Critical Link for Corporate Citizenship Ollege Strategies and Real Cases from 8 Companies

INTEGRA TION: CRITICAL LINK FOR CORPORA TE CITIZENSHIP • The C

A Research Report by The Center for Corporate Citizenship at Boston College • 2004 enter for C orporate Citizenship at Boston C Integration: Critical Link for Corporate Citizenship ollege Strategies and real cases from 8 companies

A Research Report by The Center for Corporate Citizenship at Boston College • 55 Lee Road • Chestnut Hill, MA 02467-3942 The Center for Corporate Citizenship www.bc.edu/corporatecitizenship at Boston College • 2005 The Center for Corporate Citizenship at Boston College, a membership-based research organization, is committed to helping business leverage its social, economic and human assets to ensure both its success and a more just and sustainable world. As a leading resource on corporate citizenship, The Center works with global corporations to help them define, plan and operationalize their corporate citizenship. Through the power of research, executive education and the insights of its 350 corporate members, The Center creates knowledge, value and demand for corporate citizenship.

The Center offers publications including a newsletter, research reports, and white papers; executive education, including a Certificate program; events that include an annual conference, roundtables and regional meetings; and a corporate membership program.

www.bc.edu/corporatecitizenship

PROFILES IN ACTION Cover photo illustration represents many of the professionals who are initiating action and building momentum for the integration, alignment, and institutionalization of corporate citizenship inside the companies participating in the research project.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management Foreword

Reality. Rarely does it come as neatly packaged and as prescrip- tive as textbooks might suggest. So it is not surprising that, as The Center for Corporate Citizenship at Boston College looked inside eight North American-based companies at efforts to integrate corporate citizenship, our research team documented challenges, success stories, frustration and joy; reality – writ large.

Mostly the research team found exciting strategies, savvy methods of col- What distinguishes laboration, and evidence of success. They also found difficult situations and obstacles that managers were forced to confront, and observed the this research is the ways managers responded. We did not find a single, fool-proof formula. focus on the middle This report provides recommendations that managers can adapt to support the reality of their company’s specific corporate citizenship strategies level of companies – and business climate. a place where strategy What distinguishes this research is the focus on the middle level of companies – a place where strategy and implementation intersect. While and implementation many doubt the power of mid-level managers to initiate such large-scale intersect. efforts as the integration of corporate citizenship, we found in these individuals significant energy, intelligence, commitment, resourcefulness, and know-how. As this report reveals, these are results-oriented, ambi- tious professionals who, when willing to take risks, find ways to engage business colleagues across function lines and business units as well as up and down the command chain.

Our research clearly demonstrates how mid-level managers can successfully initiate action and build momentum to move toward integration and alignment of the varied components of corporate citizenship. This does not minimize the importance of CEO-level support. Only senior leadership can ensure the viability of corporate citizenship over time by requiring that strategies, policies, processes, systems, and other standard business practices be embedded into the fabric of the organization – what we call institutionalization. But we found that substantial progress can be made before that support is garnered and, in fact, this progress provides evidence to executives of the value and importance of corporate citizenship.

We also know that a CEO mandate alone is not sufficient. It must be supported by efforts to connect corporate citizenship to business objectives with a cohesive, corporate-wide strategy – what we call alignment – and the embedding of corporate citizenship goals across all business units and functional areas including manufacturing, supply chain, business planning, and human resources – what we call integration.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 1 Foreword

All three – alignment, integration, and institutionalization – constitute genuine corporate citizenship and create a balance of social, environmental, and economic goals. They enhance the bottom line and strengthen the long-term viability of the company.

In this report we identify critical success factors for corporate citizenship and provide examples of the challenges and successes of more than 20 managers inside eight companies. Through the use of anecdotes, short case studies, and the voices of these professionals we endeavor to make these lessons real and applicable. We hope other practitioners will relate to and learn from these individuals who through risk-taking, smart planning, and innovative practices have advanced corporate citizenship within their companies. Each has a vision of how integrating corporate citizenship activities improves the performance of their group and supports larger company interests. In this report they explain the path they have shaped and share the details of their adventures.

Bradley, K. Googins, Ph.D. Executive Director The Center for Corporate Citizenship at Boston College

2 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Contents

I. Foreword ...... 1 II. Introduction ...... 5 Integration: Critical Link for Corporate Citizenship III. Model for Change ...... 11 Research Team: • Identify hand-holds: organizational commitment, risk, and opportunity Julie Engel Manga, Ph.D. • Critical first steps Philip Mirvis, Ph.D. Steven A. Rochlin IV. Role of Change Agents ...... 16 Kristen F. Zecchi • Lead without formal title or mandate • Sustain momentum with passion, pragmatism, and patience Acknowledgements: • Develop allies for guidance, learning, and inspiration We would like to thank the following for the contributions to the report: V. Building Relationships ...... 20 • the Executive Forum project • Create professional alliances as a foundation for action participants • Connect with key business representatives • Chris McKnett, intern and writer • Identify opportunities for upward influence • Seek out passionate supporters VI. Building Knowledge ...... 26 • Know the business from the inside • Identify and understand key business drivers VII. Taking Strategic Action ...... 33 • Alignment strategies • Integration strategies • Institutionalizing strategies VIII. Conclusion ...... 45 IX. Case in Point Profiles ...... 47 • Unocal: Relationships as a foundation for action • Levi Strauss & Co: Knowing your audience • Agilent Technologies: Gathering data to build the business case • Petro-Canada: Making the case for a corporate responsibility director • AMD: A means to a greater end • Verizon: Building knowledge, building buy-in • Petro-Canada: Building corporate citizenship into existing structures X. Appendix ...... 63

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 3

4 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

Introduction

L eading corporations around the globe are taking steps — in some cases preliminary, in other cases more advanced — to align, integrate, and institutionalize corporate citizenship throughout their businesses. In part, these companies are responding to growing external pressures to recognize “Global citizenship has to their role in and impact on society. In the face of this, companies are also hold a catalytic function beginning to feel internal pressure to embed a strategic and systemic busi- and act as a resource for ness approach to social, economic, and environmental concerns. In short, businesses are being asked to deliver profits for the bottom line while pro- the organization. We lead tecting society; to deliver returns for shareholders along with tangible ben- certain initiatives, we help efits to customers, employees, communities, and ecosystems; and to uphold create tools, and we share the law while becoming more open and accountable to society. information across the organization. But citizen- In this context, corporate citizen- working with these managers, The ship is not one corporate program Center explored the questions: ship is the job of every per- among many but a key dimension of a company’s business model. • How do companies initiate and son in the company, not build momentum to align, inte- Most companies working to build just us.” an aligned and integrated approach grate, and institutionalize corpo- to corporate citizenship do so with- rate citizenship as a full fledged — Reeta Roy out the guidance of the norms and dimension of their business? Abbott Laboratories rules that support well-established areas of business. There is also no • Can managers catalyze corporate commonly accepted definition of citizenship from the middle? corporate citizenship — illustrated by the many descriptive terms used, including corporate responsi- Methodology bility, corporate social responsibili- Funded by The Ford Foundation ty, and sustainability. and participating companies, The Center’s Executive Forum on To advance its mission — challeng- Corporate Citizenship was a ing companies to redefine business two-and-a-half year action-research success as creating measurable project. Participating companies gains for business and society — included: Abbott, Advanced Micro The Center for Corporate Citizen- Devices (AMD), Agilent Tech- ship at Boston College worked with nologies, JPMorgan Chase, Levi mid- to senior-level managers Strauss & Co., Petro-Canada, inside eight companies to explore Unocal Corporation, and Verizon. how they were advancing corporate (See Appendix B for information on citizenship in their companies. In each company.) The participant

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 5 Introduction

EXECUTIVE FORUM PARTICIPANTS

COMPANY PARTICIPANTS

ABBOTT Susan Beverly, Manager, Global Citizenship and Policy Kevin Callahan, Director, Global Citizenship and Policy www.abbott.com Reeta Roy, Divisional Vice President, Global Citizenship and Policy

Gail Brownell, Quality Systems Manager www.agilent.com Gene Endicott, Public Affairs Director

Tammy Bigelow, Health and Welfare Program Manager Shaye Hokinson, Extended Producer Responsibility Group, www.amd.com Worldwide EHS Allyson Peerman, Global Community Affairs Director Philip Trowbridge, Member of Technical Staff, Worldwide EHS

Pamela Kersey, Senior Vice President, Corporate Philanthropy & Sponsorships www.jpmorganchase.com Robert Rosenbloom, Vice President, Corporate Philanthropy & Sponsorships

Theresa Fay-Bustillos, Vice President of Worldwide Community Affairs www.levistrauss.com

Hazel Gillespie, Community Investment Manager Sharon Mulligan, Director, Corporate Responsibility www.petro-canada.com David Stuart, Senior Director, Environment, Health, Safety and Security

Greg Huger, Director, Corporate Responsibility www.unocal.com Laurie Regelbrugge, Manager, Corporate Responsibility Roxanne Sinz, Manager, Public Affairs, Unocal Alaska Louisa Chan Boegli, Corporate Responsibility Consultant

Patrick Gaston, President, Verizon Foundation Chris Lloyd, Director, Strategic Alliances Mike Stauffer, Former Director, Strategic Alliances www.verizon.com Susan Sullivan, Director, Verizon Foundation

6 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Introduction

companies were deliberately cho- knowledgeable about or relevant to CORPORATE CITIZENSHIP: sen to reflect different industries their company’s corporate citizen- WHAT IT TAKES with an array of corporate citizenship efforts. The team also com- ship challenges and because each pleted a similar set of interviews as company was already developed in the project was ending. In the Alignment: To connect corporate citi- some aspect of corporate citizen- interim, the research team devel- zenship to business objectives with a ship. The project’s intention was to oped an understanding of each cohesive, company-wide strategy that is capture the diversity of experience company’s corporate citizenship commonly understood throughout differ- among industries, company sizes, landscape and its ongoing develop- ent parts of the business and that leads and consumer bases. While the ment through regular interviews to consistent attitudes, aspirations, inter- sample size was insufficient to pro- with project participants and other ests, knowledge, and goals. company representatives. The team vide a representative view of what Integration: To embed corporate citi- is happening in any given industry, also made site visits and reviewed zenship goals across all business units it did allow the research team an relevant documents and tools as and functional areas, including manufac- overview of corporate citizenship part of data collection. The Center turing, supply chain, business planning, trends and activities common to hosted 10 conference calls and five and human resources. These goals are many companies today. two-day plenary sessions in which integral to business goals, not separate the participants were able to inter- from or tangential to them. Over the course of the project, The act with each other while the proj- Institutionalization: To ensure sus- Center’s research team engaged ect team gathered data. (See appen- tainability of corporate citizenship over regularly with project contacts dix A for the timeline of project time by embedding strategies, policies, from each company, individuals activities.) processes, systems, and other standard who, despite their variety of titles business practices into the fabric of an and functions, had taken a high organization. Institutionalization ensures degree of ownership of their com- Project Findings that corporate citizenship will be sup- pany’s corporate citizenship activi- Based on this research, The Center ported throughout the company, even if ties, strategy and/or implementa- has identified lessons to offer man- the main proponents transition to other tion. In this report these individu- agers interested in initiating and roles or leave the organization. als are referred to as corporate citi- building momentum for corporate zenship managers or practitioners. citizenship in their companies. The bulk of the information has Consistent among the companies come from conversations with and was the need to actively align, inte- observations of the practitioners grate, and institutionalize the ele- • highly segmented, siloed, and their colleagues. The research ments of corporate citizenship. The and fragmented citizenship team has not verified this informa- practitioners in this research proj- activities; tion from sources outside the com- ect are working to have their com- • an over reliance on philanthropy panies. Claims made about per- panies move to a model of citizen- as the core or perceived core of formance or impact reflect the ship that is robust enough to han- citizenship efforts; and views of the individuals, not neces- dle the demands of a rapidly chang- • challenges of transparency, sarily the corporation. ing global business environment. accountability, and reputation as They are addressing challenges key competitive issues for the At the outset of the project, the that include: business. team conducted extensive baseline interviews within each company among a range of individuals

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 7

Introduction

The traditional citizenship model as an essential part of strategy and model as many leadership and has entailed ensuring legal compli- are integrated into the processes organizational change experts have ance, adhering to corporate gover- and policies that underlie business begun to note of change strategies nance, and promoting strong phil- practice. more generally. anthropic and volunteer activities. While many large companies are Each company studied has made convening cross-functional teams substantial progress in its effort to to incorporate citizenship into initiate and move forward a corpo- business strategy, the vast majority rate citizenship agenda that aligns are looking to individual leaders, with business strategies and is HALF often at the mid-manager level, for integrated throughout the busi- Introduction leadership. This report provides a ness. (This progress is illustrated framework for managers and exec- by the chart on page 44.) The Center has analyzed the tactics that utives who have been charged with This progress has not always been TRUTHconventional wisdom suggests are integrating, aligning, and institu- linear, often simultaneously mov- tionalizing citizenship. essential to integrating corporate citizen- ing along multiple fronts. It has ship. Throughout this report, read about The research has revealed several sometimes included stops and these “Half Truths” and how they can qualities and professional skills starts, with two steps forward spark momentum but also act as traps or that are important for the success matched by one step back. It has rarely been an easy sell, as practi- hinder progress. of the manager who takes on the role of champion for citizenship. tioners work to gain awareness and For full list, see page 67-68. This report is as much about the acceptance across all dimensions personal journey of more than two of the company — from executives dozen committed managers who to managers to line employees. are taking strong actions to Their successes debunk popular advance corporate citizenship with- While these focus points served as myths that often inhibit corporate in their companies in a more inte- a central component of citizenship citizenship practitioners. Research grated and aligned manner as it is in the past, they represent an insuf- findings include: about the findings and a frame- ficient approach in an era of global- work for others. ization that comes with a multitude Finding #1 of expectations and pressures The research demonstrates that Progress can be made during placed on business by activists, middle managers from a variety of tough economic times. nongovernmental organizations functions can successfully initiate Six companies in the Executive (NGOs), governments, and local action and make substantial Forum experienced difficult finan- and cyber-communities; not to progress, building momentum for cial conditions during the research mention employees, customers, a more far-reaching corporate citi- period, and yet only one saw its cit- and investors. zenship effort in their companies. izenship efforts stall as a conse- While this may not be the prototyp- The new corporate citizenship quence. Three recalibrated their ical top-down textbook approach, it must be linked with business strat- bold objectives to take a more mod- is a realistic, prevalent, and effec- egy. It requires a robust organiza- erated approach that advanced spe- tive method. This approach may tional frame, in which the critical cific initiatives that could still yield more robust and sustainable issues of citizenship are accepted advance the overall effort. Two results than a traditional top-down were able to make progress in

8 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Introduction

building momentum. The lesson Finding #3 nies, and built solid evidence for is that during times of economic Middle managers do make a the value of corporate citizenship. adversity corporate citizenship ini- difference. These enterprising managers were tiatives do not need to become a The research reveals that mid-level also adept at leveraging whatever drain on already scarce resources managers can successfully act as support they could—from the and secondary to the main goal of internal catalysts for the corporate goodwill and relationships built turning the business around. In citizenship agenda. As formal, infor- through the years to the political fact, in some cases a corporate citi- mal, or even self-appointed owners, clout of their department to exist- zenship perspective provides a they develop solutions that prove the ing structures and policies. The valuable point of reference to guide value of corporate citizenship and approaches varied among the com- an organization through challeng- build internal support in particular panies, according to the skills and ing times. departments and levels of the organ- strengths of the manager and the ization. Coming from different needs of each organization. Finding #2 functional areas, these managers were able to increase their scope of It is possible to mobilize corporate influence by being involved in the citizenship awareness and support Catalyzing Corporate larger picture of citizenship. While without the perceived urgency of mid-level managers can be the Citizenship external or internal pressure. impetus for integration and align- In the absence of a strategic imper- The Executive Forum participants ment, institutionalizing citizenship ative from the senior executive demonstrated that much can be does require genuine support from level, the corporate citizenship accomplished without a “burning top leadership. practitioners in this research study platform” or other catalyst that cre- have advanced their work using a ates a sense of urgency. The keys to three-dimensional approach that, generating momentum and aware- Finding #4 over time, has allowed them to ness include: Developing an iron-clad business achieve success. Their work is gen- case is not a prerequisite for • creating relationships and erally not part of an explicit, thor- taking action on corporate oughly developed plan or larger alliances that support a com- citizenship. mon corporate citizenship goal; strategic corporate citizenship The Executive Forum participants agenda. • launching pilot programs that demonstrated that working to build demonstrate the value of inte- and promote the business case is The practitioners navigate the grating corporate citizenship; challenging and takes valuable process by virtue of their masterful • identifying opportunities that time. Instead of focusing solely on ability to listen for, identify, and act make management aware of hard data or undeniable proof that on opportunity. They recognize corporate citizenship issues rel- increased profit follows good citi- that systemic change often begins evant to the company’s business zenship performance—a causal incrementally and that working strategies; argument that is generally not one small part of the system can • securing an executive champion definitive—the participants use catalyze new, often unpredictable, when the time is right. this time to demonstrate the case opportunities in other areas. They for corporate citizenship through understand that organizational action. In the process, they devel- change is not always a linear, oped stronger relationships, rational, top-down process and learned more about their compa- relies on a network of individuals

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 9

Introduction

throughout the company. Their Figure 1 actions demonstrate their understanding that organizational THE THREE DIMENSIONS OF change can and should be gener- CATALYZING CORPORATE CITIZENSHIP ated from multiple points and levels in the company simultaneously. As corporate citizenship managers, they are instrumental in Take Strategic Action catalyzing energy and momentum for system-wide change.

Understandings of organizational Build Build change and professional skills Knowledge Relationships were matched by the belief that there was a void to be filled. Reflecting many of his peers, Gene Endicott, director of public Change Agent affairs for Agilent Technologies says, “I had an unwavering belief that continuing to focus on these issues was going to help my company be better off.” • Take strategic action. advance corporate citizenship. Based on the research team’s Choose actions that will provide Finally, it outlines the strategic observations on how practitioners learning, demonstrate the value actions that practitioners can take to in the Executive Forum worked, of corporate citizenship, and fos- initiate and build momentum to three fundamental elements of ter behavior change. align, integrate, and institutionalize integrating, aligning, and institu- corporate citizenship in their organ- tionalizing corporate citizenship The remainder of this report out- izations. Throughout, this analysis were identified: lines the lessons learned from the is supported by the real stories and corporate citizenship managers experiences of practitioners who are • Build relationships, leadership, involved in the Executive Forum successfully working to affect and connections. project. First, it looks at a model for change in their companies. Collaborate with key people in change and the critical first steps the organization — for their that practitioners should take to knowledge, potential to moti- ensure that their citizenship initia- vate, and ability to produce tives are built on a solid foundation. action. Next it examines in depth the role of the manager as a change agent to • Build knowledge/know the create momentum, visibility, and business. action for corporate citizenship. Study the strategy and interests Then, as outlined in the diagram of the company to show how above, the report identifies specific corporate citizenship is relevant strategies for building knowledge to future business needs. and building relationships that

10 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Model for Change

In contrast to traditional, top-down strategic planning, the experiences of the eight participant companies demonstrate that progress often occurs through an opportunistic, incremental, and emergent process. Under this approach, goals, strategies, and activities are shaped through action. Plans “Most of our programs shift as managers respond to opportunities and the state of the company work in silos. We are and revise priorities in the face of intractable obstacles. The process relies trying to integrate them on the art of managing internal organizational politics, culture, and social networks more than on the expertise of formal planning and project man- more throughout the agement. The decentralized, relationship-based, and improvisational company, but it has to be character of this process makes it possible for practitioners to make progress an effort by people, not by in their companies even in unfavorable and uncertain circumstances. systems and processes.” — Theresa Fay-Bustillos Levi Strauss & Co. Identify Handholds tain holds for reasons having to do Using a rock-climbing metaphor, with their skills, experience, what Laurie Regelbrugge, manager of results they can anticipate, and the corporate responsibility at Unocal plan they have for scaling the rock Corporation, recommends finding face.” “handholds” to establish traction By finding handholds and opportu- and create opportunities to move nities for strategic action, a manag- in the direction of company-wide er can capitalize on situations, aligned and integrated corporate events, and activities that increase citizenship: awareness of risks, opportunities, “In scaling a wall of rock, a rock and internal conditions, which in climber must find and make effec- turn creates more opportunities for tive use of the meager or substan- action. Incremental progress in dif- tial handholds along that wall. ferent parts of a company creates Some handholds that seem prom- pockets of demonstrated success ising may ultimately lead the that help build toward company- climber to a dead end, while others wide corporate citizenship align- allow the person to reach the ment. A key role of the practitioner desired destination. Different is raising awareness of these “pock- climbers, presented with the same ets” as part of a greater corporate rock face, may choose a different citizenship commitment. set of handholds and, therefore, Many models of corporate citizen- follow a slightly different path. The ship advocate a top-down approach key is that there are often many that simultaneously addresses a options, and climbers choose cer- company’s risks and opportunities

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 11

Model for Change

strategy also welcomes the notion that change involves a network of Figure 2 people in a company and is gener- MODELS OF CORPORATE CITIZENSHIP CHANGE ated from many directions, not just from the top down.

In the end, this approach is no less Traditional, top-down Catalytic systemic or strategic than its top- down counterpart. Rather, by Risk focusing on building connections among more bounded and local- ized successes and leveraging experience gained, practitioners can create momentum around compa- Organizational Opportunity Commitments ny-wide corporate citizenship alignment without waiting for senior executives to generate an over- - Fixed Plan - Adaptive and responsive arching plan. In fact, practitioners - Top-down, change from one source - Multidirectional, multisource change have found that when executives - Managers as implementers - Managers as strategists and catalysts can respond to successful corpo- - Directive - Emergent rate citizenship initiatives, this - Predictable outcomes are assumed - Lack of predictability recognized as strategy has helped produce more part of the process robust senior management buy-in and resource dedication.

Examples of how Executive Forum participants used the risk-opportu- and is grounded in organizational effective approach. They identify nity-organizational commitments commitments (such as values and and seize opportunities with the construct are varied. culture), as shown on the left of the intent of demonstrating success figure. In this model, practitioners rather than establishing and adher- Leveraging organizational are encouraged to develop a coming to a strict overarching strategy commitments prehensive, strategic, and long- with prescribed steps and activities. For some companies, organizational term approach to citizenship. It is The process of identifying and act- commitments—including values, typically designed to be executed ing on “handholds” and making culture, and existing systems and from the top down and encompass- the connections among them is processes—are the lens through es different parts and levels of the shown on the right side of Figure 2 which all else is viewed. In these company, which are trying to (shown above). This incremental companies, organizational commit- accomplish very different types of and emergent strategy allows for ments are distinct from risk and work (for example, human variability in organizational readi- opportunity and given more prima- resources, supply chain, design, ness in different parts of the com- cy than the other two areas. For sales, or manufacturing). pany, senior management buy-in, other companies, organizational and functional differences commitments carry the same Executive Forum participants oper- throughout the company. This weight as risk and opportunity. ate with a more pragmatic and

12 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Model for Change

For example, many of the Executive national expansion, risks quickly Forum companies espouse corpo- surfaced. rate values that relate to cultural norms regarding personal ethical Other companies are aware of ways in which wider industry issues HALFBuild on existing behavior (integrity, respect, empathy) and business success (innova- could potentially become a risk for policies and systems tion, results-focused, decisive). their organizations if not addressed with diligence. At AMD, for exam- First ensure that the policies are up-to- Others have values that speak to ple, the issue of lead in the manu- TRUTHdate and still relevant to your business. If their specific industry and business facturing process falls into this cat- they are, modify existing structures to model, such as Levi Strauss & Co.’s egory. While efforts are under way deliver on corporate citizenship objec- value of originality, relevant to the to address it, this challenge would tives, but don’t force a fit. apparel industry, or Agilent’s value be problematic if left unattended. of speed, a challenge in the quick- moving high-tech sector. For all Identifying opportunity companies, however, these corpo- One of Agilent’s product lines pro- Critical First Steps rate values represent a commit- duces goods that are used to meas- ment to the standards of behavior, There is no single approach to ini- ure air and water quality. Since tiating or gaining momentum. operations, and decisions that cor- these products have inherent social porate citizenship seeks to opera- There are, however, several critical benefits, Agilent’s citizenship prac- first steps that, regardless of the tionalize. (For a full list of company titioners are looking for ways to values see Appendix C.) company or situation, allow a man- support expansion of and innova- ager to choose focus points wisely, For other companies, existing busi- tion in these product lines. build a strong internal network, ness priorities can be expanded to JPMorgan Chase has also expanded and proceed in a way that resonates include a deeper corporate citizen- programs in low- to moderate- with the company culture. The fol- ship focus. At Levi Strauss & Co., income neighborhoods that were lowing section explores how con- for example, Fay-Bustillos has originally initiated because of the ducting a corporate citizenship sought to insert creative citizenship Community Reinvestment Act. By inventory and creating a political initiatives in the company’s already acting on these programs as busi- strategy shed light on the risks, innovative supply-chain practices. ness opportunities rather than opportunities, and organizational By leveraging an issue that already merely a response to legislation, commitments that are firm hand- has buy-in and visibility, she is able the company has fostered high lev- holds for the citizenship effort. to promote bold new ideas. els of growth in these previously neglected communities. Conduct a corporate Assessing risk citizenship inventory With its significant expansion into The work of making a persuasive, Every company in the Executive international properties, Petro- strategic argument is never com- Forum has a wide range of initia- Canada saw potential risk in the plete, and in the initial phases tives, policies, systems, and prac- lack of specific policies regarding leveraging discrete opportunities tices in place that are related to cor- human rights and prevention of builds toward a larger, more sys- porate citizenship, but many had improper payments. The policies temic strategy. This in turn gener- not been formally identified as and training were originally devel- ates more opportunities, which in such. This includes, for example, oped when the company operated turn adds to the strategic case, and diversity practices, supply-chain exclusively in Canada. With inter- so forth in a dynamic system. practices, work-life programs, envi-

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 13 Model for Change

ronmental considerations in prod- • establish evidence of corporate centrating on some foundational uct design and development, codes citizenship success; issues around structure and inte- of conduct, and community • develop internal allies and rela- gration, because that’s the under- involvement programs. tionships with others involved pinning of what we want to do in corporate citizenship work in moving forward.” They used exist- their company; ing overarching mechanisms in the • create a foundation for assess- company — communications, rep- ing a company’s level of readi- utation management, environ- ness and the approaches and ment, health and safety manage- pacing that will be most appro- ment systems — to create mes- HALFEngage the line priate; and sages and platforms to promote a organization • identify opportunities for devel- unified corporate citizenship. They opment: what can be built upon also proposed new structures to the Corporate citizenship staff must function or built into. executive leadership team, includ- TRUTHas internal consultants, strategists, ing a position dedicated to corpo- For many practitioners, the realiza- boundary-spanners, and innovators, but rate responsibility, a governance tion of the breadth of activities often ultimately the line must own corporate model, and an executive steward- comes as a result of creating a com- ship team. Ultimately, this combi- citizenship. pany’s nonfinancial social or sus- nation of internal knowledge and tainability report, but it can also be a external benchmarking allowed the general learning process on the way practitioners to position a more to create a more strategic citizenship strategic proposal to the executives. Being aware of, understanding, initiative. and assessing these current and past corporate citizenship-related When Petro-Canada identified Create a political strategy: initiatives within the company is existing work related to corporate power, influence, interests essential. One critical first step responsibility, practitioners saw In addition to taking an inventory many managers take in initiating a that the activity was widespread but of activities, it is important to map corporate citizenship strategy is to without any aligned strategic pur- how people relate to advancing a conduct an inventory of these exist- pose. “We all realized that we were corporate citizenship agenda for ing initiatives, policies, systems, contributing to the company’s the company. Individuals differ in and practices. After the inventory, internal and external reputation,” terms of their ability to influence practitioners frequently said, “I says Community Investment change and their level of interest. didn’t know we did so much.” Manager Gillespie, “but we weren’t The Executive Forum managers Although they realized that there doing it in a coordinated, concen- have keen political instincts which were many existing initiatives to trated, focused, strategic way.” they used to assess potential and build on, the practitioners had to When they realized how many relatively ready allies, opponents, contend with the fact the initiatives pieces were ready to be connected, and whose support mattered most were largely siloed and disconnect- they conducted external bench- to their cause. ed from one another. marking and internal research to understand next steps. As a result, Formally or informally, mapping a By identifying early the full inven- Gillespie, along with David Stuart, political strategy is critical to under- tory of initiatives and activities, senior director of environment, standing the lay of the land in a practitioners are able to: health, safety and security, spent company. It enables a manager to time, as Gillespie says, “really con- think about who possesses power,

14 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Model for Change

the extent to which they under- Building a Political Strategy stand corporate citizenship, and how to engage them. By analyzing Considering these questions in a systemic way for internal the political layout of the organiza- stakeholders can generate a plan for approaching others within tion, practitioners can better the company. engage colleagues in the tasks and ■ Attitude toward corporate citizenship activities that are relevant to their Supportive of the Concept particular interests and level of • Do they understand what you are trying to accomplish? influence, understand how those • Do they believe that companies in general should focus on individuals interpret success, and this type of endeavor? how that success is most likely to occur. Supportive of Action • Are they willing to dedicate resources of time, staff or A political strategy identifies likely money? allies, opponents, and those neutral • When push comes to shove, would it stay on their priority list? toward corporate citizenship. It • Would they be willing to influence others who are less also shows how different relation- dedicated? ships and people can influence the course of citizenship. By identify- ■ Strength of current relationship ing possible points of leverage and • Comfort level in approaching this person, both from a roadblocks, the practitioner gains a personal and business standpoint. Personally, do you have a comprehensive sense of how to strong, candid relationship? • Can you openly express your opinions and negotiate build relationships with different solutions? types of people. This process is not • Professionally, do you have a strong sense of their business merely about assigning people a needs? place on the scale that ranges from • Do you understand the constraints and challenges that are a advocate to adversary, however. part of their business context? Do you know about the poten- Rather, it enables managers to tial growth areas of their business? think more critically about engag- ■ Areas for contribution ing individuals at different levels • What kind of company influence does this person have? and with varying responsibilities, • Can they provide tangible resources? as well as refining their ability to • Do they have the ear of an influential person in the articulate the value of corporate cit- organization? izenship. • Do they have a strong business acumen that would enable you to better understand the business? Once the mapping effort is complete, the process of establishing ■ Strategies for engagement • Do they need to be part of a basic corporate citizenship relationships with different indi- initiative? viduals in the organization • Should you do some “reconnaissance” work before becomes more clear. approaching them directly? • Do you need to schedule an informational interview to learn more about their business? • Could they become a key partner in the corporate citizenship effort?

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 15 Role of Change Agents

The Executive Forum participants all used similar business processes and tactics, which resulted in the Center’s framework for corporate citizenship action described later in this report. But the managers’ individual “Don’t wait for a dictate. traits and skills and qualities were also critical to their ability to make If you see an opportunity, progress. The managers who have been most successful demonstrate the ability to operate as both formal and informal change agents. They under- just go. Do it, act on it. stand and act on both their organizational knowledge — both the system- If your instinct is telling atized and the more unofficial ways their companies operate — and the you there’s something to opportunities and constraints of their own roles and spheres of influence. do, and it’s not being done — move. Don’t worry Successful managers use their the term “change,” as it often car- influence and energy to mobilize ries negative connotations for about having it all figured support and resources for building those within the organization. the foundation for aligned corpo- out on your own.” rate citizenship across different — Gene Endicott parts of their company. For many, Lead Without Formal Agilent Technologies this means taking greater advan- Title or Mandate tage of and, at times, stepping out Endicott, director of public affairs at of their formally defined organiza- Agilent, exemplifies the outlook that tional roles; drawing on their own characterizes managers who are commitment as a source of motiva- successful at jump-starting efforts to tion; and building networks of sup- align corporate citizenship in their portive relationships and coalitions companies. His bias toward action of allies. is grounded, however, in an understanding of his sphere of influence, Notably, many of the managers in including an awareness of how he the Executive Forum resist the is perceived by others in the organ- notion that they are seeking organi- ization by virtue of both his formal zational change. They tend to talk title and his informal roles. in terms of their companies “mor- phing” or “evolving,” and say they For example, Endicott began his are “building on what already quest to promote corporate citizen- exists.” Nonetheless, fundamental- ship by trying to understand the ly these managers are involved in value to Agilent of the public and making change happen. Indeed, it community affairs programs for is the sensitivity these managers which he is responsible. He rea- demonstrate toward the culture soned that his programs con- and structure of their companies tributed to enhancing Agilent’s that makes many reluctant to use reputation as a good corporate citi-

16 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Role of Change Agents

zen, but wanted to find ways to formal sphere of influence, and quantify this impact. Endicott over time he and Brownell became Read “Making the Case for a engaged the company’s investor identified as the people steering Corporate Responsibility relations director in pursuing ways Agilent’s corporate citizenship Director” on page 54. case in point to become listed on several corpo- efforts. Today, Endicott says he rate citizenship indices, such as derived professional satisfaction FTSE4Good and the Dow Jones when purchasing managers con- Sustainability Index. Given the sulted him on the selection of a professional role provides an screening criteria for these listings, paper vendor: “If it wasn’t for the opportunity to demonstrate a more he felt that Agilent’s inclusion work I was doing in this area, there personal set of commitments. “My would serve as public acknowledge- is no way anyone would have passion and commitment are how I ment of the company’s high level thought to contact me about that want to make a difference,” says of commitment to corporate citi- kind of an issue, but I weighed in Agilent’s Brownell. “This is the kind zenship. This would, in turn, on it because I had the chance.” He of work I’ve wanted to do ever since enhance the company’s reputation. has also been invited to sessions I decided where to go to college.” with new product development Agilent’s investor relations director managers as they prepare to pitch Similarly, Chris Lloyd, director of also recommended that Endicott new product ideas showcasing strategic alliances at Verizon, relat- collaborate with colleague Gail Agilent’s potential contribution to a ed a similar long-standing commit- Brownell, a quality systems manag- market for products that support ment: “My interest in sustainable er, who was advancing similar sustainability efforts. practices derives from my family interests within the company. background. My grandmother was Together they began to network always very pragmatic, using what with managers throughout the Sustain Momentum with meager resources she had available company since the data required to Passion, Pragmatism, to her. She also had a long-term apply for inclusion on the indices and Patience focus, trying to develop ways of extended beyond their purview. doing things that would still be What allowed the managers to be so Soon Endicott and Brownell valid in an uncertain future. The determined about taking the initia- became heavily involved in produc- reason I first enjoyed my role in tive and stepping beyond their for- ing the company’s annual sustain- environmental policy for Verizon mal role? For most, their determina- ability report, which was eventually and now corporate citizenship is tion was driven by a more strategic folded into the company’s overall that both roles are true to my val- vision for corporate citizenship in reporting strategy that Endicott ues. I have the unique opportunity their companies, even when such a now oversees. In each case, no of assisting the company to be con- vision was not well defined. The process had been in place for what scious of its impact on others and managers, each in their own way, was clearly a cross-functional proj- to act responsibly.” ect. It is important to note that were passionate about the possibili- Endicott and Brownell didn’t wait ty of a robust and integrated corpo- With such a strong sense of pur- for permission; they took the rate citizenship program for their pose, these managers are able to opportunity to make their ideas company. persist through setbacks and slow- happen. downs. For many, corporate citi- For many of the managers, their zenship is not yet or not always an passion is quite personal and not Beginning with areas linked to his explicit top priority of their compa- confined to their designated profes- domain of responsibility, Endicott ny’s senior management. For expanded his project beyond his sional role. Indeed, many feel their

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 17 Role of Change Agents

example, many managers experi- agenda. However, it’s not about report, Philip Trowbridge, member enced what they referred to as the the recognition; it’s about advanc- of technical staff, worldwide EHS organizational “churn” that accom- ing progress throughout the says: “You’ve got to have patience. panies challenging business condi- organization.” None of this is going to move tions. This is reflected in the expe- quickly. And by patience, I mean rience of Theresa Fay-Bustillos, vice The managers participating in the that it takes people a certain president of worldwide community Executive Forum are pragmatic amount of time to get comfortable affairs for Levi Strauss & Co. “I was about the realities of corporate cul- with divulging information or pro- patient and figured out what was ture and organizational change. viding information, particularly right for the company and pushed Most explicitly recognize that initi- external to the company. And that’s ating and building momentum for a comfort level you can’t force on corporate citizenship in their com- them. You can push the edge, but pany is slow work. you can’t force it.” “This is a slow-moving train,” says AMD’s Allyson Peerman, global HALFDesignate an owner of Develop Allies for community affairs director. “You corporate citizenship don’t expect to reach your goals Guidance, Learning, overnight. This work is about coali- and Inspiration The corporate citizenship expert should tion building, and that takes a long Initiating and building momen- TRUTHask the right questions, not provide all time. But at the end of the day, the tum for corporate citizenship in a the answers. This role is meant to gener- results should be stronger and company becomes exciting work ate attention to and action around corpo- longer lasting than a fleeting pro- for managers who are passionate, rate citizenship at all levels and across all gram.” but it also can be hard and slow, often characterized by Executive operations. “Patience is a virtue,” says Hazel Forum participants as “glacial.” Gillespie, manager of community Managers sustain themselves by investment at Petro-Canada and a developing allies and support net- veteran in leading cross-functional works, both within their own com- corporate-wide efforts. “These pany and with peers from other that agenda,” she says. “I never things just don’t happen companies. gave up. When I saw my Plan A overnight.” falling apart, I was still intent on Kevin Callahan, director of global achieving my objective. I just knew Agilent’s Brownell has come to citizenship and policy at Abbott, I needed a different approach, so terms with organizational realities. points to the importance of this that’s what I did. It’s a results-driv- “I’m remarkably tolerant of type of support, even though he en mentality.” bureaucracy,” she says. “I even has a formal title and mandate. amaze myself sometimes. But I “You have to pull together a group Susan Beverly, manager of global know that when dealing with large of people, externally and internally, citizenship and policy at Abbott, organizations, you have to work whom you can use as a sounding adds, “My passion for citizenship through the structure. I think I’m board to start testing some of your allows me to be successful in good at helping people around me initial strategies and thinking advocating our company to take a do that as well.” about action,” he says. responsive approach to the needs of society. Citizenship, by nature, Referring to his experience produc- Agilent’s Endicott and Brownell may not always lead the corporate ing AMD’s first sustainability are clear that their alliance has

18 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Role of Change Agents

The managers who have been most successful demonstrate the ability to operate as both a formal and an informal change agent. They understand and act on their organizational knowledge — and the opportunities and constraints of their own roles and spheres of influence.

allowed them to stay on course moving the agenda. You learn. You while Agilent weathered a series of get ideas. You get encouragement. difficult quarters. “One of the You have a group of people you can learnings had to do with that con- call up, and they will help you. There cept of ownership,” notes Endicott. are people at other companies who “That in reality, it was going to take are more than willing to collaborate. a small number of people — specif- Being a part of these external groups ically two — in order for us to real- is a way to move the internal agenda ly drive the kind of focused activity at your company.” we felt we needed in order to start producing some results that could For AMD’s Trowbridge, the be measured.” Executive Forum serves as a peer network that supports his efforts at In addition, most of the managers his company. “You always come participating in the research back energized from meetings like acknowledged the benefits of hav- the Executive Forum,” he says. ing a group outside their company to provide broader perspectives, These managers recognize their best practices, and benchmarking role as agents of change, the nature and to serve as a reality check and of the work in which they are means to recharge their enthusi- involved, and the organizational asm for their work. reality within which they are exe- cuting their roles. Their passion for Referring to her involvement in the corporate citizenship fuels their Executive Forum research project, commitment. Their understanding Fay-Bustillos of Levi Strauss & Co. of the landscape in which they said, “This is a very collegial envi- operate makes them effective in ronment to work in. We don’t terms of both choosing appropriate always appreciate what we can actions and finding ways to sustain accomplish just by networking and their energy through developing being part of different external internal and external allies. organizations that are interested in

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 19 Building Relationships

To be a successful change agent, forging the right relationships can matter as much as or more than the technical aspects of strategy, management, and the business. As Executive Forum participants expanded their “At the end of the day, roles and influence in their companies, they demonstrated that relation- corporate citizenship work ship building is one of the most critical strategic actions in building support for corporate citizenship. Even more than promoting policies and pro- is all about relationships, grams, building allies and gaining audiences are all indispensable steps in and that’s how the effort is a successful citizenship initiative. moved forward in the company. It’s through Some practitioners do this in a for- breadth of knowledge about the mal way, as Unocal did by conduct- organization — to pursue strategic individuals who under- ing “listening tours” to understand actions more intentionally. stand the importance of the needs of different business units, or as AMD did by instituting corporate citizenship — a formal qualitative research Create Professional process with focus groups and Alliances as a how it impacts the interview protocols. Many others, Foundation for Action company and, ideally, though, take a less formal but just One type of relationship that cre- as rigorous approach, one consist- ates a strong foundation for corpo- how it impacts their par- ing of building relationships with rate citizenship action is among colleagues from different organiza- individuals in the organization ticular organization — tions to gain business knowledge; who are formally tasked with individuals sharing similar pas- that the roles of individu- social- or environmental-oriented sions to secure allies; and people at responsibilities. Often residing in als can help us reach our different levels in the company staff functions, some of these peo- hierarchy to obtain buy-in. ple recognize the ways in which goals as a company.” Many practitioners falsely believe corporate citizenship relates to — Allyson Peerman that arming themselves with a bul- their designated role, while others AMD letproof business case for corporate are not aware of the wider implica- citizenship is essential before solic- tions of their work. When individu- iting support from individuals als or groups recognize the overlap throughout the organization. between their own formal respon- Instead of considering the business sibilities and greater citizenship case as a prerequisite for action, efforts in their company, align- practitioners should work to build ment and integration of a corporate the business case with real-life suc- citizenship strategy can be cultivat- cess stories as they take citizenship ed. These groups or pairings can action. These experiences provide generate tremendous action the necessary groundwork — more around corporate citizenship, resources and support and a wider regardless of position or level.

20 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

Building Relationships

These partnerships between busi- audience with more diverse tions manager connected Endicott ness functions often propel system- responsibilities by using fewer and Brownell because of their per- atic or company-wide action more resources. sonal and professional interests in than general relationships with line socially responsible mutual funds and staff personnel. By aligning At AMD, Allyson Peerman from and their desire to become more around a more comprehensive global community affairs and involved with the measurement view of corporate citizenship, these Philip Trowbridge, part of the process that the fund question- individuals parlay their siloed activ- worldwide EHS group, have collab- naires entail. ities into more strategic, company- orated over the last several years to wide initiatives that target different strengthen the initiatives that are According to Endicott, it was their lines of business, other staff areas, “owned” by their separate depart- mutual interest and support for and employee groups. On a more ments as well as to champion new corporate citizenship at Agilent practical front, these strategic rela- corporate citizenship efforts. that caused them to form a bona tionships can generate more action fide partnership. They are able to Part of the reason they chose to col- more quickly, given the agility of a pursue a wider and more strategic laborate in this way was to mini- small group versus the bulk of a path than their individual efforts mize the resource commitment larger committee. Scheduling for- would allow. “We just sensed that during a lean time for the compa- mal meetings and preparing there was something we could ny. “From a resource point of view, detailed agendas become less of a work together on, and we are still and with a sea change of leadership concern than just getting the work figuring it out,” says Endicott. occurring at AMD, it was not a done. “Don’t feel as if you have to have it good time to launch anything all sorted out and know specifically Most common for Executive Forum new,” says Peerman. “And it cer- what it is you’re pursuing.” participants are alliances between tainly wasn’t a good time to ask for environment, health, and safety additional resources or schedule Defining the role of a cross-func- (EHS) personnel and staff in com- new meetings, because everyone tional partnership in advancing munity affairs or other externally felt overwhelmed as it was.” corporate citizenship at Agilent has oriented positions. Many commu- been critical because, as Endicott Though Agilent’s corporate citizen- nity affairs professionals demon- says, “It wasn’t realistic to expect ship co-owners, Gail Brownell, strate a high degree of skill and the other people we’re working quality systems manager and Gene great affinity for relationship build- with — no matter how cooperative Endicott from public affairs, now ing and stakeholder engagement and supportive they are — to proac- collaborate on several initiatives and are natural communicators. tively participate in this process.” (such as running the cross-func- Balancing these skills and knowl- While individuals in other functional team and business opportu- edge, the EHS managers con- tional areas might be sponsors of nities for corporate citizenship), tribute expertise on specific envi- different initiatives, Endicott and their initial relationship stemmed ronmental issues and generally Brownell have evolved into overall more from mutual interest than have deep understanding of the strategy owners. professional mandate. In fact, many data-tracking systems and Endicott and Brownell became Establishing an operational rela- management processes that under- reacquainted about four years ago, tionship with a partner or co-owner pin EHS operations. By bridging soon after Agilent separated from that can help forge the corporate these functions, balancing skills, Hewlett Packard as it was trying to citizenship strategy and generate and crossing spheres of influence, become established in the invest- action is essential for those without the partners can access a greater ment community. An investor-rela- an explicit mandate. But develop-

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 21 Building Relationships

ing these same types of relation- business decisions. Unocal’s strate- ships is just as essential for those gy was built upon an intense face- Read about Unocal’s involvement who do have formal responsibility, to-face process with the business with their lines of business as the next section explores. units in order to understand the on page 48. case in point unique businesses and issues and to demonstrate a commitment to Connect with the specific situation of each loca- Key Business tion. This strategy brought Greg zenship. By engaging with individ- Representatives Huger, the director of corporate uals in appropriate positions, prac- Because most corporate citizenship responsibility, from his office in titioners can find quick turnaround initiatives — both formally man- Washington, D.C., to Southeast opportunities to support strategic dated and grassroots — grow out of Asia more than 24 times in his first line or staff functions by address- corporate or staff functions, there three years with the company. ing a critical need. Though these is some danger that corporate citi- programs do not always contribute As the research participants in a tangible way to the bottom zenship will manifest in a way that revealed, the process of integrating remains unaligned and detached line, Executive Forum companies corporate citizenship into the line find that it is a different way of from the core of the business. starts quite simply: with conversa- Developing relationships with the making a business case. In tion. By sitting down with line Unocal’s case, each business unit business units and staff functions managers to understand the busi- alike helps bring awareness of the made its own business case in ness of their business, practitioners which corporate responsibility was relevance of corporate citizenship learn the ways in which corporate into the heart of the business so fundamentally relevant and inte- citizenship is material to the strate- gral to achieving business objec- that it is easier to engage a larger gic decisions that these managers base of managers and employees. tives. Ultimately, these collabora- make. This process helps practi- tive relationships help the business For the Executive Forum compa- tioners: units get their work done as well as nies, developing relationships with • build their understanding of the helping practitioners to demon- the lines of business around viable business; strate success for corporate citizen- “handholds” provided opportuni- • build relationships with line ship and the value it adds to the ties to both advance corporate citi- managers; business, whether it results in zenship and demonstrate success • identify the landscape of oppor- measurable financial returns or throughout the company. tunities for corporate citizenship not. Integration between the revenue- in the business units, including For example, several of the producing business units and staff issues that need to be raised to functions is essential because this Executive Forum practitioners the surface or addressed; and found business allies in their sup- is where corporate citizenship is • identify those business units operationalized. ply chains, which opened the door and individuals that are ready to to more extensive opportunities. At Petro-Canada, for example, the demonstrate early wins. Abbott’s global citizenship group brand and reputation functions The corporate citizenship champi- initially sought out the purchasing play heavily into the company’s on also needs to establish relation- department as a potential partner overall corporate business strategy. ships with key internal allies who because of the tremendous citizen- The same holds true for Levi understand the strategy and man- ship opportunities and risks that Strauss & Co., whose marketing agement aspects of corporate citi- the pharmaceutical industry as a department is a key player in major

22 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Building Relationships

whole sees in supply-chain opera- one-on-one meetings with the seized the opportunity — this tions. The group’s ability to suc- heads of the various departments. nexus of business need and per- cessfully partner with this purchas- His plan was to introduce himself, sonal interest — to further develop ing unit is largely due to the rela- learn about each business, and the relationship. tionship-building skills of Kevin establish the conditions for a rela- Callahan, Abbott’s director of glob- tionship. As part of the process to As a result of positioning himself al citizenship and policy. create Abbott’s global citizenship as an internal business partner, report, Callahan initiated a rela- Callahan is helping the purchasing Callahan, who joined Abbott in tionship with colleagues in pur- group to “think about this as a part early 2004, began his tenure in the chasing. This opened the door for of their work,” by conducting a company by conducting a series of deeper conversations, and Callahan supplier assessment and sending

MAKING CONNECTIONS

Below are some examples of how Executive Forum companies are forging key business relationships to expand their corporate citizenship initiatives. These have proved to be valuable steps in their effort to advance their work, parlaying single issues into wider initiatives.

Company Connection Action

Abbott Corporate purchasing + Conducted assessments of Global citizenship and policy 100 key suppliers on citizenship.

AMD Organizational development + Using Sustainability Report as a Sustainability training tool for leadership development sessions.

Petro-Canada Corporate responsibility + Reflecting corporate responsibility Corporate communications principles through key corporate messages that are communicated to the public and incorporating corporate responsibility into their reputation strategy (reputation = performance + communication).

Unocal Human resources + Developing the relationship to be able Corporate responsibility to be involved in human resource-specific programs such as employee orientation programming and leadership development as well as forging stronger connections with the business units.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 23 Building Relationships

out risk-assessment question- The evolution of relationships with Identify Opportunities naires. Both departments see this the lines of business is a critical for Upward Influence as the first step in being able to strategy for successful citizenship The Executive Forum practitioners understand the state of their com- practitioners. Unocal has devel- have demonstrated that an execu- plex supply chain and identify oped a relationship strategy with its tive mandate is not necessary to lines of business that involves deep initiate momentum for corporate interaction, coaching, and engage- citizenship, nor does it guarantee ment. While the process is not buy-in throughout the organiza- based on a formal set of surveys or tion. While securing the support of standardized procedures, over time individuals who report into key HALF this approach is yielding a frame- decision-makers can be just as Get buy-in from the top work of interaction that is increas- helpful, the research supports the ingly replicable and understood in assumption that executive-level Drive the process from all levels. Find the business units. Petro-Canada support is necessary to genuinely TRUTHallies in all areas of your company to sup- has developed a similarly targeted institutionalize corporate citizen- port change from the middle. While you business approach, engaging sen- ship in the long run. ior leaders in its Executive Corp- might need executive permission or orate Responsibility Steering As an alternative to beginning with “benign neglect” to move forward in Committee to address the risks and an official stamp of executive some areas, most executives look to their opportunities faced by the different approval or mandate for the entire staffs to identify and advance new ideas. business units, whether because of corporate citizenship initiative, Our experience with companies shows function or geography. The steer- many of the Executive Forum com- that effective work can happen before ing committee directs working panies have taken the more incre- groups on such issues as mental approach of gaining the active C-level support is secured and that Aboriginal relations, human rights, attention of those who have it does not necessarily pave the way to business integrity practices, and upward influence. By identifying organization-wide buy-in. nonfinancial disclosure. By virtue individuals who possess a combi- of engaging business representa- nation of internal influence, repu- tives around issues that are rele- tation, and understanding of the vant to the success of their depart- relevance of corporate citizenship, opportunities to move the citizen- ments, the corporate citizenship practitioners are able to position ship agenda forward. By identify- practitioners are able to more effec- these initiatives so they will be vis- ing an area that fits the needs of tively address corporate citizenship ible to more senior individuals both the citizenship group and the issues while building a relationship within the organization. purchasing group, Callahan is able that fosters ongoing contact. As to advance the project with greater Theresa Fay-Bustillos at Levi AMD provides a good example. ease. He has also built bridges with Strauss & Co. puts it, “It is about Trowbridge, who works in extend- the ethics and compliance function listening to the business people ed producer responsibility, which at Abbott. This group’s external talk, boiling it down, and then focuses on product life cycle, has stakeholders overlap with the citi- using their own language to sell it long interacted with many key zenship group, and a sense of com- back to them.” players in the organization because mon work around societal expecta- of his formal role. For the past five tions provides many opportunities years, Trowbridge has worked with for collaboration. the head of procurement, Alex

24 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Building Relationships

functions one level junior to the “Through these interactions we’re Read about how Levi Strauss & senior executives, she has been getting a lot of additional interest,” Co.’s efforts to gain traction from able to convene a working group says Rolf Jaeger, director of Agilent the top resulted in Plan B that carries clout with the execu- Labs. “It’s just a grassroots effort,

on page 50. case in point tives. This group is working to but that can be augmented by gather the evidence necessary to explicit support from a division’s persuade critical gatekeepers. management. One of the leaders of Brown, to assess suppliers on their a discussion group would, for environmental track record. Brown instance, take it upon herself to participates freely in these activi- Seek Out Passionate talk to the general manager of her ties, which have a set scope, but Supporters organization and make him aware Trowbridge was looking to expand Securing passionate advocates to of this discussion and talk about the influence of AMD’s corporate champion corporate citizenship is ways he could participate. Through citizenship initiatives. So he built not merely about creating convinc- that, the general manager actually on his existing relationship with ing key messages and talking expressed explicit support and has Brown and invited him into the points. While a business case cer- taken steps and actions that have cross-functional working group. tainly is essential in building a substantiated his support.” Now Brown is exploring ways to strong base of supporters, corpo- take more innovative and active To involve these informal grass- rate citizenship also gains momen- steps to push corporate citizenship roots supporters, says Jaeger, there tum from those who personally see forward in the procurement organ- must be company-specific content it as a worthy cause. Executive ization. As Trowbridge says, “I am on which to educate them and Forum participants identified indi- there as a sounding board and to opportunities and activities for viduals that possess a passion for say how his work fits in with other engagement. “The key is to actual- the issue as potential messengers. corporate responsibility initiatives ly have some substance that you Sometimes these individuals have at AMD.” By engaging a player can communicate,” says Jaeger. a personal enthusiasm for corpo- with the authority to push citizen- “Once you have that, it is a lot easi- rate citizenship while others are ship forward in his own organiza- er to get buy-in and support. There committed to the advantages it can tion, Trowbridge has started to has to be content and a context cre- bring to their business. build a case for its effectiveness. ated. Without those, you might get At Agilent, for example, several support, but it’s meaningless sup- Working up and down the hierar- education and awareness initiatives port because it wouldn’t point any- chy can also provide traction by engage employees from different where.” generating a critical mass that can areas of the business. The company have an upward influence. Cross- produces newsletters, sustainabili- functional groups are a key exam- ty training programs, and discus- ple of how a group of nonexecutive sion groups that educate Agilent peers can still wield influence. At employees on corporate citizen- Levi Strauss & Co., for example, ship. Through these initiatives, the Fay-Bustillos found that she had a corporate citizenship practitioners difficult time deeply engaging sen- have identified some personally ior executives because of the busi- impassioned individuals who may ness environment. But by focusing be willing to “carry the torch.” her energy on individuals in key

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 25 Building Knowledge

Corporate citizenship is a cross-cutting effort, making it essential for practitioners to understand the company’s business and business environment. Ultimately, a key determinant of the practitioners’ effectiveness “It was a sense of urgency in developing a successful citizenship strategy is the extent to which others about our business over- in the company view them as being business-savvy. Do the corporate citizenship practitioners — especially those in corporate staff functions that seas that led the company do not often interact with the lines of business — really understand the initially to hire a director business and the particular issues and demands of business operations? of corporate responsibility. Successful corporate citizenship practitioners, whatever their formal role in That was the first- the company, have studied key business units and have met with individ- generation mandate. uals across a range of functions to deepen their understanding of business operations. This insight provides a solid foundation with which to initiate As the work progressed, conversations with line managers and ensure that they will view the citi- we were able to focus more zenship practitioners with legitimacy and respect. attention on how the

whole company delivers on Know the Business from With various management systems the Inside its values and how the underpinning day-to-day opera- The building blocks of business are tions, it is essential that the citizen- whole company does people, process, and profit. On top ship practitioners have a sense of of these building blocks, under- the purpose of these systems, things.” standing the business goals and including the metrics that are internal issues give a more com- tracked, the responsibilities that — Laurie Regelbrugge plete sense of how employees and are assigned, and the auditing or Unocal processes operate within a particu- verification measures that are lar company and industry. taken. Frequently, systems most relevant to corporate citizenship Corporate citizenship cannot be pertain to overall project manage- successful when treated with a ment; environment, health and cookie-cutter approach, notes Fay- safety measures; and supply- Bustillos of Levi Strauss & Co.: “I chain/procurement issues; but knew I had to pinpoint exactly what human resources and community our issues are and not just be a fol- relations systems can also be cen- low-the-leader. I had to figure out tral to operationalizing corporate what we needed to do, and then citizenship. stick with that. I had to figure out what’s right for this company, and Many practitioners ultimately get a then push that agenda.” sense of these systems as they seek material for a social report or are

26 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Building Knowledge

guided by the measurements in the For Petro-Canada, its expansion Global Reporting Initiative (GRI) into international markets for ener- Read more about Agilent’s or SRI questionnaires. Many prac- gy exploration and production has efforts to gather hard data from titioners find that not knowing motivated the company to take a what data exists can be an obstacle fresh and more comprehensive internal and external stakeholder to efforts for improvement. look at issues related to human groups on page 52. case in point rights, codes of conduct, contractor Because these systems are often issues, and improper payments. not “neat” or do not offer direct, Because its core operations had comparable, and easily extractable only been domestic, certain inter- Allyson Peerman at AMD was data, having knowledge of what national business challenges looking less for systemic holes and they represent and what that weren’t part of its scope. But by more to understand attitudes and means to a company is critical. understanding the changing nature opinions around corporate citizen- Sharon Mulligan speaks of her of the business, Mulligan was able ship in order to develop a global experience trying to match Petro- to identify holes in the corporate volunteer initiative that would res- Canada’s data — which comes citizenship agenda. onate with the business. She from a variety of legacy systems planned a formal research initia- from previous mergers and acqui- “There’s a gap around the support- tive, conducting 21 one-on-one sitions — with the requests from ing management processes for our interviews with executives around external sources such as SRI two statements of principle related the world, and focus groups and groups. “Finding a systems way to to human rights,” she says. “We surveys with employees at other automatically gather information is have high-level statements, but we levels. She was able to draw out maybe not even possible,” she said. don’t really have a clear line of sight information about values and atti- “And if it’s possible, it’s expensive. down through our policy frame- tudes and was also able to see how And even if it’s not expensive, is it work to the line management, nor strongly business needs around doable in terms of people’s the assurance and monitoring communications and reputation resources and time?” mechanisms. I think our behaviors factored in AMD’s business global- are consistent with our statement ly. As a result, Peerman developed of principles at the front line, but a program plan around community Identify and Understand it’s not easy to demonstrate out- involvement that focuses on the Key Business Drivers side, looking in. And if you look at company’s increasingly global Before being invited to sit at the the international businesses in the business needs. table with key company executives, countries that management would it is important for the corporate cit- like to look at from a technical At Levi Strauss & Co., Fay-Bustillos izenship practitioner to thoroughly opportunity, human rights is a risk recognizes that employees are a understand the business, to identi- area, I think, in terms of future key driver of incorporating corpo- fy key strategic drivers, and to business success.” Without a keen rate social responsibility into the know the business models for dif- sense of the business issues that business. “Employees play an ferent areas. This fundamental underlie Petro-Canada’s business important role in asking questions understanding of the business is model, Mulligan would not be able about our practices and in consis- necessary before collaborating with to anticipate the needs and corre- tently reinforcing the perception by managers in different parts of the sponding corporate citizenship executives that one of the top rea- business. issues. sons employees come to Levi Strauss & Co. is because they think

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 27 Building Knowledge

we are a responsible company,” she tion,” she says. “In the absence of a and new technology, individual says. “They can’t articulate specifi- burning platform driving corporate companies are often grouped as cally why we are responsible, nor citizenship, values become the driv- one entity with the broad brush of do they need to. It’s the consisten- er. Yes, you need change agents, but public perception. During times cy of the message that reinforces they in turn need values to create when public skepticism about an keeping corporate citizenship near the need to change. The business industry takes hold, all companies the top of a business-focused case is a justification, but values can are vulnerable. Abbott, Unocal, and agenda.” be a driver.” Petro-Canada all face the clear challenges of their industries. For An underlying reason for this ded- Other companies have come to rec- example, with the pharmaceutical ication is the role of values in ognize how similar internal drivers industry experiencing heightened defining the company’s culture can be at the strategic core of their public scrutiny about issues such and business strategy. As Fay- citizenship agendas as the chart on as access and affordability and the Bustillos notes, values are more page 30 illustrates. extractive industries being watched than a collection of words; they are for environmental performance, an essential part of the company’s Keep current with industry corporate citizenship practitioners operations. “Corporate values pro- issues at these companies must not only vide the commonality across dis- While companies in the same know how these pressures influ- parate functions for corporate citi- industry compete for market share, ence (or do not influence) business zenship to move beyond the silos professional talent, innovation, decisions, but they also must be or the corporate philanthropy func- aware of the external organizations and people that are exerting the pressure.

As Kevin Callahan of Abbott says, this is not merely about a one-size- THE IMPETUS FOR CHANGE fits-all model. “It’s not just about looking at what others are doing, Outside Forces Internal Motivators but leading the company to help • Direct action such as law- • CEO, board or senior find solutions,” Callahan says. “We suits, boycotts, and share- executives help them get through conflicting holder resolutions • Employee expectations opinions and demands and work to • Regulatory enforcement • Strategic opportunity and provide leadership in the organiza- and governmental pressure competitive advantage tion to stay ahead of these issues.” • Activist pressure targeting • Risk company issues or • Policies, systems, codes of Be aware of growing practices conduct and values shareholder activism • Media attention • Expansion into new mar- Several high-profile examples of • Expectations associated kets and cultures shareholder activism, particularly with industry the dynamics that led to the US • Economic conditions Supreme Court case Nike v. Kasky, • Socially Responsible have recently been brought into the Investment (SRI) public eye. For practitioners, simul- movement taneously engaging external stake-

28 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Building Knowledge

holder groups while gaining the As Unocal’s Laurie Regelbrugge In their role of product steward- attention of internal stakeholders says, “It was another good step in ship at AMD, the extended produc- can be a powerful opportunity to our continued dialogue with people er responsibility group — of which build knowledge and relationships. who want to see a lot of change Philip Trowbridge is a part — within the company.” After the assists the line with ensuring that Shareholder activism continues to revised code of conduct was offi- the company’s products meet or grow as public pension and faith- cially released, a similar sharehold- exceed environmental regulatory based groups demonstrate the er resolution filed in late 2002 was standards. But it is the group’s abil- potency of collective power. Being withdrawn based on the content of aware of the issues that are raised the new code, which had benefited in the form of shareholder resolu- from the ideas and input from tions can serve as an early-warning internal and external stakeholder system for issues management. A consultations. HALFAdopt an external code willingness to engage in dialogue with representatives of special Unocal has continued to meet with or standard stakeholder interests can also stakeholder groups to discuss how strengthen a company’s corporate the code is implemented. Greg Adopting a standard is not a substitute citizenship commitment. Huger, Unocal’s director of corpo- TRUTHfor the company’s vision of citizenship. It rate responsibility, noted, “The should reflect an established strategy In May of 2002, a shareholder proxy withdrawal of a shareholder pro- and support performance goals. was proposed that Unocal should posal on the code after release of explicitly recognize the the new code was a very obvious International Labor Organization plus to the senior management of (ILO) principles, such as the right to the company as well as a lot of peo- free association. When the resolu- ple who followed the company ity not just to enforce existing stan- tion garnered 32.6 percent of share- externally.” holder votes, it caught the attention dards but also to anticipate changes of Unocal CEO Chuck Williamson. that enables them to influence The company was already engaged Forecasting changes in the business decisions by making cor- in a revision of its code of conduct regulatory environment porate citizenship central to the and saw this as a great opportunity Beyond landmark legislation like business agenda. Sarbanes-Oxley, new laws — or to engage both external and internal “The stakeholder pressure that stakeholders in dialogue. So even the threat of them — can move companies to action. For cor- we’re feeling is primarily driven by Williamson pledged that the team regulatory changes, particularly in revising the code of conduct would porate citizenship practitioners, awareness of anticipated legislation the European Union,” Trowbridge take the concerns raised by these says. “And while it’s driven in the stakeholders into consideration. in headquarters locations and across the globe can increase their European Union from a regulatory Through this process, Unocal repre- perspective, we’re seeing many sentatives were able to meet face-to- visibility as a legitimate business partner and also serve as a motiva- customers accelerating their com- face with a range of stakeholder pliance schedules to beat the mar- groups to better understand their tion for more swift adoption of business change. ket while others are moving at a perspectives. slower pace. So it’s a difficult jug- gling act, particularly in the types of products that we manufacture

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 29 Building Knowledge

out innovative programming to BUSINESS DRIVERS address the needs of those communities. Although banks were initial- Company Internal Business Drivers ly concerned about the impact of Abbott Questions around access and CRA, ultimately it has led to win- affordability of medicine win situations that were good for both banks and communities.” AMD Increased attention to developing economies and bridging the digital divide Be informed about concerns Agilent Business lines that connect to sus- and interests of customers tainability (e.g., life sciences) Especially for business-to-business (B-to-B) companies, the serious- Levi Strauss & Co. The key role of values in the ness with which customers are ask- corporate culture and employee ing about and engaging around satisfaction social and environmental factors is Petro-Canada and Unocal Expanding international presence in on the rise. Says AMD’s new countries and geographies Trowbridge, “More and more of Verizon New business opportunities and our customers are asking us specif- model around broadband service ic questions about our management systems, our business continuity, our environmental health and safety, codes of conduct, our and the lead times that are part of the product life-cycle social responsibility conduct. required in order to change process. And if we don’t understand They’re incorporating these types processes.” these emerging regulations and of things into sales agreements, what they mean to our company, we and that’s a relatively new trend.” Allyson Peerman, Trowbridge’s could get caught flat-footed.” To be assured of the business’s colleague at AMD, also sees the continuity, customers are asking future of regulation as an area that For JPMorgan Chase, the Comm- for more detailed plans around merits attention. “If we don’t unity Reinvestment Act (CRA) was issues like natural disasters, terror- organize around this, get our act a strong motivator. As Bob ism, and stakeholder engagement, together, and at least have some Rosenbloom, vice president of cor- and these issues are leading to understanding of how potential porate philanthropy and sponsor- greater sharing of information regulations could impact us,” she ships, says, “The Community across company boundaries. says, “it leaves us wide open as a Reinvestment Act created a new target in a lot of different ways. We environment to which we needed For some business-to-consumer do use chemicals in the manufac- to respond. We recognized a need (B-to-C) companies, however, sec- ture of semiconductors, and we to think in new ways about how to tors of their consumer audience engage a lot of labor in the overall create community programs that are showing an interest. As process. While we have a great would have an impact in the low- Rosenbloom of JPMorgan Chase track record in these areas, there and moderate-income neighbor- notes, “Our Private Bank col- could be potential threats down the hoods that we serve. CRA also leagues have leveraged our work road. We may not be in the con- caused us to realize the need to be with their clients who are first sumer goods business, but we are a continually proactive in seeking interested in banking with a social-

30 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

Building Knowledge

ly responsible company, and sec- necessitates provides a strong ond in sharing best practices and argument for practitioners seeking knowledge of the nonprofit field.” to raise the visibility of citizenship By seeking out these pockets of within their companies. The SRI HALFMake risk mitigation a external interest, the citizenship field not only provides a natural practitioner can develop internal link with investor relations groups, primary driver motivation. but it also creates an impetus for Risk management is a potential driver, greater transparency and availabili- Because the consumer base for TRUTHbut it should not be the only motivation ty of information. many B-to-B companies is general- behind a company’s corporate citizen- ly diffuse and diverse, some com- Communication of such informa- ship efforts. Because not everyone in the panies choose to work with a repre- tion to the SRI groups is typically company will agree that social and envi- sentative subgroup. Verizon, like through questionnaires. Because ronmental factors pose significant risks, many other telecommunications each SRI group sends a unique — companies, has developed a 25- and typically detailed — question- heightening awareness can be a more member consumer advisory board naire, the sheer volume of these appropriate strategy. in order to be in closer touch with inquiries often results in “survey the issues that affect the wide vari- fatigue,” and companies are often ety and large number of customers forced to choose which question- they serve. “They are the external naires to complete. For companies folks that are actually helping us to without a clear-cut process for lead the charge with corporate completing these questionnaires, By bringing the importance of the social responsibility within the the lack of efficiency in operations questionnaires to light and assist- company,” says Susan Sullivan, can be a drain on resources. ing in their efficient completion, director, Verizon Foundation. “We citizenship practitioners have an use them to be our eyes and ears At Petro-Canada for instance, additional platform from which to out in the community, to report Sharon Mulligan, director of cor- promote transparency and demon- back to us what the issues are, what porate responsibility, described the strate the value of citizenship to the the concerns are, and how we can situation when she stated: “The company. move the needle forward.” SRI questionnaires were handled fairly ad hoc, and people were asked for similar information Reputation as a motivator Leverage socially functionally three or four times In many ways, the evolution of the responsible investing over the year. We eventually pulled value of reputation — from “soft” The socially responsible investing together a good story, but it wasn’t intangible to hard driver — in the (SRI) field continues to gain promi- a very efficient response to the business mind-set is a model for nence, and for many companies external demands.” As Mulligan corporate citizenship practitioners. this external force is the perfect has gradually taken over responsi- Though difficult to quantify, repu- marriage of business push and cor- bility for these surveys, she has tation is widely recognized by exec- porate citizenship pull. The combi- built a stronger relationship not utives to be a central asset to a com- nation of the financial motivator of only with individuals in investor pany’s value, and many corporate being listed in an SRI index or relations but also in the functional citizenship practitioners are using fund along with the social and envi- groups from whom she gathers this external force as an internal ronmental performance that it information. motivator. Understanding that

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 31 Building Knowledge

good actions can precipitate a bet- understanding of the new risks that At other companies, citizenship ter reputation, many citizenship we might face, and how we plan to managers are using reputation managers are leveraging the influ- manage these risks.” more explicitly to motivate citizen- ence of reputation as a driver for ship efforts. At Agilent, for exam- corporate citizenship action. Petro-Canada citizenship managers ple, Gene Endicott has been able to took advantage of this uncertainty collect data from the brand man- At Petro-Canada, for example, man- to nail down some key messages agement group, as well as conduct agers are working to understand around reputation that were not his own surveys, to demonstrate a how the company’s recent shift explicitly about corporate citizen- link between overall company rep- from domestic to international ship but embedded those ideals. utation and citizenship performance. This work has had several benefits, including more data to support Endicott when speaking Understanding that good actions can precipitate a about citizenship at Agilent, a criti- better reputation, many citizenship managers are cal component for a scientific and engineering-oriented culture. leveraging the influence of reputation as a driver for Additionally, though, this bridge to corporate citizenship action. reputation has developed business linkages with the corporate functions that are concerned with different aspects of reputation. “I’m work affects its corporate citizen- As Gillespie says, “If you look at a starting to see corporate citizenship needs and how all of this plays piece from IBM, you can tell it’s an ship show up in more of the sales into its reputation as “a Canadian IBM piece of information, but you and marketing materials,” Endicott company.” As Mulligan notes, couldn’t tell that from Petro- says. “Similarly, our brand man- “Our key stakeholders are primari- Canada. Our message was very agement folks — who drive our ly in Canada and on Wall Street in fragmented. The whole idea was to corporate advertising — have also New York, and they are not entirely create some key messages so that shown a real willingness and inter- comfortable with Petro-Canada our stakeholders would understand est in highlighting corporate citi- stepping out onto the international what Petro-Canada is and define zenship as a part of our overall scene. We run a retail service sta- our reputation.” advertising, and that’s something I tion network coast-to-coast, and are take some pride in. I can’t claim to The focus on reputation provided in the minds of the public every have ownership of it, but it’s an stability in a shifting business envi- day. With the addition of U.S. and example of how over time this con- ronment and allowed Petro- international assets, and recently certed effort starts to permeate.” Canada’s corporate citizenship publicized interests in Russia and practitioners a platform from northern Africa, our stakeholders which to internally promote the are wondering where we are going need for ramped-up citizenship next. It is important that we com- efforts. municate clearly where we intend to be three to five years out, our

32 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

Typically, in a company that lacks urgency or executive-level inspiration for corporate citizenship, the options for action require ongoing negotiation. Practitioners must be sensitive to these conditions, choosing where and how much to push the envelope but not shy away from taking “It is important to start leadership and being creative. with where you are and When business conditions are difficult, for example, corporate citizenship build on what already work is often constrained. “We went through several tough years before exists. We can’t start with things bottomed out,” says Allyson Peerman, AMD’s global community a clean sheet of paper, or affairs director. “The down economy created a lot of uncertainty within the company, not to mention the outside world. So, we made a conscious deci- even pretend that we have sion not to try to make a big, visible push for corporate social responsibili- a clean sheet of paper, ty during that time. In lieu of that, we worked on expanding our circle of because we don’t. champions, one by one. This approach helped us gain momentum from There are a lot of the the bottom up. This worked well for us, but it was a very slow process.” components in place, and

Managers like Peerman emphasize readiness around corporate knowing that dictates how the importance of “keeping on responsibility and different pieces to fit in the new pieces.” keeping on” with corporate citizen- were there.” The confluence of new ship work during tough times. business acquisitions, a crisis at — Sharon Mulligan Even modest activity that involves one of the company’s competitors, Petro-Canada individuals from different func- and internal work around stake- tions or business operations keeps holders and systems created the the agenda alive and seeds the right environment for movement. ground for more aggressive action as business conditions improve. This is an important opening when executives often begin to demon- In other situations, managers find strate more explicit buy-in. Seizing that the moment is ripe for bolder this opportunity is a step forward action. After plugging along, build- in fostering company-wide aligning both relationships and knowl- ment and integration around citi- edge, and taking relatively bound- zenship. ed action, the right moment for bolder action emerges. David For many mangers, the situation is Stuart, Petro-Canada’s senior direc- often somewhere between tor of environment, health, safety Peerman’s deliberately cautious and security, speaks of that maturi- approach and Stuart’s moment of ty point: “I think the stars have to readiness. Regardless of the situa- be aligned. There was a kind of tion, though, managers can take

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 33 Taking Strategic Action

concrete steps to foster alignment, Create a coherent context for part of a bigger corporate citizen- integration, and institutionaliza- corporate citizenship ship picture. tion of corporate citizenship in In an effort to foster a shared Executive Forum participants had their companies (as outlined in the vision of corporate citizenship, two primary ways of fostering a chart below). By working across a managers can build bridges coherent sense of corporate citizen- range of company functions or between disconnected activities, ship. One is based on communica- business operations with a variety initiatives, and programs by shar- tion, the other is structural. of individuals, managers can be ing learnings. They speak about catalysts for wider corporate citi- the different efforts in the context zenship action. of a greater corporate citizenship Communications strategy: strategy and vision and demon- creating a context strate that one program’s outcomes An effort to align existing activities Alignment Strategies can support another department’s can be as simple as a single person Aligning corporate citizenship goals. beginning to speak about these within the company requires con- seemingly disparate activities as necting business objectives using a Managers who make these falling under the broader umbrella cohesive strategy. The practitioner connections generate energy and a of corporate citizenship. works toward fostering a common “buzz” about corporate citizenship Gene Endicott, public affairs director understanding and compatible atti- that begins to give it a sense of at Agilent demonstrates this strategy tudes, aspirations, interests, company-wide coherence. Isolated in his work. “I have to look at the knowledge, and goals. practices, initiatives, policies, and systems begin to be understood as whole collection of Agilent activities — operational practices, what we do as a business, our products,” he says. “Part of assuming a leadership role in corporate citizenship entails pulling all this together to align it TAKING STRATEGIC ACTION around corporate citizenship.

Alignment Integration Institutionalizing “I am not talking about something super complicated. It’s about saying Strategies Strategies Strategies our employee-relations practices are • Create a coher- • Build and • Leverage existing part of what we do as a corporate cit- ent context demonstrate the systems, process- izen. Our environmental, health, for corporate business case es, and structures and safety practices are part of what citizenship • Leverage reporting • Obtain support we do as a corporate citizen. Same • Communications of key nonfinancial of CEO and with being involved in the commu- strategies issues company leaders nity: Align it, put it under a com- • Structural • Bring the outside in mon heading.” strategies • Establish a formal Being able to articulate — in a bold • Generate con- corporate citizen- and declarative way — how differ- sensus on ship position ent functions, programs, and oper- name, scope • Focus on pockets ations contribute to overall corpo- and boundaries of excellence rate citizenship goals is a key step aligning corporate citizenship to

34 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

business strategy. Voicing this both this group includes representatives formally and informally is critical from EHS, global community rela- to giving people an understanding tions, human resources, investor of how their company is making relations, corporate supply man- HALFForm cross-functional citizenship happen, how it is rele- agement, strategic communica- vant to their work, and how they tions, and legal. committees are contributing to it. In trying to ascertain where AMD’s Convening cross-functional committees corporate responsibility efforts TRUTHis a common tactic for other business Structural strategy: creating should be focused, Trowbridge initiatives, but the breadth of corporate cross-functional groups compiled a list of issues that regu- citizenship requires unique discipline Managers also create informal and larly surface in customer question- around planning, goals, and ownership. formal cross-functional groups to naires, SRI surveys, and other foster corporate citizenship align- Committees are a means to a greater institutional investor surveys. The ment. By gathering individuals end. For success, establish clear owners list includes topics ranging from from different areas together at the and commitment to bold goals and corporate strategy and business same table, they begin to under- identify a senior champion. continuity planning to workplace stand the interconnectivity—or safety and human rights. From the absence of such—of their citizen- list, he developed an issues matrix ship-related projects, processes, (see Appendix D) so that the group and issues. This often results in could systematically determine Through these discussions, the discussions of issues that previous- where gaps in performance group has been able to deepen its ly were not seen as citizenship- occurred and which issues were understanding of a cohesive agen- related. In many cases, this gives pertinent to their corporate respon- da within the company. In addi- rise to cross-functional citizenship- sibility agenda. tion, however, the conversation has related projects. Even informal promoted a collective sense of cor- cross-functional groups generate “We went through a classic SWOT porate citizenship so that many synergy, inspiration, and a sense of analysis, looking at our strengths, individuals — not just one or two community for the individuals weaknesses, opportunities, and — understand the heart of the involved. They are energized to threats in each area,” says issues that the company faces. continue their work in their Trowbridge. “But we also asked the Trowbridge recognized the human “home” organizations and can fundamental question: Do we have rights gap well before the commit- draw on a company-wide network a program that addresses this tee convened but it was important of like-minded peers. issue? And if not, do we need one? to gather the support of a wider And how would people rank this AMD, for example, has used its group. “I’ve been discussing this issue in terms of importance to cross-functional group — the issue with our human resources AMD? For example, we all Sustainability Advisory Group — department, and now others are acknowledged that, yes, we do have as a platform to discuss a variety of asking similar questions,” he said. human rights incorporated into issues that are normally seen as the “A healthy dialogue on an issue our value system and into world- domain of “the business” and how often results in people becoming wide standards of business con- they relate to issues that are more more comfortable with change.” tracts, but we don’t have a policy typically thought of as corporate cit- Trowbridge has leveraged this col- statement that conveys these izenship issues. Sponsored by the lective sense of understanding human rights values.” chief administrative officer and around the need for action. managed by Philip Trowbridge,

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 35 Taking Strategic Action

Without a unifying concept for corporate citizenship, how we would define corporate social responsibility for AMD.” a manager operates in a gray area with no parameters During the next year, the company within which to prioritize. Lack of clarity can also began to implement programs and initiate conversations pertaining to create friction or drag. the initial strategy of trying to gar- ner more widespread buy-in across the company. Peerman and Trowbridge began to look more in- Generate consensus Some managers run as fast and as depth at a wider breadth of issues on name, scope, and far as they can with existing under- to be encompassed in their sustain- boundaries standings of corporate citizenship, ability strategies, including, for In order to be able to create a coher- regardless of how unclear or incon- example, supply-chain and human ent context for corporate citizen- sistent they are. These managers resources issues. The company ship, many practitioners find that pursue strategies to initiate and was receiving more questionnaires they first must take a step back build momentum in the absence of that had greater breadth from both and define what it means for their a clear definition, knowing that socially responsible investing firms companies. their working definition will likely and customers. As a result, change. In some cases, these initia- Trowbridge convened a cross-func- Lack of clarity around the meaning tives actually help companies tional group. During one of their of corporate citizenship for a par- “define corporate citizenship by meetings, Trowbridge said the ticular company affects how doing.” group determined that “‘corporate aggressive a practitioner can be in responsibility’ was a term that For example, AMD began its corpo- pursuing commitment in terms of more aptly described its end goal rate citizenship efforts using the resources, alliances, and actions. and was consistent with the com- term “sustainability” for both Without a unifying concept for cor- pany’s core values.” porate citizenship, a manager oper- strategic and technical reasons. On ates in a gray area with no parame- one hand, it aptly described the Other practitioners use the process ters within which to prioritize. Lack issues and concerns that some of deciding between the myriad of of clarity can also create friction or internal stakeholders — especially possible terms for corporate citi- drag for a manager since there is those in staff functions such as zenship as a critical first step. This no articulated basis for appropri- human resources, community rela- decision point often leads into ately engaging with others in the tions, and marketing — deemed deeper conversations to flesh out company about corporate-citizen- important to AMD. But it translat- what it encompasses for the com- ship-related issues. ed as an EHS-specific term for pany, messaging, and communica- many others. “Our focus on corpo- tions. The chosen term and defini- The process by which managers rate citizenship had broadened tion are crucial to being able to address this ambiguity tends to substantially to include many other communicate a concept and strate- take one of two courses — either key components beyond EHS, yet gy that key internal stakeholders resolving it immediately or making we still produced a ‘sustainability’ can understand and champion. it a part of how they operate. Both report,” says Peerman. “While we Hashing out these issues can be a require comfort with uncertainty. knew that we wanted to adopt a dif- mechanism to align those involved ferent term, we purposefully held in the process. off until we had determined exactly

36 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

Petro-Canada’s naming and strate- Leverage existing systems, potential weakness. Others have gizing process was more deliberate processes, and structures built a case by collaborating with than the one used by AMD. The process of integrating corpo- colleagues in other departments Because part of the impetus for rate citizenship into the business is whose professional or personal Petro-Canada’s corporate citizen- both accelerated and more effective interests in corporate citizenship ship work grew out of its reputa- when existing systems processes compel them to action. tion management team, messaging and structures are used or modi- Most of the participants in the and structure were always key fied. Rather than reinvent the Executive Forum have chosen to issues. The communications team, wheel, managers seek out opportu- leverage existing structures, in conjunction with the corporate nities to introduce a corporate citi- whether to promote knowledge or reputation management team, zenship focus into what already behaviors, build buy-in, and track developed a set of key messages exists in order to lessen resistance, action, processes, and practices. that are central to how the compa- maximize efficiency, and avoid Petro-Canada has leveraged the ny portrays its corporate responsi- redundancy. Executive Forum par- success from various cross-func- bility efforts both internally and ticipants are emphatic about this tional teams, while Agilent has externally. It allows them to do point and employ it as a central used existing surveys and measure- “strategic story-telling” and to posi- operating principle and strategy in ment tools to gather data that will tion corporate responsibility so that their corporate citizenship work. it rings true to both internal and inform the direction of its citizen- external stakeholders. These managers demonstrate a cre- ship initiatives. AMD has also been ative range, seeking out opportuni- working with its organizational As the chosen term is rolled out — ties for expansion, revision, and development staff to insert more often in a relationship-based cam- recalibration. They incorporate corporate responsibility concepts paign — many practitioners realize social considerations into existing into management training. All that the complexity, depth, and decision-making processes, use three examples are discussed in scope of the issues they discuss regular customer and employee greater length in the “Cases in with others surpass their original surveys to gather data related to Point” presented later in this concept. This continual process of corporate citizenship, and add report. deepening and redefinition social and environmental dimen- Unocal practitioners grasped through conversation is critical to sions to existing management opportunities to embed social hone a well-defined concept of cor- operating systems. Producing early measurement criteria into existing porate citizenship. wins by seeking low-hanging fruit business processes. The Country and paths of least resistance stimu- Risk Assessment Process, for lates learning and garners buy-in example, was previously dedicated Integration Strategies from colleagues who may be more to economic (largely commercial), Integrating corporate citizenship skeptical of the value of corporate political, and environmental fac- requires that its goals be embedded citizenship to the company. across all business units and func- Identifying the strategic potential tional areas including manufactur- Read more about how Petro- ing, supply chain, and human of these initial projects is key. Some Canada used existing structures resources. corporate citizenship practitioners have pursued opportunities around as a foundation for action high-risk stakeholders groups that on page 60. case in point internal parties recognize as a

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 37 Taking Strategic Action

IDENTIFYING PROGRESS tors. The corporate responsibility Over the course of the research project, all participating compa- team contributed to this process to nies made palpable progress in their corporate citizenship efforts. include consideration of various Much of this included increased awareness and interest at all lev- social dimensions when assessing els of the company, greater engagement from and with external new countries for possible oil and stakeholder groups, and more strategic and wider spread commu- gas projects. They are also increas- nications and use of citizenship initiatives. However, these compa- ing engagement with the nies also developed new programs and initiatives that are more Operations Management System “quantifiable” in the course of the two years. Such examples (OMS). Two corporate responsibili- include: ty consultants have been trained as OMS auditors and now participate AMD: The creation of a cross-functional team that is dedicated to on the audit teams. The practition- assessing the most pertinent “big issues” to the company and act- ers also worked with the OMS ing upon them. team to “further flesh out the guidelines and the standards with- Abbott: A progression from a more simple social report to one that in the OMS that we really are striv- is more strategic, forward looking and reviewed by third-party ing to achieve in company opera- reviewers. tions and our corporate responsi- Agilent Technologies: Proactive risk assessment program around bility work,” says Regelbrugge. suppliers with subsequent auditing and corrective action plans; Since 1991, Levi Strauss & Co. has an integrated triple bottom line report based on the Global launched a suite of efforts relating Reporting Initiative that is also summarized in the company’s to supply-chain responsibility, annual corporate report. including a supplier code of con- Levi Strauss & Co: Sophisticated community development product, country risk assessment, and gram around targeted supply chain locales that combines philan- internal and external auditors. thropy focused on supporting community organizations to educate However, according to Theresa workers and managers about their legal rights and management Fay-Bustillos, vice president of processes, financial literacy, health issues and to enforce laws that worldwide community affairs at supplement rigorous yearly audits (including worker interviews) by Levi Strauss & Co., opportunities the supply chain of all contractor factories. still exist to ensure that these standards are followed and to “shore up Petro-Canada: The approval for a new position of a dedicated cor- the risk.” One of the biggest prob- porate responsibility director from the executive leadership team. lems, she explains, is that government enforcement is weak in Unocal: Highly specialized coaching strategy that is targeted to many countries in which Levi business leaders and corporate citizenship practitioners in individ- Strauss & Co. has manufacturing ual business units/countries and expanded involvement with the facilities, so she wanted to build on company’s internal operations management system. the existing supply-chain practices Verizon: Leadership team supports creating a social report. January in a way that would more directly 2005 the first social report is released publicly. address this problem. Since 2001, Fay-Bustillos has been funding a multifaceted approach to ensure that:

38 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

• government agencies have In a prescient move, AMD’s resources to enforce the laws; Peerman earmarked some of her • local NGOs have the resources philanthropy budget for the then- to advocate for better conditions; unopened Chinese facility. When HALFProduce a social report and the new facility opened, she was • local residents have access to able to offer part of her budget to Producing a social report is not the same microlending opportunities to the new operations staff to help as being a good corporate citizen. create a more stable economic build goodwill in the community TRUTHEnsure that resources are dedicated to base. and was then able to get in on the ground floor of some of the new the report so as not to detract from other By building on an existing area of efforts in AMD’s Chinese mar- citizenship activities. Social reports are a focus within Levi Strauss & Co., Fay- kets. As Peerman says, “Money management tool first, a vehicle to dis- Bustillos has been able to move this opens the door for conversations close material risks second, and a com- innovative program forward more within these highly strategic munications piece third. quickly and with greater buy-in. countries.” For the past three years, Agilent’s Endicott has been responsible for Leverage reporting of key producing a combined report that nonfinancial issues includes environmental, social, and The process of producing a social annual financial and legal compli- report is another type of cross-func- notes, “The global citizenship ance data. Though previously these tional collaboration that facilitates report is a real catalyst for change, three reports were separate, integration of corporate citizen- sometimes unbeknownst to us. Endicott was able to spearhead this ship. The product itself communi- The report has brought people for- united corporate reporting effort cates to employees and external ward from many different depart- and, in the process, create a unified stakeholders a company’s corpo- ments saying, ‘We’re going to try to strategy around this integral part of rate citizenship performance in a do something different in our citizenship: reporting and trans- comprehensive and coherent way. department, and we want to check parency. “I can’t just talk to them Perhaps, even more importantly, with you and see if you think this about the corporate report,” he the process of developing this would be a good idea.’ The citizen- says. “I’ve got to talk to them about report can generate cross-function- ship report has become a mecha- the corporate report in the context al learning. Those involved gain a nism through which initiatives to of how we’re approaching report- more explicit understanding of integrate corporate citizenship can ing generally, so they understand how the company is currently inte- be recognized, supported, and that and can place our reporting grating corporate citizenship into brought into alignment with deliverables in their minds.” business operations and points to Abbott’s broad citizenship vision.” important areas for development and improvement. It simultane- Bring the outside in ously allows the individuals Read more about how AMD In a world where corporate scan- involved to build collegial relation- leveraged its Sustainability dals, media scrutiny, and height- ships that can become a foundation Report to generate momentum ened activism are more and more for future cross-functional action. for corporate citizenship prevalent, the Executive Forum participants worked to translate this on page 56. case in point Kevin Callahan, director of global citizenship and policy at Abbott external pressure into internal

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 39 Taking Strategic Action

internal education campaigns that ply-chain practices with the social Read about how Verizon worked circulate press reports and research issues advocated by the NGOs, with its external advisory group to demonstrating the perils of ignor- whose primary point of view might ing societal expectations. be poverty alleviation, migrant build support for corporate citizen- workers, or female workers in ship on page 58. case in point At Abbott, Callahan takes on this developing countries. These inter- role of educator as his mission. actions bring a sense of immediacy “We aren’t here with any other and clarity to many of the issues, agenda but to better the business according to Fay-Bustillos. and these external perspectives motivation. Managers can leverage need to be taken into consideration To understand the internal busi- the external environment to per- to do that,” he said. “How can we ness landscape, it is essential to suade colleagues that such forces serve as a resource and a partner to know the external pressures and are relevant to their company’s provide that external context to help challenges facing the company, strategic concerns and opportuni- the business think through dilem- including those that are obvious ties. The voice of the stakeholder mas and conundrums, and figure and up-front as well as those that can be powerful, particularly when out what needs to be done in a might pose a potential threat or managers connect it to conversa- thoughtful way? That is part of our opportunity down the road. Not tions that are seen to be the exclu- role: to ensure that decisions are only can the external environment sive domain of business opera- made bearing in mind the external act as a driver for corporate citizen- tions, such as supply chain, human context. If that’s not done, we aren’t ship action, but by building an resources, or specific lines of busi- doing our job.” Examples of this understanding of external issues, ness. work include advancing Abbott’s as well as stakeholders and their approach to affordability and access needs, corporate citizenship practi- Managers in companies without a to medicine and HIV/AIDS in tioners can enhance their standing perceived burning platform can Africa, among other issues. as valued partners within the busi- struggle to find a compelling case ness organization. for corporate citizenship, but fram- At Levi Strauss & Co., Fay- Bustillos’s approach has been to ing external opinions in a relevant Establish a formal corporate way can illuminate both risk miti- bring the outside in, quite literally. As a former community advocate, citizenship position gation and the pursuit of opportu- When the moment is right, some nity as viable paths forward. Some she understands the need to incorporate stakeholder perspectives not managers find the opportunity to managers do this by pursuing a propose a formal corporate citizen- path of least resistance or quick only into the company’s strategy but also into operations. So she ship position for their company. In wins. They find instances in which many companies, this role is about external pressures have a clear asks herself the question, “Who aren’t we listening to?” Fay- integrating with the manager work- impact on key business lines and ing with and through other man- staff functions, even if fairly Bustillos makes it a practice to reach out to NGOs to develop rela- agers in the business, without bounded, and use the experience to much departmental staffing. build awareness and a persuasive tionships based upon mutual respect and participate in meetings Managers in this role typically work case. Other managers have worked in a consultative and advisory man- to position themselves as a broker, or conferences where the NGO perspective is present. She is then able ner, engaging with business and allowing staff and line colleagues to functional managers to open possi- engage with external stakeholders to more fully understand the inter- directly. Finally, others launched section of Levi Strauss & Co.’s sup-

40 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

bilities for integrating corporate panies, and in proposing a role that more clearly reflects the end point citizenship into their areas in spe- fit with Petro-Canada’s business, we are seeking. We are not just cific ways as well as to support structure, and culture. As managing issues but really trying to implementation of any company- Raymond says, “To have somebody develop points of view and take wide corporate citizenship policy. who can wake up thinking about action to address challenging issues The individual in this role acts as a corporate responsibility every day facing our company and industry. It facilitator and also as a hub, oper- is great — to bring all the pieces is more in keeping with our values ating with an overview of the com- together and to organize and coor- and our mission and with how we pany’s corporate citizenship strat- dinate and think more strategically support the business.” egy and connecting individuals about it.” from different parts of the busi- Focus on pockets of ness to share learnings that will Reeta Roy, Abbott’s divisional vice president for global citizenship and excellence enhance implementation of corpo- Many practitioners begin their cor- rate citizenship. policy, has been able to transform a decentralized approach to citizen- porate citizenship efforts by trying to strategize a large-scale, organiza- The role of a corporate citizenship ship into a unified global citizen- tion-wide approach. A common director or vice president is to ship and policy function since she menu of activities for this task ensure that the company is paying joined the company in 2002. “I includes defining corporate citizen- attention to relevant issues that the was hired for a job called ‘issues ship within the organization (often various corporate citizenship initia- management,’ in the public affairs with a cross-functional working tives in the company are aligned, department, and different ele- group), conducting an inventory of and to deepen the extent to which ments of citizenship were handled all existing activities and programs citizenship is integrated into busi- by different parts of the group,” that relate to citizenship, and devel- ness practice in an ongoing way. Roy explains. “When I took on the position, I did some internal oping a company-wide strategy for At Petro-Canada, community in- research with senior executives, pushing the initiative forward. vestment manager Hazel Gillespie interviewing them about the issues While having this big-picture view and David Stuart of EHS found confronting our business and our of the business is essential in the that after they worked informally to industry, and did some external long term, in a company that lacks advance corporate citizenship for benchmarking.” a sense of perceived urgency and several years, the “stars aligned,” executive-level leadership, man- making the idea of a director-level Roy quickly recognized that what agers have more success in initiat- corporate citizenship position fea- Abbott really needed was not an ing momentum by electing a sible, with a high likelihood of exec- issues management function but a smaller scale, incremental utive buy-in. After success with sev- unified global citizenship and policy approach. This approach uses ini- eral cross-functional initiatives, function. “Our department’s name tiatives including in-depth engage- and with the support of their ment between particular business leader, Greta Raymond, vice presi- units and their key stakeholder dent of human resources and envi- groups, regionally-focused initia- ronment, health, and safety, who Read about Petro-Canada’s tives, and facilitation and decision- sits on Petro-Canada’s executive successful campaign to hire a making work around a substantive leadership team, they made their corporate responsibility issue. These initiatives often serve pitch. This required due diligence director on page 54. as pilots and produce learnings for in demonstrating how this type of case in point future work, generate buy-in for position functioned in other com-

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 41

Taking Strategic Action

larger initiatives, and build a busi- Building on the learning from this ed for a large number of compa- ness case for corporate citizenship. process, Gillespie encouraged the nies and not very compelling — formation of a cross-functional showing correlation rather than Gillespie and her colleagues at corporate reputation management causality. Petro-Canada have demonstrated team (CRMT). The CRMT provided a chance for managers from In contrast, participants in the different corporate functions to Executive Forum have shown align on specific messaging about greater success with strategies that Petro-Canada’s identity as a “prin- use specific corporate citizenship HALF cipled company.” The team also initiatives and tools to respond to business problems or opportuni- Make the business case designed a process and materials for supporting all managers in ties. Managers support their ration- ale for company-wide corporate cit- A financial justification does not communicating this identity in the izenship by presenting evidence capture the full value of corporate citi- context of their own jobs. TRUTH from successes and failures within zenship and does not always their own company. Some practi- generate action. The business case tioners institute pilot programs is more about laying the initial ground- Institutionalization before developing a larger initia- work. Use financial data to open the door Strategies tive. They build relationships and for a conversation around the value and Institutionalizing corporate citi- demonstrate the value of aligning strategy of corporate citizenship at your zenship ensures sustainability by and integrating corporate citizen- company. embedding appropriate strategies, ship with business operations to policies, processes, systems, and one area of the business that is other standard business practices then able to sing the praises of this into the fabric of the company. It approach to another. also ensures that corporate citizen- this strategy with several corporate- ship will be supported throughout wide, cross-functional initiatives. Fay-Bustillos explains the Levi the company, even if the main pro- As national community investment Strauss & Co. situation: “I do think ponents transition to other roles or manager and a key early proponent we need to struggle with making leave the organization. and leader for a corporate-wide cor- the business case, but I worry that porate citizenship strategy, if we get stuck there we won’t take Gillespie led a process that includ- Build the business case enough action. For example, when ed the participation of line busi- through action Levi Strauss & Co. created its code ness managers in formulating the Practitioners trying to promote cor- of conduct for suppliers in 1991, company’s community investment porate citizenship to their leader- the business case argued that strategy. This strategy produced a ship teams commonly look for sta- implementing such a code would community investment policy that tistics or other quantitative evi- put the company at a cost disadvan- line managers supported, set a dence that citizenship has a posi- tage compared to its competitors precedent for modeling cross-func- tive impact on a company’s bottom since no one else was doing it. But, tional initiatives, and helped line. While evidence exists that cor- we decided to proceed to be the Gillespie learn about the steps porate citizenship is beneficial to a first multinational company to required for engaging the business company’s well-being, concise and develop and implement a compre- around corporate-citizenship-relat- direct return-on-investment data is hensive code of conduct governing ed issues. not only scarce, it is often aggregat- our suppliers because our values and our employees told us it was

42 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Taking Strategic Action

the right thing to do. So those fac- each business unit are addressed. you name it. And the value of that tors won out, and we did it. Now we By engaging coaches and consult- for us is that by documenting this have evidence it was a sound busi- ants in each particular region, the project, and the way this group has ness decision, but it took 10 years corporate responsibility team is engaged with this project, as a case after the code of conduct was able to work to address potential in point, we think it will really help implemented to make the business risks that need to be tackled on a us internally document lessons case.” one-off basis rather than through learned and move those lessons systemic, corporate-level change. learned to other projects far more “We’re not making the business At the same time, however, the effectively. We invited representa- case,” says Unocal’s Director of need to share the working knowl- tives from two other business Corporate Responsibility Greg edge that is produced in these busi- units, so that has already served as Huger. “We’re asking questions ness units is essential to: a catalyst for moving some of the about the business — the future lessons quickly into work that’s and the present reality of the busi- • share replicable learnings for under way in those business ness — and then business unit col- other business units/regions; units.” leagues tell us the business case. • communicate learnings that It’s not hard to convince people of could affect decisions and poli- Unocal is using this model to push it, because they’re living with it and cies at the corporate level; and forward with other business units asking questions that frame the • generate buy-in from other busi- and connect disparate functions vexing problems that they have in ness units when they can wit- and programs into a more cohesive terms of a context that we can ana- ness “success stories.” and aligned effort. This living, lyze together. I think the enthusi- breathing example allows Unocal To address the need to both reflect asm for corporate responsibility to institutionalize more citizenship on cross-functional work and share will come from successes. The efforts within the company. buzz that needs to be created knowledge across organizations, should be based on reality.” Unocal is following the example of Ultimately, however, a business conducting “retrospects” as a for- case and CEO support is needed to At the end of the day, the business mal way to understand and share ensure successful, long-term insti- case is best demonstrated through lessons learned. One such retro- tutionalization of citizenship. For action and activity, as opposed to a spect examined how the company corporate citizenship to be sustain- persuasive presentation. In this addressed the “nontechnical” areas able, there must be a company- approach, the business case for cor- in its involvement in the Baku- wide signal to all stakeholders that porate citizenship is derived from Tbilisi-Ceyhan (BTC) pipeline proj- it is a critical business issue. proven results rather than an initial ect. “The retrospect,” says Laurie driver. This makes selection and Regelbrugge, Unocal’s corporate documentation of early citizenship responsibility manager, “provided a initiatives particularly important. very helpful forum in which to really look at all of the nontechnical At Unocal, for instance, the corpo- areas together, in a way that will rate responsibility team has made allow us to get better traction and the business case “alive” and coordination among the disparate demonstrated success in individual pieces of that work — everything business units/locales by interact- from legal affairs, to financing, to ing on a local/regional level to environment, to government rela- ensure that the individual issues of tions, to communications, to CR, to

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 43

Taking Strategic Action

Figure 3 HOW EIGHT COMPANIES PERFORMED—BEFORE & AFTER

This illustrates the status of the eight companies regarding key elements of strategic corporate citizenship. The top bar reflects the companies before the research project, the bottom bar plots progress two- and-a-half years later.

5 2 1 Executive Before Support After 2 4 2

Perceived Before 5 1 2 External Pressure After 2 4 2

Defined 5 3 Concept for Before Corporate After 1 5 2 Citizenship

2 Defined Before 6 Business Case After 5 3

Cross 7 1 Functional Before Integration & After Alignment 1 5 2

Levels of Success:

44 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

Conclusion

Is corporate citizenship more than just the sum of its parts?

The answer to that question is yes, in theory. In practice, however, most companies struggle to make that vision a reality. Some companies and During the last 20 years, The Center for Corporate Citizenship at Boston managers are stepping College has examined the work and experiences of executives and man- away from the program- agers from hundreds of leading companies. Many, if not most, of these businesses have a range of corporate citizenship-related activities with matic view of corporate goals around compliance, philanthropy, ethics, and in some cases, business citizenship and striving to need. Individually, these programs have well-defined goals and operational develop a system that is practices. Collectively, a makeshift strategy is often reflected in the genesis more relevant, functional of the program from similar company origins, but this strategy rarely and beneficial, both to the serves as a proactive driver to close strategic gaps and improve business performance. company and society.

With a disjointed approach and lack ship differently, as a vital and core of cohesive strategy, it’s no wonder element of the business, as the that companies struggle to align, responsibility of every employee integrate, and institutionalize corpo- from top to bottom, and as the rate citizenship into the business. means to make corporate values The lack of structural cohesion such real. But in doing so they must as a CEO-led mandate, official strat- confront a variety of myths. egy, designated owner, and business case, can make an initiative that The myths about corporate citizen- already seems somewhat peripheral ship portend that unless finances even more so. are flush, a crisis is brewing, senior executives are leading the way, As this report demonstrates, rather and a rock solid business case is than become stuck in this cycle, clear, companies won’t be com- some companies and managers are pelled to strategically align corpo- stepping away from the program- rate citizenship. The eight compa- matic view of corporate citizenship nies in the research project called and striving to develop a system The Executive Forum on Corporate that is more relevant, functional Citizenship are dispelling these and beneficial, both to the compa- myths. They demonstrate the ny and society. These managers are important role that commitment, moved to look at corporate citizen- energy, and passion play in initiat-

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 45 Conclusion

ing and building momentum for The critical outcome of this going learning and results rather corporate citizenship. Evidence research: managers who have than having a preplanned, compre- from the companies demonstrates made progress and held their hensive agenda they sought to exe- that: ground in the face of countervail- cute. ing pressures have demonstrated • progress can be made during leadership grounded in their sense While this report challenges many tough economic times that corporate citizenship consti- misconceptions of corporate citi- • it is possible to mobilize corpo- tutes an important opportunity for zenship and presents middle man- rate citizenship awareness and their company. They have been agers as effective change agents, it support without a perceived successful when using an incre- does not minimize the reality that external or internal pressure mental, opportunistic and emer- sustainable and authentic corpo- • middle managers can and do gent strategy to advance corporate rate citizenship must be integral to lead to align and integrate citi- citizenship in their companies. the company’s strategic goals and zenship across a company promoted from the highest levels • developing an iron-clad busi- In practice, catalyzing momentum of the company. Few companies in ness case is not a prerequisite incorporates a wide range of tac- the world have successfully institu- for taking action on corporate tics, with the intent of maximizing tionalized corporate citizenship citizenship. each opportunity at hand. On the into their core business strategies. formal side, some practitioners It is encouraging to see, as this While these findings are encourag- have employed existing planning report illustrates, the success coming, it is important to acknowledge systems and processes to add rigor panies are having with the more the full set of realities that man- to corporate citizenship. More foundational work of integrating agers face: informally, managers have worked and aligning these efforts. • starting with foundational to build relationships, coalitions, and allies across the company with The individuals and companies knowledge building is critical. highlighted in this report will Managers must spend time the goals of both connecting those already engaged in corporate citi- hopefully serve as both allies and getting to know their com- inspiration for others seeking to pany’s people, processes, and zenship work and engaging new colleagues to the effort. build the momentum to a corpo- strategies; rate citizenship approach that is • they will experience resistance Most managers have worked to neither feel-good, nor must-do but within the company; engage with the lines of business rather as a vital part of the way that • large-scale progress is slow– and to demonstrate how corporate business conducts business. think years, not quarters; citizenship directly impacts the • initiating and building momen- success of at least a facet of the tum for a strategically aligned, business. Overall, the managers integrated, and institutionalized have been responsive to their com- approach to corporate citizen- pany’s realities, acting as catalysts ship does not have a textbook to align, integrate and institution- approach to guide it forward; alize corporate citizenship across and their companies. This way of oper- • executive support is, eventually, ating builds on the managers’ on- necessary.

46 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship CASE IN POINT: Profiles of Corporate Citizenship in Action

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 47 case in point

RELATIONSHIPS AS A FOUNDATION FOR ACTION Unocal builds relationships with the line management

The participants The situation Louisa Chan Boegli Unocal’s corporate responsibility efforts in places where the company has opera- Corporate Responsibility tions are more local and relationship-based than formally programmatic. Actions are Consultant tailored to fit each business unit and host culture as there is no one-size-fits-all Greg Huger approach to corporate responsibility. A global strategy provides a framework, and Director, Corporate specific actions are tailored for local and national relevance. Responsibility

Laurie Regelbrugge The punchline Manager, Corporate • Develop relationships with a range of personnel across the operation to catalyze Responsibility action throughout the business units. • To make corporate citizenship “business relevant” is critical. • Listen and learn before selling and telling.

Background in business units. Together they strive to ensure that corpo- In the mid-1990s, Unocal Corporation underwent a signifi- rate responsibility is not just an idealistic corporate system cant restructuring that accompanied a strategic shift away but something relevant to the activities in the field. from downstream activities such as refining, to focus most- “It makes sense to begin by focusing primarily on business ly on upstream activities such as exploration and produc- operations where these issues are large and there is a lot to tion. This transformation resulted in Unocal’s growing be gained or lost,” says Greg Huger. “You get people’s atten- presence in developing countries as a larger share of the tion on these issues. Business unit leaders are willing to company’s portfolio. The shift required that Unocal deepen make tough decisions to allocate resources and time. Then and expand its stakeholder engagement strategies to accom- when it works, implementers in operations talk about the modate the increased number and variety of communities experience and results — all involved become ambassadors with which it interacts. of the corporate responsibility work.” Unocal’s corporate responsibility practitioners faced the To help business units develop strategies, programs, and challenge of strengthening the business units’ capacity to teams, Huger’s team uses a “player/coach” approach that effectively develop these relationships and support key engages staff with outside contractors who bring valuable country managers who had functional, on-the-ground corporate responsibility perspectives and experience. responsibilities. Despite a decentralized corporate culture, there was also a need to work with business units in ways that consistently supported overall corporate responsibility The “Player/Coach” Strategy goals. This strategy relies, as Laurie Regelbrugge describes it, on “not trying to tell any of the business units what to do or While several company structures support Unocal’s corpo- how to do it. We’re trying to facilitate a process to see that rate responsibility work, including a board-level corporate corporate responsibility issues are addressed and the corpo- responsibility committee and an executive-level steering rate responsibility work gets done.” This subtle difference team, the corporate responsibility staff is tasked with strate- ensures that the corporate responsibility team engages with gy development, oversight, and administration of the com- the line organization in a way that is appropriate to the spe- pany-wide effort. Implementation occurs in the business cific business operation and the community and is in line units. The corporate team works with corporate responsibil- with the organization-wide corporate responsibility strategy. ity practitioners and a range of support and line managers Unocal’s “coaching” is done by employees or consultants

48 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship skilled in listening, providing corporate responsibility expe- ect examining the evolving community context in southern rience and perspectives from internal and external con- Thailand and implications for the company. This involves stituents, and supporting actions within company opera- asking questions of a country manager such as: tions to advance corporate responsibility across the business. As outsiders, they bring objectivity and credibility to • Where do you see this business in five years to 10 years? the specific operations, and, as insiders they develop credi- • Who cares about this business operation? bility by building long-term relationships with business unit • Who’s going to be affected by it enough to think about it leaders and line employees at all levels. and want to help or hurt it? • What kind of relationship do we have with those groups To engage in these relationships, Huger’s approach has or people now? been to begin the conversation by talking about key busi- • What kind of relationship would we like to have with ness concerns and the business strategy going forward, the them? issues associated with those plans, and what might help or hinder achievement. Eventually, conversations lead to stake- Another example of this location-specific work is Unocal’s holder engagement and ways it can provide solutions to extensive, long-standing operations in Indonesia, a country business challenges. “When we sit down to talk, very quick- experiencing substantial transition in the economic, social, ly we’ve listed about three pages of issues in my notebook,” and political landscape. Seeking to protect the Unocal’s long- Huger says. “Then it’s very easy to come back and talk about term social license to operate and nurture existing relation- how the company is dealing with those issues. I find that ships, the business unit and Huger’s corporate responsibili- our colleagues are really concerned about these issues, and ty team have worked together over the last four years to they’re not really sure how to deal with them. Often they’ve review operations and strengthen the company’s capacity in tried some things, and some have worked and some haven’t. stakeholder engagement and issues analysis. This collabora- And so, in all of these situations, there’s something to build tion has identified and placed experienced staff who could on. It gives us a basis for considering and taking new action. help advance the business unit’s work internally (across That’s the way we’ve been able to work with the business functions) and externally (with communities). Huger and his units.” team have spent considerable time working with on-site Unocal managers to build appropriate internal teams, work Follow-up is essential, notes Huger. “If we’re just there once effectively with local managers, and earn the trust of com- or once every six months, mainly to have the same conver- munities through healthy relationships and engagement. sation again, without the capability of helping the business unit deal with the problems and challenges identified Unocal’s approach aims to create a network that endures together, then it’s a waste of time,” he says. “But if we can over time by developing lasting business partnerships. identify actionable challenges, act, and work through the These relationships provide a channel for the corporate challenges of developing the business unit capability. That’s team to contribute corporate responsibility perspectives for what they want. That’s what the company needs.” integration in the business operations. Sharing the success stories that emerge has helped foster new relationships in other parts of the business. Making it Happen As these relationships with Unocal line management be- Says corporate responsibility consultant Louisa Chan come stronger, the corporate responsibility staff engages Boegli, “There’s been some good success integrating corpo- business units in focused and customized activities such as rate responsibility into the work of the technical teams in scenario planning for business contingencies; conducting Indonesia. For example, the business unit’s corporate focus groups with employees and communities; meetings responsibility team now engages with technical teams in with community leaders, activists, and officials; action plan- planning and implementing actions in advance of technical ning; and operations management systems reviews. processes like drilling and seismic surveys. The results have enhanced our social license to operate and met the business The objective of scenario planning is to tie corporate objectives. Those experiences advance credibility within the responsibility principles into the business by proactively organization.” identifying and managing nontechnical issues to help pre- vent crises, mitigate risks, and consider opportunities. One example is the East Kal (Indonesia) review, in which Unocal is examining the aggregate impact of its activities in the context of that area’s development and community aspirations. Another example is a formal scenario-planning proj-

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 49 case in point

KNOWING YOUR AUDIENCE At Levi Strauss & Co., switching to Plan B allows for mobility and traction

The participants The situation Theresa Fay-Bustillos Trying to generate momentum for corporate citizenship during a business turn- Vice President of Worldwide around situation would be a challenge, so Theresa Fay-Bustillos thought it best to Community Affairs start at the top.

The punchline • Know when to engage whom; peers, executives, and employees all have their time and place. • Always have a Plan B.

Background a means to a greater end: to set goals and track and meas- Although Levi Strauss & Co. has been a pioneer of many ure progress around CSR. corporate citizenship activities, including responsible sourc- To prepare, Fay-Bustillos and a team of consultants spoke ing and integrating diversity into the workplace, the compa- with each WLT member to develop a data baseline. She ny had not formalized its “profits through principles” cul- wanted to understand: ture through formal processes, operating models, or progress measurement. Theresa Fay-Bustillos, vice presi- • the level of knowledge they had around CSR generally dent of worldwide community affairs, took advantage of her and, more specifically, at Levi Strauss & Co.; position on the worldwide leadership team (WLT), her job of • whether they saw any relevance between CSR and their monitoring corporate social responsibility (CSR) trends, business objectives; and and the interest of Chairman Bob Haas to put more struc- • which social, environmental, and ethical issues the exec- ture into what had been an organic development. Though utives thought were most critical for the company to CSR had always been an implicit part of the culture of Levi address, and why. Strauss & Co. throughout its 150-year history and an explicit part of the company’s vision and values, she wanted to As a part of these conversations, Fay-Bustillos says she and develop a more integrated corporate citizenship agenda by the team “used key business problems and turned them starting at the top of the house in conjunction with col- around and said all of those reasons are why corporate leagues who could provide expertise around specific issues. social responsibility is important. Since they know their businesses better than I do, this approach brought forth Plan A better examples than I could ever conjure up on my own.” As CEO, Phil Marineau had a goal to build CSR into the Fay-Bustillos continued the conversation by using their WLT’s work with the “LS&CO. Way,” an integrated operat- answers as a baseline for discussion during a regular ing model and business planning process, and Fay-Bustillos WLT meeting and to identify areas of convergence and worked to implement it. The LS&CO. Way was intended to divergence. create a cohesive leadership team among company veterans and newcomers incorporating values, vision, decision-mak- The engagement continued with a “homework assigning guidelines, and planning and execution strategies. By ment” for each executive to bring to the second meeting. targeting the company’s ultimate decision-makers—the She challenged them to identify a business issue they were senior executives—Fay-Bustillos took advantage of the facing and whether and how corporate citizenship was opportunity to embed CSR into how the company plans and involved. “This produced incredible examples of how CSR executes its business strategy through the LS&CO. Way, not intersects with our business and operations in ways I could just the vision and values. Through this process, she sought not have identified or articulated,” Fay-Bustillos says. “It

50 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

also produced a thoughtful discussion among the WLT the breadth of CSR work at the company. What certain members about the role of CSR at Levi Strauss & Co. It got members of this group might lack in seniority was balanced them to see that CSR was not relevant for only certain by personal passion and commitment. members of the team, and this was a big breakthrough.” This group has since developed a three-phase, 20-month These conversations set the stage for the third meeting. The work plan to be completed by March 2006. They have WLT members were divided into teams and given another assumed responsibility for: homework assignment to consider CSR from various stakeholder perspectives, including personal values, the market, • establishing a CSR definition/positioning statement and the organization, and society. At the meeting, Fay-Bustillos objectives; planned to: • conducting an internal inventory; • performing internal and external benchmarking; and • Discuss values and social mission, facilitated by CEO • developing measurement processes and accountability Marineau; for aligning and integrating corporate citizenship with • Bring in internal and external stakeholders to tell their the organizational values and strategy. stories; and • Continue business-related discussions around the plan- In order to maintain continuity with her “Plan A” and keep ning process and the company’s identity as an employer. CSR visibility high, Fay-Bustillos conducts regular check-ins with Haas and Marineau; the WLT receives a full briefing Though Fay-Bustillos had initial success engaging the WLT, and provides feedback at the end of each phase; and the she decided to put this top-down approach on hold before CSR committee of the corporate board is kept abreast of the conducting the third meeting. It was clear that the forth- project. coming business reorganization and efforts to streamline operations demanded the concentration of the executives in Staying the Course order to stabilize and grow the company. “I was worried Despite the change in approach, Fay-Bustillos has found that this project would not get the attention it needed in the that her initial approach of using the LS&CO. Way as a midst of such sweeping change,” she says. means to greater integration has not disappeared. During an update to the WLT partway through Plan B, she says, Plan B “there was incredible support for this project. Everyone Not wanting the long-term goals for corporate citizenship to agreed that when this project is finished, CSR should be suffer, Fay-Bustillos formulated “Plan B.” Although she had explicitly a part of the LS&CO. Way, not just a part of our val- initially considered promoting CSR from the middle of the ues and vision. They agreed that we should not assume, just organization, she had seen an opportunity to involve the because we are a values-based company, that our CSR pro- executives through their work on the LS&CO. Way. But gram is focused on the right things. We have to hold our- then she saw her Executive Forum colleagues finding suc- selves accountable for the process and results.” cess working from the middle of the organization. These executives were able to access individuals at a level where While Fay-Bustillos may have been frustrated by the lack of strategy meets implementation and who often have a sharp- progress during this time of what she calls “organizational er sense of on-the-ground operational challenges. She churn,” the support of the larger employee base for values applied this model and took “the opportunity to secure the as a centerpiece of the Levi Strauss & Co. culture was reas- commitment of a core group of leaders to do the ground suring. Some employees were concerned that the Levi work and wrestle with the details before getting feedback Strauss & Co. family-owned, values-based culture was erod- from the WLT.” ing in the face of harsh business realities. She says that many have felt relieved and excited that the foundation of With the blessing of the Marineau, Fay-Bustillos convened values in the LS&CO. Way was “like an anchor in a storm” a cross-functional, multilevel working group around corpo- amid plant closures and layoffs, and it influenced the rate citizenship, which did include some crossover mem- restructuring process positively. At Levi Strauss & Co., cor- bers from the WLT. It was critical that the group represent porate citizenship has illustrated the value of continuity in the face of tremendous business volatility.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 51 case in point

GATHERING DATA TO BUILD THE BUSINESS CASE Hard data from stakeholder groups reinforces importance of corporate citizenship at Agilent

The participants The situation Gene Endicott Agilent sought to demonstrate the importance of corporate citizenship in a manner Public Affairs Director that resonated with its analytically-minded culture. By gathering data about different Gail Brownell internal and external stakeholder groups, Agilent’s citizenship practitioners have Quality Systems Manager demonstrated the value of their efforts, influenced a more strategic approach to corporate citizenship, and accessed more levels within the company and employees in locations beyond corporate headquarters. Some of this data has led to stronger links with the company’s existing reputation initiatives and established key partnerships in working to establish a business case.

The punchline • Hard data can be a powerful illustration of why citizenship is important, and it can also help practitioners tweak their strategies. • Data-gathering activities abound within companies; citizenship practitioners should find ways to be included in these efforts.

Background specifically two—for us to really drive the kind of focused As one of the leading advocates of corporate citizenship at activity we needed to start producing results that could be Agilent, Gene Endicott, public affairs director, holds many measured.” of the “social” aspects of corporate social responsibility Consequently, Endicott and Brownell focused on a less (CSR) within his job purview. After creating a partnership structured and more relational effort to engage individuals with Gail Brownell, quality systems manager, whose from across the business, including representatives from responsibilities focus on environmental issues, Endicott human resources, procurement, brand management, and began pushing corporate citizenship forward with a cross- other departments and functions. Their goal was to gather functional working group that represented widespread data from internal stakeholders about perceptions of ownership throughout the company. Agilent’s corporate citizenship efforts and broaden the Unfortunately, an unfavorable business climate—nine audience for citizenship activities. Endicott and Brownell straight unprofitable quarters—and the demands it created believed that if more people had CSR within their line of for all employees as well as a lack of hard data that would sight, the business case would emerge. Furthermore, at an “prove” the bottom-line worth of corporate citizenship analytically-minded company such as Agilent, they recog- made Brownell and Endicott realize that the team and its nized that the support of hard data would be invaluable. individual members would be most effective by playing an The result was an effort to gather information from overall advisory role rather than owning specific strategies employees, customers, and other external stakeholders. or programs as part of a distinct company-wide corporate citizenship plan. Understanding Internal Stakeholders To achieve measurable short-term progress, the two practi- Endicott and Brownell understood that employees are a key tioners knew they needed to own the overall effort and do stakeholder group and knew that they needed to assess most of the heavy lifting. “One my biggest learnings was employees’ perceptions of Agilent’s citizenship efforts around my initial concept of ownership,” says Endicott. “In before they could obtain their support. Because Endicott reality, it was going to take a small number of people— had a good relationship with the individual responsible for the semiannual employee survey, he successfully negotiat-

52 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship ed the inclusion of a question about Agilent’s corporate cit- Citizenship in the Marketplace: The izenship performance. This would allow him to capture Customer’s Perspective employee opinions and understand differences among the Brand management is another group whose access to stake- various geographic and functional areas of the company. holders provided an opening. The group’s initial emphasis was on forging a new brand identity for Agilent following By running correlations between the citizenship question the company’s 1999 spin-off from Hewlett-Packard, but it and other questions about motivation, loyalty, and geogra- now engages in other activities such as brand tracking sur- phy, Endicott was able to identify strengths and weaknesses veys. Initially, Endicott interacted with this group as a part in his citizenship efforts. Certain regional differences will of the cross-functional CSR working group. Over time, both help shape local implementation strategies, and the data parties began to appreciate the role that good corporate citi- will serve as a baseline to track progress over time. zenship could play in increasing brand strength and reputation. As a result of this stronger relationship and growing Understanding Community Perceptions buy-in, Endicott was able to include a citizenship-related Though the employee survey information proved useful, question in the brand tracking survey distributed to cus- Endicott knew that the data’s legitimacy would be enhanced tomers. Commenting on the value of the connection with if it could be cross-referenced with external, third-party data corporate citizenship, the senior director of brand manage- about CSR and reputation issues. In 2001, he purchased ment, Shirley Horn says, “The more research I'm exposed GlobeScan’s (formerly Environics International) CSR to in these areas — because Gene's been very good at keep- Monitor, which provides global perceptions about corporate ing us posted on the current thinking — the more I realize social responsibility issues through an annual survey in 22 how important it is to our image overall that people have a countries. An unintended but welcome consequence of high respect for our abilities and our concern in these working with the CSR Monitor, says Endicott, was that areas.” “when we had the data to share, that was a reason to get the same group of people together again, to go over the data and Because many Agilent products, such as air- and water-qual- see what it said.” As existing relationships were strength- ity-testing equipment, are used for environmentally respon- ened and new relationships were forged, a base of support sible efforts, Endicott and Brownell would like to increase was steadily formed. corporate citizenship’s influence on product development efforts. In effect, business growth through greater sales of Endicott subsequently contracted with GlobeScan to con- these products lends credence to Agilent’s own CSR efforts. duct a customized survey to capture the external attitudes Highlighting this connection between product and citizen- about Agilent in communities where the company operates. ship, Endicott has helped his colleagues understand how to Initiated in early 2004, it focused on the company’s reputa- leverage Agilent’s CSR activities to influence business tion and visibility in the United States, Korea, and development. “It’s a matter of getting others in the compa- Singapore generally and on citizenship activities more ny to think about the fact that corporate citizenship is not specifically. The data has also allowed for more targeted just a public affairs responsibility,” he says. “Our business local planning. The data from Korea, for example, reflects a managers also play into that objective as a result of the prod- high degree of importance placed on employee treatment, ucts and technologies we offer, which address issues that while U.S. communities ranked product development and our stakeholders often care very passionately about.” R&D efforts as more central to their understanding of Highlighting this connection has enabled Endicott to illus- Agilent as a good citizen. trate that being a socially responsible company is central— and not peripheral—to operations. “It sounds simple, but we need to understand that what’s important in one community may not be the same issue With the aggregation of this data, Endicott has been able to that’s important in another,” says Endicott. “We need to explore more systematically his colleagues’ shared interest in remind ourselves that—at the local level—understanding working for a company with a solid reputation and good citi- those issues and the degree to which we can try to affect zenship performance. The data will facilitate the development them is a big, important part of our job.” of baseline measures, new initiatives, and a strong business case. But at the end of the day, says Endicott, “we have data that we’ve never had before and there is value in that, period.”

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 53 case in point

MAKING THE CASE FOR A CORPORATE RESPONSIBILITY DIRECTOR Petro-Canada shows that sometimes “slow and steady” wins the race

The participants The situation Hazel Gillespie Despite an abundance of corporate citizenship activities, Petro-Canada needed a Community Investment unifying strategy and owner to make efforts more strategic and ensure that key Manager issues did not fall through the cracks. David Stuart Senior Director, The punchline Environment, Health, Safety and Security (EHS) • Pursue your strategy with patience. • Design an approach that addresses the concerns of stakeholders at different lev- Greta Raymond els and in different parts of the company. Executive Vice President, Human Resources and EHS. • Demonstrate the value of corporate citizenship through incremental initiatives in different parts of the company even as you await buy-in from the top of the Sharon Mulligan Newly-appointed Director, organization. Corporate Responsibility • Have a senior executive ally. • Do your homework. Have the background information about the business that you need to bolster your case.

Background ities was too diffuse, and the group came to realize the need Driven by several issue-oriented programs, Petro-Canada’s for a position that would coordinate and champion the inte- approach to corporate responsibility in the late 1990s gration of corporate responsibility across the company. included programs such as Aboriginal relations, communi- “We were missing the linkage to the bigger management ty investment, and environment, health, safety, and securi- system,” says Stuart, who added that when efforts were coor- ty. Though each of these programs was successful in its dinated it was “largely because of personal relationships, own right, the company lacked a wider strategic commit- rather than any kind of systematic management system ment to corporate responsibility, and efforts were siloed around that framework.” This fragmented approach to citi- even when they spanned business units. zenship was not consistent with the company’s systems-ori- Such social and environmental initiatives were traditionally ented culture or its values that emphasize dedication to spearheaded by three key executives: Hazel Gillespie, com- quality and safety. The result was a lack of integration of cor- munity investment manager; David Stuart, senior director porate responsibility across corporate functions and busi- for environment, health, safety, and security (EHS); and ness lines and into company-wide practice. Several aspects Greta Raymond, executive vice president of human of corporate citizenship, such as attention to culture-specif- resources and EHS. ic issues in newly acquired international businesses, were falling through the cracks. As a result, the three Petro-Canada practitioners, according to Gillespie, “initiated a few things that were multifunction- al and somewhat ‘softly led’ that worked out pretty well. But Preparing for a Strong Move Forward there was still a lot of confusion. And with the new activity Gillespie, Stuart, and Raymond conducted a critical assess- that comes along in the area of social responsibility, the ment of Petro-Canada’s corporate responsibility initiatives structure and approach was pretty ad hoc.” and operations in early 2002, with the intention, says Gillespie, of making “a really strong move forward on corpo- Despite the best efforts of this trio, accountability for the rate responsibility in the company.” The research process range of citizenship-related structures, processes, and activ- included:

54 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship • using a consultant to benchmark best practices against Gillespie and Stuart believed that an expanded and integrat- other companies; ed corporate responsibility initiative would increase effi- • meeting with internal stakeholders in both corporate ciency and strategic action. Specifically, they argued to the staff functions and line management; and ELT that a more strategic corporate citizenship approach • conducting a series of in-depth conversations with prac- would: titioners at other oil and gas companies that were comparable in size. • increase effectiveness in corporate responsibility by moving from an issue-response approach to a strategic As a result of this research, Gillespie and Stuart realized the approach; need to balance the interests of the company’s executive • clarify accountabilities; leadership team (ELT) with those of the line personnel. The • reduce rework and overlap; executives wanted a corporate responsibility governance • close gaps in management systems and align their posi- structure that centered on individual employee commit- tions and activities regarding related issues; ment, coordination, and measurement and the employees • potentially reduce time spent in meetings and commit- needed a framework they could use to manage their busi- tees and preempt additional working groups; and ness operations on a daily basis. Striking a balance was • result in new efficiencies and cost savings. crucial to gaining approval for the proposal from both groups. Results Approval of the new governance structure and director posi- Making a Recommendation tion came after more than a year of discussions about From the research came a set of recommendations to the resources, qualifications, and organizational positioning company’s ELT to align and integrate existing corporate among the ELT and representatives from community affairs responsibility efforts and address missing components. and EHS. The recommendations included: After a lengthy interview process, Petro-Canada hired an • a simplified corporate responsibility management sys- internal candidate, Sharon Mulligan, who began her new tem as a companion to the existing operations manage- job in January 2004. Mulligan reports to Raymond and ment system known as total loss management; serves as the link between the dozen various owners of • a “corporate responsibility accountability/governance Petro-Canada’s corporate responsibility agenda, including structure,” including the formation of an Executive community investment, EHS, and reputation management. Corporate Responsibility Steering Committee; and To accomplish these tasks, Mulligan’s primary role is to • a new “nonauthoritative” corporate responsibility man- “develop and oversee the corporate responsibility manage- ager position. This position would link and integrate the ment systems, including policy and guidelines, training corporate responsibility activities that were under the content, and assuring assessment and reporting.” Through authority of the various business and shared services relationship building and system integration, Mulligan units. serves as a connective hub, unifying the sense of corporate citizenship throughout the company. Anticipating that the process of achieving buy-in from the executives would not be immediate, Gillespie, Stuart, and “It’s great for me because I felt like I was trying to do this Raymond sought to obtain incremental approval from the and then do my day job at the same time,” says Raymond. ELT. Rather than making a single, hard-sell presentation “To have somebody who wakes up thinking about it every right off the bat, they made their case over the course of a day is great, somebody to bring all the pieces together and year. Simultaneously, they advanced specific operational to organize and coordinate and think more strategically initiatives to demonstrate the value of corporate responsi- about it.” bility, including an expansion of the total loss management system to include additional measurements, ramping up Aboriginal Affairs to involve more individuals and business units, and piggy-backing on existing systems around community investment. They adopted a “slow and steady wins the race” approach with the ELT, meeting with the team periodically.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 55 case in point

A MEANS TO A GREATER END AMD leverages its sustainability report to generate momentum for corporate citizenship.

The participants The situation Allyson Peerman With increasing external pressure and growing internal interest, the sustainability Director, Global Community report at AMD has grown to include an increasingly broad set of issues. The corpo- Affairs rate citizenship practitioners who own the report have worked to find new, strategic Philip Trowbridge uses for it and have gained new allies and audiences in the process. Member of Technical Staff, Worldwide EHS The punchline • The report is not an end in itself. Consider different ways to leverage the finished product from the outset. • Use the report as a conversation starter.

Background Presbyterian Church. It was a real eye-opener for the com- In 1995, when Advanced Micro Devices (AMD) produced pany, says Trowbridge: “It was a significant turning point its first annual environmental report, it was seen as cutting when we brought MRTI in and discussed their concerns. edge for a company to report on nonfinancial information. They were surprised to find that we were a lot further ahead AMD was committed to publicly offering meaningful infor- than they thought, because they hadn’t seen much informa- mation about its environmental, health, and safety (EHS) tion on AMD. We didn’t have a lot of information out there. performance. In 2000, AMD broadened the scope of the We had an EHS report, but it didn’t go into many of the report to include social and economic data, creating what is other things that the company was doing. A couple of years now an integrated Sustainability Progress Report. later, we received the first Dow Jones Sustainability Index survey. It asks a lot of hard questions, a lot of questions we were not quite sure how to answer, and that made us look The Evolution of a New Report at how our communications needed to change in order to With each subsequent year, the impact of the report grows. It address the difficult issues.” is now more than a tool for transparency and measurement. It serves as a catalyst for sharing information and framing the At the same time, AMD was beginning to receive more relevance of corporate responsibility within AMD. questionnaires from customers and socially responsible investing (SRI) organizations like MRTI. These question- The integrated approach to the report was the result of naires probed deeply into company performance in areas efforts to broaden the scope of corporate citizenship led by such as labor practices, product content, community Philip Trowbridge, a member of the worldwide EHS techni- involvement, and management systems. cal staff, and other key members of AMD’s EHS department. AMD was also influenced to varying degrees by pres- As a result, AMD decided to ramp up its ability to respond sure from stakeholders — including customers in its busi- quickly to external queries. It raised the bar on its new ness-to-business context — for greater transparency. reporting strategy by using the Global Reporting Initiative (GRI) framework as a guide (though they do not subscribe Other external stakeholders were also catalysts for the to it in its entirety). The company now also posts answers to expanded report. A 1998 shareholder resolution “seeking frequently asked questions about its EHS programs on its assurances that their labor and environmental standards in website. facilities are adequate” came from Mission Responsibility Through Investment (MRTI), affiliated with the

56 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Engaging New Audiences The energy and interest generated by the report has also The Extended Producer Responsibility (EPR) group within been harnessed as a tool to engage business groups in ongo- the EHS department has been the owner of the report ing corporate responsibility efforts. In late 2003, because of its responsibilities for tracking product-related Trowbridge convened cross-functional discussions around regulations, supplier EHS assessment programs, and AMD’s corporate responsibility strategy. This forum has responding to customer and investor EHS inquiries. Since since matured into the Sustainability Advisors Group, with AMD doesn’t have a designated corporate citizenship members representing a cross-section of the company owner, EPR was the functional area best suited to drive the meeting regularly to strategize about corporate responsibil- effort to enhance AMD’s nonfinancial reporting. ity. To expand cross-functional citizenship efforts beyond Trowbridge, as part of the EPR group, recognized the the report, the group is now examining global citizenship opportunity to use the new reporting strategy to infuse trends and how they relate to AMD. more corporate responsibility awareness and acceptance Trowbridge also uses the report as an informal door-opener into the company. for conversations about business partnerships inside the The current strategy for production of the Sustainability company. He has involved various business representatives Progress Report relies on involvement from a variety of in the planning stage for the next report by asking their groups, such as human resources, public relations, EHS, views on the key messages they believe their stakeholders community affairs, organizational development, and legal. are interested in seeing in the report. Trowbridge recognizes that collection of the data itself is a vehicle to rally departments together toward a common Positive Results goal. For instance, there is a closer working relationship Another result of the more fluid information-sharing and with investor relations to provide critical corporate gover- data-collection environment is that AMD is listed in the nance information because of the report interaction. FTSE4Good, an SRI index, and has been included in the global fund Portfolio 21 that invests in environmentally sus- In addition to engaging more individuals from a wider tainable companies. Compiling citizenship information range of functions, Trowbridge uses the finished report as a also allows AMD to maintain its status with similar indices selling tool for AMD’s corporate responsibility agenda, both and funds, such as the Dow Jones Sustainability Index. in meeting with individuals and in forming strategic inter- Trowbridge credits effective communications and coopera- nal business alliances. tion from many different groups for these successes.

At the annual meeting in early 2004, because of a short delay In the end, the most beneficial outcome of the reporting in the start of the proceedings, attendees had an opportunity process has been the development of relationships promot- to read the 2003 Sustainability Progress Report. The ing a more integrated approach to corporate responsibility response was overwhelmingly favorable, including positive within AMD. The sustainability report has facilitated the feedback from CEO Hector Ruiz. Ruiz has come to recognize sharing of information and helped frame the relevance of it as much more than a sustainability report and considers it corporate responsibility to the business units. a comprehensive reflection of the nature and activities of AMD as a whole. This CEO support has raised the visibility “This work is all about relationships, and that’s how the of the report’s value, Trowbridge notes. effort is moved forward in the company,” says Allyson Peerman, Trowbridge’s partner in working to integrate cor- A senior member of AMD’s organizational development porate citizenship throughout the company. “It’s really group refers to the report as “a great snapshot of the com- through individuals who understand the importance of cor- pany” and makes it required reading for employees partici- porate citizenship, how it impacts the company and their pating in AMD’s training program, “The Experienced particular business unit, and the role they can play in it.” Manager’s Academy,” which seeks to broaden managers’ corporate perspective. As a result of this success, Trowbridge is examining other ways to integrate AMD’s citizenship efforts with other ongoing leadership development programs.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 57 case in point

BUILDING KNOWLEDGE, BUILDING BUY-IN At Verizon, a cross-functional group provides the foundations for movement

The participants The situation Kathy Brown In an effort to catalyze a larger-scale corporate citizenship initiative, Verizon staff Senior Vice President, leveraged the interest raised by its Consumer Advisory Board — a group of external Public Policy and Corporate Responsibility stakeholders—to convene a cross-functional team within the company. B. Keith Fulton The punchline Vice President, Strategic Alliances • The definition of corporate citizenship is not a given. Take time to do research and develop words and focus areas that will resonate at your company. Patrick Gaston • The power that external stakeholders can lend is compelling. Seek them out. President, Verizon Foundation and • Capitalize on existing corporate responsibility efforts for greater traction. Former Vice President, Strategic Alliances

Chris Lloyd Director, Strategic Alliances

Background Corporate Responsibility: The Next Step External stakeholders — including policymakers, NGOs, Verizon has many well established and effective citizenship and customers — play an important role in most corporate oriented programs, most notably a long-running supplier citizenship efforts, in both partnership and adversarial diversity program, an award-winning employee diversity roles. For Verizon Communications, ranked 12th on the strategy, an innovative program that provides access for dis- Fortune 100 with more than 200,000 employees and $71 abled individuals, and a substantial philanthropy program billion in annual revenues, a truly integrated corporate managed by the Verizon Foundation. While each program responsibility program requires a scale few other compa- is successful in its own right, and many are considered flag- nies need. ship programs, they were not connected under a wider, more comprehensive corporate responsibility strategy.

Consumer Board: An Outside Influence Always attuned to Verizon’s external environment, the CAB A compelling factor for advancing corporate responsibility perceived the need for an overarching corporate citizenship at Verizon was its Consumer Advisory Board (CAB), a cross- approach. “They identified it as an area in which we needed sectoral panel that represents external stakeholders, includ- to focus, primarily because it was an issue that external ing customers, advocacy groups, and government officials. stakeholders monitor, and it has a significant impact on This 25-member board meets quarterly to advise the compa- Verizon and how we do business,” says Patrick Gaston, ny on a broad range of issues, including quality, marketing, president of the foundation and former vice president of and customer service policies that are important to strategic alliances. When the CAB catapulted this concern Verizon’s many constituencies and locations. The CAB to the forefront, Verizon’s citizenship practitioners were engages internal and external experts to provide guidance able to leverage the heightened visibility of citizenship to and public opinion on the issues it covers, including prod- sell the concept up through the company. ucts, policies, and business practices. The CAB is so highly regarded by this customer-focused company it has survived Seizing the opportunity to generate momentum, Verizon several mergers and acquisitions since its origin at New assembled a cross-functional group to develop recommen- York Telephone, a former Bell operating company. dations for moving corporate responsibility forward. The company created a corporate responsibility core team

58 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

(CRCT), comprised of some 25 Verizon managers from tory work and the impetus from the respected CAB, the diverse functional areas, such as procurement, branding, team was able to present the business advantage of corpo- finance, marketing, network operations, environment, and rate responsibility to Seidenberg, who gave them the green strategic planning. The CRCT received a limited but clear light for moving ahead. mandate from its senior management cochairs: conduct research before implementing a plan. The team’s objective Next stop was the CLC meeting, at which Brown and her was to present research-based recommendations to boss, Tom Tauke, Verizon’s executive vice president of pub- Verizon’s corporate leadership council (CLC), the compa- lic affairs, policy, and communications, made specific rec- ny’s most senior leadership group. These recommenda- ommendations around strategy and implementation. tions would address ways Verizon could build upon the Brown and Tauke later met with the Public Policy foundation of existing citizenship programs and engage Committee of the board. Both groups approved producing senior management by defining a vision of corporate Verizon’s first corporate responsibility report, which was responsibility at Verizon. released in January 2005. Generating ongoing support from senior management has continued in parallel with The CRCT’s first step was to identify what corporate respon- other work on the report, a web site, a revised values state- sibility meant to Verizon. Initially, the team members had ment, and several other strategic paths for action. no firm grounding in corporate citizenship issues or an understanding of Verizon’s current activities in that arena. Senior management supports a broader corporate responsi- As a result, they developed a plan to enhance their under- bility strategy, says Brown, “because the strategy advances standing of corporate citizenship by creating four working our goal of transforming the perception of Verizon from a groups, each with different data-gathering responsibilities: regional telephone company to a broadband, wireless, and video services company.” Notes Lloyd, a key executor of the • Inventory – Identify current corporate responsibility strategy, “Our goal is to transform Verizon into a great activities throughout Verizon American company, a great American institution. We see • Best practices/benchmarking – Determine what other corporate responsibility as a way to transform the reputa- companies are doing, particularly other telecommunica- tion of our company, from the inside out.” tions companies • Stakeholders – Map Verizon’s stakeholders with respect The Difficult Part Begins to corporate responsibility Fulton recognizes that the difficult part is in institutionaliz- • Metrics – Assess what should be measured and how ing a culture of corporate responsibility. “Our challenge,” Just as the task force prepared to provide early findings to he said, “is to develop a culture in which employees make senior leadership, major organizational changes at Verizon decisions that are consistent with our values and informed (including reduction in force and senior corporate responsi- by stakeholder interests. We want a decision-making bility staff changes) temporarily slowed the momentum of process in which employees consistently identify relevant the corporate responsibility work. While many companies stakeholder and company interests and consider how the find that this type of organizational change can stall efforts two intersect with our corporate values.” for the long term, some of the personnel shifts at Verizon Through the confluence of external and internal pressures, actually gave the practitioners allies in new areas. And when the prevalence of successful existing programs, a commit- the new team settled into place the effort quickly regained ment to building knowledge before taking action, and the momentum. This new team includes Kathy Brown, senior commitment of several practitioners, Verizon’s corporate vice president for public policy and corporate responsibility; responsibility approach was built on incremental and delib- B. Keith Fulton, vice president, strategic alliances; and Chris erate preparatory work. The dynamic relationships that Lloyd, director, strategic alliances. emerged among the practitioners and the other key groups Armed with the information the CRCT compiled, Brown — from the Consumer Advisory Board to the senior leader- engaged the senior leadership by presenting recommenda- ship team and the corporate responsibility core team — was tions for moving forward. The first step was a presentation the winning formula for initiating momentum within to CEO Ivan Seidenberg. Because of the breadth of prepara- Verizon.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 59 case in point

BUILDING CORPORATE CITIZENSHIP INTO EXISTING STRUCTURES Petro-Canada uses the existing foundation to build momentum

The participants The situation Hazel Gillespie As Petro-Canada’s practitioners sought to develop a more holistic corporate citizen- Community Investment ship strategy, they recognized that many foundational issues of corporate citizenship Manager were already being addressed within the company, but in a siloed fashion. Rather Sharon Mulligan than adding more individual programs to this menu of activities, Petro-Canada Newly-appointed Director, Corporate Responsibility wanted to build upon what existed and use current successes to encourage a more integrated and robust corporate citizenship program. David Stuart Senior Director, The punchline Environment, Health, Safety, and Security (EHS) • Don’t reinvent the wheel. Build on what exists, starting with where you are. • Leverage success to demonstrate the value of corporate citizenship. John Young Manager, Aboriginal Affairs • Portraying corporate citizenship as something “new” and “big” can breed resistance; allow employees to see how it fits into the known.

Background Hazel Gillespie, community investment manager; David A common obstacle to advancing corporate citizenship is Stuart, senior director, environment, health, safety, and often resistance to change. In this context, executives may security (EHS); and John Young, manager of Aboriginal view this change as a potential drag on resources, and affairs used these initiatives to address different aspects of employees may see it as another top-down initiative added corporate citizenship — stakeholder engagement, vision to their plate. Anticipating this resistance, the corporate cit- and values, and performance management. izenship practitioners at Petro-Canada recognized they could use existing activities as a solid foundation for Corporate Reputation Management Team momentum. Incremental change rather than a sweeping In 1997, a cross-functional “social vision” team was formed initiative would be the name of the game. to develop a focused community investment strategy for After debating the best way to move corporate responsibili- corporate giving and community development. The group ty forward, Petro-Canada’s practitioners identified three initially sought to align employees’ community-related areas. These “handholds” would enable the practitioners to interests with an enhanced corporate strategy. As a result, use existing work to build momentum for the longer-term the community investment program’s activities are now vision of corporate responsibility. “guided by the social vision to invest Petro-Canada energy to develop talent, expertise, and innovation through educa- The three key initiatives for this approach included: tion,” says Gillespie. She adds that “the process enabled many pieces to come together to create a strength,” and • Corporate Reputation Management Team – A cross- everyone came away able to “sing from the same sheet.” functional group to better understand Petro-Canada’s reputation and ways to strengthen it. During this process, larger issues were raised around how • Aboriginal Relations Framework – A five-part strategy Petro-Canada wanted to be perceived by the community, that was the result of the Aboriginal Relations team’s and in 1998 a team was created to manage reputation. The work over a 12-month period to align Aboriginal com- corporate reputation management team is comprised of munity needs to the company’s business activities. members from corporate communications, EHS, investor • Total Loss Management System – A business-wide per- relations, human resources, community investment, and formance management system based around 10 key ele- the business units. Since the team came from such diverse ments related to environment, health, and safety. areas of the business, several months were dedicated to dis-

60 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship covery and building consensus. One of the group’s early Total Loss Management outputs was a set of four key messages that convey the ethos Petro-Canada’s approach to managing the impact of opera- of Petro-Canada: 1) strong business capability; 2) highly tions on people, the environment, and corporate assets was principled; 3) successful track record; and 4) positioned for developed to close the gap between policy and operational a world-class future. reality and cuts across business unit lines and geographic boundaries. The system, known as total loss management These messages bring consistency to company communica- (TLM), involves 10 elements that set expectations and meas- tions and act as a unifying framework. ure and assess performance around issues such as product quality; employee well-being; and environment, health, and Aboriginal Relations Framework safety. This integrated system also serves as a mechanism In 2001, Petro-Canada established a formal strategy for for future improvements through ongoing evaluations, gap engaging Aboriginal peoples in Canada centered on the assessments, audits, and system refinement. Since its 1997 principle of mutual respect. John Young, manager of implementation, TLM has been revised to align with busi- Aboriginal affairs, describes the genesis of this cross-func- ness needs and emerging quality and environmental stan- tional program: “In order to remain aligned with corporate dards. Recently, some elements of the system were modi- values, Petro-Canada wanted to shift to a proactive, consis- fied in accordance with ISO 14001. tent approach, and to ensure adequate resources were The holistic nature of TLM integrates numerous activities attributed. Petro-Canada also wanted a central coordinating that fall under the umbrella of corporate responsibility; it is role to track activities, ensure accountability from line staff widely recognized as a flagship program. Used at all levels to executives, and define processes and reporting.” to track operational performance, TLM was able to over- Rising expectations from Aboriginal communities come the resistance often associated with large-scale increased national government attention to this issue and change. It also appeals to external stakeholders, as audit some key court decisions stimulated a review of existing results are available through social and environmental policies, resulting in the realization that an integrated and reports. The success of TLM and the engagement of all lead- disciplined approach was required. The group developed an ers and employees have allowed the organization to use it as inclusive strategy over the following year. Stuart and his a model for other corporate responsibility efforts. team interviewed 25 people, from the CEO down, and then tested early iterations of the framework with internal stake- Alignment: the Path Forward holders, government representatives, and within Aboriginal These three areas of activity were part of the critical founda- communities. The finished product is a framework outlin- tion that allowed for a more concerted effort around corpo- ing a comprehensive, two-way engagement between com- rate responsibility at Petro-Canada. Ultimately, a confluence munity leaders and the cross-functional team, comprised of of external pressures, new business strategies, and these key line and staff personnel. three successes allowed for this engagement and the subsequent push forward. “I think the stars have to be aligned,” With Young as the company’s Aboriginal relations point says Stuart. “There was readiness around it. The company person and the formal engagement process established, line had acquired Veba Oil and Gas, giving Petro-Canada a managers are also able to see the company-wide strategic greater international presence, and there was the Talisman approach to Aboriginal community needs. Sharon situation, so there were concerns about how we managed Mulligan, director of corporate responsibility, is looking to that part of the business. We had successes around the total the successes from implementation of this framework as loss management standards, the Aboriginal strategy, and she implements new human rights guidelines internation- Hazel’s social vision work.” ally. “The Aboriginal framework is a good example,” Mulligan says. “There have been many learnings from that As Stuart notes, this alignment is the key to moving for- model that are being applied now in pulling together ward. Before this effort, he says, executives were “more human rights policies and practices and understanding neutral than engaged, and for it to be successful, we need- how to integrate these practices at the front line in a practi- ed to have them engaged.” cal way.”

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 61 Section title here

PROFILES IN ACTION These case studies examine the reality of professionals initiating action and building momentum for the integration, alignment, and institutionalization of corporate citizenship.

62 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Appendix

Appendix A EXECUTIVE FORUM ON CORPORATE CITIZENSHIP TIMELINE

Intake interviews Summer 2002 Plenary Session #1: Boston

2002 October 2002 • Introductions Teleconvening 1: Kirk Stewart of Nike • Motivations for corporate on Nike v. Kasky citizenship Teleconvening 2: Dave Stangis of Intel • Integrating mechanisms on the role of the CSR manager Teleconvening 3: Group check-in

Plenary Session #2: San Francisco April 2003 Teleconvening 4: Steve Lydenberg of • Theories of change Domini Social Investments on • Measurement Socially Responsible Investing • Creating allies and political Teleconvening 5: Group check-in and mapping discussion around management support 2003

Teleconvening 6: Geoffrey Bush of Plenary Session #3: Boston Diageo on their measurement October 2003 program • Introduction to integration & institutionalization Teleconvening 7: Chris Tuppen of • After action review British Telecom and his measurement • Stake in the ground & goal setting of the “vital few” Teleconvening 8: Martin Sandelin of Nokia on their global community involvement Plenary Session #4: Calgary May 2004 • Integration and institutionalization: Outtake Interviews drivers, values and delivery Summer 2004 mechanisms • Stages of corporate citizenship • Engaging the lines of business

Teleconvening 9: Mitch Jackson of FedEx on their hybrid truck program Teleconvening 10: Kathy Reed and Plenary Session #5: Boston Keith Miller of 3M on operationalizing 2004 September 2004 values • Learnings from the Executive Forum • Then and now: lessons learned and progress made • Moving corporate citizenship Final report released forward Spring 2005

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 63 Appendix B EXECUTIVE FORUM COMPANIES AT A GLANCE

Agilent JPMorgan Levi Strauss Petro- Unocal Verizon Abbott AMD Technologies Chase & Co. Canada Corporation Communications

2004 Revenues, in billions $19.7 $5.0 $7.18 $46.1 $4.1 $14.4 $8.2 $71.28

# of employees 60,000 14,480 28,000 160,000+ 8,850 4,700 6,590 210,000 +

Industry Healthcare Semiconductor High Tech Financial Branded Oil and Gas Oil and Gas Tele- Pharmaceutical Services Apparel communications

Ownership NYSE: ABT NYSE:AMD NYSE:A NYSE: JPM Privately held NYSE: PCZ NYSE: UCL NYSE: VZ by descendants TSX: PCA of the Levi Strauss family

Regions 130 countries Corporate Facilities in Operations Global North Major Provides local locations in the more than in more trademarks, America, activities phone services U.S. and oper- 30 countries; than 50 licensees, Northwest in Asia, to about one ations and product countries sales, and Europe, especially third of the U.S. manufacturing development manufacturing North Africa/ Southeast population, in 29 facilities in tin the U.S., Near East, Asia, and states the US, China, Northern North Europe, Japan, Germany, Latin America and Asia Japan, America Malaysia, . Singapore, Australia, and the UK

Year Founded 1888 1969 1999 Earliest 1853 1975 1890 2000 predecessor in 1799. July 2004 merger with Bank One

Products Pharmaceutical Micro Technologies Investment Design and Explores, Oil and gas Local and long and medical processors, for customers banking, market jeans, develops, exploration distance phone products, flash in communi- financial casual and produces development service, broad- including memory cations, services for dress pants, and markets and band and wire- nutritionals, devices, and electronics, consumers tops, jackets, crude oil, production. less services, devices, and low-power life sciences, and and related natural gas Equity directory pub- diagnostics processor and chemical businesses, accessories; and natural interests in lishing, and solutions for analysis financial license gas liquids, certain electronic com- the computer, transaction trademarks in including petroleum merce services. commun- processing, various propane, pipeline cations, and asset and countries for petroleum companies, consumer wealth accessories, products wholly owned electronics management, pants, tops, and pipeline industries and private footwear, lubricants terminals and equity home, and natural gas other products storage business in North America. Producer of geothermal energy in Indonesia and Philippines

Headquarters Abbott Park, IL Sunnyvale, CA Palo Alto, CA New York, NY San Calgary, Los New York, NY Francisco, CA AB Canada Angeles, CA

64 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship

Appendix

Appendix C Corporate Values

Company Values Respect for people Integrity and responsibility Competition Knowledge Initiative and accountability Our customers’ success Uncompromising integrity Trust, respect and teamwork Innovation and contribution Focus Speed Accountability Focus on the customer first. Think globally, execute locally. Set the highest standards of performance. Strive to be the low-cost provider through efficient and great operations. Don't compromise our integrity or our reputation. Execute superbly with skill and urgency. Maintain rigorous financial and risk disciplines to build and maintain our fortress balance sheet. Act and think like an owner and partner. Operate as one team. Communicate honestly, clearly and often. Value and promote diversity. Create an open, entrepreneurial meritocracy for all. Strive to build a great company for employees, shareholders, customers and our communities around the world. Be a leader. Empathy – Walking in other people’s shoes Originality – Being authentic and innovative Integrity – Doing the right thing Courage – Standing up for what we believe Results-focused Trustworthy Professional Respectful Decisive Honesty Integrity Excellence Trust Bring the benefits of communications to everyone with integrity, imagination and passion Create the most respected and innovative brand in communications Keep our promises to customers, communities, shareholders, and employees Ensure that the success of our company is vested in the future of all those with whom we connect

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 65 Appendix

Appendix D ISSUES ANALYSIS At AMD, Philip Trowbridge and his cross-functional advisory group used this matrix as a way to prioritize issues and strategize the road ahead for corporate citizenship.

Programs Priority S.W.O.T. (Strengths, Weaknesses, Opportunities, Threats)

What Do we have Importance opportunities What a program If not, do Rating What are What are our are available threats do to address we need (1 = High; Priority our strengths weaknesses to us in we face in issue? a program? 3 = Low) Ranking in this area? in this area? this area? this area? ECONOMIC RESPONSIBILITY Corporate Governance Code of Ethics Socially Responsible Investing Risk Management/ Crisis Management Business Continuity Planning SOCIAL RESPONSIBILITY Supplier Diversity Supply Chain CSR Workplace Safety Employee Wellness Employee/Leadership Development Code of Conduct Community Involvement Corporate Philanthropy Employee Commitment Human Rights Workforce Diversity Talent Attraction/Retention Wages & Benefits Customer Satisfaction/ Relationship Management Knowledge Management/ Organizational Learning E-Readiness/E-Learning Stakeholder Engagement Product Stewardship ENVIRONMENTAL RESPONSIBILITY Environmental Policy/ Management Resource Conservation Design for EHS - Products Design for EHS - Manufacturing/R&D Climate Change Customer EHS Inquiries Environmental Preferred Purchasing COMMUNICATION CSR/Sustainability Questionnaires Sustainability Report Balanced Scorecard Corporate Strategy

66 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship Appendix E Ten Half-Truths of Integrating Corporate Citizenship

Every day, more companies come to value the opportunities that corporate citizenship presents – both to business and society. Becoming a leading citizen requires companies to institutionalize and integrate corporate citizenship into company strategy, operations and policies, in all areas and at all levels.

In our direct research with leading companies, The Center for Corporate Citizenship at Boston College has analyzed the tactics that conventional wisdom suggests are essential to integrating corporate citizenship, from making the business case to producing a social report. This list describes ten of those tactics but also reveals the half-truths behind them: Yes, these tactics can spark momentum. But, the same tactics can also act as traps or hinder progress.

The bottom line? Consider each tactic within the broader corporate strategy and business environment to drive corporate citizenship forward. Each tactic is a means to an end rather than an end in itself, and several tactics should be pursued simultaneously to maximize their potential benefits.

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management • 67 Appendix E Ten Half-Truths of Integrating Corporate Citizenship

YES … HALF-TRUTHS BUT …

Connects corporate citizenship Can be overstated, underwhelming, to the business agenda and opens 1 and mask the real value of corpo- the door to more strategic Make the business case rate citizenship as a core organi- discussions zational element; can inhibit strategic thinking Ties the company to the legitimacy Can lead to volumes of data to of third-party objectives; provides a 2 fulfill “box-checking” compliance; structure for measurement Adopt an external code may not translate into company- or standard specific vision and actions that advance and deepen corporate citizenship Provides a powerful motivator; Can put company in reactive mode; leverages a well-established 3 corporate citizenship can lose its Make risk mitigation business concept orientation toward opportunity a primary driver

Ensures priority status and is Waiting for executive endorsement essential to securing resources 4 can delay progress and inhibit Get buy-in from the top activities where approval is unnec- essary; support at the top does not ensure support throughout the organization Assigns an owner to foster Can result in the perception of cor- alignment between corporate 5 porate citizenship as a unilateral Designate an owner of citizenship and company strategy responsibility and peripheral to the corporate citizenship core business Drives accountability and puts Can be a time-consuming bureau- company on the public record; 6 cratic exercise that distracts from Produce a social report focuses internal attention on progress; can become a substitute corporate citizenship for actual corporate citizenship activity Creates a forum to share issues and Can be seen as a meeting-for-meet- knowledge across the company; 7 ing’s-sake; can create competition Convene a cross-functional produces new ideas, synergy, and between staff and line committee alignment Broadens buy-in and ensures Can result in fragmented, inconsis- corporate citizenship links with 8 tent activity and commitment in Engage the line organization business strategy the absence of an integrating mechanism Increases comfort level and reduces Can dampen innovation and ener- resistance; provides a “tried-and- 9 gy over time Build on existing policies true” approach; can jump-start and systems corporate citizenship Builds deeper connections to 10 Can diffuse the corporate stakeholders, leverages outside Form cross-sectoral citizenship agenda; doesn’t replace perspectives, and can build exciting partnerships internal commitment to stakehold- programs er engagement

©2004 The Center for Corporate Citizenship at Boston College. All rights reserved. This was prepared by The Center for Corporate Citizenship at Boston College and is not to be reprinted without permission of The Center.

68 • THE CENTER FOR CORPORATE CITIZENSHIP AT BOSTON COLLEGE • www.bc.edu/corporatecitizenship The Center for Corporate Citizenship at Boston College, a membership-based research organization, is committed to helping business leverage its social, economic and human assets to ensure both its success and a more just and sustainable world. As a leading resource on corporate citizenship, The Center works with global corporations to help them define, plan and operationalize their corporate citizenship. Through the power of research, executive education and the insights of its 350 corporate members, The Center creates knowledge, value and demand for corporate citizenship.

www.bc.edu/corporatecitizenship

A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management A RESEARCH CENTER AT BOSTON COLLEGE • The Wallace E. Carroll School of Management INTEGRA TION: CRITICAL LINK FOR CORPORA TE CITIZENSHIP • The C