The Obligatory Year-End Post

Apologies to my handful of loyal readers (Hi mom!) for not posting in so long! Being in retail, every part of the business heats up as we enter the Holiday period. Add to that all the typical “year end” business (budgets, next year’s goals, etc.) and the annoying tendency for all CSR events and conferences to be scheduled in Q4, it’s been tough to keep up.

But today I find myself on a plane (yet again, but this time for an extended holiday break) with some time to reflect. It’s been a full year for me – one that marked a significant amount of change, opportunity and accomplishment. I do feel like I’m laying the groundwork for some very exciting and challenging work ahead, but I want to acknowledge some of 2010’s highlights.

Net Impact – The 2010 Annual Conference in Ann Arbor, MI was simply incredible. From inspirational keynote speeches by Gary Hirshberg to Majora Carter, this year’s content was top-notch and continues to move me to continue in CSR. And as a Net Impact board member, I’m privy to some exciting information that I truly believe will help launch this organization to the next level. Liz Maw is an exceptional leader and I am thrilled to be part of the team. Everyone should stay tuned to what Net Impact has in store and make an effort to attend the 2011 conference in Portland, OR – the first to be held in a convention center!

HERproject – Our partnership with HERproject has already proven to be one of the most fulfilling initiatives I’ve had the privilege to work on. Attending the kick-off meeting at a factory in Vietnam this fall was an uplifting experience and I’m so excited to see the positive impact I know this project will have on the lives of the women workers in our supply chain.

Playing Professor – I had the chance to speak to an undergraduate business class on CSR at UC Berkeley and left inspired by our next generation of business leaders. These students certainly didn’t hold back any tough questions and weren’t afraid to dig deeper when I gave unsatisfactory answers! These kinds of events not only keep me on my toes, but also help me understand the shifting expectations on companies’ CSR strategies.

Engaging our Executives – Much has been made of the need to engage a company’s executives to gain “buy in” for CSR strategies, so I was glad to have the opportunity to spend half a day with some key executives and CSR experts. The rich dialogue helped to inform our CSR strategy and helped me understand where this work can connect more significantly to our business objectives.

Engaging our Employees – I was invited to speak at our quarterly all-employee meeting last week, something that’s usually reserved for our senior-most executives. Despite my nerves (A live audience of 800, while being simulcast to offices around the country – with our C-level executives seated in the front row!), I managed to make it through the presentation without fainting or falling. And since the presentation, so many employees have reached out to say how proud they feel, working for a company that invests in our CSR initiatives.

Wool Farming – I never thought my job would take me to visiting wool farms in Australia, but learning about more sustainable wool practices was definitely an eye-opening experience. This education helped to turn our company around on a critical issue and allowed us to take a leadership position on a topic that previously had been a challenge for us to fully understand.

It’s been a busy year and I’ve been a mediocre blogger, but I’m looking for more great things to come in 2011. I’ll probably add being a more prolific blogger to my list of New Year’s resolutions, but until then, I’m going to enjoy the holiday break and I hope you all do, too!

Moving Beyond Social Compliance

Most companies, even if they do not have a "CSR department" have a program in place to monitor social compliance in their global supply chains. For these companies, it is important to protect their brands' reputations by ensuring that the factories manufacturing their goods, often in developing countries, respect workers' rights, pay legal wages and abide by environmental legislation. It's also often from these departments that companies develop a more holistic CSR strategy.

I've spent the past two days in Ho Chi Minh City at the Better Work Vietnam International Buyers' Forum.  The Better Work program is described as:

"... a unique partnership between the International Labour Organization (ILO) and the International Finance Corporation (IFC).  It unites the expertise of the ILO in labor standards with that of the IFC in private sector development."

That's not a very telling description, but basically it's an effort to develop a sustainable, industry-wide mechanism to promote stronger industrial relations and good working conditions for garment factories in targeted countries (Vietnam, Cambodia, Jordan, Haiti).

Today, apparel retailers have different codes of conduct that they expect their contract factories to adhere to as a condition for doing business. To ensure that these factories are upholding the expectations expressed in these different codes of conduct, retailers employ auditors (either company employees or third-party audit firms) to visit factories and check conditions against their respective codes. With many retailers sharing the same factories, you can imagine that factories are visited dozens of times each year by auditors and out of each visit comes a list of "corrective action plans" for the factory to implement in order to remain in good compliance with retailers' codes.

This approach creates an environment where factories seek to solve specific problems in preparation for the next audit, but they may not take the time to understand root causes of non-compliance. Instead of understanding why they're unable to control overtime hours, factories may look for short-term solutions in order to "pass" the next audit.

The Better Work program seeks to shift the dialogue away from "auditing" and "monitoring" to truly finding long-term, sustainable solutions to poor factory working conditions.  In addition to conducting factory assessments (similar to a typical audit, but much more detailed and thorough), Better Work provides factories with consulting services and training (both for management and workers) in order to build factories' capabilities to manage working conditions and industrial relations.

Furthermore, retailers that subscribe to the Better Work program, agree to stop auditing factories and rely instead upon the Better Work assessments for insight into factory working conditions. This alleviates the factories from repetitive auditing and the International Labor Organization provides a credible approach that provides companies with the confidence that factories are being held to internationally accepted labor standards.

To me, it's a win-win situation, but these past two days have highlighted some challenges to broader adoption of this approach. Companies have had social compliance audit programs in place for decades and some are unwilling to let go of their own programs. People who represent companies and auditors have a vested interest in seeing the current environment prevail (They may fear for their jobs.), so they're not necessarily interested in promoting an industry-wide practice. Companies insist that their standards are stricter than the ILO standards and are unwilling to compromise on some points in order to support the Better Work framework.

The Better Work program has its work cut out for them, but I'm hopeful that retailers will embrace this approach more fully and the industry can move beyond the never-ending cycle of social compliance audits toward an internationally accepted, industry-wide system that focuses on the most important goal: improving the lives of garment workers.

Our CSR Summit

Earlier this week, we hosted a CSR brainstorming session to help three of our C-level executives understand some possibilities of infusing our brand with a more "socially conscious" angle. We invited in several CSR experts and a few CSR practitioners from other consumer-facing companies.

Prior to the event, I spent several weeks trying to convince people from my network to spend a few hours on the Tuesday morning after Labor Day with us in New York City. Understandably, people didn't commit to flying across the country for our meeting, but we did manage to get some strong representation from the New York area.

I also spent time in healthy debate with a marketing VP, whose role is to ensure that we project the appropriate brand image to external guests, including the type of food we have catered, the vases of white hydrangeas placed throughout the room and the color of the foam core (silver or white) we were allowed to use behind flip charts! She wanted bottled water, I insisted we get pitchers. She wanted to use a beautiful trash receptacle, I suggested recycling bins. In the end, since I'm not based in the New York office, she got her way. Despite saying she'd honor some of my sustainability requests, our meeting had bottled water and no recycling (among other things). As expected, several of our CSR guests commented on the "opportunities" to host a more sustainable meeting.

But the meeting itself went better than expected. We had a very robust dialogue, surfaced some exciting possibilities and I think everyone in attendance felt inspired by our brand and its potential connections to the planet and to communities.

The problem we have now is how do we take these ideas and this momentum and bring it to life? My job is to continue to push this work forward, but we don't have the appropriate resources to accomplish everything we discussed. Our Chief Supply Chain Officer pledged that he would debrief with his executive peers and our CEO to get a better sense of priority and I hope we'll then be able to work on a strategic plan to put some of this work into action!

The Holy Grail?

I've spent the past few weeks tweaking a new tool to rate our suppliers on social performance. It's never going to be "perfect," but it's at a point where I think it's workable.

Ever since before I started working in CSR, I'd heard social performance metrics described as "the holy grail." Professors grandly alluded to the possibilities of tying "hard social metrics" to financial performance and building a stronger business case for CSR. Of course, no one suggested that social metrics would demonstrate that CSR does not have business value. That outcome would simply mean the metrics were "wrong."

In any case, I don't know whether or not we'll ever get to the social metrics that hard-core CSR professionals and academics seek. What I do know, however, is that people in other parts of my company need an easy way to understand CSR performance and I need to develop something that gives us directional insight into social performance. As it stands, my metrics system doesn't provide an absolute grade. The important part is that it serves as a springboard for discussion.

And my point in introducing these metrics into our company vocabulary isn't to help our contract factories strive for perfection. When it comes to social performance, it's about continuous improvement and metrics can help describe relative performance between entities or over time. I just hope my business partners understand that I want to provide these metrics in a certain spirit - to cultivate ongoing feedback, dialogue and improvement.

The Ethical Supply Chain

I recently returned from a trip to Hong Kong and China, where I had the opportunity to visit some of the factories that produce our goods. In today's economy, supply chains are global behemoths, with companies balancing, among other things, cost, quality, speed, trade preferences, technical capability, product assortment and "social and environmental compliance."

Obviously, it's impossible to maximize all the different variables, which is why companies also seek to diversify their sourcing base. You don't want to be beholden to one country and/or factory for all your goods. If anything happens to that country/factory, your company would find itself up the proverbial creek without a paddle.

My job is to help maximize the last dimension I mentioned in the opening paragraph: "social and environmental compliance." In my and other industries, "social compliance" is a common term. Many people are surprised to hear that most any western company with a global supply chain has a "compliance" organization. The tricky part for stakeholders is to understand what authority that "compliance" team has and how they approach this work.

Some companies take a "checklist" approach to compliance where they have a list of important attributes for their contract factories to follow. Typically, this includes a no child labor provision, no corporal punishment and paying workers. These companies are minimizing the risk that's inherent in sourcing from developing countries.

Other companies encourage their contract factories to "own" social responsibility and work with them to provide management and worker training. They focus on building socially responsible practices into factories' management systems and seek collaborative partnerships with local civil society organizations to keep all parties honest.

Not surprisingly, more companies follow the former model than the latter.

I had the chance to only visit three factories during my trip to Asia and I was pleased to see that they were all pretty good from a social and environmental perspective. Two factories had pretty robust programs where they self-monitor for social and environmental issues. They had stated philosophical approaches to social responsibility and one had even developed a set of standards that it hoped would be stricter than local law or any of its customers.

In thinking through my own company's approach, we definitely fall between the two extremes I describe above. By no means are we doing the bare minimum, hoping that social and environmental risks will never rear their ugly heads. But we haven't evolved to the point where we are actively building management systems in place for factories to embrace and own social responsibility. It's a journey that takes time and an evolution that requires resources.

I'm lucky that the executives I work with "get it" and support me in my efforts to elevate the company's ethical sourcing efforts. Would I consider my company a leader in the ethical supply chain? Not yet, but if I have anything to do with it, we'll get there.

Industry Boomerang and Career Paths: An Open Letter of Apology

Dear internet friends,

I realize it's been a long time since I last posted, and for this I apologize. You see, since I last posted, I became pretty busy, wrapping up my job, coordinating a cross-country move (which is still in slow, slow progress) and preparing to begin a new job tomorrow.

After only 19 months in the healthcare industry, I decided to return to my roots, accepting a position to begin a vendor compliance and CSR program at a specialty apparel retailer. People have asked me if my time in healthcare was so bad that I lasted such a short period of time, and I insist that isn't the case. Instead, I was lucky enough to be offered an opportunity that will allow me to build a program from the ground-up.

As nearly everyone knows, the CSR "profession" is still a relatively new one. Unlike Corporate Finance, where a career path is relatively straightforward, positions in CSR differ widely from one industry to another - and even from one company to another within an industry. And thus, there is no one "career path" if you want to ultimately lead CSR at a company.

It was early on in my most recent job that my supervisor told me that it would be unlikely for me to find myself in a VP position in CSR at that company. Since she loved her job and continued to be challenged by her own VP position, she had no plans to vacate it. (And why would she?) So, she offered kindly, she would help me find a leadership position with another company, once I was ready for that next step.

Well, I think that next position is now in front of me, even if it arrived more quickly than either my former boss or I expected. The job I begin tomorrow puts me in charge of developing supply chain social and environmental standards and stakeholder engagement, with the hopes of building out a fuller CSR capability. It's in the industry where I got my first taste of a CSR role in a corporation and it's with a brand whose heritage I'm excited to become a part of.

My focus will be shifting considerably: from environmental sustainability to human rights in multinational supply chains. It's a shift I'm excited for, but I do hope to retain the environmental responsibility as well.

As I think about my career, it's important for me to "round out" my CSR portfolio, gaining experience in different focus areas so I may become a more effective CSR leader in the future. It's also important for me to find increasing levels of responsibility and challenge, to grow my skills and stretch myself. So, while I'm sad to leave my last company and the wonderful people I've had the chance to work alongside, I am very excited for this next chapter in my CSR career, where I will hopefully continue to learn and truly make a difference.

So, I apologize for the radio-silence, but I got very busy and I hope to post more frequently moving forward!

Sincerely,
Marcus

Data Dependency

Most CSR practitioners, I believe, continue on a quest for data. We all want data to support our theses that good corporate citizenship adds value to the company. Value can come in the form of cost savings, enhanced reputation, employee engagement or any number of other shapes and sizes.

The tricky part about gathering data to support CSR is that there are very few defined ways to measure impact and value. And as such, there are very few methods or systems to gather meaningful CSR data within companies. Much of my job is spent trying to take the company's existing data and either performing some calculations to arrive at CSR impact metrics or finding proxies for the value I'm trying to describe.

Since returning to work from the holiday break, I've been working a lot with data for two separate projects. One has to do with calculating environmental impacts of a particular process and the other relates to measuring consumption of a particular resource across the enterprise.

For the first project, I've been trying to get at some raw data from other Business Units. In theory, this should be rather simple. I pick up the phone, call someone in another department, explain the project and describe my need. They, in turn, either take some time to "run some numbers" and send me back the relevant information or they refer me to someone else. Usually, it's the latter, so it typically takes a few days (yes, days!) to track down the right person. More often than not, the data that returns isn't quite what I'm looking for, so we work together until we arrive at something meaningful.

Well, this process has been playing out for nearly two months with a particular business partner and his unresponsiveness has resulted in me not being able to deliver on some promised metrics. I hated to throw him under the bus, but I had to bring in a VP to finally get him to send me the data he'd promised back in November. Approximately an hour later, I delivered the metrics that were expected of me.

In the second case, I recently received a spreadsheet with spend data from every cost center in the company (thousands) and I've been diligently pouring through it, figuring out which line item is relevant and which is outside the scope of this project. Essentially, I'm taking the spend data, translating it into units purchased and figuring out the resources necessary to create those units, resulting in the environmental impact of our consumption. The problem here is that I have to make sense of a spreadsheet that isn't necessarily meant for this purpose and is riddled with codes, acronyms and sequences of numbers I don't understand. It's time-consuming work and rather tedious, but hopefully will tell a good CSR story in due time.

With both examples, you see how CSR practitioners must rely on others to supply information before we can produce results. For my business partners, they can simply run a report through an existing information management system, but I have to spend time doing manual calculations because no system exists (or we can't afford such a system) to extract data in the format we need.

Looking for No-Brainers

Thanks to an email I received from an employee at one of our distribution centers, we've identified an unnecessary process that, when discontinued, has the potential to save the company thousands of dollars in paper and postage costs.

Since I sit at the corporate level, I don't have insight into the day-to-day operations of our business units, and this is one of my biggest challenges as a CSR practitioner. How, then, do we uncover all these inefficiencies that can help reduce the company's environmental impact and save money? I've been in my role for approximately a year and a half and in that time, I've received close to 200 unsolicited calls or e-mails from employees around the world with ideas (and complaints!) and it's all thanks to shameless self-promotion.

I'm lucky to have an internal communications team that sees value in CSR and they've been very generous with real estate in company newsletters, our intranet and internal articles. When I first arrived in my role, my position was featured in an intranet article that announced a point person for CSR and sustainability. In our employees' minds, there was now a concrete person to direct inquires. This, however, is a blessing and a curse. While some ideas have the potential to have a significant impact, I find myself responding to and researching many other employee concerns about temperature control and recycling, often in locations across the country.

Beyond that first introductory article, our weekly company news round-up has featured more than a dozen articles on CSR in the past year. We've highlighted volunteer activities, employees who've brought to light a significant environmental opportunity and other accomplishments. This steady stream of internal communication has helped to reinforce the idea that we're working together to get things done. Ideas will be granted an appropriate audience and we will move toward resolution.

At the same time, you have to maintain an "every little bit helps" mentality or you'll go crazy. I recently spent several hours working with employees in Florida, North Carolina and Texas, trying to figure out how to digitize a process and reduce paper usage. I thought this might be a breakthrough that would result in saving tons of paper and a whole lot of money. The result? Approximately $50 in savings per year. But, the employee who brought this idea to my attention was so grateful for the help in getting rid of some unnecessary paperwork.

What Does Executive Buy-in Really Mean?

The only reason I'm in my job is because someone at our company had the foresight to declare that a commitment to good corporate citizenship and environmental sustainability is important to the company. Fortunately for me, that "someone" was our CEO. Less than a year after his formal declaration to our company's leaders, I was hired to lead our environmental sustainability strategy.

Every academic, pundit and CSR practitioner insists that executive buy-in or commitment is an imperative for CSR to be "strategic" at a company. I don't argue with this notion, but I've come to realize that executive support can take on different forms and degrees of strength, each leading to different approaches when it comes to a CSR practitioner's duties.

I've been thinking about this lately because I'm trying to engage some senior-level executives in our CSR work. While our CEO has declared a formal commitment, I don't think it's crystal clear to those who report to him (and the layer immediately below that) what that commitment means for them. It's my job to help make this commitment relevant to their day-to-day jobs and to give them the insight and tools to bring this commitment to life.

In thinking of the best way to engage these executives, I've been talking to some consultants and to peers at other companies to understand how they've helped their executives "get it." Through these discussions, I've seen a range of executive commitment and the ways that they influence a CSR practitioner's work:

Executive Champion - When your CEO truly believes that CSR will help drive innovation, differentiate the brand and contribute to a company's overall success, the CSR team is in a great position. Within that team, however, are varying roles and each practitioner is likely highly specialized. Some will be setting strategies while others will be managing programs. There are many opportunities for CSR practitioners here, but each person is valued for a highly specific set of skills and experiences.

Engaged Leadership - Company leaders may understand the importance and value of CSR, but they may not see it as a common thread throughout the entire business. This situation can cause some tension between the CSR practitioner and other business units or departments, but from this healthy tension arises potentially innovative solutions. It also demands that the CSR practitioner remain vigilant in expressing the business value of his/her work and brings some rigor to analyzing the benefits of CSR projects.

Limited Scope - Many companies seem to be in this category, where an executive (or a few executives) understand that CSR is valuable to their companies, but they don't see the whole picture. For example, an executive may appreciate the enhancement that philanthropy has on the company's reputation in a community, but may not connect this opportunity to creating a license to operate in new markets. In this case, the CSR practitioner is typically trying to expand the scope of his/her work in order to make these connections clear and seamless.

Executive Curiosity - In this case, an executive wants to understand what CSR is and how it can bring value to the company. They've heard about it from the press or their peers and they're curious to know what shape it might take within their organizations. This can be a golden opportunity for a CSR practitioner (or more likely, a manager in a traditional function who takes the initiative to build the business case for CSR at his/her company). If taken cultivated properly, an executive's curiosity about CSR can mature into a full-fledged strategy that's aligned with the business.

Nominal Commitment - Some executives discuss a company's commitment to CSR, but don't truly believe that it's of any importance. If any resources are devoted to CSR, it's typically in the communications or marketing space. While it sounds bleak, this is also a great opportunity for the initiative-taking manager who can clearly define CSR in new terms. Instead of "CSR," the conversation must shift to other drivers of value. Whether it's cost-savings from environmental sustainability, brand enhancement through ethical business practices or community goodwill from public-private partnerships, every company with a sophisticated CSR strategy started somewhere.

Cold Shoulder - There will always be executives who refuse to engage in CSR and where it may be a losing battle for any employee who's interested in taking responsibility for CSR. This probably isn't the right environment for someone who is interested in CSR as a career. Maybe wait for a change of leadership!

Obviously, these are simplified scenarios, but my point is that many people in this space discuss executive buy-in without really thinking through what that means. Sometimes, the opportunity can be greater at companies where there is no executive buy-in (yet) and some CSR practitioners may be frustrated at other companies where there is an authentic commitment to CSR but not a lot of opportunity to be entrepreneurial.

I Have an Idea!

Companies are networks of individual people. So, to be successful, you need to build relationships with your colleagues in order to get many things done. This especially holds true in CSR where you’re often part of a very small team with limited resources and you depend on others to help bring your work to life.

One of my biggest challenges in working for a large company is identifying the right person or people to help take a project from idea to execution. I’ve only been with my company for a year and a half, so I feel like I’m still learning the ropes and trying to figure out who’s in charge of what.

As a result, I often spend time following up on e-mails and voice messages that seem to have fallen on deaf ears. For example, I just spent about 45 minutes going through sent messages and either re-sending them to the original recipient or forwarding them to other people, in the hopes that someone will bite.

In my (very humble) opinion, I have some interesting ideas! The problem is, when you’re approaching a busy colleague who has no idea who you are (or what your job is), it’s tough to get them to understand how you can help. In CSR, you’re constantly engaging internally and building not only the value of your work, but also the value of your self.

So, especially during the early days of working for a company, you spend a lot of time re-sending, re-explaining and hoping that someone “gets” what you mean and agrees that you have an idea worth chatting about.

Purpose

With so many corporate social responsibility (CSR) blogs and resources out there, what could I possibly add to the dialogue/noise? And in such a new "industry," certainly no one can profess to have all the answers or claim true mastery.

I can, however, share my experiences and opinions from spending several years as a CSR practitioner in the hopes that this blog helps to illuminate the truth (the good, the bad and the ugly) about my job and others like it.

Recently, I returned from Ithaca, NY where I attended the Net Impact annual conference. It was my eighth conference and continues to be one of the highlights of my year. What I cannot even begin to communicate is the energy and optimism that results from thousands of MBAs and professionals who come together with a more noble vision for the purpose of business and its role in society. At 2,400 participants, it was Net Impact's largest conference to date and it's clear that interest in CSR continues to gain momentum.

What's frustrating, however (and I've certainly experienced this firsthand), is that the idealism expressed by students and professionals who aren't CSR practitioners doesn't always match up with reality. Even at the most "progressive" companies, CSR isn't readily embraced and there are many, many uphill battles and difficult conversations to be had.

So I hope this blog can serve as a resource to those who are interested in learning more about CSR and how companies can play an active role in improving society and the environment. To the fullest extent possible, I'll offer my honest opinion and unguarded insight into my day-to-day world.