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social responsibility as strategy

Page history last edited by PBworks 15 years, 9 months ago

I recently found this interview with michael porter, here:

 

A few years ago he says that companies view corporate social responsibility as a mere instrument of public relations or marketing. Por quê? Why?

MICHAEL PORTER I would say that the area of social responsibility has gone through two stages.  The first one was the reaction to political pressure, when companies were forced to provide answers to questions that they thought it their responsibility.  One is that of Nike, which at the beginning of the decade of 90 became a victim of a boycott on the part of consumers around the world to take its relationship with suppliers in Indonesia escancarada the press.  Companies were being criticized, and that generated a lot of bad publicity.   They then went to play some things - but not in ways voluntary.  It came the second stage, which began about five years ago, when companies began to realize that the social responsibility could be something positive in that it is worth being proactive.  They then went to enxergá it as a tool for building an image.

Why do companies have trouble leaving this stage? 

 

Normally, the companies have an economic strategy and a strategy of social responsibility, and what they should have is a strategy only.  In the decade of 90, wrote an article for the magazine Scientific America which explained how the company would be more competitive if take care of the environment. I was harshly criticized.  Today, it is known that there is a universe of opportunities there.  The same logic applies to other issues, which have already been digested by most companies, as investment in training and safety. 

What do you know about the movement of corporate responsibility in Brazil?

I would say that the majority of Brazilian companies is in the second stage.  I can not make a thorough analysis, but what I feel is that companies are very generous and invest a lot of money in their actions.  However, so many things at once, and few of them seem strategic.  In most cases, these actions are motivated by guilt, to improve the image, because in Brazil there is a great concern for social equity.

 

He says that companies should prioritize social issues to which will devote. Por quê? Why?

I have the feeling that there is much emphasis on "how" and little is spent to "how.  See Petrobras.  The company is very generous in the amount of resources which aims to its strategy of corporate responsibility and embark on a myriad of social issues.  This is a typical example of company that spreads its money everywhere in the attempt to be socially responsible.  Petrobras combat illiteracy, hunger, encourages the culture.  And in the middle of all this there are some jewels, projects related to the environment, biofuels - which are the areas in which their actions can actually have a greater impact.  We can examine other Brazilian companies and see the same pattern of behaviour.

 

 

But arent these noble causes?

They are all very noble causes, but make it clear that there is a lack of strategic focus.  A bank must help people of low income to save to finance housing, because it is what he believes. Supporting a company of dance is a social issue to a general energy, but it can become a competitive differential for a company credit card, which profits with the increase in consumer spending on entertainment.

You say that companies have become hostages of different audiences that influence in his administration, the so-called stakeholders. They overestimate the influence them?

Companies are very sensitive to external reviews.  And it is clear that the views of some stakeholders about the business are important.  What needs to be clear is that these groups will never understand depth with a business.  Companies should be careful not to succumb to pressure from some groups and pass skewing to believe that the cause is more important to them or to the world.  Companies that establish a strategy for social responsibility simply to aplacar constraints of certain stakeholders fall into a trap: now working to react to attacks, and it does not generate benefits for the business or to society.  Many NGOs that pressure companies, for example, are more interested in drawing the attention of the media for them than achieving any progress on a theme.

 

Already there are companies that can add a social dimension to the strategy and make money with it?

The American retailer Whole Foods is an excellent example.  The value proposition of the company is to sell organic or natural products to consumers who are concerned about the food you eat and with the environment.  And the social issues that permeate this proposition of value is allowing it to have a unique position in retail.  The company prioritizes the purchase of local suppliers, not put in gondolas foods containing any of the 100 ingredients that it considers harmful to human health or the environment and manage a foundation that strives to which animals are raised and slaughtered in a manner worthy, and other initiatives.  That is, everything that the company does reinforce the social dimension of his proposition of value.

But the market in which the Whole Foods operates facilitates this type of action, no?

Claro. Sure.  Not all companies can build its entire value proposition of on top of social issues, such as Whole Foods.  In the future, however, all good strategy should incorporate a social element, that make single, more difficult to be copied.  GE is trying to do this with the Ecomagination and its line of green products.  Unilever also in trying to create products and distribution systems to meet consumers of low income.  And the important thing is that this is real, and not marketing.  You see all these social aspects of Whole Foods to get in any store.  So what matters is not what you say, how much you spend or how many people support.  What is important is the result.  If what your company does cause actual impacts, she eventually gaining notoriety. 

Recently, you said that global warming should radically change the corporate scenario, the example of phenomena such as globalization and technological revolution. Companies are prepared?

There is much uncertainty about what is really happening to the planet, even with all the vehemence of former American vice president Al Gore.  What should be clear to the companies, however, regardless of what the science says about global warming is underway or not, it is better that they behave as if the phenomenon was happening.  And the first lesson to be drawn is that that save energy and minimize waste is good.  Good for the company, good for society.  The second is that the cost of emissions of gases causing the greenhouse effect will rise.  And these two factors are strong enough to reconfigure the whole structure of global corporations.

 

How?

Today, a company buying parts in China, which are then sent to Singapore, which go to the United States and to return to China as finished products to be consumed. How to move up will be very expensive, a flow like that becomes impracticable. Think of e-commerce itself.  I do not understand how people do not buy realized that the Internet is one of the most ecologically incorrect actions today.   Before you went to the bookstore to buy a book.  Today, you find more practical order a book from Amazon, in this small package makes all the travel from the United States to Brazil.   Within a scenario of global warming, that does not seem very efficient.   Therefore, I believe that the way companies organize their logistics and its relationship with suppliers will change dramatically.  Companies will be forced to return to buy locally. Many of the business models that today is not efficient remain so long and have to be reinventados. 

 

 

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