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THOUGHT LEADERSHIP

Corporate Responsibility and Social Media...50 // Spending Shareholder’s Money Ethically...53

The latter, on the other hand, is a still-


evolving phenomenon borne out of the
perfect storm of technological innovation,
accelerating globalization and economic
turbulence—not to mention significant revi-
sions to the standards of business commu-
nication. However, especially in the context
of communication in the modern business
environment, corporate responsibility and
social media share inextricable similari-
ties—namely, a profound effect on compa-
nies’ reputations and, in turn, bottom lines.

Indeed, corporate responsibility (CR)—


which, broadly speaking, encompasses
the theories and practices of corporate
social responsibility, sustainability, corpo-
rate citizenship, ethics, issues advocacy,
environmentalism and/or community rela-
tions—and social media have both made
their respective entrées into the business
vernacular, but neither are “trends” that
will be eradicated by or replaced with
something equally fleeting. Rather, corpo-
rate leaders must accept their respective
significance and then adapt their commu-
nication strategies accordingly; their cor-
porate reputations—not to mention their
survival—depend on it.

Mutually Inclusive: The Convergence of


Corporate Responsibility & Social Media

When considered independently of one an-


other, the arguments in favor of implement-
ing both CR and social media strategies are
compelling, especially in terms of defend-
ing and enhancing corporate reputations.
To begin with, statistically speaking, CR
initiatives can shape various constituents’
opinions of/confidence in/support of compa-
nies’ products and services (see Sidebar on
page 52).

At the same time, so do social media initia-


tives. In fact, recent research confirms that
the depth of a company’s engagement in
social media can be directly correlated with
its financial performance; specifically, those
brands that are deeply engaged in social
media outperform peers in terms of revenue

Corporate Responsibility growth, gross margin growth and net mar-


gin growth.

and Social Media But “engagement” does not simply refer to


the ownership of social media platforms. A
Written by Paul Argenti, Professor, Dartmouth company might play a passive role in social
media, but that doesn’t mean it participates
in conversations with its constituents. Par-
ticipation is a matter of “talking back”—not
At first mention, the topics of corporate responsibility and social media have seem- as a defensive measure, but as part of the
ingly little in common. The former is a recurring topic that emerges every decade exchange of ideas between and among
or so under a new guise, whether environmental awareness sparked by the Exxon companies and their audiences.
Valdez oil spill of 1989, the phasing out of chlorofluorocarbons (CFCs) in the early
1990s, the introduction of the Kyoto Protocol in 1997, or the trend of environmental Which brings us to CR and social media’s
protectionism sparked by Al Gore’s Nobel Prize-winning 2006 documentary film, intertwined relationship. Constituents are
An Inconvenient Truth. more likely to purchase/work for/invest in

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THOUGHT LEADERSHIP
socially responsibility companies, while,
at the same time, the emergence (and
subsequent proliferation) of social media
platforms like Twitter, blogs and social
networks has empowered the very same
constituents to trumpet their opinions of
these companies to vast audiences. Thus, if
a company’s CR commitments influence its
investment dollars, recruitment and reten-
tion capabilities, and bottom-line results— DELL USED FACEBOOK TO
and if the same company’s constituents can
discuss these commitments via social me- SUPPORT A CONTEST IN 2008,
dia—then both are of paramount interest to
this company’s communication strategy. IN WHICH PARTICIPANTS WERE
But CR and social media’s relationship is
symbiotic for reasons beyond this shared
ASKED TO SUBMIT ARTWORK ON
interest; executives can use social media
platforms to communicate their CR initia-
THE PAGE’S “WALL” BASED ON
tives and, in turn, enhance their reputa-
tions, as we will see by the examples pre-
THE THEME, “WHAT DOES GREEN
sented in the next section. But first, there
is another similarity that corporate leaders MEAN TO YOU?” THE CAMPAIGN
must understand: CR and social media can-
not be presented as campaigns executed DREW MORE THAN 7,000
over a finite period of time. They must in-
stead be ongoing commitments that grow ARTWORK SUBMISSIONS, AND
alongside the organization with no “end
date” in sight. MORE THAN 1 MILLION USERS
Socializing Responsibility: Communicat-
ing CR Initiatives via Online Platforms
VOTED FOR THEIR FAVORITES.
Certainly there is more than enough data to
prove CR and social media’s respective im-
portance to businesses, but one must also
consider the reputational risks that emerge
from misusing either activity to engage con-
stituents. In terms of corporate responsibil-
ity, that misuse is best described as “green-
washing,” which, according to Wikipedia, is
“the practice of companies disingenuously environment demands that more attention investors and its current or potential impact
spinning their products and policies as en- be paid to environmentally sound prac- on the company.
vironmentally friendly.” Any CR efforts that tices—financial reporting is increasingly
constituents perceive as greenwashing will synonymous with sustainability reporting. Social Networks: Social networking plat-
have potentially devastating effects on the Plus, thanks to the Global Reporting Ini- forms like Facebook are ideal for organiz-
company’s reputation. tiative’s move to standardize the process ing and mobilizing communities around
of disclosing sustainability performance, various causes. For example, Western
In terms of executives’ misuse of social me- companies are becoming more proactive Union launched its “Our World Gives”
dia, the pitfalls are less cut-and-dry. One in communicating their CR efforts. Not sur- Facebook campaign in 2008, encouraging
possibility is being completely absent in prisingly, they are doing so online. users to support charities by rallying their
social media conversations, thus increas- friends around various causes and associ-
ing the likelihood of missing brewing issues Much like annual reports, sustainability ated nonprofits, including American Red
that inevitably develop into full-blown cri- reports communicate financial data, per- Cross and UNICEF.
ses. Another option is using social media formance metrics, achieved objectives and
channels to push one-way corporate mes- future goals. With social media, though, Dell used Facebook to support a contest in
sages out to constituents without listening this communication can occur more than 2008, in which participants were asked to
to their reactions. Finally, some executives once a year. In fact, those companies at the submit artwork on the page’s “wall” based
unintentionally misuse social media by forefront of sustainability reporting main- on the theme, “What does green mean to
communicating in various platforms before tain robust Web sites dedicated to CR. BP’s you?” The campaign drew more than 7,000
taking the time to identify their constituents site, for example, categorizes information artwork submissions, and more than 1 mil-
and listen to their conversations. by topic (safety, climate change, alternative lion users voted for their favorites.
energy, etc.) for easy navigation, and then
Simply put, corporate leaders must view positions these issues in the context of larg- Blogs: As the number of companies that
CR and social media as commitments, not er trends. Plus, the site hosts a “Sustain- maintain corporate blogs grows, so too
campaigns, and they must be prepared to ability Worldwide Map” that allows users does the number of dedicated CR blogs.
walk the walk and talk the talk. Once they to search by location, as well as a charting Take McDonald’s: The company’s roster
are, the opportunities to communicate CR tool for investors to analyze and filter data of blogs includes the “Values in Practice
initiatives via social media platforms are based on their specific interests. Blog,” which hosts everything from dis-
plentiful: cussion forums and CR-related news, to
Ford and Starbucks’ CR reporting efforts videos and information surrounding Mc-
Online Annual Reports: As the investor are also Web-centric, and both include a Donald’s CR mission. The keys to its suc-
community becomes more interested in so- “materiality matrix,” in which information cess—and the success of any CR-centric
cial responsibility—and as the regulatory is organized according to its relevance to corporate blog—are transparency com-

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THOUGHT LEADERSHIP
munication, authentic engagement and
credible commitments.
CORPORATE RESPONSIBILITY & BUSINESS:

BY THE NUMBERS
Crowdsourcing: Crowdsourcing is a neolo-
gism describing the practice of outsourcing
activities that would usually be performed
in-house to the general public, most often
through an online forum.

MyStarbucksIdea.com is the quintessential


crowdsourcing site. It takes a laissez-faire
approach to communication, inviting all
constituents to participate in an open ex-
change of ideas. One of the site’s main ar-
eas of discussion is that of “Involvement,”
which is dedicated to community building
and social responsibility. There, visitors Despite the challenging economy, 34
have recommended everything from put- percent of American consumers report
ting recycling bins in every store to using being more likely to buy environmen-
energy-saving light bulbs. tally responsible products today, and
another 44 percent say their envi-
Twitter: This platform experienced a re- ronmental shopping habits have not
ported 1,400% increase in users between changed as a result of the economy;
February 2008 and February 2009, mark-
ing a phenomenal rise in popularity. The
140-character limit on “tweet” lengths 65 percent of privately
makes it ideal for communicating concise held businesses cite re-
messages that pack a punch, and a grow- cruitment and retention
ing number of companies are leveraging it pressures as their main
to engage constituents around CR efforts. CSR driver;
When asked to name the ways in which
In August 2009, Toyota executives devel- business should work to advance the
oped “Harmony Tweets,” a Twitter cam- 72 percent of surveyed execu- CR agenda around the world, 70 per-
paign launched in conjunction with the tives agree there will be more cent said strengthening the alignment
3rd-generation Prius’ debut. Using www. demands on business to solve between CR and business strategy; 64
HarmonyTweets.com as a hub, the program societal problems, and more percent said taking measureable steps
shares tweeted updates from charitable or- than half of this group is con- to make progress on key CR issues; and
ganizations and industry leaders, and gives fident that business will meet 41 percent said developing sustainable
users a platform for submitting their own these demands; products and services;
sustainability-themed tweets. Once again,
the open approach to communication, cou-
pled with distinctly “non-marketing” mes-
sages, proves to be a driver of success in
the social media space.

Closing Thoughts

Ultimately, the reality of today’s challenging


business environment mandates compa-
nies’ strategic application of both CR and When asked what is driving CR today,
social media to protect and enhance their 84 percent of survey respondents cited
reputations. As we’ve seen through the re- reputational benefits, and 80 percent
search and examples presented in this ar- cited increasing stakeholder demands;
ticle, executives can integrate their efforts
around both activities to maximize overall
business value. After all, the best practices
that define success in social media and in
CR are one in the same: The key driver is
transparent, authentic, and engaging com-
munication with all constituents. While the
barrier to entry is low, the price of not par-
ticipating is quite the opposite.
77 percent of survey respondents are 73 percent of surveyed global CEOs
either somewhat or very optimistic that agree or strongly agree that “business-
global business will embrace corporate es need to collaborate more effectively
responsibility as part of their core strate- with industry peers and business part-
gies and operations in the next five years; ners in mitigating climate change.”

Wanna Facts Sources


1.”Consumer Interest in Environmental Purchasing not Eclipsed by Poor Economy,” Cone Consumer Environ-
know mental Survey, Cone, Inc., February 18, 2009. 2. “Corporate Social Responsibility: a necessity not a choice for
privately held businesses,” Grant Thorton International Business Report, 2008. 3.“Corporate Responsibility in a
more? New World Survey,” Cone Inc. and Business for Social Responsibility (BSR), 2008. 4. Ibid. 5. Ibid. 6. Ibid. 7. 11th
Annual CEO Survey, PricewaterhouseCoopers, 2008.

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