Climate Change and Social Responsibility

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Climate Change and Social Responsibility

• A Reality Check
• Dr James Bellini 20 April
  2008

2
CSR Defined

• CSR is about corporate behaviour
• That behaviour includes
• What you do or say
• What you do not do or say
• CSR is not only about climate change

3
Its All In The Mind
The successful companies of the future will base
their strategies on a healthy corporate psyche
founded on clarity, integrity and authenticity
4
The New Scarcities

• Time
• Attention
• Trust

5
The pressure to deceive is felt everywhere in
business and deceptions are ethically
justifiable departing from the strict truth
and the golden rule is part of the strategy of
business. Albert Z Carr Is Business Bluffing
Ethical? Harvard Business Review
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(No Transcript)
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Building The Company Trust Bank
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What Trust Is Not

• Familiarity
• Heritage
• Low cost
• Local
• Availability

9
Who trusts whom?
trusted to tell truth - of sample
MORI
10
Future Conditional

• Blueprint for Tomorrow?

11
The Millennials Agenda

• Authentic companies
• Courageous leaders
• Sustainable future

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Millennium Poll

• Public opinion on the changing role of companies
• 25,000 citizens worldwide
• Most important corporate values by rank
• 1. Social responsibilities
• 2. Brand quality / reputation
• 3. Financial success

13
The World in 2032

Key Issues
Oil famine
Climate change impact
Future Leaders Survey 2007
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The New Agenda

• 86 agree material consumption must reduce
• 66 think 4x4s should be banned from city centres
• 41 support personal carbon quotas

Future Leaders Survey 2007 - 08
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• This world cannot continue to function the
  way it is if we wish to live out the next hundred
  years.
• Not only do both government and the
  individuals perspectives on the environment
  need to change, but also the way we relate to
  each other
• Camilla van Klinken, 18,
  Netherlands
• Future Leaders Survey
  2007- 08

16

• There is no trade-off between economic growth
  and responding to climate change. Either we do
  something about it, or all our growth will go to
  waste when climate change begins to wreak havoc
  with markets, international relations and the
  world in general
• 
  
  
  Matt Bardley, 18, Cardiff
  University

Future Leaders Survey
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Corporate Denial

• Casebook

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• The national science academies of the G8
  nations and Brazil, China and India, three of the
  largest emitters of greenhouse gases in the
  developing world, have signed a statement on the
  global response to climate change...and call on
  world leaders to ... acknowledge that the threat
  of climate change is clear and increasing
• June 2005

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Case Study in Denial

• We in ExxonMobil do not believe that the science
  required to establish this linkage between fossil
  fuels and warming has been demonstrated
• Lee Raymond Chairman/CEO ExxonMobil
  2002

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• In September 2006, the Royal Society wrote to
  ExxonMobil to express concern that some of its
  corporate publications were presenting a
  misleading view of the scientific evidence about
  climate change
• The Society raised concerns about Exxon's
  position on climate change and the company's
  funding of lobby groups that misrepresented the
  science
• Although we have exchanged further letters
  with ExxonMobil, it has still not addressed this
  issue

Royal Society press release
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(No Transcript)
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EXXON VALDEZ

• Good Friday 1989
• 1100 miles Alaskan coastline affected
• Clean-up bill 3.5bn private lawsuits
• Two years after 70 believed still polluted
• 34th largest spill in history - not large but
  effects on reputation critical

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Case Study in Denial
Alaska Oil Spill An Act of God
ExxonMobil management
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Case Study in Denial
On oath before Congress 1994
The presence of nicotine does not make
cigarettes a drug or smoking an addiction
Q Does smoking cause lung cancer? A I do not
know.
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The Badvertising Backlash
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A Crisis of Trust

• The 21st Century Corporate Agenda

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Dishonesty Pandemic

• Enron
• WorldCom
• Tyco
• Qwest
• Global Crossing
• Arthur Andersen
• ...........

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Dishonesty Pandemic

• HIH -- 4 billion
• Parmalat -- 10 billion
• Ahold -- 500 million
• Mannesmann six
• execs tried for
• breach of trust
• over 57 million bonuses
• Multiple scandals in Japan

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THE MAP OF CORPORATE MISCONDUCT
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10 of the 15 biggest bankruptcies in history
have occurred since 2001 All have been driven
by massive corporate dishonesty
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Corporation  n. artificial person
created by charter an entity unto itself under
the law.
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The corporations legally defined mandate is to
pursue, relentlessly and without exception, its
own self-interest, regardless of the often
harmless consequences it might cause to others.
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Traditional Mistrust Model
You are here
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Virtual Trust-based Model
Contingent specialist
Knowledge broker
Customer
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The Company A Living Organism

• A company has psychological verities
• Corporate psyche can be analysed
• Psyche can develop dysfunctions
• Dysfunctions block clarity
• Lack of clarity
• imperils psychological contract
• threatens corporate survival

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Doing Business in 2020

• The successful organisation of 2020
• will have no HQ, no CEO, own no IT and will have
  one-tenth the fixed assets
• it has today
• Its most vital competitive resource will be the
  authenticity and trust it has built with its
  stakeholders

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CSR A Progress Report
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CSR Value Curve
Growth platform
Efficiency
Value-based self regulation
Strategic philanthropy
Legal and compliance
IBM Institute for Business Value
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The Future Company?

• HYPER-ORGANISATION
• Win
• Strip out unnecessary Ps
• Positions
• Processes
• Purchases
• People
• Order workplace lives to match corporate goals

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The Future Company?

• HYPER-ORGANISATION
• Win
• Strip out unnecessary Ps
• Positions
• Processes
• Purchases
• People
• Order workplace lives to match corporate goals

• DISORGANISATION
• Align with personal values
• Mirror individual identities
• Flatten hierarchies
• Integrate workplace lives with non-work goals

41
Lost Opportunity

engaged in CSR activities
IBM Institute for Business Value
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Exploring Corporate Psyche

• What drives corporate behaviour?

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A New Psychological Contract

• We are moving from the Industrial Age
• to the Connected Age
• Business needs a new mental
• model of how to engage in
• relationships with its stakeholders
• Trust and truthfulness are key

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The central theme of The Bullshit Factor is that
organisations and people inhabit the same
psychological universe and that, like people,
organisations can have psychological issues.
These issues are manifested in patterns of
behaviour that reflect levels of
untruthfulness, misperceptions, delusions or
some other deceit.
The Bullshit Factor p 171
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What Makes A Healthy Psyche?

• Objective perception of reality
• Naturalness simplicity spontaneity
• Empathy for humanity
• Democratic characteristics

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Goodbye Gordon Gekko A New Business Ethos

• Healthy Corporation
• Civilised Workplace
• Nice Company
• No-jerks rule
• Our people are hired and fired for attitude
  SouthWest Airlines

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Companies On The Couch
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Case Study in Arrogance
Caught with their pants down?
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Case Study in Arrogance
Food Is Survival
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Portrait in Courage GEs Jack Welch

• Routinely fired worst-performing 10 per cent
• Neutron Jack
• 100,000 jobs disappeared during his tenure

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Portrait in Courage GEs Jack Welch

• Took GE in 20 years from 26.8 bn to 130 bn
• Company share price rose 4000
• I want bosses to have more candour, less
  bullshit

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Semco A Maverick Corporation

• KEY PRINCIPLES
• Be dependable and reliable
• Value honesty and transparency above all
• Encourage creativity support the bold
• Question decisions imposed from the top
• Pleasant and informal environment
• No dress code voluntary meetings mandatory
  vacations
• Employees set hours and wages, choose IT

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Principled Leaders A Checklist

• Personal humility, not ego
• Ambitious for organisation, not themselves
• Defend beliefs with courage
• Nurture core values integrity
• Hire people of right character

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Elements of Courage

• Consumers, employees, leaders
• New consumer equation / precision markets
• Optimum talent mix
• Metanoia for business decision-makers
• Virtuous circle in the workplace
• Clarity, honesty, integrity
• End to workplace schizophrenia
• Principled leaders

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Climate Change and Social Responsibility

• A Reality Check
• Dr James Bellini 20 April
  2008

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