Social Impact May 8, 2017
“If You’re Inconsistent, You’re Toast.”
Companies serious about social impact are taking a deliberate stand on issues in line with their core business.
Even in today’s highly polarized political climate, business leaders are taking an active role in protecting and promoting social values through their companies. Starbucks committed to hiring as many as 10,000 refugees in response to the Trump administration’s travel ban. Leaders in the healthcare industry helped influence popular opinion through their opposition to the proposed American Health Care Act. The investment firm State Street installed a bronze statue of a young girl opposite the bull statue on Wall Street, ostensibly to draw attention to the lack of women in boardrooms.
Shannon Schuyler, the chief corporate responsibility and purpose officer at PricewaterhouseCoopers and an adjunct lecturer of social impact at the Kellogg School, sat down with Megan Kashner, a clinical assistant professor of public–private interface and director of social impact at the Kellogg School, to discuss how businesses are keeping their companies focused on social impact.
This interview has been edited for length and clarity.
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Megan KASHNER:How should corporate leaders choose which issues their companies focus on from a social-impact standpoint?
Shannon SCHUYLER: Organizations should look at both the primary drivers of their business and the issues they see on the horizon, asking: “What’s the biggest risk, and what’s the greatest opportunity?”
It’s also a matter of companies thinking about the resources they use throughout their global supply chain. You have beverage companies focusing on water, obviously, because that’s significant to their livelihoods. Other companies focus on health issues. They ask, “How can we amplify a positive trend in society? What kind of statement can we make? What are the outcomes our products can contribute towards?”
KASHNER: We’ve seen examples of companies starting to do this. The Walmart Foundation saw that its business model depends on human capital, so they focused resources on retail career pathways, partnering with local high schools, community colleges, and training programs. CVS Health, which decided they would stop selling cigarettes in 2014, had to think about who they were and where their brand was going. It was a risky decision, but CVS did it because they were taking a long-term view.
We’ve also seen entire industries come together around certain issues they feel are important to society as well as to their businesses.
SCHUYLER: Right. Because we’re in a time when almost everything is politically charged, we now have companies coming together and responding as an industry. They say, “I don’t care if we go head-to-head on the shelves. If we do this together, we help our industry more than if we went it alone.”
Leaders are talking with their colleagues on a daily basis because they don’t want to get things wrong or appear out of step. When an issue like North Carolina’s controversial “bathroom bill” or a tragedy like the Pulse nightclub attack in Orlando, company leaders get on the phone or send messages back and forth asking, “How are you responding to this?”
“There used to be a lot of talk among big multinationals about trying to change the world. Now, I think people are more focused on communities.” —Shannon Schuyler
KASHNER: We saw this with the healthcare industry’s response to the AHCA bill. Similarly, more than a hundred companies have pulled their advertising off of Breitbart in the wake of what they consider to be hate speech and false headlines.
SCHUYLER: Right, and it’s not just a moral issue. We at PwC have a very diverse organization. We sent out a note in support of the bathroom-ban repeal, not because it’s a moral issue, but because the ban would mean we can’t appropriately serve our clients. The same thing with the Executive Order travel ban. We aren’t able to serve our clients if we can’t get the people that we need from overseas here. That was the stance that we took.
KASHNER: How do you think the question of social impact or social responsibility has changed for companies in recent years?
SCHUYLER: There used to be a lot of talk among big multinationals about trying to change the world. Now, I think people are more focused on communities. The closer you are the ground, the more you can actually see the change. So companies today are going into local communities and deciding how they can impact school systems or local healthcare issues. They’re getting down to the grassroots level, because they want to be authentic and because storytelling has become the way companies are able to connect what they do to people on the ground.
Here’s another trend I see: Today, if you’re inconsistent, you’re toast. You’ve got to stand for something, and you have to make sure that your behaviors and your values guide you through the decision-making process. You need to use your purpose as a lens through which you view decisions, so that you can stay consistent. If someone doesn’t like it, that’s fine, as long as you are able to explain your stance and authentically discuss it.
KASHNER: We’ve seen both proactive and reactive examples of that. I think about Airbnb, which took a little while to recognize that people of color felt discriminated against. The company took a more defensive stance at first, but now when I look at their messaging, the positions they’re taking, their hiring, and how they’re starting to look at corporate social engagement, I feel like that company looked in that mirror and changed direction. I think it’ll be interesting to see if and how that will benefit their business.
SCHUYLER: Newer organizations get a bit more leeway in terms of making mistakes and recovering from them versus organizations that have been around for decades. More established companies often get held to a higher standard.
KASHNER: That’s a really good point. I wonder what we would see if we compared Airbnb’s messaging and positions to Intel’s public statements and actions around increasing their human-capital diversity, as well as their investments in companies that are founded and led by underrepresented minorities and women. Because for Intel, it’s a matter of “show us the money.”
SCHUYLER: It’s interesting, this shift: organizations that are developing today have evolved in a much more visible, social, human way. We’re not asking young companies to show us what their investment will actually look like. We have decided that they’re good, because they’ve been born under this halo. Older companies have to earn the halo.
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