Interview with Tom for ‘Good works’ web site

This month Tom was interviewed about ‘Welcome to GoodCo’ by Nick Franchini of the Good works web site.

 

Your book explores how “the tools of business can be used for public benefit”. What do you think makes this book relevant to Good works and its members?

“Well, first of all it promotes the concept of the ‘corporate citizen’ which is a company that sees it has responsibilities to the world around it rather than just to its owners. This kind of company believes that when it engages with the wider community there are benefits for all, and this books shows that this win:win situation is increasingly common.

“I took nine months to research the book and I found the whole process very inspiring because there is such a wide range of opportunities for the corporate citizen. Yes, it is about engaging employees at a community level but it is also about how the company invests capital; it’s about issues like tax and longer term aims such as climate change.”

Does a corporate citizen focus on the longer term?

“Yes, very much so, and history is instructive on this. For example, one hundred years ago most companies were family companies. That is much harder to maintain nowadays as companies get bigger and more complex and need many more skills. The ethos used to be to hand over something better to the next generation, and that gave them a 25-30 year horizon which is missing in a financial world that very often trades in seconds.

“An example is Wates, the construction company. Although it is a big company it is still owned by the Wates family. It has an operational board for day to day business and then there is a higher board with 9 members who are all associated with the Wates family who guarantee that the original longer term generational perspective is maintained. For example, they have an aim of zero waste going to landfill. This is clearly very green but over the next thirty years this aim will prove to be of great financial value as well.

“Among PLCs Unilever have not gone as far as a generational plan but they do have a ten year programme for the better management of their resources, including energy. They also abandoned quarterly reporting so they only report to shareholders once a year. As a result, the proportion of shares held by Hedge Funds has fallen by 15% to 6% and also the volatility of their shares has got a lot less.”

Good works members tend to be middle ranking managers, experts or consultants. How can they use the book?

“Middle managers, consultants and technical experts have diverse needs which can be brought together – it should feel good for people to come to work, for workers to feel that they are fulfilling a good purpose both in the sense of contributing to building and maintaining an effective business but also contributing to the public good.

“To begin with I would ask them to ask for this book to be put in the company library or given to the corporate strategy team. And why not their local library too?”

Tell us more about bringing the whole person to work…

“The best initiatives tap into this sense of bringing the whole person to work. For an SME this could be supporting local community initiatives such as a local junior sports club which serves the children of its employees. For larger businesses this could be something similarly reciprocal but much more far reaching – like National Rail working with The Samaritans. This partnership saves lives on the railways, enhances the well-being of employees and saves money for the company without one purpose detracting from another. Just as importantly, until someone had the foresight to push through this idea it may have seemed stranger than fiction. It illustrates that if we are going to make it easier to bring the whole person to work then we need to look at what small steps we can take as individuals and employers to make that possible.”

Clearly the corporate citizen needs to recognise the boundaries of good taste as well as the public good. How important is ‘good will’ in all this?

“I believe it is a widely accepted belief in companies and among employees that investing in the public good can be ‘good business’ as well.

“It is also true that in business this is sometimes done with the wrong intentions – such as being subordinated to the marketing strategy. This can reduce the pursuit of the public good to a bureaucratic box ticking process. In the long run, that’s not maximising the benefit to the company.

Are there any specific challenges that you would like to highlight?

“Well, volunteering is quite common so let’s look at that. Let’s ask why the level of ‘time volunteering’ by employees falls off among bigger companies. This is maybe because as a company grows there is a greater need for team building to retain cohesion and this reduces the time available for (arguably more useful) skills volunteering programmes.

“And when a big company does commit to increasing the level of time volunteering this is not necessarily the best way to create public good. Indeed the volunteering could be being used simply as a team building exercise. For example, an accountancy firm might send a team of employees to paint a community hall over the weekend. While they are painting and learning to be a team on one side of a wall, on the other side there might be a charity treasurer pulling their hair out over a problem and in urgent need of free specialist advice – which is available just a few feet away. So near and yet so far…

“My experience is that once you start down this path you might be pleasantly surprised. As described in my first book (‘Partners for Good’ Gower 2012) I visited a Nestle plant in Harrisburg near Johannesburg, South Africa. It was the biggest single employer in the town and was suffering from high staff turnover as a result of illness and death from AIDS. The employers realised that to stem this awful tide they had to go outside the factory and reach out into the surrounding residential areas from which they drew their staff. So they partnered with relevant NGOs and the University of Pretoria and pulled off a remarkable success, raising life expectancy in both community AND company and thus saving costs.”

This sounds like it takes a ‘flipping of a switch’ in corporate perception to create the corporate citizen

“Yes it is just like that and there are plenty of inspiring examples to stir us into action. There is a story in ‘Welcome to GoodCo’ about Leon Sullivan, who was a contemporary of Martin Luther King and fellow civil rights activist. He was the first black man to sit on the board of a major US company, General Motors. He drew up the ‘Sullivan Principles’ which led to not just GM disinvesting of its interests in South African but over 100 other firms followed their lead. They bought into the principle that a US company could not have one policy on employees in the USA and another one for employees in another country, in this case because of Apartheid laws.

“Another example is Frances Perkins who was eventually President Roosevelt’s (FDR) Labor Secretary and the first woman to sit in the President’s Cabinet. She laid down the foundations for the Health & Safety policies we now take for granted. Her work was inspired by fate as by chance she found herself walking down the street and witnessing first-hand the death of 143 women in just ten minutes in a fire at the Triangle Shirt Waist factory in New York in 1911. She went on to become a Professor at Colombia University. These are truly unsung heroes who show all of us what can be done.

“And don’t be put off by initial indifference or negativity. The truth will out. With a lot of these things companies will initially oppose the change but then once it becomes the new norm they will claim it was their idea. History shows this time and again.

“This is about spirit and principle rather than just law and regulation. The true Corporate Citizen will engage with new situations with the right spirit. By that I mean extending the spirit of established principles rather than allowing a gap to develop in new areas where those principles have not yet been applied. Sadly this does happen and perhaps an example could be US firms circumventing local laws by outsourcing their production to foreign owned companies in foreign countries.

“On the other hand, an example of companies coming together with a humanitarian agenda is SEDEX, which has 36,000 members including Marks & Spencer. Check out www.sedexglobal.com for details.”

How important is the role of language and jargon in legitimising pernicious business practice?

“An example is outsourcing abroad which can be a force for good where it takes advantage of lower labour costs to introduce investment which gradually leads to rising living standards such as in China. But it also can be a force for bad if lower labour costs abuse worker’s rights such as entitlement to health and safety protection in the workplace.”

So does corporate citizenship depend on clarity of communication as well as good will?

“That is a very succinct point. Certainly we need to be clear about the context when making decisions. There will be different solutions for different contexts. But that shows how valuable it is to have at our disposal to guide us universal principles like ‘A Blueprint for Better Business’. These principles guide decisions on what is reasonable easier to make in complex situations. And they make it harder to obfuscate or hide what really matters.

“A practical example is Fujitsu’s recently announced strategy to analyse their whole supply chain’s community impact using ‘Trading for Good’. The title says it all – they are trying to ensure no stone is left unturned in the process.

“Another is ‘Ban the Box’, Business in The Community’s (BITC) campaign to remove the ‘Do you have a criminal record?’ tick box off job application forms. Boots have already done this internally but they have also persuaded companies in their supply chain do the same.”

PostScript by the interviewer Nick Franchini

“If Corporate Citizens do exist just as there are good citizens then is it the case that we also need to develop a ‘corporate civil society’ in which these corporate citizens can grow and prosper? And what does that corporate civil society look like and consist of?