Quanta Corporate Citizenship The Fundamental Question for Strategic CSR
| Quanta Corporate Citizenship |
Before embarking on any citizenship-related initiative, an organisation should have clear in its mind why it wants to carry out this kind of work. It is always very tempting for organisations to try to jumpstart the process by diving into the simplest, most common and most high profile activities and then validating it with any information they can gather.
Unfortunately, this kind of reverse engineering, although quite probably cheaper and faster in the short term, does not have the as powerful an impact on targeted beneficiaries nor does it engender positive results for companies.
Real citizenship commitment starts with a structured soul searching exercise within the organisation. Any organisation needs first to understand why it wants to commit to citizenship. The reason ought to be intimately linked to the organisation’s overall strategy, which by its turn is a consequence of its mission, vision, values or principles. Without this golden thread linking the overall objectives and ethos to the organisation’s strategy and the citizenship strategy, the later will often be a source of wasted resources and not of value generation for the organisation. If the citizenship strategy is not clearly reinforcing the organisation’s values, and not facilitating the achievements of its overall objectives, it is unlikely to be taken seriously or stay for long, which ultimately will generate more damage than good to those who should be benefiting from it.
The reasons for taking a closer look at an organisation’s citizenship might vary from simply complying with legal regulations – i.e., staying in business – to trying to generate good PR (cause-related marketing), to a greater sense of moral duty, to a desire to truly shape and change the world.
Unfortunately, this kind of reverse engineering, although quite probably cheaper and faster in the short term, does not have the as powerful an impact on targeted beneficiaries nor does it engender positive results for companies.
Real citizenship commitment starts with a structured soul searching exercise within the organisation. Any organisation needs first to understand why it wants to commit to citizenship. The reason ought to be intimately linked to the organisation’s overall strategy, which by its turn is a consequence of its mission, vision, values or principles. Without this golden thread linking the overall objectives and ethos to the organisation’s strategy and the citizenship strategy, the later will often be a source of wasted resources and not of value generation for the organisation. If the citizenship strategy is not clearly reinforcing the organisation’s values, and not facilitating the achievements of its overall objectives, it is unlikely to be taken seriously or stay for long, which ultimately will generate more damage than good to those who should be benefiting from it.
The reasons for taking a closer look at an organisation’s citizenship might vary from simply complying with legal regulations – i.e., staying in business – to trying to generate good PR (cause-related marketing), to a greater sense of moral duty, to a desire to truly shape and change the world.
Before embarking on any citizenship-related initiative, an organisation should have clear in its mind why it wants to carry out this kind of work. It is always very tempting for organisations to try to jumpstart the process by diving into the simplest, most common and most high profile activities and then validating it with any information they can gather.
Unfortunately, this kind of reverse engineering, although quite probably cheaper and faster in the short term, does not have the as powerful an impact on targeted beneficiaries nor does it engender positive results for companies.
Real citizenship commitment starts with a structured soul searching exercise within the organisation. Any organisation needs first to understand why it wants to commit to citizenship. The reason ought to be intimately linked to the organisation’s overall strategy, which by its turn is a consequence of its mission, vision, values or principles. Without this golden thread linking the overall objectives and ethos to the organisation’s strategy and the citizenship strategy, the later will often be a source of wasted resources and not of value generation for the organisation. If the citizenship strategy is not clearly reinforcing the organisation’s values, and not facilitating the achievements of its overall objectives, it is unlikely to be taken seriously or stay for long, which ultimately will generate more damage than good to those who should be benefiting from it.
The reasons for taking a closer look at an organisation’s citizenship might vary from simply complying with legal regulations – i.e., staying in business – to trying to generate good PR (cause-related marketing), to a greater sense of moral duty, to a desire to truly shape and change the world.
Unfortunately, this kind of reverse engineering, although quite probably cheaper and faster in the short term, does not have the as powerful an impact on targeted beneficiaries nor does it engender positive results for companies.
Real citizenship commitment starts with a structured soul searching exercise within the organisation. Any organisation needs first to understand why it wants to commit to citizenship. The reason ought to be intimately linked to the organisation’s overall strategy, which by its turn is a consequence of its mission, vision, values or principles. Without this golden thread linking the overall objectives and ethos to the organisation’s strategy and the citizenship strategy, the later will often be a source of wasted resources and not of value generation for the organisation. If the citizenship strategy is not clearly reinforcing the organisation’s values, and not facilitating the achievements of its overall objectives, it is unlikely to be taken seriously or stay for long, which ultimately will generate more damage than good to those who should be benefiting from it.
The reasons for taking a closer look at an organisation’s citizenship might vary from simply complying with legal regulations – i.e., staying in business – to trying to generate good PR (cause-related marketing), to a greater sense of moral duty, to a desire to truly shape and change the world.
To invest in initiatives both internally and externally means a company can fulfil its legal obligations. It is therefore an investment in keeping its authorisation to operate or to avoid lawsuits. An organisation, for example, that does not invest in complying with the Sarbanes-Oxley Act in the US will sooner or later be forbidden to operate in the US. An organisation that does not have clear practices forbidding discrimination against disabled job candidates in the UK will sooner or later be sued under the Disability Discrimination Act.
Investing to comply with regulatory requirements is the minimum level of investment possible to any organisation. It is also the least risky in the short term as it avoids exposing the organisation to the implicit risks of taking on the initiative and exposing itself to potential errors and criticism. On the other hand, because the organisation is simply reacting to the world around it, it is more likely to suffer from the problems faced by those taking a reactive approach to corporate citizenship: it reduces its space to manoeuvre in shaping the future, and becomes more likely to be exposed to criticism. Stakeholders are also less likely to be loyal when the organisation faces a difficult time, simply because it hasn’t built goodwill around it by going beyond its minimum duties. Another reason that organisations might want to steer away from just minimum legal compliance is that there is little to learn from the process. When legal changes finally come along – and they are inevitable – the organisation is more likely to find itself patching up activities at the last minute to comply with higher thresholds, whilst its competitors, that took a more proactive approach, are more likely to be already complying with new standards and have probably learned how to do it more efficiently. The automotive industry in California learned this lesson the hard way when new regulations introduced in 2002 forced them to spend significant resources to quickly redesign their engines to reduce the amount of green gas emissions (as it turned out, some decided to spend the resources in the subsequent legal battle against that law). A similar problem is now faced by building companies in California: with the approval of the new Building Code (called CALGreen), aiming to reduce the consumption of indoor water by 20%, recycle at least 50% of construction waste, and boost the use of low-pollutant paint, carpet and flooring. The building companies that had taken the initiative are likely to be in full compliance already, whilst those that adopted a more reactive position had to play catch up. Furthermore, those who took a proactive approach probably had a much longer period to learn and adapt than the 12 months worth of legal deadlines established by the new Code, which will probably incur greater financial costs. In other cases, simply complying with current legal requirements may isolate the organisation from the rest of its peers: in 2010, 29 members of the World Shipping Council proposed to the International Maritime Organisation a series of new vessel efficiency standards (VES) that would be mandatory for all new vessels. Any ship not complying with the new law would be fined. Obviously, ocean carriers that took a more reactive approach to its CSR policies were unable to influence the shape of this proposal, which might later reduce their competitive advantages by increasing their costs.
Another problem with minimum legal compliance is that it might hinder the expansion of the organisation in terms of financial size, markets or industries. An organisation that is keen to invest simply to comply with Mexican legal requirements is very unlikely to be allowed to operate in the US if it does not seriously re-adjust its accounting and health and safety policies to comply with the US regulations as well.
The fact that an organisation might decide to invest only to check its legal compliance boxes does not mean that it needs to advertise its objectives. Clarity of why does not mean publicising it to the whole world. But it does mean clarity at least for those leading the organisation and for those responsible for implementing it. And it also does not mean only having it clear in one person’s mind. All those responsible for leading the organisation and those responsible for delivering the initiatives have to have a common understanding of the reason behind the initiative.
Companies might decide to invest on a citizenship-related initiative to capture goodwill from consumers, government or local communities. Although more expensive than simply investing to check legal compliance boxes, it can be done relatively cheaply if the organisation adopts a well-thought strategy. And the returns are generally positive if the organisation knows why it is making those investments, what it is getting in return, is able to link those investments to its marketing initiatives, and does not over claim its results.
The two main risks associated with these caused-related marketing initiatives are (a) the risk of over-claiming and (b) being perceived to try and buy goodwill. A few years ago I was leading the due diligence on a potential partner for a tourism joint venture in Kenya. Although they seemed to be very sound from a legal, financial and marketing perspective, knowing the importance of the involvement of local communities for this kind of business, I asked to see a few of its projects. To my surprise, none of the community leaders knew the organisation, its leaders or those responsible for partnering with them. It soon became clear that our potential partner was just signing checks without any real understanding of what the local communities were trying to achieve and what the not for profits they were funding were actually delivering. Also in Africa, I saw the efforts of a well-known European toothpaste brand backfire when it was ridiculed by both tourists (apparently their target audience) and local communities (the beneficiaries of their philanthropy) when they decided to portray their brand on the entrance of schools it was supporting. And, at the end of the 1990s, the case of the tobacco manufacturer that spent US$75m on philanthropy and US$100m advertising its philanthropic investments became a well-known outrage.
Cause related marketing cannot be simply signing checks to fundraisers or internal campaigners. It has to make sense and be strategically considered; otherwise, as the three examples above illustrate, they are very likely to backfire.
Organisations might also decide on citizenship-related initiatives due to a firm moral commitment. They want not only to be legally compliant and to capture the goodwill of its stakeholders, but to go beyond and truly fulfil a greater moral duty. As a matter of fact, for these organisations, both legality and stakeholders’ goodwill are positive consequences of something else, and not objectives per se. The urge to do something moved by moral obligation comes less from a fully rationalised justification and more from an implicit belief that it would be unacceptable not to do it. The moral justification is an explanation in itself for doing something, but trying to understand where the moral driver comes from requires a much deeper and philosophical analysis that is probably better left for a different piece of work. My experience, though, is that moral feeling is primarily driven by empathy, i.e., by recognising those near and far as part of the same group as ourselves, and share their perspectives and plights without having to be in the same situation as they are. And empathy, by its turn, is the result of a sense of ‘belonging’ and ‘being part of’. Regardless of what generates this sense of ‘being part of’, organisations moved by a sense of moral duty will decide to act because they find it unacceptable not to. And because the moral threshold is generally higher than for legal or marketing objectives, citizenship investments based on a sense of moral duty are, generally, more expensive in the short and medium terms than if the organisation was simply trying to tick a compliance box or to develop a sound cause-related marketing campaign. In the longer term, though, the goodwill and brand recognition built around an organisation perceived to be going beyond its selfish reasons might counterbalance the short-term costs. Organisation such as Whole Foods and Pret a Manger benefited from their reputation of moral commitment towards customers by providing organic and responsibly source produces, and freshly made food, respectively. The goodwill earned by Marks and Spencer‘s moral commitment towards its employees pre-empted potential friction with the same employees when the organisation hit a rough patch in the 1990s. In none of those 3 cases was the objective to leverage on those moral commitments, but the organisations benefitted from the goodwill they generated, nevertheless. The problem is that this kind of goodwill cannot be accurately measured, let alone accounted for.
The difference between those moved by moral responsibility and the change-makers is that the former wants to fulfil what it perceives to be its own responsibility, whilst the later wants not only to fulfil its own responsibility, but also wants to move others to do so as well. The Body Shop objective was not only to fulfil its perceived moral duty of not offering products that were tested on animals, but also to stop the practice of animal testing altogether across the cosmetic industry, if not beyond. In the long term the organisation benefited from the goodwill generated by its citizenship positioning, but in the short term its position generated a significant amount of friction across different stakeholders, especially suppliers and competitors.
In none of the four organisations mentioned, did the impact of their strategic positioning, so to speak, directly hurt the organisations’ operating and financial models. But there is a potential fifth group of organisations that might actually and rationally decide to cut its own flesh: the altruistic, i.e., those who will put themselves at risk beyond what is reasonably expected, because they are committed to a greater moral value. Although this is much more evident in the NGO world, where organisations such as MSF and Greenpeace often put themselves and their assets at risk to defend their moral commitments, it can also happen in the corporate sector, albeit the number of examples are much more limited. Google pulling out from China because of the presumed attempt by the Chinese Government to violate the Gmail accounts of human rights dissidents could be considered as one of those altruistic commitments. Google operating in one of the most competitive industries in the world decided to seize its flourishing operations in the fastest growing market on the planet (during one of the worst recessions in history), because it felt that its ethos of “do no evil” could not be compromised. Even if that represented a financial drawback.
The difference between altruistic NGOs and altruistic corporations is that the first are likely to generate more revenue from their social purpose positioning (as this is one of their key marketing approaches), whilst the second may be creating a serious financial and brand commitment that might cost it dearly, and will generally have greater incentives not to make that kind of commitment.
Any of these 5 reasons (legal compliance, public relations, moral duty, change maker and altruism) might be genuine from a strategic perspective, but if the organisation is not crystal clear about where its citizenship objectives fit into this scale, it stands no chance of success. It stands no chance because (a) it is not rooted in knowing why it wants to be active, and (b) since it does not know why it wants to do it, it cannot define what is the best way to deliver it, nor can it define how it is the best way to achieve what it wants to achieve, and (c) because it has no idea why it is doing this activity, naturally it will not know when it has achieved its goals. The organisation will invariably overspend or under spend its resources, both in time and money.
Moreover, organisations need to have very clear pros and cons of different levels of commitments, in particular their correlated financial, time and knowledge demands, as well as the potential risks and gains the different positions might generate in the short and long term.
Another problem with minimum legal compliance is that it might hinder the expansion of the organisation in terms of financial size, markets or industries. An organisation that is keen to invest simply to comply with Mexican legal requirements is very unlikely to be allowed to operate in the US if it does not seriously re-adjust its accounting and health and safety policies to comply with the US regulations as well.
The fact that an organisation might decide to invest only to check its legal compliance boxes does not mean that it needs to advertise its objectives. Clarity of why does not mean publicising it to the whole world. But it does mean clarity at least for those leading the organisation and for those responsible for implementing it. And it also does not mean only having it clear in one person’s mind. All those responsible for leading the organisation and those responsible for delivering the initiatives have to have a common understanding of the reason behind the initiative.
Companies might decide to invest on a citizenship-related initiative to capture goodwill from consumers, government or local communities. Although more expensive than simply investing to check legal compliance boxes, it can be done relatively cheaply if the organisation adopts a well-thought strategy. And the returns are generally positive if the organisation knows why it is making those investments, what it is getting in return, is able to link those investments to its marketing initiatives, and does not over claim its results.
The two main risks associated with these caused-related marketing initiatives are (a) the risk of over-claiming and (b) being perceived to try and buy goodwill. A few years ago I was leading the due diligence on a potential partner for a tourism joint venture in Kenya. Although they seemed to be very sound from a legal, financial and marketing perspective, knowing the importance of the involvement of local communities for this kind of business, I asked to see a few of its projects. To my surprise, none of the community leaders knew the organisation, its leaders or those responsible for partnering with them. It soon became clear that our potential partner was just signing checks without any real understanding of what the local communities were trying to achieve and what the not for profits they were funding were actually delivering. Also in Africa, I saw the efforts of a well-known European toothpaste brand backfire when it was ridiculed by both tourists (apparently their target audience) and local communities (the beneficiaries of their philanthropy) when they decided to portray their brand on the entrance of schools it was supporting. And, at the end of the 1990s, the case of the tobacco manufacturer that spent US$75m on philanthropy and US$100m advertising its philanthropic investments became a well-known outrage.
Cause related marketing cannot be simply signing checks to fundraisers or internal campaigners. It has to make sense and be strategically considered; otherwise, as the three examples above illustrate, they are very likely to backfire.
Organisations might also decide on citizenship-related initiatives due to a firm moral commitment. They want not only to be legally compliant and to capture the goodwill of its stakeholders, but to go beyond and truly fulfil a greater moral duty. As a matter of fact, for these organisations, both legality and stakeholders’ goodwill are positive consequences of something else, and not objectives per se. The urge to do something moved by moral obligation comes less from a fully rationalised justification and more from an implicit belief that it would be unacceptable not to do it. The moral justification is an explanation in itself for doing something, but trying to understand where the moral driver comes from requires a much deeper and philosophical analysis that is probably better left for a different piece of work. My experience, though, is that moral feeling is primarily driven by empathy, i.e., by recognising those near and far as part of the same group as ourselves, and share their perspectives and plights without having to be in the same situation as they are. And empathy, by its turn, is the result of a sense of ‘belonging’ and ‘being part of’. Regardless of what generates this sense of ‘being part of’, organisations moved by a sense of moral duty will decide to act because they find it unacceptable not to. And because the moral threshold is generally higher than for legal or marketing objectives, citizenship investments based on a sense of moral duty are, generally, more expensive in the short and medium terms than if the organisation was simply trying to tick a compliance box or to develop a sound cause-related marketing campaign. In the longer term, though, the goodwill and brand recognition built around an organisation perceived to be going beyond its selfish reasons might counterbalance the short-term costs. Organisation such as Whole Foods and Pret a Manger benefited from their reputation of moral commitment towards customers by providing organic and responsibly source produces, and freshly made food, respectively. The goodwill earned by Marks and Spencer‘s moral commitment towards its employees pre-empted potential friction with the same employees when the organisation hit a rough patch in the 1990s. In none of those 3 cases was the objective to leverage on those moral commitments, but the organisations benefitted from the goodwill they generated, nevertheless. The problem is that this kind of goodwill cannot be accurately measured, let alone accounted for.
The difference between those moved by moral responsibility and the change-makers is that the former wants to fulfil what it perceives to be its own responsibility, whilst the later wants not only to fulfil its own responsibility, but also wants to move others to do so as well. The Body Shop objective was not only to fulfil its perceived moral duty of not offering products that were tested on animals, but also to stop the practice of animal testing altogether across the cosmetic industry, if not beyond. In the long term the organisation benefited from the goodwill generated by its citizenship positioning, but in the short term its position generated a significant amount of friction across different stakeholders, especially suppliers and competitors.
In none of the four organisations mentioned, did the impact of their strategic positioning, so to speak, directly hurt the organisations’ operating and financial models. But there is a potential fifth group of organisations that might actually and rationally decide to cut its own flesh: the altruistic, i.e., those who will put themselves at risk beyond what is reasonably expected, because they are committed to a greater moral value. Although this is much more evident in the NGO world, where organisations such as MSF and Greenpeace often put themselves and their assets at risk to defend their moral commitments, it can also happen in the corporate sector, albeit the number of examples are much more limited. Google pulling out from China because of the presumed attempt by the Chinese Government to violate the Gmail accounts of human rights dissidents could be considered as one of those altruistic commitments. Google operating in one of the most competitive industries in the world decided to seize its flourishing operations in the fastest growing market on the planet (during one of the worst recessions in history), because it felt that its ethos of “do no evil” could not be compromised. Even if that represented a financial drawback.
The difference between altruistic NGOs and altruistic corporations is that the first are likely to generate more revenue from their social purpose positioning (as this is one of their key marketing approaches), whilst the second may be creating a serious financial and brand commitment that might cost it dearly, and will generally have greater incentives not to make that kind of commitment.
Any of these 5 reasons (legal compliance, public relations, moral duty, change maker and altruism) might be genuine from a strategic perspective, but if the organisation is not crystal clear about where its citizenship objectives fit into this scale, it stands no chance of success. It stands no chance because (a) it is not rooted in knowing why it wants to be active, and (b) since it does not know why it wants to do it, it cannot define what is the best way to deliver it, nor can it define how it is the best way to achieve what it wants to achieve, and (c) because it has no idea why it is doing this activity, naturally it will not know when it has achieved its goals. The organisation will invariably overspend or under spend its resources, both in time and money.
Moreover, organisations need to have very clear pros and cons of different levels of commitments, in particular their correlated financial, time and knowledge demands, as well as the potential risks and gains the different positions might generate in the short and long term.
Different objectives for different stakeholders
Even when an organisation has an overall strategic citizenship objective, it also needs to be clear about its objectives for each stakeholder group. It is naïve for any organisation to imagine it can tackle all areas of citizenship in the same way and with the same level of commitment, regardless of how large it is and how much money they have available for the work. They will at some stage face a lack of resources, find different stakeholders have different objectives, and that potential initiatives for the same stakeholders end up being in conflict.
A fundamental step in developing a strategic approach to corporate citizenship is to understand which areas to prioritise, why they should be prioritised, and how to tackle those priorities. Trying to solve all of the world’s problems is overwhelming, if not impossible. And, as we’ve seen, the more to the right we move along in the stakeholder curve, the more contradictory the issues become.
As Michael Porter put it, “no business can solve all of society’s problems and bear the cost of doing so. Other social agendas are best left to those companies in other industries, NGOs, or government institutions that are better positioned to address them. The essential test that should guide CSR is not whether a cause is worthy but whether it presents an opportunity to create shared value – that is, a meaningful benefit for society that is also valuable to the business”[1]
In order to deliver meaningful impact to society and to itself, the organisation needs first to decide what it will not do. In the same way that in other areas of strategy an organisation needs to decide what are the limits to what it will do, and agree that whatever falls outside that scope is beyond the realm of its strategic objectives, the same needs to occur for strategic citizenship
A fundamental step in developing a strategic approach to corporate citizenship is to understand which areas to prioritise, why they should be prioritised, and how to tackle those priorities. Trying to solve all of the world’s problems is overwhelming, if not impossible. And, as we’ve seen, the more to the right we move along in the stakeholder curve, the more contradictory the issues become.
As Michael Porter put it, “no business can solve all of society’s problems and bear the cost of doing so. Other social agendas are best left to those companies in other industries, NGOs, or government institutions that are better positioned to address them. The essential test that should guide CSR is not whether a cause is worthy but whether it presents an opportunity to create shared value – that is, a meaningful benefit for society that is also valuable to the business”[1]
In order to deliver meaningful impact to society and to itself, the organisation needs first to decide what it will not do. In the same way that in other areas of strategy an organisation needs to decide what are the limits to what it will do, and agree that whatever falls outside that scope is beyond the realm of its strategic objectives, the same needs to occur for strategic citizenship
Even an organisation acting altruistically, as the Google example described before, will inevitably be creating a trade off. Google stopping its operation in China might help to protect its commitment to ‘do no evil’ and show its commitment to consumer’s data privacy, but by ceasing its operations in China it makes its local staff unemployed, therefore hurting another group of stakeholders. It is unrealistic for any organisation to believe that its actions in one area will not generate impact elsewhere. The question for any organisation is, ‘What are the priorities?’, understanding why they are the priorities, and what the potential and real repercussions are – positive and negative – of making these the priorities.
The what question
Once an organisation fully understands why it is doing something, and why it is important to do it, it can start establishing exactly what to do.
Obviously, the number of commitments an organisation can make is directly correlated to the amount of resources – people, time and money – it can spend, as well on its desire to spend them. But it is also directly correlated to another two variables: the need for something to be done, and the knowledge within the organisation to do it.
Only when and where these four dimensions align is there a possibility of true success.
Obviously, the number of commitments an organisation can make is directly correlated to the amount of resources – people, time and money – it can spend, as well on its desire to spend them. But it is also directly correlated to another two variables: the need for something to be done, and the knowledge within the organisation to do it.
Only when and where these four dimensions align is there a possibility of true success.
It only makes sense for an organisation to tackle areas where there is an issue. Without a clearly understood need, the organisation should not be committing itself. Although it sounds obvious, the corporate sector routinely diverts valuable resources to areas where there is no need. Be it because the social problem is not the most relevant, or because the problem is not relevant for the organisation, or because the problem has already been tackled by another organisation. The number of organisations investing in me-too-projects is staggering. And they do it for a very natural reason: the lack of a fundamental understanding of strategic citizenship. When an organisation lacks such an understanding, its easiest option is to replicate what other organisations are already doing, even when that does not fit with its own strategic necessity. Even if it does, it is likely to do so by chance and not because the organisation fully understands what it is decision making. As a result the organisation cannot fully leverage its impact and benefit from its commitments.
And the social need has to mean something to the organisation. In other words, the organisation needs to want to do something about the problem and it needs to represent something meaningful to the organisation. Recently a major global bank invested millions of dollars on the preservation of exotic fish and inadvertently transformed its CSR into a running joke amongst its employees. Their mistake was to overlook the importance of investing in something that represented a meaningful cause to the organisation. Organisations cannot afford to act impulsively. Desire cannot be just the impulsive wish to do something positive, but must also be something that is truly meaningful to the organisation.
Furthermore, by ‘desire’ we also mean leadership support. Without clear backing from the top, the commitments will lack the legitimacy to generate the adequate resource mobilisation required to achieve its goals, or it will lose its momentum when it faces a rough patch. Support means more than authorising or giving the go ahead: support means publicly and personally committing to the success of a project. In other words, sticking one’s neck out.
On the other side, an organisation that realises the needs of a social problem and knows how to tackle a citizenship-related issue stands no chance of success if it does not align the resources required to tackle that issue. Without clearly defined resources – and that does not mean only direct financial resources – an organisation is setting itself up for failure. Public failure, more often than not. As in any other project, without a clearly defined set of resources, the organisation is creating an illusion of feasibility that sooner or later will undermine the confidence in its commitments. Furthermore, the resources need to be adequate for its objectives. Underfunding, setting unrealistic timelines for investment or impact, or understaffing a project will be to act based on wishful thinking. The organisation will need either to realign its expectations or its resources if it anticipates any relevant results, and likewise if it wants to avoid public failure and future mistrust from within and outside the organisation. My experience to date has been that in the absence of appropriate resourcing, an organisation is better off simply not stepping into CSR work in the first place, because those scarce resources it decides to invest will be wasted partially or totally, anyway. Furthermore, it will erode the goodwill and support of those with whom it may interact with in the future.
Finally, an organisation that does not know what and how to solve the perceived need is also setting itself up for failure. In the case of lack of capacity, the organisation is setting itself up for failure due to a lack of means. In the case of lack of knowledge, the failure can be anticipated not only because the objectives are not outlined, but – and probably even worst – because the organisation is likely to produce bad or undesirable outcomes. It is not only a case of wasting valuable resources that could be used positively now or saved for future use, but also of potentially generating counterproductive results that move the goalpost even further away. All of this makes future actions more difficult, if for nothing else, because they will first need time and effort to heal from the impact of the initial mismanagement.
And the social need has to mean something to the organisation. In other words, the organisation needs to want to do something about the problem and it needs to represent something meaningful to the organisation. Recently a major global bank invested millions of dollars on the preservation of exotic fish and inadvertently transformed its CSR into a running joke amongst its employees. Their mistake was to overlook the importance of investing in something that represented a meaningful cause to the organisation. Organisations cannot afford to act impulsively. Desire cannot be just the impulsive wish to do something positive, but must also be something that is truly meaningful to the organisation.
Furthermore, by ‘desire’ we also mean leadership support. Without clear backing from the top, the commitments will lack the legitimacy to generate the adequate resource mobilisation required to achieve its goals, or it will lose its momentum when it faces a rough patch. Support means more than authorising or giving the go ahead: support means publicly and personally committing to the success of a project. In other words, sticking one’s neck out.
On the other side, an organisation that realises the needs of a social problem and knows how to tackle a citizenship-related issue stands no chance of success if it does not align the resources required to tackle that issue. Without clearly defined resources – and that does not mean only direct financial resources – an organisation is setting itself up for failure. Public failure, more often than not. As in any other project, without a clearly defined set of resources, the organisation is creating an illusion of feasibility that sooner or later will undermine the confidence in its commitments. Furthermore, the resources need to be adequate for its objectives. Underfunding, setting unrealistic timelines for investment or impact, or understaffing a project will be to act based on wishful thinking. The organisation will need either to realign its expectations or its resources if it anticipates any relevant results, and likewise if it wants to avoid public failure and future mistrust from within and outside the organisation. My experience to date has been that in the absence of appropriate resourcing, an organisation is better off simply not stepping into CSR work in the first place, because those scarce resources it decides to invest will be wasted partially or totally, anyway. Furthermore, it will erode the goodwill and support of those with whom it may interact with in the future.
Finally, an organisation that does not know what and how to solve the perceived need is also setting itself up for failure. In the case of lack of capacity, the organisation is setting itself up for failure due to a lack of means. In the case of lack of knowledge, the failure can be anticipated not only because the objectives are not outlined, but – and probably even worst – because the organisation is likely to produce bad or undesirable outcomes. It is not only a case of wasting valuable resources that could be used positively now or saved for future use, but also of potentially generating counterproductive results that move the goalpost even further away. All of this makes future actions more difficult, if for nothing else, because they will first need time and effort to heal from the impact of the initial mismanagement.
[1] Michael Porter. Strategy and Society. Harvard Business Review, December 2006, p. 8
