Authenticity in Corporate Social Responsibility

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Social media continues to impact businesses and nonprofits in unforeseen ways. Perhaps the greatest trend of the moment is the fusion of corporate and philanthropic interests, which in turn is producing growing pains and change. It’s likely that the requirements of online transparency will demand a new era of authenticity in corporate community investment efforts.

This trend results from demands for better corporate citizenship and community participation, transparency digressions, and frankly, very public cause marketing and corporate social responsibility programs that have exposed weaknesses in the social media realms.

It’s a problem that keeps coming up, and won’t go away. This will force organizations and companies to become much more mindful about how they invest in their communities.

This discussion is one that I’ve been having piecemeal with many people, in and outside of Zoetica, from cohorts Kami Huyse and Beth Kanter to change-minded folks like Alex Bornkessel, Allyson Kapin, Dan Morrison and Amy Sample Ward. I want to thank each of them for our ongoing dialogue, and directly or indirectly helping synthesize this post. My purpose in publishing this is soliciting feedback to evolve this authenticity theory. Please sound off.

The Current Authenticity Situation

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Many companies blur the lines now between cause marketing and corporate social responsibility, which in turn creates problems. One is not the other, but unfortunately, the current business environment will likely continue blurring the definitions rather than adhering to form. In that sense, this reminds me of the personal brand vs. reputation debate.

Ninety percent of companies cannot discern the difference between cause marketing and corporate social responsibility. Altruism often fails or is not thought out. In reality, most companies think, “Yeah, we’ll give some money to charity,” and let their executives figure out which ones. In the social media world, now they just outsource it to their communities (in both good and bad ways).

We must accept this level of understanding and approach CSR/cause marketing in a manner that raises the general level of ethics at play. In either case, social media continues exposing weaknesses in cause marketing, which will force such initiatives to become more CSR-oriented.

Moving forward, regardless of purpose, companies need to become much more authentic in their community investments. Authenticity means instead of simply throwing money at a cause or contest, they would directly address their missions, or the problems directly/indirectly created by their business. A third category — family — would be the causes that impact their employees, such as healthcare.

By being much more mindful in their cause initiatives, companies become better community citizens. And frankly, their online communities of interest will start demanding it.

Three Forms of Authenticity in Community Investment

Authenticity in Corporate Social Responsibility

Mindful authenticity in corporate community investment manifests itself in three ways:

Mission: Every company tries to market something. In doing so they have a mission and a product or service that fulfills a need. As such, authenticity dictates that the company invest in a community in a manner that relates to their core competency and also their marketing initiatives.

This is much more important for cause marketing initiatives. For example, if a company’s mission is information technology oriented, then literacy and education are obvious investments. So is poverty, and ensuring that the digital divide gets conquered. But investing everything the company had in cancer research makes no sense as an IT company’s strategic investment. It would for a healthcare oriented company.

Problem: In life we all create wreckage, both directly and indirectly. Some do less, some do more. In the environmental sense, every person has a carbon footprint. Thus it’s safe to say every company impacts the community in some negative ways.

Authenticity here dictates acknowledgment of impact, and actions to address the damage. For example, Exxon Mobile may want to make a greater investment in green energy than a trifle $100 million investment. Or instead of allocating $20 million for Pepsi Refresh, Pepsi would take a few million dollars to support causes addressing obesity issues as well as investing in reusable container technologies.

Family: Right now I would classify 90 percent of corporate community investments in this category, and that’s a mistake. Many of the crowd-sourced contest initiatives go wayward in this sense, too… Why? Because most of the investments are not thought-out and represent haphazard donations. They don’t acknowledge the corporate mission or the problems the company creates.

That being said, we all have or are employees. Companies represent big families, and in that sense it’s right to take a portion of donatable funds, and invest in real human issues like autism research or homelessness.

The right formula of mission, problem and family needs to be weighed intelligently by each organization. But that’s where the growth comes. Because blindly investing in family causes, or solely focusing on mission based initiatives causes an organization to stray from its community. Given today’s social media environment, at some point a cry will come for more balanced investment approaches.

What do you think about authenticity in corporate social responsibility?

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  • http://amysampleward.org Amy Sample Ward

    Thanks for diving into this, Geoff!

    Last night I went to Social Impact Camp, a new gathering that’s just started in London (http://socialimpactcamp.wikidot.com/events/)… To be honest, much of the time I didn’t feel very engaged with the content because I have only ever worked in the nonprofit or philanthropy sectors. Talking “business” in the actual for-profit business sense wasn’t a very inviting topic for me. But, something one of the speakers said, when discussing some of the reasons why companies aren’t very good at auditing/measuring their social impact, really struck me and I think is really relevant here. He said that companies aren’t comfortable talking about the social impact or the good they are doing.

    Just think about that.

    As someone coming from advocacy and nonprofit organizations, I can’t imagine that: what else do we talk about?! Every day we need to remind the world how we are making change, it’s how we operate.

    To think that a company isn’t comfortable talking about the social impact it makes seems crazy to me – is it because it invites criticism of the other “impact” the company may be making? (maybe) is it because they aren’t used to talking about their products or services? (definitely not!) is it because they don’t know what the response from the community will be when they start laying claim to impact? (maybe)

    I’d love to hear your thoughts and generally add the idea to the conversation. Truly, being authentic with your CSR means talking about it!

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  • http://geofflivingston.com Geoff Livingston

    Great comment, Amy. And with so many cos funding NPs, too, yet they do so blindly without thinking. It’s a major problem because we all inter-relate in society, with companies investing in nonprofits to alleviate the ills of society. Yet, aren’t cos responsible as members of society to take more of a share of the burden?

    It comes back to pure capitalism versus a networked economy where we all need each other and work with each other in more thought out processes. A nonprofit can help a company see their impact, and understand how communicating the impact, weaving it into the strategy and communications to stakeholders can better integrate the company into the community. And vice versa, more responsibility about company impact, both positive and negative, makes for better investments… And more impact.

  • http://amysampleward.org Amy Sample Ward

    Geoff I totally agree! I liken the scenario to the kind of guides I often give to nonprofits: don’t tell your own story, help your community tell the story of your work and impact and services for you. Same with the scenario you present with companies that are funding nonprofits as part of their CSR program. The companies don’t need to take all the responsibility in telling the story of their impact, but DO need to support the organizations and the community in telling the story for themselves.

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  • http://selfishgiving.com Joe Waters

    Nice post, Geoff. I think there is a lot of confusion out there about cause marketing and corporate social responsibility.

    As you know from my blog I really focus on transactional cause marketing that is better called cause-related marketing (but I hate this clunky term that’s why I stick with CM).

    I wrote about “What is Cause Marketing” a couple of weeks ago.

    http://selfishgiving.com/cause-marketing-101/what-is-cause-marketing-2

    However, when a lot of people talk about cause marketing they are really talking about cause promotion.

    Regardless, what I try to impress on everyone I talk to is that compared to CSR, cause marketing is a tactic, a subset of a much larger set of values that is reflected in a social responsibility strategy.

    Whenever I meet with a company I talk about how my cause marketing efforts can contribute to their CSR. Or, if they don’t have a visible corporate values program in place, how it cause marketing might help start one. But it’s just one step, and it’s at the bottom of the stairs at that. ;)

    Joe
    @joewaters

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  • http://www.thinkingaboutmedia.com Brian Reich

    I couldn’t agree more, authenticity is key. And your description of what more organizations (not just companies, frankly this is true for groups regardless of sector right now) need to be doing is spot on. But there is something missing.

    I think the key element that is missing — maybe not from the venn diagram, but certainly from the conversation — is the consideration of structures, or systems, or something that can support and allow for authenticity to sustain and be shared. There is an operational component, a process to how organizations go about their work that must be considered at the same time, in parallel, for authenticity to survive outside pressure. Sounds odd, I know, that you need a structural support for authenticity to exist, but its true. Peer pressure and market pressure are powerful forces which, save for a few very enlightened individuals (who, at last check, weren’t in the business of, well, business), can shift people’s internal compass. Outside forces can make people think, and companies act, in ways that they start to believe are right, or can be justified.

    Why can authenticity be mistaken for something else, or become confused? Because authenticity is about heart and mind. Its about belief and conscience. They are emotional in nature. Which means there can, in fact, be an authentic acceptance of the need for a company to organize their support of issues or causes in a way that reflects a certain set of values, or sense that people have for how to behave in society — and reasonable disagreements about how to approach that work. If a company believes that providing healthcare to its employees is an important part of its mission to be a family-friendly organization, but the cost realities of healthcare are prohibitive, how much healthcare is enough? If a company is truly committed to the addressing climate change, but the tools they need to produce a certain part of their product aren’t environmentally friendly, do they scuttle the whole effort until they can figure out a more viable solution?

    Authenticity is key, and having an internal sense of where the company/organization needs to head will help to solve a lot of these problems. But I think we need to balance the emotional and intellectual approach to this discussion with a practical consideration of the business environment we are trying to impact. Markets exist and create opportunity which companies and organizations pursue. You can shape and create your own markets, but its much more difficult. Organizational charts dictate how people interact and filter what information people receive. Those barriers are breaking down in a connected society, but their legacy is still very much felt. Rules and regulations, laws and policies, behaviors and best practices that have been in place for years, or become commonplace over time, have significant implications on people’s behavior and establish patterns for how organizations function. Individuals can act, and communities can form to support an idea — but everyone’s experiences and perspectives are different and must be considered. All of these things need to change, and will — much faster when there is authenticity and focus about what a company is working to achieve. But long-term, sustainable, meaningful and measurable change – internally, or around the world, takes time. Progress needs to be shown. A sense of accomplishment needs to be felt or momentum will cease. This is true for everything. As such, we need to meet the short terms challenges that the market creates. We need to recognize the anxiety that comes when people are asked to shift what they are doing, and consider the internal structure of the organization and how to utilize it to support what needs to get done. We need to work within the structure of the existing laws and policies, or move quickly to throw out, re-write, dismiss, or re-consider the established protocols and best practices that, left untouched, become barriers to finding, embracing, and sharing authenticity across an organization.

    Authenticity is critical. Its probably the first thing that needs to be in place for a successful organization to succeed, and change the world. And you nailed the path towards recognizing and embracing it – the family metaphor is a great one. But without its practical partner – the consideration of the basic operational challenges that authenticity creates, or the structural needs to support even the most basic, internal communication of authenticity (so other people can share the concept) – true authenticity, and the potential impact it can have, will forever be limited. The concept of family cannot survive the pressures of the real world, without some help. Authenticity, with some idea of how to structure what flows from it, is critical.

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  • http://geofflivingston.com Geoff Livingston

    @Brian An interesting truth to that as many cos realize this when they embrace social in general. Great concept, hard to change a culture, something I’ve written quite a bit about myself on a non CSR angle.

    On the structure side, departmentally CSR needs to become a competency, I fully agree. Whether that’s an ethics department, communications, or some new function altogether, I don’t pretend to know. What I do know is simply creating a Foundation as a giving mechanism seems to be too siloed.

    Structure helps, you also need top down support from the executive team. And sometimes you have to replace middle management to make the change happen.

  • http://www.thinkingaboutmedia.com Brian Reich

    I couldn’t agree more, the support at the top is needed. Without it nothing will break through, nothing will survive. My point is more that the concept that cultural (and other) change needs to occur must be embraced at the same time, not in sequential order. If you have authenticity first and then try to figure out how to put it into practice, it won’t work. If you have a bad/old system in place and try to put some clarity and focus through it, it will quickly fragment and undermine everything else. That’s a big part of why support from the top needs to be there, because in theory only the person at the top really knows how all the pieces fit together, where the levers that most need to be pulled will be found, etc.

    And yes, when I think about structures and systems, I think most of what we are talking is the fuzzy stuff. The ways that people talk and behave, the information that is shared, the opportunities that individuals have to explore on their own terms. Creating a foundation to lead your cause-related work won’t have that impact. Either will imposing a requirement that employees do volunteer work or give a certain part of their salary to charity. Artificial rewards for good acts will raise awareness, but not shift understanding or change behavior. Creating a new department that is responsible for explaining, promoting, and supporting this work across a whole organization is still one step removed. To change culture, to shift behavior, to deeply embed authenticity, you need to change from the inside out. In many cases, you may even need to wipe the slate clean and start fresh, hire some new employees, etc.

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  • http://www.sportsotherdebates.blogspot.com Holt Murray

    Some delineation that works for me.

    CSR = Problem & Family
    Cause Marketing = Mission

    Corporate Social Responsibility, by virtue of its very name, supports Problem and Family. Companies are socially (and some would say morally, ethically,…) responsible for any ill-effects caused from their very existence (Exxon/Mobil & soft drinks being poster-child examples).

    Mission connects to Cause Marketing. It may fall under a company’s CSR, but to me they’re kidding themselves — it’s a well-placed investment designed to add to the bottom line. But, that’s the magic of Cause Marketing – they may be helping themselves by helping the very cause they choose, but there’s never anything wrong with a win/win. If anything, I’d hope it creates more competition within respective categories to help foster a given cause.

    No, it’s not that black & white, nor does it address poorly executed giving/cause support; for example, at least in my mind, the fact that Exxon/Mobil gives to a Green Initiative may be the tie-breaker for me if there’s a gulf or an Exxon/Mobil on opposing corners (that, or whichever one is on my right-hand side and I don’t have to cross traffic).

    But, I would agrgue that the only thing that is going to make CSR & CM more efficient is its occassionally reckless proliferation. From that will come those who have bragging rights to successful programs, and others who shine the light on paths to never go down again.

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  • Anita Lobo

    Hi Geoff,

    Authenticity, in the spirit of the term is quite painful for the corporate world.

    People running companies know their actions negatively affect the environment. But the overall cost of acknowledging impact, is so huge [not just money, but image, careers, jobs etc] and so scary, that people step back.

    Action then dilutes into hogwash. Mission becomes a flowery declaration that jumps straight into a family crowd-sourcing contest.

    From the India perspective, we’re seeing a lot of debate around a corporate Save the Tigers campaign that’s completely media driven, without any changes that will deter poachers on the ground or reduce demand [in China].

    A TV channel is doing a greenathon. And the Commonwealth Games that take place in Oct 2010 is claiming to be a green games – after digging up half the city to rebuild infra & cutting down half the city’s trees!

    Until now, companies have acknowledged their impact only when forced to. Finding a way to change this ‘pain’ and wrapping respect around acceptance, lies at the heart of authenticity.

    Until then, our efforts are quite akin to pouring water in a very leaky bucket. And we have little water left to waste.

    Cheers,
    Anita

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  • http://twitter.com/iconic88 Iconic88

    Absolutely loved this post Geoff!! Congrats.

    In a world of transparency via Google, Twitter, Facebook etc, access to information about a company is just a ‘tweet’ or status update away. This inherently creates pressure on companies to be accountable for what they do. If they don’t, consumers can always invest their spending dollars elsewhere.

    You’re absolutely right in saying that “ninety percent of companies cannot discern the difference between cause marketing and corporate social responsibility”. This is evident in the mixed messaging that occurs in their campaigns. Bottom line, they lack congruency. You’re spot on here >> ” instead of allocating $20 million for Pepsi Refresh, Pepsi would take a few million dollars to support causes addressing obesity issues as well as investing in reusable container technologies”. What Pepsi are doing just doesnt make sense?

    If companies were truly altruistic Geoff, they’d do their investing anonymously.

    All the best.

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  • http://www.netwitsthinktank.com frank

    I thought I should leave a comment to thank everyone for the discussion going on here. I’ve got nothing to add … just learning from all the great knowledge being shared!

    Thanks everyone.

    @franswaa

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