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Oil on Troubled Waters

Oil on Troubled Waters:

Can Shell Make Good in Nigeria?

Blog by Wayne Visser

Anyone who works in sustainable business or CSR will probably have cut their teeth on the classic (some would say infamous) case study of ‘Shell in Nigeria’. What makes it such a compelling case is that it has yet to reach any final resolution. Ever since Shell was tarred with the brush of bad publicity surrounding the execution in 1995 of environmental activist Ken Saro-Wiwa by the Nigerian government, it has struggled to regain its social license to operate.

My first direct encounter with Shell in Nigeria came a few years after the incident, when I was running KPMG’s sustainability practice in South Africa. In fact, KPMG’s sustainability practice in the Netherlands had worked closely with Shell to pioneer its triple bottom line reporting approach, and the KPMG Norway practice was working with Shell in Nigeria on sustainability reporting and environmental management.

Two things stick in my mind from that time. One was being rather puzzled by the failure of Shell Nigeria’s HSE (health, safety and environment) reports to mention the Saro-Wiwa fiasco, which was still very much at the forefront of protests and boycotts against Shell, both in the country and abroad. If ever there was an elephant in the room!

The second recollection was a trip to Nigeria by one of my team members to do an audit on Shell’s ISO 14001 system. When she returned, I was aghast to learn that, at one point, the Shell vehicle had been surrounded by an angry mob threatening violence, after which the team travelled to Shell sites by helicopter and with an armed guard.

I have subsequently visited Nigeria five times and had a chance to speak to many of those working on corporate responsibility in the country, including a number of Shell’s national sustainability managers. As a result, I am more convinced than ever that the case holds vital lessons for other companies in how to be more accountable in the 21st century.

Lesson 1: Perception is reality

Whether Shell was actually in any way complicit in Saro-Wiwa’s execution did not make any difference. The fact that they made a plea to the Nigerian government for clemency did nothing to change the public perception – shaped largely by activist NGOs like Greenpeace and organisations like The Body Shop – that Shell must be guilty of serious human rights and environmental abuses.

Lesson 2: If you lie with dogs, you wake up with fleas

One of the reasons that Shell was targeted was that it was (and continues to be) ‘in bed’ with the government, which today is a majority shareholder in the company. 95% of Shell’s revenue after costs goes to the Nigerian government. Rightly or wrongly, stakeholders believe that, given these close ties, Shell is little more than a puppet of a corrupt government.

Lesson 3: Beware the resource curse

Despite Nigeria’s vast natural wealth, the majority of its people remain poor. Shell paid $42 billion in revenues to the Nigerian government between 2008 and 2012. A further $5.2 billion was paid in royalties and taxes in 2012. Due to the greed and corruption of its politicians, very little of this money is spent on human development. Poor governance and transparency makes the economic and social contribution of companies as effective as moving around the deck chairs on the Titanic.

Lesson 4: Penalties for losing a social license to operate are high

Shell estimates that, of the 26,000 barrels of oil spilled in 2012, 95% was the result of sabotage and oil theft. Besides these serious economic and environmental impacts, the safety and security of Shell staff are also compromised. In 2012, two contractors were killed in an armed attack while assessing the remediation of an oil-spill site, and in 2010, 26 employees and contractors were kidnapped (down from 51 in 2009).

Lesson 5: Environmental damage is costly

Shell is installing equipment that will reduce gas flaring from its facilities at a cost of $2 billion, in addition to the $3 billion already spent to reduce flaring. In order to lessen its operational spills, Shell constructed a $1.1 billion replacement pipeline. At the beginning of 2012, there 316 sites in need of remediation from spills (they had cleaned nearly 80% by the end of the year).

Lesson 6: Trust begins with transparency

Shell actively promotes and participates in the Extractive Industries Transparency Initiaitve in Nigeria, in which all payments to government are publicly disclosed. Besides this, Shell as created a public website which tracks the company’s response to, and investigation and clean-up of, every spill from its facilities, whether operational or the result of sabotage.

Lesson 7: Communities expect more than promises

Shell uses a Global Memorandum of Understanding (GMoU) model (introduced in 2006) to formalise its community contributions. Communities identify their own needs, decide how to spend the funding provided by SPDC and its joint-venture partners, and directly implement projects. By the end of 2011, Shell had signed and implemented agreements with 290 communities, of which 30% are around their operations in the Delta. In 2011, 596 projects and $79 million was channelled through the GMoUs.

Lesson 8: Reward innovation and best practice

In 2012, Shell received recognition in Nigeria’s Social Enterprise Reporting Awards (SERA), run by Trucontact, for its $27 million Kobo Fund, which enables small Niger Delta contractors to access loans needed to finance the supply of goods/services to Shell. The company is also providing $6 million for the UN-led Global Alliance for Clean Cooking Stoves, which aims to supply 100 million homes by 2020.

Lesson 9: Go beyond philanthropy

Despite spending over £31 million on community projects in 2012, Shell’s commitment to sustainability in Nigeria is demonstrably focused on reducing the negative environmental and health impacts of their core business operations, while increasing of the positive economic and social benefits.

Lesson 10: Support better policy

In recent years, the Nigerian government has moved to legislate CSR, including a requirement to spend no less than 3.5% of gross annual profits per year on CSR. Shell would do well to oppose policy developments like this, which only serve to embed a philanthropic mode and act like a tax. Far better would be to encourage better legislation (and more importantly, better enforcement) on critical issues like labour rights, environmental management and anti-corruption.

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/08/blog_csrwire8_wvisser.pdf”]Pdf[/button] Oil on Troubled Waters: Can Shell Make Good in Nigeria?  (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Oil on Troubled Waters: Can Shell Make Good in Nigeria? Wayne Visser Blog Briefing, 7 August 2013.

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CSV: Revolution or clever con?

Creating shared value:

Revolution or clever con?

Blog by Wayne Visser

The Corporate Social Responsibility (CSR) movement has not delivered a system change. Creating shared value (CSV) can change this as it has challenged the narrow definition of corporate purpose to go beyond profit maximization.

‘The capitalist system is under siege. In recent years business has increasingly been viewed as a major cause of social, environmental, and economic problems.’ This was the statement made by Harvard professor Michael Porter and management consultant Mark Kramer in Harvard Business Review in 2011. The solution they propose is ‘creating shared value’ or CSV, which they are at pains to point out ‘is not social responsibility, philanthropy, or even sustainability, but a new way to achieve economic success.’ At its heart, they say, CSV is the way in which ‘businesses must reconnect company success with social progress.’

Porter and Kramer observe that ‘companies are widely perceived to be prospering at the expense of the broader community. Worse still, the more business has begun to embrace corporate responsibility, the more it has been blamed for society’s failures.’ Hence, for them, CSR is something of a red herring, which they describe as a ‘mind-set in which societal issues are at the periphery, not the core’ and ‘a reaction to external pressure—[which has] emerged largely to improve firms’ reputations.’

However, the question is whether CSR and CSV are really different? In fact, is CSV even a new concept, or just old wine in new wineskins? Porter and Kramer also argue that CSV is more preferable than fair trade. Is that true? In this brief article, I want to tackle some of these questions, as well as reflect on the true value of CSV and the future of CSR.

The first thing to place on record is that CSV reflects an evolution in Porter and Kramer’s own thinking. After a career spent focussing on economic competitiveness devoid of any consideration of social impacts, Porter teamed up with Kramer in 2002 to write about ‘the competitive advantage of corporate philanthropy’, which they then reframed in 2006 as ‘strategic CSR’. Hence, CSV is their third foray into the field of social responsibility – which rather ironically and explicitly disparages the previous two.

The second point is that CSV is nothing new. At the very least, we can say that it strongly echoes the work of C.K. Prahalad and Stuart Hart on serving markets at the ‘bottom of the pyramid’ (BOP), which dates back to 2002, as well as the idea of supporting ‘inclusive business’ – something into which the International Finance Corporation (IFC) has channelled $7 billion in over 80 countries since 2005. It is somewhat disingenuous and poor academic form that these foundational concepts were not even acknowledged by Porter and Kramer.

The third aspect of CSV that I take issue with is the way in which the duo characterise corporate social responsibility. I agree that some companies are still practising an immature form of CSR – which I have called CSR 1.0 – that is defensive and risk-based, philanthropic-oriented or PR-driven. However, numerous companies have moved on to a fourth stage – strategic CSR, as exemplified by the ISO 26000 standard – and some have even gone beyond that, to what I call transformative CSR, or CSR 2.0.

Not content to discredit social responsibility alone, Porter and Kramer also launch an attack on the fair trade movement, which they say ‘is mostly about redistribution rather than expanding the overall amount of value created.’ By contrast, CSV ‘focuses on improving growing techniques and strengthening the local cluster of supporting suppliers and other institutions in order to increase farmers’ efficiency, yields, product quality, and sustainability. This leads to a bigger pie of revenue and profits that benefits both farmers and the companies that buy from them.’ The fact that these aspects are integral to the work that the Fairtrade Foundation seems to have been conveniently overlooked.

Having said all that, if my short critical tirade has given the impression that I am against CSV, allow me to set the record straight: I am a CSV fan, and here are the reasons why: I believe it has injected a new energy into the CSR movement. It has cleverly changed the language of social responsibility into the language of value creation, which business leaders can better understand and it has challenged the narrow definition of corporate purpose to go beyond profit maximization. What is more, it has rightly advocated a better alignment between a company’s core strategy and the social problems that it can have an impact on.

At the end of the day, I am less concerned about the labels we use – be it CSR, BOP, corporate citizenship, sustainability or CSV – and more interested in whether the concept and practice are holistic and transformative. This means business has to embrace what I call the four DNA elements of responsibility: value creation, good governance, societal contribution and environmental integrity. It also means applying creativity, scalability, responsiveness, glocality and circularity to the business solutions to society’s needs. Lastly, it means calling for a transformation of capitalism – which I am pleased to see Porter and Kramer agree with. For a more resilient capitalism to emerge, I believe all future economic and business activity will need to be guided by five criteria:

  • Responsible investment – ensuring that money is channelled towards productive and sustainable investments, as the Co-operative and Triodos banks have done, and not into speculative trading in the casino eco
  • Long-termism – understanding that real wealth is created by adopting a long-term perspective, including the needs of future generations, as Generation Investment and Warren Buffet’s Berkshire Hathaway showcase;
  • Transparent disclosure – embracing transparency in revenues, in line with the International Integrated Reporting Council, Carbon Disclosure Project and Extractive Industries Transparency Initiative (EITI);
  • Full cost accounting – internalising social and environmental costs (externalities), either through taxes (such as those on carbon and pollution) and social and environmental profit & loss accounts (such as Puma’s); and last, but not least …
  • Inclusive development – serving the ‘bottom four billion’ markets, as demonstrated by the BOP 2.0 Protocol, and enacting Porter and Kramer’s concept of creating shared value.

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/08/blog_csv_csr_wvisser.pdf”]Pdf[/button] Creating shared value: Revolution or clever con? (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Creating shared value: Revolution or clever con? Wayne Visser Blog Series, 17 June 2013.

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Yin and Yang

Yin and Yang:

Striving for sustainable harmony in China

Blog by Wayne Visser

Waking dragon of the East

I first visited China in 2008, where I presented at the China Europe International Business School (CEIBS) conference on Responsible Competitiveness, in Shanghai. I was also a judge for the Innovate China International MBA competition. My initial impressions were that – contrary to popular belief – in the medium to long term, China may very well set an example for other countries and companies in terms of sustainability and responsibility.

A clue to my optimism came from something that William Valentino, CSR Director for Bayer in China, said to me: ‘Above all else, China prizes stability. And stability, in turn, can only be maintained under conditions of social upliftment and environmental improvement.’ Despite labour conditions remaining a concern, human rights abuses are starting to become the exception rather than the rule, and I believe China’s sustained economic boom is doing far more social good than harm.

Reconciling its new-found addiction to growth with environmental constraints, however, may prove its most difficult challenge yet. Elizabeth Economy, author of The River Runs Black, has studied China’s environmental challenges in depth and believes the crisis they face is deep and intractable. The facts she cited when I interviewed her for The Top 50 Sustainability Books, were sobering, to say the least. She told me China has 20 of the world’s 30 most polluted cities in terms of its air quality. Seven hundred and fifty thousand people die prematurely every year in China because of respiratory diseases related to air pollution.

Water is another major challenge. China has only 25% of the world’s average per capita availability of water. Something like almost 30% of the water that runs through China’s seven major river systems and tributaries is unfit even for agriculture or industry, much less any form of drinking or fishing. Between five and ten cities will completely run out of water by 2050. China is roughly one-quarter desert, and the desert is advancing somewhere between 1,300 and 1,900 square miles per year. Furthermore, 10% of China’s agricultural land is contaminated with heavy metals and other contaminants.

People like Amory Lovins, founder of the Rocky Mountain Institute, is more optimistic. He told me that China is the only country that’s cut its energy intensity over 5% a year for a quarter of a century. They are the world leader in distributed renewable sources of power and is the only country that has energy efficiency as its top development priority. To be sure, implementation is at an early stage. But, Lovins said, China has better leaders than we do, are more highly motivated and work harder. ‘For all these reasons, I think we can rely on China to lead the world out of the climate mess.’

William McDonough, co-author of Cradle to Cradle, shares these sentiments. He told me that while  …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/08/blog_csrwire7_wvisser.pdf”]Pdf[/button] Yin and yang: Striving for sustainable harmony in China (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Yin and yang: Striving for sustainable harmony in China, Wayne Visser Blog Series, 31 July 2013.

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Going glocal with CSR

Going glocal with CSR:

Multilateral musings in Mexico

Blog by Wayne Visser

In some senses, my CSR quest world tour, which was the main inspiration behind The Quest for Sustainable Business, started back in December 2007, on a trip to Guatemala. The main purpose of the visit was to launch The A to Z of Corporate Social Responsibility at the Inter-American Development Bank (IADB) annual conference on CSR. That was when the seed of the idea was planted—while talking to my colleague and co-author, Professor Dirk Matten, over a glass of celebratory champagne in the hotel bar late one night.

One of the greatest insights for me had come after a tour we had at a local sugar plantation. The company had prepared a presentation on its approach to CSR, and imagine my delight when I saw that it also had a CSR pyramid! The interesting thing, however, was that it was not Carroll’s CSR pyramid or a Prahalad and Hart’s BOP pyramid. Economic responsibility was still seen as most important, and depitcted as the bottom layer of the pyramid, but the next most important responsibility was to the families of the plantation’s employees. The third tier was community responsibility and, rather intriguingly, the apex of the pyramid was ‘engagement in responsible national policy development’.

Was that company right and others wrong in its interpretation of CSR? Of course, they were right. That is the beauty of ‘glocality’. It is not an ‘either–or’ mentality, but a ‘both–and’ approach. The other interesting observation is that they had formed a cooperative of farms in order to tackle CSR. Individually, they were too small to justify a sustainable business programme, but collectively, it made sense. This is one of the ways that SMEs can address sustainable business, through pooling their resources and collaborating.

I gained more insights into sustainable business and SMEs when I visited Mexico in 2008, at the invitation of Jorge Reyes, Director of the IDEARSE Centre at Anahuac University, which is doing some excellent work on the subject. In 2009, I was invited back to deliver the keynote address at its 7th International CSR Conference, and again in 2010 to run a workshop, so I got to know a little bit about its research programme.

In response to a government-sponsored project aimed at SME growth acceleration, IDEARSE put together an approach for supporting growth of the businesses through the implementation of a sustainable business administration model that would develop competitive advantages for the companies. Built into its business training programme, therefore, were six elements for SME development: self-regulation, stakeholders, human rights, environment, labour and social/community impact. Working with the supply chains of big brands such as Sony, Coca-Cola and Cemex, IDEARSE have taken more than many SMEs through the programme, with impressive results. On average across the six sustainable business dimensions, the SMEs improved from a score of 23% to 43%, while simultaneously showing average annual sales growth of 30%. They have effectively demonstrated that CSR is perfectly feasible for SMEs and may even be constructed as part of a growth and competitiveness strategy.

In 2008, on another trip to Mexico City …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/08/blog_csrwire6_wvisser.pdf”]Pdf[/button] Going glocal with CSR: Multilateral musings in Mexico (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Going glocal with CSR: Multilateral musings in Mexico, Wayne Visser Blog Series, 24 July 2013.

 

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Creating shared value

Creating shared value:

How South Africa led the world in corporate governance & economic empowerment

Blog by Wayne Visser

The concept of shared value became increasingly important for business in South Africa during the 1990s, long before it was coined by the Harvard academic duo of Michael Porter and Mark Kramer. Fortunately for me, I had a front-row seat.

In 1997, having helped to kick-start the South African New Economics (SANE) Foundation, I then joined the global accounting firm KPMG. My mandate was to establish an Environmental Unit, which later evolved to incorporate social, economic and ethical dimensions and become KPMG Sustainability Services. Over the next six years, I advised numerous companies, many of them multinationals, on how to improve their sustainability performance.

So, what of lessons? There are two that I want to share and both are areas in which I believe South Africa has made a significant contribution to the worldwide quest for sustainable business. The first is corporate governance and the second is economic empowerment.

Challenging shareholder supremecy

Following the success of the UK’s Cadbury Report in 1992, South Africa launched its own King Report on Corporate Governance in 1994, under the chairmanship of former High Court judge and company director, Mervyn E. King. King went much further than Cadbury in recognising the non-financial aspects of corporate governance and incorporating the concept of wider stakeholder accountability. In later updates, in 2002 and 2009, the King Report placed sustainability and responsibility at the heart of corporate governance.

When I caught up with Mervyn King in Turkey a few years ago, he told me that directors are accountable to the company first, not to shareholders, and that a broader set of stakeholders provides a better perspective on what is good for the company in the long term. It is no coincidence that he went on to chair the GRI and now spearheads the International Integrated Reporting Council (IIRC).

Although the King Code is a voluntary standard, in common with other corporate governance codes around the world, the Johannesburg Securities Exchange (JSE) made compliance with the code a listing requirement. This had a dramatic effect. By 2003, 85% of South Africa’s top companies were already practising annual reporting on sustainability-related issues, and 77% of the companies referenced the existence of an internal code of ethics or code of corporate conduct.

There is a downside to the boom in sustainability reporting since the 1990s, evident not only in South Africa but around the world. I believe it has distracted us from a related, and in some ways far more important trend, namely social and environmental accounting. This refers to financially quantifying the social and environmental impacts of business, or to use economics jargon, pricing the ‘externalities’.

In fact, while at KPMG, I helped a large chemical company to design an environmental accounting system. At the time, social and environmental accounting was a strongly emerging field, under the intellectual leadership of UK academic Rob Gray, and the pioneering efforts of companies such as BT, Baxter International and Ontario Hydro. Today’s much-hailed environmental profit and loss account of Puma is actually 15 years behind the times …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/08/blog_csrwire5_wvisser.pdf”]Pdf[/button] Creating shared value: How South Africa led the world (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Creating shared value: How South Africa led the world in corporate governance & economic empowerment, Wayne Visser Blog Series, 17 July 2013.

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Ties that Bind: Experiments in Community Business

Ties that Bind: Experiments in Community Business

Blog by Wayne Visser

After graduating in business studies from Cape Town, in 1992 I started a 4-month management traineeship programme with the Royal Bank of Canada in Kingston, Ontario. During this time, I came across the inspiring research of Professor Greg McLeod from Cape Breton University, written up in his Community Business Series booklets (and later, in From Mondragon To America – Experiments In Community Economic Development). Having worked in community development for over 30 years, McLeod was concerned about rootless capital – the trend of companies funded by absentee investors with no stake in the communities in which the business operates.

This is when I first learned of the amazing experiment in community business that had being going on for decades in Mondragon, a small town in the mountainous region of north-eastern Spain. Here, based on the teachings and initiatives of a Roman Catholic priest, a business comprising one electric stove manufacturer with five employees established was in 1955. Today, the Mondragon corporation is a complex of co-operatives with €36 billion ($46 billion) in assets and €13 billion ($17 billion) in sales, employing 80,000 people – all of which actively pursue a philosophy of local community development based on the values of co-operation, participation, social responsibility and innovation. With companies operating across four divisions (finance, industry, distribution and knowledge), Mondragon is today the foremost Basque business group and the seventh largest in Spain. For those who are interested to know more, there is a great series of blogs about Mondragon by co-founder and former CEO of Seventh Generation, Jeffrey Hollender.

Of course, not all community businesses are large. A much smaller-scale venture that interested me at the time was New Findhorn Directions (NFD), established in 1979 as an umbrella body for businesses operating from the Findhorn Foundation eco-community in Scotland. As it happened, I visited the community after my traineeship in Canada, and again in 1996 when I began my Masters in Human Ecology in Ediburgh. The businesses in place at that time included the Wood Studio, Bay Area Graphics, Findhorn Bay Apothecary, Weatherwise Solar and Alternative Data. They also had a pioneering eco-housing project (which included houses made from whisky barrels). What united these diverse companies were that they were all trying to demonstrate a broader community philosophy of ‘spiritual management’ and ‘work as love in action’.

What can we learn about corporate responsibility from these somewhat eccentric experiments in community business? The first point to note is that these businesses exist within a different (some might say counter-mainstream) micro-culture. The common objective in places such as Findhorn in Scotland and Mondragon in Spain is community and environmental improvement, including through enterprise. They are not hungry for short-term profits; rather, they are pursuing long-term sustainable development strategies. The desire is to be autonomous and self-sustaining and, most of all, to promote local self-development rooted in history and tradition. These two examples serve to illustrate that success stories in alternative ways of doing business do exist. The details of exactly how they are different, however, still need more thorough exploration …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/07/blog_csrwire4_wvisser.pdf”]Pdf[/button] Ties that Bind: Experiments in Community Business (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Ties that Bind: Experiments in Community Business, Wayne Visser Blog Series, 10 July 2013.

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Meme-Splicing in the Land of the Rising Sun

Meme-Splicing in the Land of the Rising Sun

Blog by Wayne Visser

Kaizen, Sushi and Toyota

My career in sustainable business really got started in September 1990, when I attended AIESEC’s World Theme Conference on Sustainable Development in Tokyo, Japan. This was an opportunity of a lifetime. As a management student, I was all too aware of the rise of the Asian tiger economies, especially Japan. The West was spellbound by the revolution of total quality management (TQM), which the American statistician Edward Deming had introduced to Japan in the 1970s. The Japanese had perfected TQM through their kaizen philosophy of continuous improvement or ‘change for the better’.

The aim of the conference was to create a contribution to the 1992 Rio Earth Summit in 1992, which we called ‘A Youth Action Guide on Sustainable Development’. We also had study tours, most notably to the Toyota headquarters in Nagoya, where we met with the senior management team. I remember being served a sushi style lunch in square plastic trays, each morsel neatly and aesthetically arranged. Apart from glimpsing the highly automated production line, we had a chance to explore the company’s R&D display area. I was amazed by numerous eco-efficient and alternative fuel technologies already in the mature stages of development.

Having seen all this in 1990, it was no surprise to me that Toyota led the motor industry with its sustainability reforms nearly 20 years later, launching the Toyota Prius hybrid technology and RAV4 EV all-electric vehicle in 1997. With around 3 million Prius cars sold and the RAV4 EV relaunched in partnership with Tesla Motors in 2012, other automotive companies have been falling over themselves to catch up and introduce their own hybrid and electric models. This is one of those rare moments when we are seeing a ‘race to the top’ on environmental performance.

Earth Charter, Zero Waste and Fuji-Xerox

One of my great insights from the trip was that ‘vision’ is something the Japanese really understand. Shortly after my visit and ahead of most companies in the world, in 1992 Toyota issued its Environmental Guiding Principles and adopted its own Earth Charter. What is interesting is not that it has these principles (after all, many companies have flowery statements on their boardroom walls now), but rather the way they are expressed, which I believes conveys a qualitative difference in aspirations.

For instance, in its Guiding Principles it commits to ‘honour the language and spirit of the law’; to ‘enhancing the quality of life everywhere’; to ‘foster a corporate culture that enhances individual creativity’; and to ‘pursue growth in harmony with the global community’. And in its Earth Charter, it is already striving to ‘pursue production activities that do not generate waste’ and to ‘participate in the creation of a recycling-based society’. Note that it does not say ‘activities that reduce waste’; they say activities that ‘do not generate waste’. Hence, long before Ray Anderson at Interface conceived his much-celebrated ‘Mission Zero’ or McDonough and Braungart had popularised cradle to cradle concept, Toyota had understood and integrated the concept of a circular economy.

Of course, it is not just Toyota that has understood these principles. In August 2000, Fuji Xerox  …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/07/blog_csrwire3_wvisser.pdf”]Pdf[/button] Meme-Splicing in the Land of the Rising Sun (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Meme-Splicing in the Land of the Rising Sun, Wayne Visser Blog Series, 3 July 2013.

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Will anyone join your revolution?

Will anyone join your revolution?

Article by Wayne Visser

Margaret Mead once said, ‘The only person who likes change is a wet baby’, to which Hunter Lovins added ‘and the baby squalls all the way through the process.’ So change is never easy, especially on the big issues of sustainability. In thinking about this, I have found Richard Beckhard and David Gleicher’s Formula for Change rather useful: D x V x F > R. This means that three factors must be present for meaningful organisational change to take place. These factors are:

D = Dissatisfaction with how things are now;
V = Vision of what is possible; and
F = First, concrete steps that can be taken towards the vision.

If the product of these three factors is greater than R (Resistance), then change is possible. I have seen sustainability change efforts fail for all four reasons. Deep-seated resistance often exists because the benefits of the status quo to those in power are considerable. Sustainability initiatives, especially if they are integrated into the core business, are often seen as extra burden. For instance, an operations manager of a plant really doesn’t want the extra hassle of collecting emissions data for a sustainability report, or subjecting his staff and facilities to an audit.

Most often, I think, the dissatisfaction that we may feel with the state of the world or the company’s actions really isn’t widely shared enough. Jonathon Porritt, author of Capitalism as if the World Matters, after many years in the sustainability game (he started the UK’s Green Party and chaired the government’s Sustainable Development Commission among other things), told me: ‘Looking at people all over the world today, rich and poor world, they are not remotely close to a state of mind that would call for anything revolutionary. There’s no vast upheaval of people across the world saying, “This system is completely and utterly flawed and must be overturned and we must move towards a different system.”  There isn’t even that, let alone an identification of what the other system would look like.’

Likewise, on creating a compelling vision, Porritt concludes that ‘we have not collectively articulated what this better world looks like – the areas in which it would offer such fantastic improvements in terms of people’s quality of life, the opportunities they would have, a chance to live in totally different ways to the way we live now.  We haven’t done that. Collectively we’ve not made the alternative to this paradigm, this paradigm in progress, work emotionally and physically, in terms of economic excitement.  We’ve just not done it.’ Taking first steps is something companies are generally much better at, especially picking the so-called ‘low hanging fruit’. But the reason these steps so often don’t get beyond the pilot or peripheral stage is because the other two factors – dissatisfaction and vision – are not strong enough.

Another way to think of change in a structured way is Peter Senge’s concept of the learning organisation, popularised in his book, The Fifth Discipline. He described the five interrelated disciplines as follows: ‘Systems thinking [the fifth discipline] needs the disciplines of building shared vision, mental models, and personal mastery to realise its potential.

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/07/article_join_revolution_wvisser.pdf”]Pdf[/button] Will anyone join your revolution? (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Link[/button] The Age of Responsibility (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

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Visser, W. (2013) Will Anyone Join Your Revolution? Eurocharity Yearbook 2012/2013.

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Lessons from Africa’s Wild Frontiers

Lessons from Africa’s Wild Frontiers

Blog by Wayne Visser

Birthplace of blood diamonds

We start our journey around the world in Africa, in the country known today as Zimbabwe. This is the place where I was born and spent my childhood years. At that time, however, the country was still called Rhodesia – so named after the colonialist Cecil Rhodes in the late 1800s. Rhodes, an English-born explorer turned entrepreneur and business magnate, is the focus of my first story – a lesson in the abuse of corporate power.

In 1871, Rhodes joined the diamond rush and headed to Kimberley in South Africa. By 1889, he had formed an effective monopoly through a strategic partnership with the London-based Diamond Syndicate, which agreed to control the world supply of diamonds – around 90% at one point – and thereby maintain high prices. In the same year, Rhodes established the British South Africa Company, which was empowered under royal charter to trade with African tribal leaders, as well as to form banks; to own, manage, grant or distribute land; and to raise a police force.

In return, the company agreed to develop the territory it controlled, to respect existing African laws, to allow free trade within its territory and to respect all religions. Four years later, however, the very same company had recruited its own army and invaded tribal king Lobengula’s territory in what became known at the 1893 Matabele War. The troops and white settlers occupied the town and Bulawayo was declared a settlement under the rule of the British South Africa Company. Rhodes ordered that a new town be built on the ruins of Lobengula’s royal place.

For me, the lesson to learn from Rhodes and his British South Africa Company is clear: when companies have too much power—either political power or economic power – they will tend to abuse that power to enrich themselves. The fusion of private economic interest with public political sanction is the ultimate toxic recipe for corporate irresponsibility. We see it in all the classic cases of business crimes against society and the environment, whether it is through the regressive political lobbying of the oil industry in the United States (going all the way back to Rockefeller’s Standard Oil company), or the majority ownership of Shell by Nigeria’s former military dictatorship government.

Man versus wild

My second story from Zimbabwe is about how greed and exploitation is decimating wildlife on the planet. I have a childhood memory of visiting Hwange National Park (then called Wankie), which is

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/07/blog_csrwire2_wvisser.pdf”]Pdf[/button] Lessons from Africa’s Wild Frontiers (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) Lessons from Africa’s Wild Frontiers, Wayne Visser Blog Series, 26 June 2013.

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The Life Story of a Global Movement

The Life Story of a Global Movement

Blog by Wayne Visser

This new blog series for CSRwire is based on my book, The Quest for Sustainable Business. The book, in turn, follows a journey – around the world and through time; a journey of discovery and ideas. In the blog posts that follow, I will give you some glimpses into the search that has taken me to over 65 countries in the past 20 years. The path begins in Africa and winds its way through Asia, North America, Europe, Australasia and Latin America.

Along the way, I will share what I have learned in my encounters with mega-corporations and small farmers; and in conversations with CEOs and social entrepreneurs. I draw on facts and figures about world trends, and interviews with thought leaders and activists. This is a tale that consciously weaves the personal and the professional, mixing anecdotes and case studies. It looks outwards and reflects inwards, and is both autobiography and the life story of a global movement.

My inspiration for the book came when I decided, in 2010, to leave the security of the University of Cambridge – where I had been developing a Master’s in Sustainability Leadership – and set out on a ‘Corporate Social Responsibility (CSR) quest world tour’, which took me to 20 countries on five continents, travelling continuously for nine months. It was one of those great ironies of my life that I had to leave one of the world’s premier educational institutions in order to advance my learning.

Suffice to say I had an itch and I needed to scratch it. I wanted to reconnect with what was happening on the ground in countries around the world; and I was excited by the prospect of making new friends, seeing new lands, soaking up diverse cultures and discovering fresh case studies. More than anything, I needed to rekindle the passion that had started me on this career in sustainable business 20 years before.

My intention was always to capture my insights along the journey and share them with a wider sustainable business audience. One of the ways I did this was to conduct nearly 100 video interviews, all of which are shared on the CSR International channel on YouTube, and referred to throughout the text of the book.

The other way was to keep a diary and to write a book about my travel experiences—the book which forms the basis for this blog series. However, when I started to write, I repeatedly found myself referring to earlier parts of my career. Gradually, I began to wonder if there was a bigger story to be told. After all, my journey began in the lead-up to the Rio Earth Summit in 1992, and here we were, 20 years later, preparing for Rio+20.

In the interim, I had been fortunate to work, study, teach and research in the field of sustainable business, tracking its path as it emerged from a fringe concern to a mainstream movement and a global profession. There were stories to tell that ranged from hippie-like adventures in eco-villages and community enterprises to hard-nosed consulting assignments for big global brands. I had worked as a strategy analyst for Cap Gemini and set up and ran KPMG’s Sustainability Services in South Africa.

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2013/07/blog_csrwire1_wvisser.pdf”]Pdf[/button] The Life Story of a Global Movement (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-quest-for-sustainable-business”]Link[/button] The Quest for Sustainable Business (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

Cite this blog

Visser, W. (2013) The Life Story of a Global Movement, Wayne Visser Blog Series, 19 June 2013.

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