Sunday, October 5, 2008

Corporate Social Responsibility

I was asked to write an article on Corporate Social Responsibility (CSR for short) in a recent issue of the Mass High Tech Journal[1]. I have permission to reproduce it here and I also refer you the on-line edition, here.

The Changing Face of Corporate Social Responsibility

Last year during a NetHope
[2] collaboration summit of nonprofit and for-profit technology leaders, the head of corporate affairs for a leading software company leaned over to me and said, “Guess what the number three question applicants are asking us now?” Building the suspense, she cited the obvious number one and two questions about salary and career path. “What’s your corporate social responsibility program,” she delivered word-by-word after a pause, “It wasn’t even on the radar screen three years ago.”

The generation entering the work force today grew up with a keen awareness about the environment, poverty and disease—and the expectation that we can do something to change it. In a recent Wall Street Journal report
[3], the author cites the 2006 Cone branding survey, which notes the following about 13-to-25 year-olds:

79% want to work for a company that cares about how it impacts and contributes to society.
69 % are aware of their employer’s commitment to social/environmental causes.
64% say their company’s social/environmental activities make them feel loyal to that company.
56% would refuse to work for an irresponsible corporation.

These are sobering numbers. Couple these with the huge demographic shift we are about to experience in the U.S. and it is a wake up call with both alarm bells ringing for corporate leaders.

As my generation of 79 million Boomers retires and 35 million Millenials take our place, it does not take much foresight to see that competition for knowledge workers will become acute. Paying attention to what the “incoming class” of workers thinks is important is no longer a “nice to have;” it is fundamentally strategic.

I recently completed an executive fellowship as CIO-in-Residence at the Tuck School of Business at Dartmouth. While I was in Hanover, one of the professors told me that 50% of incoming students ask about the school's Allwin Initiative for corporate social responsibility
[4] as part of their decision process for attending the school. In addition, 30 students at the business school, out of an incoming class of just 240, volunteer to work on nonprofit boards for the school year. These are not the average workers of tomorrow; these are future CEOs.

Corporate social responsibility (CSR) has evolved since the days of the Carnegies, Fords and Rockefellers. For most of the last century, corporate philanthropy was about supporting the arts and local community. Leading corporations and corporate leaders were known as patrons of the arts, schools and hospitals.

This began to change toward the end of the 20th century as employees—in what was a grassroots movement—demanded more from their organizations. Cases in point are the Kosovo refugee crisis in the 90’s and Hurricane Mitch in Nicaragua earlier this decade. In both cases, employees pushed their organizations to respond and apply the specific resources of their companies to help. CSR became more of an employee response and engagement issue. One corporate philanthropy leader told me that it was not important to tell the story of what her organization was doing with Save the Children; it was important to tell their employees what they were doing.

The next wave followed the burst of the bubble, as some organizations offered employee fellowship options to work at nonprofits as an alternative to downsizing. Many employees took the option. What happened next was a valuable surprise. As a leader at a telecommunications giant told me, they discovered that employees who returned after the economy recovered said the experience was a profound experience in leadership. Managing in chaotic, under-resourced situations—the modus operandi of nonprofits—proved to be valuable leadership training. Sabbaticals at nonprofits are now part of this organizations leadership development program. Notice the shift: corporate philanthropy is now strategic; it’s about developing the next generation of corporate leaders.

Yet another Silicon Valley executive told me that the next generation of CSR is about skilled-based philanthropy. In this case, the focus shifts from leveraging the time and general management skills of employees working with nonprofits, to working on projects that leverage the specific skills of the employee and the organization. So if software development is the skill, then helping nonprofit organizations develop emergency response supply chain management applications may be the project.

Over the past 24 months we’ve seen “green” initiatives move from the periphery to the mainstream of business. The same is also true about emerging countries—even the people at the bottom of the pyramid—as market segment. Combining these trends with the changes in new employee attitudes and the evolution of CSR programs means that philanthropy is no longer an adjunct activity for good community relations; it’s about core business strategy. As Daniel Pink has recently written
[5], there are for-profit, non-profit, and not for only profit organizations. This is the new face of corporate social responsibility with which we would all do well to become very familiar.
[1] "The changing face of corporate social responsibility," Mass High Tech, The Journal of New England Technology, Friday, September 5, 2008.
[2]For background on NetHope, see
[3]Sarah E. Needleman, “The Latest Office Perk: Getting Paid to Volunteer,” The Wall Street Journal, April, 2008, ; see the Cone Inc. press release on the report, here:
[4]For information on the Tuck/Dartmouth Allwin Initiative For Corporate Citizenship, see
[5]Daniel H. Pink, A Whole New Mind: Moving from the Information Age to the Conceptual Age, New York: 2005. Pink coined this phrase in the DVD seminar related to the book.

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