It's one thing to talk a good game about corporate social responsibility, quite another to implement an effective program, as panelists explained at the 2005 Social Enterprise Conference, held March 5th at Harvard Business School.
"Operationalizing Corporate Social Responsibility" was the topic of the panel discussion moderated by HBS professor Herman B. "Dutch" Leonard. Executives John McGoldrick, general counsel of Bristol-Myers Squibb, and Mike McBreen, director of global operations for Nike, shared lessons learned as their companies implemented worldwide corporate social responsibility (CSR) programs.
Six years ago, Bristol-Myers Squibb started a $120 million program called Secure the Future to address the problem of HIV/AIDS, particularly in Africa. The process has not been easy, McGoldrick said.
At first, the company found that they didn't control enough factors to be truly successful. "We found that check-writing was [so] completely insufficient that we had to have real live human beings on the ground working with partners for this to work."
Involving the community
Community mobilization was the key, he continued, stressing the importance of making "common cause" with the communities you are working in. At first, the company felt a sense of dissonance partnering with village healers, whose practices are so wildly different from what the company considers standard practice. But by keeping the focus on their common cause (helping those suffering from HIV/AIDS), they've had high levels of success partnering with traditional healers in villages, who in turn referred people to the clinics Bristol-Myers Squibb set up.
"If we didn't make common cause with them, we wouldn't succeed," he said.
Another challenge is to develop models that can be delivered in different settings, and that are inexpensive enough for governments and foreign agencies to scale them to their needs.
| You do it because it drives benefits throughout the whole operation. |
| — Mike McBreen, Nike |
"One of the greatest values we could add was a tech transfer of some very low-tech stuff—how to do an audit, how to write a grant application, how to set up financial and other controls," McGoldrick said.
Still, he acknowledged, there are many questions surrounding CSR programs. Why are we giving away shareholder money? Why not give money the company makes to the shareholders, and let them decide what to do with it? "The answer," McGoldrick said, "is it's legal, it's a core practice of companies, and it's widely supported by shareholders."
There is no outcry from shareholders to stop engaging in CSR. If anything, shareholders ask why more isn't being done. "There is another reason," he said. "I believe there is a certain moral imperative for companies to engage in these activities."
Nike's McBreen talked about his work in focusing the many CSR strategies at the company. "By trying to solve everything," he said, "we were solving nothing."
The company began by changing "the overall posture from a defensive posture to a defining posture," he said. Nike implemented a Balanced Scorecard approach, focusing on price, quality, delivery, and CSR. The company looked for logical connections in what they do, and created strategic plans with CSR aligned and integrated into individual business strategies.
"It brought to light the end of the debate about whether you do this for business or whether you do this as a social enterprise," said McBreen. "You do it because it drives benefits throughout the whole operation."
The company decided to focus on labor and the environment, issues that could show tangible difference to the company's bottom line while also achieving social goals.
The Balanced Scorecard gave them common performance metrics to measure the impact of the work they do across segments.
Four elements
"When I listen to a lot of the discussion today, it is a lot of the same debates we have internally: How do you prioritize your work? What is the best management strategy for social enterprise? What are the tools and resources that can be brought to bear? When you think about social enterprise, remember it has four basic elements: people, process, tools, and culture. The element of culture often gets the least attention, but in many respects can be the most deterministic of your success."
| One of the greatest values we could add was a tech transfer of some very low-tech stuff. |
| — John McGoldrick, Bristol-Myers Squibb |
McBreen also talked about the challenges and rewards of getting multiple stakeholders to share a common vision.
"When you allow that dialogue to happen," he said, "you find that we are much more the same than we are different."
McGoldrick said he is struck by how much business and law have to offer in areas that, until recently, have been dominated by government and non-governmental organizations (NGOs).
"Business does not have all the answers. I think business comes with a certain hubris, and conceit, to many of these problems—we can solve that. Not so, but there is a great deal we can do."
"The nature of the dialogue today is enormously different. It's not just talk." McGoldrick concluded. "The glacier is moving, and you are living in the middle of it." 