scrutiny, CSR is the way for smart businesses to get ahead of the pack, retain talent, and experience growth to the bottom line. And, I predict the cannabis companies that do accept this challenge to become industry leaders in CSR, will experience robust growth, more customer loyalty, and greater community admiration – just like the companies in other industries with strong CSR programs.
In the must-haves for a successful Corporate Social Responsibility (CSR) program to yield a desirable Return on Investment (ROI), I consider the “holy trinity” of CSR components to be that the program is Strategic, Integrated, and Authentic. In many ways, authenticity is perhaps the most important of the three for while a CSR program can lack strategy and may stand-alone without integration, and still experience some modicum of success, the entire program will fall apart if it is revealed as anything less than truly authentic. Employees will become disillusioned, the communities that your company impacts will turn against you, and the media might very well eviscerate you, causing tremendous loss of profit or market share (see the recent falls from grace of Wells Fargo, Volkswagen, and Uber).
As I discussed last week, authentic employee engagement can yield tremendous benefits in attracting talent and in reducing turnover, absenteeism, and employee theft. Authentic community engagement can go a long way in creating mutually-beneficial partnerships with those most directly impacted by your company. Now, I’d like to focus on the other two pillars of CSR, creating authentic sustainability and corporate philanthropy programs.
The jury is out. People want companies to “go green.” In fact, Millennials demand it. But, what exactly does that mean as far as constructing an authentic sustainability plan? I suggest that any company that is undertaking minimal amounts of sustainability for “show” or merely to cut some expenses in the budget, is doing it wrong. The companies that are most successful and that see the greatest returns in the market place, as well as to the balance sheet, are the ones that authentically strive to be industry leaders in sustainability. Understandably, smaller and startup companies are not likely to have the capital to put into a green building construction project, but there are a variety of ways that you can authentically build your sustainability program. When viewing sustainability, it should always be a 360-degree approach to all stakeholders, internally and externally. This might sound like a lot of work to gain authenticity, but it will pay off in spades.
Let’s be clear. Simply having recycling containers around your office or putting up “Don’t Leave Me Turned On” stickers by light switches, might save a few dollars, but it won’t go far in the way of authenticity.
image: Sorana Secu
Let’s continue with our example from last week: Your company has a new food item going to market and you want to appeal to those consumers who specifically seek out healthier alternatives. How can you strategically integrate authenticity throughout your CSR program that may give you a competitive advantage?
For sustainability, the company will want to look at three elements: operations, ingredients, and externalities.
Operations: is your business generally operating in a sustainable manner? Do you have written operational procedures in place to ensure that you are creating, marketing, selling, and delivering your product in the most sustainable manner possible? Are your offices and your manufacturing facilities being operated as sustainable as possible when it comes to energy, water, and other resource usage? Areas to review for sustainability include electronics/computers, HVAC, lighting (natural and otherwise), plumbing, landscaping, printing/duplication, file management, onsite power generation, composting/food waste, etc.
Ingredients: Are you sourcing truly sustainable, natural, organic ingredients from the geographically closest sources available? Are you using sustainably harvested and fair trade ingredients? Are you limiting excess sugars, transfats, and processed materials? Packaging is also an extension of ingredients as far as minimization of materials that might not be compostable or recyclable or, worst case, harmful to human health (e.g., BPA liners). Could you use a biodegradable, wax-paper carton instead of a plastic tub? What are other, more sustainable ingredient alternatives or unique ways that you could package your product?
Externalities: What are your impacts on the planet from shipping your ingredients to production and distribution of your final product to market? Could it be produced in multiple locations to reduce greenhouse gas emissions/shipping costs? Are you operating your offices/manufacturing facilities as efficiently as is possible? Have you utilized “sustainable design” techniques in developing your business as well as production of your product?
The final, and most important element of authenticity concerning sustainability is to make sure that you are measuring your results and reporting them. There are lots of ways to do this using the International Organization for Standardization (ISO), the Global Reporting Initiative (GRI), the UN Sustainable Development Goals, but perhaps the easiest and least expensive one is using the B Corp B Impact Assessment. The B Impact Assessment is a free application from B Lab. It will enable your company to identify your strengths, challenges, and areas for improvement when it comes to sustainability and, in the process, provide you with an industry comparison to similarly-situated businesses.
Again, nobody expects a new business to take on all of this at once, but having a comprehensive, strategic, and integrated plan will go a long way to demonstrate your authentic commitment to sustainability to all of your stakeholders.
An authentic corporate philanthropy plan is not one that simply gives money away to the founder’s favorite charities, but rather is one that authentically addresses impacted communities’ needs, as well as employee engagement strategies. To that end, it’s always best to identify groups who may be negatively impacted by the production process and/or are proximate to the company’s headquarters. Rather than just giving money or product away to those communities, authentic corporate philanthropy meets the community where it is and is an on-going discussion, providing the help that the community actually desires. It must not be a one-time action that may be viewed as a publicity stunt or a way to simply ameliorate a PR problem. It should be a story that is connected to your business and that can be conveyed in an easily understandable message to the community and your workers. An authentic corporate philanthropy strategy should be thought out, defining how the funds will be allocated, the boundaries around and requirements for fulfillment, and, ideally, the expectations regarding use for the funds and metrics for measuring success. The more that the corporate philanthropy program is designed, the more authentic (and successful) it will be.
As I stated, there should be a “story” that connects the philanthropy to the business itself. Years ago, the nonprofit I founded was the recipient of a large sum of money from Major League Baseball. While it was great to receive the funds and fun to get the picture taken with the oversized check, the fact is that there was zero connection between MLB and the organization. None. How authentic did that look to the media or to the league? I suggest that it didn’t look authentic at all and that the return on investment in that exercise was negligible for MLB.
Authenticity is the secret sauce of CSR plans because it ties directly to an emotional feeling that all stakeholders desire to have. When done well, authenticity leaves all with a positive feeling about the company and the products they produce. When done poorly, it can undermine the entire CSR program. The businesses that implement successful CSR programs do so in a way that is not only strategically integrated and makes business sense, but do so in a way that is authentic. And it is authenticity that elevates the plan into a social imperative that is compelling for communities, employees, and customers.
In today’s world of knock-offs and over-publicized, self-congratulatory acts of charity to garner media attention, what it means to be “authentic” has been severely diluted. Maybe that Rolex watch you bought on the streets of Manhattan will impress your friends and family. Perhaps that Louis Vuitton bag you found at that swap meet in South Central L.A. will not only be functional, but fashionable. In those cases, authenticity might not matter; you may only be going for a “look” and whether or not the product is “authentic” may not be of any real consequence.
On the other hand, when authenticity is a key factor in your decision-making as to the companies you will support, the products you will buy, and the places that you will work, then authenticity may make all of the difference. You might take notice of the business that “adopts a highway,” but their real motive may be merely to advertise their name on a highway sign while they operate in a manner that fails to minimize their impact on the environment or doesn’t treat their workers well. Perhaps you’re conscious about your choice in personal care products; you seek out ones that are chemical free. Without any regulations around the word “natural,” you purchase a product that you think will be “better” or “safer” for your family, only to find ingredients on the product label that you can’t pronounce, have numerous number combinations before words (i.e. “1,3 undecipherable word”), and contradict what most people would find to be “healthy” or “natural.” Believe it or not, it’s completely legal – whether it’s ethical or authentic is another story.
Thus, is the slippery slope of authenticity. When does it matter, when does it not? I would posit that when it comes to developing and executing a Corporate Social Responsibility (CSR) plan, authenticity is one of the three “must haves” to make it effective and to achieve the maximum return on investment (ROI). Without having a strategic, integrated, and most importantly, authentic, CSR plan, your business risks significant criticism in the media, with your target consumer base, and among the talent pool that you need to attract and retain to be successful.
When it comes authenticity, it must be embedded throughout the four pillars of CSR: Community Engagement, Employee Engagement, Sustainability, and Corporate Philanthropy. Obviously, there are a myriad of ways that authenticity can be strategically aligned with both your product and throughout the CSR channels. In the interest of keeping this blog post brief, I’ll focus on one example. Also, it’s important to note that when it comes to developing your CSR plan, oftentimes, the intersection of the four pillars will become blurred, with initiatives often crossing into multiple categories.
Here’s the example: You have a new food item going to market and want to appeal to those consumers who specifically seek out healthier alternatives. How can you strategically integrate authenticity throughout your CSR program that may give you a competitive advantage?
For starters, your “community” should be viewed as both consumers as well as the geographical communities impacted by the production of your product (I will address employee engagement in the next section). To that end, if you want to appeal to health-conscious consumers, limit the ingredients to as few as possible and to only those considered to be “natural” or organic. Maybe apply for organic or non-GMO certification. Utilize as many locally-sourced ingredients as is possible to reduce your product’s carbon footprint. Apply screens for ingredients (local, organic, natural, etc.) up the entire supply chain to ensure authenticity.
Engage the community (local to your manufacturing and/or company headquarters) as much as possible, prioritize the hiring of locals, philanthropic giving to community-based organizations, and create community-enhancing/helping charity events/projects. Open up your facility to weekly public tours. Allow the community to use your meeting rooms for their community organizing. Invite local politicians to have a “town hall” exchange with your workforce. Provide opportunities for members of the community to participate in R&D trials and sampling events, seek their feedback, and pay them for their time.
Have a story that says and shows, “We care about our community: the people that buy our product, the communities in which we have a physical presence, and the world itself.”
Assuming that you have authentically engaged your community, congratulations, you’ve now piqued the interest of workers desiring to work for a company that might have a greater purpose! The next step is to utilize your integrated CSR plan to engage your employees and, if you’re successful, become an employer of choice – a company for which everyone wants to work. You can do this by engaging your employees in an authentic way. Spoiler alert: just adding a ping pong table won’t do the trick!
The work environment should be underpinned by a clear mission, an inspiring vision, and a defined set of values. Having these elements alone will go a long way to engaging your workers in a meaningful way. The work environment should also be healthy, safe, and fun. Further, you can utilize your employee engagement work to tie back into Community Engagement projects in the geographical community (say, time off for volunteer work or “dollars for doers programs”), company day-of-service events, charitable giving via matching or employee involvement in corporate charitable giving decisions. Explore alternative hierarchies that rely more on self-managed teams rather than top-down directives. Utilize 360-degree feedback loops, open books policies, non-traditional compensation, profit sharing, and employee ownership plans. Have regular, scheduled company-wide, social events.
Really, any employee engagement that goes beyond what is traditionally considered as a “typical” employee-employer relationship of “work for pay” will go a long way in providing authenticity to your company’s CSR plan.
Have a story that says and shows, “We care about our workers as people and want them engaged in the business itself – not just producing our product and profits, but in the decisions necessary to run our business.”
In my next post, I will cover how authenticity can be embedded into the other two pillars of CSR (Corporate Philanthropy and Sustainability).
Image: Dave Gray, The Connected Company
I have previously suggested that one of the ways companies can build happier workplaces with more engaged workers is to have less hierarchical organizational structures. Sure, hierarchies have their place in command and control, top-down environments such as the military, government and police forces, when decisions need to be made expeditiously, when lives are on the line and accountability is of the utmost importance. But generally, nobody likes being told what to do – especially not Millennials. Thankfully, we are starting to see cracks in the traditional corporate paradigm and companies are starting to explore alternative structures that have been showing tremendous progress in productivity as well as in worker satisfaction. But in order to be successful, there needs to be buy-in from the top of the organizational chain, from management, a recognition that “power” must be redistributed, and ego must be checked at the door. Less hierarchy can be threatening to those who have lived with it for their entire working careers, so making the shift to flatter, self-managed organizations can take some getting used to for older workers.
Reinventing an organization or starting one with a flat hierarchy is not for the weak leader who relies on power to make accomplishments happen; rather, it relies on a strong set of leaders who understand that less hierarchy leads to a more engaged and nimble workforce.
The benefits of a self-managed or “flatter” organizational structure are numerous. According to the Morning Star Self-Management Institute, some of the benefits of self-managed organizations are:
Self-managed organizations need fewer formal meetings, are fluid with job titles, are transparent within their team regarding performance, resolve their own conflicts (but can call on assistance from others to help mediate, if necessary), focus on team (rather than individual) performance, and self-set salaries (with peer calibration), and enjoy equal profit sharing.
Even a simple change in vernacular can make a difference as far as the psychology behind worker satisfaction. You’ll note that several leading companies no longer refer to “employees” or even say that “employees are our best ‘assets.’” Workers aren’t fungible. They cost money to hire and even more to replace. They are truly “human resources.” Playing with the terminology a company uses to refer to workers can help improve a work environment and culture. See Wal-Mart’s “Associates,” DaVita Village’s “Citizens,” KIND Healthy Snack’s “Team Members” and Johnsonville Sausage’s “Members.” Sometimes a name change can make all the difference.
As an African proverb states, “If you want to go quickly, go alone. If you want to go far, go together.” Reexamining our hierarchical workplaces will allow the entire company to go farther in a way that is ultimately more satisfying for workers.
For more information about self-managed organizations, including some case studies, I highly recommend checking out Frederic Laloux’s website and book on Reinventing Organizations.