The New Brand Spirit

How Communicating Sustainability Builds Brands, Reputations and Profits

Christian Conrad, Marjorie Ellis Thompson

• Publisher: Routledge
• Year: 2016
• Print ISBN:
  9780566092442
• eBook ISBN:
  9781317023043
• Topic: Business
• Subtopic: Business General
• Index: Business

Effective sustainability communication can deliver business value. Get it wrong, however, and the reputational damage will be costly. Stakeholders, and the general public as well as activists, are unforgiving of companies whose products, services, business practices or culture fall short of their socially responsible rhetoric. Based on close to one hundred in-depth interviews with leading experts, Christian Conrad and Marjorie Thompson's The New Brand Spirit helps corporate communications and marketing professionals tackle this conundrum by providing a first-hand view of eight distinct and relevant stakeholder perspectives. Nineteen comprehensive and well-researched best practice cases from sustainability leaders like IBM, Unilever, Marks & Spencer and Puma will inspire all those tasked with communicating sustainability with practical and applicable tools and lessons learned. The result is a book that will enable senior executives, corporate communication professionals and brand managers to decide when, to whom and how to communicate sustainability related messages - and when not to.

PART I The Interviews

The Questionnaire

What do I associate with CSR communication? Dressing on a rotten salad!

Robert Rubinstein, CEO of TBLI Group

The answer came without hesitation from the Triple Bottom Line (TBLI) pioneer, a Brooklyn, New York City native, now residing in Amsterdam, the Netherlands, whose TBLI conferences bring together international corporate business and finance companies and aim to ‘re-educate the financial world’. I could sense the anger in his voice when he spat out the words ‘rotten salad’. The rotten salad, he explained is his characterization of what companies actually do in the area of sustainability and corporate responsibility which they then cover with smooth communication – with dressing. Robert Rubinstein, like many others we spoke to, perceives a great discrepancy between the walk and the talk of companies when it comes to CSR. There needs to be a fine and artful balance between the two – if there is too much talk relative to the walk, then the outcome tends be at least a little superficial. If on the other hand there is hardly any or no communication of substantial commitment, there is a real missed opportunity to create positive brand value and to build reputation by adding credible, open and honest communication.

What becomes very clear when talking to different stakeholders is that the perceptions of what CSR is and what CSR communication is tend to vary significantly. We found that some views and perspectives can be constructively aligned, while others are so divergent that it is hard to reconcile them. One reason for this may be fundamentally different paradigms, values and beliefs or ‘dogmas’. This is particularly true for the view of certain parts of civil society. Our aim is to show where the convergence is, but also where there may be a need for companies to agree to disagree with some of their stakeholders.

What do you associate with CSR?

Overall, there is scepticism and even dislike of the term ‘CSR’ or ‘corporate social responsibility’ among many of our interviewees. We chose it because internationally, we felt it was the term with the broadest understanding – which may, in hindsight, be a mistaken assumption, judging from the response we received. For some, ‘corporate responsibility’ without the ‘social’ is a better term, as it seems more inclusive of environmental issues. For others ‘corporate sustainability’ is the more all-encompassing and suitable term because sustainability covers the three dimensions ‘economic’, ‘environmental’ and ‘social’ and has a time dimension to it (‘future generations’) that stresses the long-term view companies ought to take more than ‘corporate social responsibility’ does. For some, ‘corporate social responsibility’ is dated. As Hugh Burkitt of The Marketing Society (UK) and Business in the Community (UK) puts it:

CSR is an old-fashioned notion of how companies should behave – but it is stuck somewhere in the Corporate Affairs department. We in the BitC team looking at this feel we have moved on, we think CSR has been discredited because it was seen as a kind of side show, because it was not handled by those in charge. Companies today need to move towards sustainability.

Peter Kruse, a German communications expert, is concerned that CSR is a blunt instrument used to create a shiny surface on a society that is increasingly blind to anything but monetary value.

There is also the pragmatic view that the terminology does not matter that much. Uwe Kleinert of Coca-Cola Germany says:

Our concern is that businesses act and produce and move in their market in a way that is responsible toward all stakeholders including future generations. Coming back to the term, we left out ‘social’ and included ‘sustainability’ to make it clear that we care for both.

This view states that it is about how companies behave, how they go about their business. Or as Nancy Baxter, formerly of Wells Fargo (US) puts it: ‘CSR is a business practice and a discipline within an organization to address and focus on the issues of being a good corporate citizen.’ British CSR expert Mallen Baker agrees, and maintains that CSR is about how companies manage the business process to produce an overall positive impact on society. Even more pragmatic is the definition of SustainAbility’s Jean-Philippe Renaut, for whom CSR encompasses ‘all corporate initiatives that improve the sustainability performance of an organization’.

The other, more philosophical, perspective takes the position that CSR is about the role of business in society. The Natural Step founder Karl-Henrik Robèrt states:

It is about the overall need to integrate business into the objectives of society at large, to consider the larger impacts of business on society, not just on shareholders. In that respect, CSR is so wide that it is difficult to pinpoint exactly what it means. Actually, while being a good starting point when talking about the role of business in society, it has become a bit flaky. In the mid to longer term we must get rid of CSR as it has the tendency to create a permanent and unhealthy dichotomy between business and society. We need to integrate the two but then we don’t need to shout so much about it anymore. If CSR creates this dichotomy it leads businesses astray and may be more dangerous than not having an agenda at all. In the full business case for sustainability businesses understand that taking into consideration all social and environmental concerns is good for business and then CSR is not needed any more.

What do you associate with CSR communication?

From our interviews we can identify two camps: those who perceive CSR communication as necessary or even positive, and those who see it as a ‘cover-up’, as a new area of public relations, and point out that a lot of it is either boring or mere window-dressing. It is strongly associated with reporting, and there has been significant change in this field over the past decade.

The negative associations are twofold: the majority of the critics feel there is too much CSR communication, while there is a group that is concerned that so far, many key stakeholders do not have sufficient understanding of the subject. ‘There is a real gap of understanding and knowledge in this area and a real need to clarify the term(s) that people who are not in the profession would use’, says one Fortune 500 corporate spokesperson who does not want to be named.

For many, the first thought is CSR or sustainability reporting. While that is important, it is not the focus of this book. There are many books, many research reports, which focus on reporting. We include reporting where it is mentioned by our interviewees, and include one case on integrated reporting (Case 14: Novo Nordisk, Chapter 16). However, many of the key lessons we learned from many of the interviews and case studies can be applied to reporting. Reporting is one format, one medium, that can be used in communicating CSR and sustainability. Our aim is to show the diversity and complexity that have developed within the subject matter. If there is one message that we want to get across, then it is this: that there is no one-size-fits-all. Marketing and PR professionals will be surprised that we even mention this point, as to them it seems so evident. But it needs to be said. The principles of marketing and corporate communication apply to CSR and sustainability communication!

Each chapter follows the structure of the questionnaire.

We start by looking at CSR communication from the stakeholders’ side. What do they expect of companies’ CSR or sustainability communication (Question 1)? And how do they see their role in the context of this communication (Question 2)? Question 3 looks into the issues and challenges that companies face when talking to the particular stakeholder group. Questions 4 and 5 reflect on what works (best practice examples) and what does not work (greenwashing examples). The final question gives some hint as to why some communication works and others do not – key success factors of CSR communication to their stakeholder group.

Interview with Robert Rubinstein, TBLI

WHAT DO YOU ASSOCIATE WITH CSR COMMUNICATION?

A salad dressing on rotten salad. A lot of companies don’t integrate sustainability into their organization. A lot of it is basically bullshit – you know the level of bullshit depending on where it is parked in the organization. Unless it is embedded in the organization, core business, it is only an add-on, an external thing, not part of business activity. I have never understood corporate volunteering if it has not got anything to do with core business. CSR has been damaging to the whole sustainability movement – not created an economy. It is investing in toxic waste and planting flowers around it. They want to feel good about the garbage they are doing. I have never been a fan of CSR – it is Oprah Winfrey ribbon-cutting nonsense. An example is Porter and his ‘effective philanthropy’. CSR is basically communication without a strict definition. Our definition of ‘sustainable investment’ is much stricter – you don’t get a membership to the fitness club. It would be different if I changed it to ‘sustainability communication’, defined as ‘While you are making money are your products or services worsening or damaging the sustainability and environmental balance?’ Social balance is more profitable, environmental balance is, in the end, more profitable through lesser use of resources! Many companies say ‘We are actively engaged in stakeholder dialogue’– but that does not mean you are making progress – see Obama and health care.¹

WHAT ARE YOUR EXPECTATIONS REGARDING CSR COMMUNICATION OF COMPANIES?

Have your company audited whether or not it is actually maintaining or improving the sustainability balance, for example according to The Natural Step. The key issue is: do companies really want to do this? Ninety-nine per cent only want to do ‘CSR-lite’, and it is very difficult to get from the dark to the light side. Take the Dow Jones Sustainability Index (DJSI): the ones who score the highest are the biggest CO₂ polluters, because they report. SRI fund managers do not look at taxes in terms of determining the sustainability of a business, it is not an issue for them, even though that means: no social contribution. Audit results need to be communicated properly. The audit companies are whores, would do it if you paid them. That is why they are supporting the present system. Yoda said: ‘Do or do not, there is no try.’ I am just tired of listening to companies chatting about this. TBLI² has the focus: show self-interest, show the opportunities, show the money flows and the progress that has already been achieved. We see the money flows that we directly or indirectly create, and that is why we focus on the financial sector – it is much easier to convince than other sectors. If they see the money, opportunities, self-interest, they will do it. They are very predictable and easier to manipulate than other industries. And I mean asset managers and asset owners, not regulators!

WHAT IS THE ROLE OF SHAREHOLDERS IN THE CONTEXT OF CSR COMMUNICATION OF COMPANIES?

They are not doing what they are supposed to do. They could be more challenging, should integrate sustainability into their portfolio rather than giving 5 per cent to charity! But the whole process is in a state of flux, it is changing, just needs to be moved faster! Their understanding is not very good, they are not very good at what they do. In general, there is a significant movement in the right direction, though, and I have confidence in the greed of people. The EU should do the same thing for pension systems as they do to telecoms and energy and offer a choice – either adhere to ESG³ to manage money or otherwise ….

CAN YOU SHARE ANY BEST PRACTICE EXAMPLES OF CSR COMMUNICATION?

Look at the Corporate Register awards for the best reports, GRI is just copying that. I am only interested in the actual sustainability effect, not the communication.

HOW DO YOU DEFINE ‘GREENWASHING’ AND COULD YOU NAME EXAMPLES?

All CSR communication is greenwashing. Maybe not the right term, certainly people who are doing it think they are doing well, there is not enough awareness. But take banks – the main impact they are having is about where they put the money.

WHAT DO YOU CONSIDER TO BE KEY SUCCESS FACTORS OF EFFECTIVE CSR COMMUNICATION FROM AN INVESTOR OR SHAREHOLDER PERSPECTIVE?

Authenticity. Show that it is really integrated into your core business activity – not an add-on. And don’t rely on reporting – fund managers don’t read the CSR reports. Take MTR, the Hong Kong transport company, as an example of authenticity: the boss of MTR is a big fan of sustainability. He went to Copenhagen,⁴ really trying to push the equation, authentic, passionate, trying to push the concept also within his organization.

CHAPTER 1 Communicating Sustainability – the Civil Society Perspective

CSR communication should be all about linking a company’s core activities back to real corporate sustainability.

Dax Lovegrove, Head of Business & Industry Relations, WWF-UK

The world of NGOs and ‘civil society’ is a multifaceted tapestry of organizations and movements with varying perspectives and agendas. It can therefore be argued that it is particularly challenging to paint a coherent picture of what this stakeholder group’s expectations of CSR communication are. Simply speaking, there are two kinds of NGOs – those which can be labelled ‘campaigning NGOs’ and those that we will call ‘collaborating NGOs’. Campaigning NGOs see it as their mission to bring specific social and environmental issues to public attention and thus onto the societal agenda. In their relationship with business they often seek to expose corporate (mis-)behaviour in the context of those issues. They are less interested in dialogue with companies, but see it as their objective to encourage public awareness as well as regulatory pressure on businesses, and in that way influence their behaviour. Collaborating NGOs take the approach of seeking solutions to social and environmental issues through dialogue with businesses (and other stakeholders). They actively engage and even partner with companies, seeking win–win solutions between social and environmental objectives on the one hand and the economic objectives of business on the other. Obviously there are overlaps between collaborating and campaigning NGOs: few are ‘purebreds’. Oxfam and Greenpeace can be seen as prominent examples of campaigning NGOs, yet they are also in dialogue with businesses. On the other hand, the WWF and the Rainforest Alliance are organizations that could be labelled ‘collaborating NGOs’, yet they also campaign for their respective causes. Good examples of organizations that increasingly do both in relative balance are the Fairtrade Foundation and the Fair Labor Association.

Both groups of civil society organizations are relevant to CSR communication for different reasons, and companies seeking to move towards corporate sustainability and aiming for effective communication of their activities need to take these different roles into account.

What do you associate with CSR and CSR communication?

CSR AND CSR COMMUNICATION ARE SUSPICIOUS

In most cases, NGOs have a paradigm that fundamentally differs from that of businesses. NGOs take a social or environmental perspective. While companies focus on generating (economic) profit and creating value for their s...

Table of contents

• Cover Page
• Half Title page
• Dedication
• Title Page
• Copyright Page
• Contents
• List of Figures
• List of Tables
• About the Authors
• Foreword
• Acknowledgements
• Reviews of The New Brand Spirit
• Introduction
• Pat I The Interviews
• Part II The Cases
• Part III Summary and Outlook
• Index