CEOs Reflect on CSR

By Pamela Babcock Oct 27, 2014

NEW YORK—Putting “visibly passionate people” in charge of corporate social responsibility (CSR) initiatives and embedding responsible leadership throughout the organization ensures those CSR efforts will work, according to speakers at the Commit!Forum conference.

John P. Bilbrey, president and CEO of The Hershey Co., said when CSR is part of a company’s core values “you’re going to be successful, and that attracts not just consumers, but it attracts shareholders. And when you bring that all together, it’s pretty magical stuff.” It also can be key to attracting and keeping the next generation of workers.

“Millennials can smell what’s real and what’s not real,” Bilbrey told attendees at the conference, held Oct. 8-9 and presented by Corporate Responsibility Magazine. “If you can make this a piece of the company’s DNA and who you are, you won’t have a hard time retaining people.”

CEO commitment to CSR is paramount. When making decisions about jobs, the majority of Americans (72 percent) want to work for a company whose CEO is actively involved in CSR and/or environmental issues, according to a survey released at the conference. The Cost of a Bad Reputation survey by Corporate Responsibility Magazine was conducted in conjunction with Alexander Mann Solutions, a London-based talent management and management services firm. Results were from a telephone survey of about 1,000 adults.

It’s Not Just Checking a Box

Rosaleen Blair, founder and CEO of Alexander Mann Solutions, admitted that CSR is often misunderstood.

“I think there are a whole bunch of people out there that are incredibly cynical about (CSR) and perceive for organizations like us that it’s a tick box” to be checked off, Blair said. “As managers and leaders, we are in a very unique and, frankly, privileged position to educate people that corporate social responsibility is not just the right thing to do, but actually it makes absolutely perfect business and commercial sense.”

During the event, several CEOs discussed the concept of “shared value,” the idea that doing good helps society and also is profitable.

Green Chemistry and More

Rakesh Sachdev, president and CEO of Sigma-Aldrich Corp., a life science and high technology company, said one challenge of running a public company is the tension between the short-term expectations of Wall Street and the long-term work needed to undertake CSR initiatives.

“I was taught a long time ago that there is what’s called ‘patient capital’–the things you invest in that you don’t expect a short-term return on [because] you’re doing it for different reasons,” Sachdev said, adding, “Long-term, I think we all want to leave this world a better place.”

In addition to a green chemistry initiative to reduce or stop creating hazardous substances, Sigma-Aldrich is working to provide products that “are much greener themselves,” Sachdev said.

Although CEOs must back CSR, Sachdev encouraged attendees to pick the most “visibly passionate people” to head up CSR so that it becomes “infectious.”

Supply Chain Challenges

New Balance Athletic Shoe Inc. operates in an industry where other manufacturers have come under scrutiny for labor and manufacturing practices. The company has five factories in the U.S. and is the only athletic shoe manufacturer still making some of its shoes in this country.

New Balance CEO and president Rob DeMartini said one CSR challenge is the company’s fast growth, which has made it critical to embed responsible leadership into the culture.

The company’s vice president of responsible leadership sits on the global leadership team and is involved in functions such as product development and the supply chain. A leadership scorecard with CSR measures is reviewed frequently to determine “where we can get better,” DeMartini said.

One goal is to reduce waste. DeMartini said a challenge is that fashion changes every three months, but supply chains are set up for 18- to 24-month cycles.

DeMartini added that strong alignment between CSR and the business is key. Companies should make the business benefits visible while ensuring CSR messaging is consistent throughout the organization, he said.

Aligning CSR and HR

Kathleen Edge, executive vice president of HR for electrical cable producer Southwire Co., said alignment between CSR and HR helps build a sustainable workforce. CSR can make employees feel they are part of something greater, which can encourage deeper employee engagement and boost retention.

Stuart Thom, president and CEO of Southwire, said the company works to ensure the entire workforce feels involved and empowered in CSR issues.

Through the company’s Project GIFT (Giving Inspiration For Tomorrow) program, employees can become known as “Blackshirts” by achieving a certain level of community service hours annually. The program began during Hurricane Katrina after a cadre of employees volunteered–all wearing black shirts at the time. About 800 Southwire employees have earned “Blackshirt” status. The company didn’t create the initiative; employees came up with the idea and lead the program.

“We don’t have any bureaucracy around it,” Thom explained, adding that it’s an example of the company’s collaborative spirit.

Southwire’s cooperative education “12 for Life” program is designed to address the high school drop-out rate and help create skilled employees. Southwire partnered with schools systems in Carrollton, Ga., and Florence, Ala., where its two factories are operated by student employees who balance school with learning job skills at the factory, while earning a paycheck.

Students attend the program during the day, earn more than minimum wage, get high school credit, and learn leadership skills, discipline and more. The school systems provide teachers, and Southwire employees volunteer as mentors.

Since 2007, the program has helped 850 students graduate, and Thom said “a bunch” have joined the Southwire employee ranks as adults. The program is run by Southwire’s director of employee resources.

“From an HR perspective, we take the best of the best supervisors and have them manage the [student] facilities,” Edge explained, adding that Southwire seeks employees who know how to mentor, lead, coach and who “have the patience to understand the journey these students are going through.”

Pamela Babcock is a freelance writer based in the New York City area.

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