When words do not wash
- Business & Industry ,
- Management ,
- Corporate governance ,
In her second article on corporate transparency, Jiggy Lloyd looks at the dangers of greenwash
I stated in a viewpoint in the November 2014 issue of the environmentalist: "We live in a world in which words are easier to deliver than corresponding actions."
It is my belief, and my great concern, that this gap is growing. Too many of the grand policy statements on the environment that organisations issue in an attempt to appear progressive lack one thing: action. The failure to act on declarations means they are simply "greenwash" and it is something that the corporate social responsibility (CSR) and sustainability professions must address.
But it does not end there: there is also a tendency for organisations to reveal a lot about issues that are easy to shed light on, while remaining silent on those that are more tricky, but possibly more important. This can be summed up as "selective" or "skewed" transparency.
Lack of control?
There are two main reasons for the gap between the stated beliefs of organisations and their actions: the first is drawn from my experience, based on many years of scrutinising CSR and sustainability communications; although many organisations say "the right thing", we have made precious little progress towards a more sustainable economy. There are many reasons why the gap might be growing.
First is the expectation that businesses should iterate policies on just about everything. Second, companies are getting larger and the management teams more dispersed. Communications are easier and costs must always be reduced, such that organisations today - at least those in the private sector - operate on a much lighter version of the management hierarchy that was typical even as recently as the 1990s. As a result, it is easier for head office to state that "so-and-so" is what the organisation believes, but harder, unless compensatory measures are put in place, to ensure that this belief is reflected on the ground across multiple sites.
Talk to the chief executive of a large organisation for any length of time and you may hear how they struggle to know what is going on in the organisation they head. This problem is particularly evident in multinationals that have their roots in one continent and culture. It is not uncommon to find that, as you travel further from the cultural heart of the company, policies are less well reflected in organisational behaviour.
Narrowing the gap
This problem prompts the question: what can organisations do to narrow the gap between what they profess and what they practise?
First, it is important to address any lingering belief that such a gap is "acceptable". Yes, there is an argument that aspirational statements are part of a visionary management culture. This is valid up to a point, but no further. Remember that an organisational culture that discounts its own statements has a very corrosive effect on stakeholder relationships.
Policies should not simply emerge from the top of an organisation, to be driven down and out to the periphery. Before the policies are rolled out, it is better that they are subject to internal discussion - along the lines:
- "what is the issue?"
- "what should we aspire to?"
- "what policy will put us on the right road?"
That way they are less likely to end up as corporate wallpaper. But beware so much consultation and consensus that they simply confirm the status quo. Aim for "stretch", but not so much that implementation is near impossible and disillusion sets in.
Of course, corporate culture will affect how much stretch and aspiration are considered appropriate in policy statements. I know of two comparable companies in the fast-moving consumer goods sector that have opposing views on communicating policy in public. One issues grand statements and far-reaching targets on every conceivable topic on the CSR and sustainability agenda; the other adheres to its mantra "we never say anything that we could not possibly live up to".
A third strand of a can-do strategy is to build policy adherence into the management reporting processes. Management reports tend to include a reference to health and safety policy. It is less common to see commentary on the reporting unit's success in adhering to other policies. Letters of assurance - a common feature of relationships between organisations and their external advisers - may be best when, for instance, the reporting unit is large or highly autonomous and has few other opportunities to communicate with the core.
At the other, more human end of the reporting spectrum, dialogue between managers and their direct reports should embrace policy as well as performance issues. It is important to avoid a tick-box mentality, however, in order to adopt appropriate techniques. For instance, "how are you getting on with ...[policy issue abc]?" is preferable to "have you complied with...?".
I am concerned about selectivity in instances when an organisation espouses in its CSR and sustainability communications policies that differ from those expressed in its dialogue with policymakers. As a professional and as an environmentalist, I believe we must acknowledge that this goes on. How else do we explain instances of companies engaging in lobbying against measures that, according to their CSR and sustainability reports, they would be in favour of? And how else can the stance of some industry groups be less pro-sustainability than the published views of individual members? A recent study from the Policy Studies Institute revealed the extent of such behaviour, finding that many major multinational companies with strong sustainability policies are at the same time members of trade associations that are lobbying against EU climate policy.
It amazes me that organisations let this happen. Clearly, it is bad for stakeholder relationships. But it also represents a huge waste of effort. If CSR and sustainability communications are not used to discuss how proposals for legislation, for example, affect the progress of an organisation, much of the benefit of those communications is lost. It is better to help stakeholders appreciate the dilemmas that organisations face in aligning business survival with sustainability goals than to waste time conveying a rose-tinted view.
From the point of view of policymakers, the same argument applies: lobbying positions framed in terms of sustainability will have more traction. Compare "we object to [legislation proposal xyz] because it will have a negative impact on our organisation" with "[legislation proposal xyz] will prevent us being a more sustainable organisation in a more sustainable world because...".
Some good reports on the relationship between CSR and sustainability communications and lobbying have been produced - the Green Alliance briefing, The private life of public affairs, is one. They all propose remedies, of which I particularly favour these:
- it should be standard practice for organisations to include in their CSR and sustainability communications a commentary on their lobbying activities and their alignment with the organisation's policies;
- there should be transparency about involvement in trade associations; and
- all lobbying communications - consultation responses and so on - should include a short statement on how the espoused view aligns with the respondent's CSR and sustainability policies.
Following these steps would do much to prevent the skewed nature of many CSR and sustainability communications. Yes, it would make them less comfortable to read, but isn't that a good thing? After all, it is the grit in the oyster that produces the pearl.
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