In order to be successful, companies must have a sustainability or corporate social responsibility (CSR) program, according to Mary Shelman, former director of Harvard Business School’s agribusiness program, who spoke at ONE18, The Alltech Ideas Conference, May 21 in Lexington, Kentucky.
“The time has come … that you need to be proactive in your organization about a corporate responsibility program. It is fundamental to your success,” Shelman said. Sustainability is essential to protect and enhance a company’s value, she said.
Sustainability has a strong value proposition: consumers expect it, customers require it, employees engage with it, it lowers costs, it creates differentiation, it increases stock price, and it gives the industry license to operate.
Five insights on sustainability programs
Shelman shared five insights from her experiences working on sustainability and CSR programs:
- Sustainability is a journey, not a destination. A company’s program must be material and dynamic and must have the ability to constantly change.
- It must be more of a commitment than just compliance. Forward-thinking companies engage in ongoing, joint initiatives to improve the supply chain rather than simply finding compliant suppliers.
- Companies must tell their stories and the effect their actions have. Data-driven metrics can help highlight the need for investment, develop cost-effective plans and provide concrete evidence that the approach is working.
- Collaborate to amplify innovation and impact. By collaborating, companies are seeking to drive performance improvements and innovation through better knowledge and to amplify the impact they could make on their own. Collaborators can include suppliers, non-governmental organizations and even competitors.
- Communication in a way that builds trust. Social media provides an ideal platform to more regularly share authentic, transparent and creative messages.
Monica Marshall, senior vice president/director of global public relations firm Ketchum, who also spoke, said that, while sustainability and corporate responsibility mean different things to different people in different geographic areas, they are always good for employee relations, company reputation and sales.
“Profitability is a key driver,” said Peter Kristensen, managing director portfolio Europe for investor firm Wheatsheaf Group. “If you are not profitable, you will not be around.”
CSR is a chance for a company to succeed or fail, Kristensen said.
“If you get it right, you’ll be richly rewarded and if you get it wrong, you’ll be gone,” he said.
In its CSR program, companies must take a stand and say what they believe in.
“Businesses that are successful will have to get a lot better and more articulate at saying, ‘This is what I believe,’” he said. “It’s not up to me to tell you whether to turn left or turn right, but I really encourage you to get out of the middle of the road.”