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Challenging times: communicators stand up for business ethics at IABC international conference.

IABC members attending international conference in June were challenged to do more than simply tell the corporate story. Communicators acknowledged that it's their professional and personal responsibility to lead the way in ensuring that the story is accurate and reflects ethical business practices.

Numerous case studies provided ample evidence of how the communication professional can shape the corporate conscience at a time when employee and consumer skepticism of corporate motives and practices is growing.

"We've always used the story as a way of understanding who we are," said keynote speaker and noted author Salman Rushdie. But he warned IABC members of growing forces worldwide that choose to contain stories within set parameters and to narrow frontiers. "It's the business of communication to expand those frontiers," Rushdie asserted. Quoting a Saul Bellow novel, Rushdie urged: "'For God's sake, open the universe a little more.'"

To that end, IABC gave conference goers a private screening of "The Corporation," a new film that takes a controversial look at the nature of the corporate institution, its impact on the planet and the public's response. In making the film and writing a book by the same title, Joel Bakan, a professor of law at the University of British Columbia, told IABC members that he was "struck by how much soul searching is going on in the corporate world. Greed, self interest and obsession with the bottom line are unsustainable and unhealthy for society," he opined. "As business communicators, you can bring community voices to the corporation and decide ... which stakeholders to listen to."

TAKING RESPONSIBILITY AND ACTION

Corporate responsibility is officially "in" as more companies embrace such programs as a way to differentiate themselves in the marketplace and build customer, employee and stockholder loyalty.

At a conference session on "Corporate Responsibility and the Communicator's Role," Michael Mitchell, director of corporate communications at Chiquita, related how the company's reputation slipped several years ago amid intense international criticism alleging unethical business practices throughout its Latin American operations. An international marketer, producer and distributor of fresh fruits and vegetables, Chiquita has successfully transformed its reputation over the last decade, winning international acclaim for its policies.

The company has earned credibility, Mitchell said, by "committing to high standards and living up to them." But change didn't happen overnight for a 105-year old company with 24,000 employees and operations in more than 60 countries. It took sustained pressure from non-governmental organizations and the media to get the attention of company management that had eschewed transparency. But in 1992, Chiquita took a major step by joining the Rainforest Alliance and agreeing to nine measurable and verifiable environmental and social standards for sustainable banana production. Since 2000. 100 percent of the company-owned farms are certified sustainable, representing a "significant investment of $20 million," Mitchell reported. Chiquita is now expanding this requirement to its independent banana suppliers, with 75 percent of growers certified at the end of 2003.

Improving labor and environmental practices was an important step toward corporate responsibility, but Chiquita pressed on. In 1999 the company embarked on a "comprehensive and inclusive program to develop core values, Mitchell related. "We involved more than 1 000 employees to determine what those values were." The team identified four values that would guide their work: integrity, respect, opportunity and responsibility. Today those core values appear on Chiquita's web site, employees' business cards and numerous communication pieces as positive reinforcement. In addition, the company updated its code of conduct to include Social Accountability International's SA8000 standards, which set expectations regarding health and safety, child labor, disciplinary practices, work hours and compensation and other labor issues. Certification requires external verification by independent third-party auditors.

To ensure the success of its corporate responsibility efforts, Chiquita has woven accountability into its management systems at all levels, and the CEO is a key driver of change, according to Mitchell. The company's corporate responsibility officer reports to the Audit Committee on Chiquita's board of directors. Corporate responsibility specialists are assigned to all divisions, and all managers sign an annual code of conduct compliance statement. Perhaps most important is ongoing education and training for employees at all levels. More than 17,000 employees in Latin America were trained in 2002, and Chiquita set up a confidential hotline to field anonymous complaints from employees.

Performance measurement closes the loop in any corporate responsibility program, Mitchell noted. Chiquita began publishing detailed corporate responsibility reports in 2001 and now prints English and Spanish editions as well as posts the report online. "Transparent reporting means that we make our commitment public and let others hold us accountable," Mitchell explained, "This also strengthens our internal resolve."

When advocating for a corporate responsibility program internally, Mitchell advised his fellow communicators to use the word "investment," not "cost." Chiquita's investment has yielded numerous bottom line benefits including reputation management. Numerous top line newspapers and magazines now cite Chiquita as an example of corporate responsibility. "It's hard to quantify," said Mitchell, "but it's invaluable." Other benefits include risk management/risk avoidance (days on strike at Chiquita plants decreased 75 percent from 2000 to 2002) and increased employee satisfaction (as measured in core value focus groups). Innovation and learning are up companywide, and Chiquita enjoys greater access to capital and increased financial performance. "Ten years of work have paid off," Mitchell said.

KEEPING THE TRUST

As corporations grapple with ethical decisions, they must communicate closely and honestly with employees, according to Joanne Reichardt, vice president and director of public relations for Randstad North America, and Don Reichardt, APR, who presented a session on "Restoring Trust in a Reality Show World." Trust has risen to the top of employees' priority list, according to Randstad research. Trust is even more critical to knowledge-based companies. "If employees don't trust, they don't innovate," said Joanne Reichardt. And because the majority of employees have one foot in the job market, she noted, they require continued reassurance that they are trusted and that the boss is trustworthy.

To build employee belief in a climate of mistrust, corporate messages must ring true, said Reichardt. "Communication integrity is critical to building trust, and it must be delivered with consistency, clarity and courage." A fair process is also critical to building trust, she added. "It requires engagement of employees and explanation (the why's behind decisions)." Organizations also must eliminate trustbusters: punishing candid employee feedback and leaving employees out of decisions that affect them.

IABC members packed the house for a conference general session on "Inspiring Trust in a Post Scandal World." Moderated by Mark Schumann, ABC, a global communication practice leader with Towers Perrin, the panel featured Dave Mowat, CEO of Vancouver City Savings Credit Union (VanCity), and Libby Sartain, senior vice president of human resources for Yahoo! Inc.

Schumann cited recent Towers Perrin survey findings that fewer than half of employees believe that senior management has a sense of concern for their well being and only half believe that their companies inspire them to do their best work. "For those of us with the communication gene, these are terribly disturbing thoughts we are hearing from employees," he said. "If employees believe in the honesty of leadership, they're less likely to look for a job," he continued. "But honesty isn't enough; we want to see leaders who get things done. Employees need to see the action. Employees expect results." As communicators, "what we're really about is the relationship between employees and leaders," Schumann said. "Our role as communicators is to help employees."

Sartain pointed out that it's not that hard to create legendary cultures, such as the one Yahoo! employees enjoy. "It's not rocket science; we all know how to do it. But the hard part is doing it," she said. Once a culture is defined, the next level is communication. "The best way to communicate culture is through internal branding," Sartain said. The third component is selecting the right people for the team. "Start off with the people who want to deliver," she advised. Then offer them meaningful work. Employees have to see the connection between their roles and what the company is striving to accomplish, she said.

As one of the top 100 employers in Canada, VanCity relies on "differentiating ourselves in the marketplace by paying attention to what employees think of us ... and what customers think," said Mowat. "There are two things we work hard on: creating a leadership discipline within the organization and having one story for shareholders, the board of directors and employees." The same story is essential, Mowat said, because "if employees hear three spins, they see them as fibs, and they're caught in the middle. It makes them question what else you're spinning."

Mowat also strives to listen and gives employees access to the company's business plan so that they have enough information to provide constructive criticism. "We're getting all kinds of ideas and innovations that fit within our strategy and that we can use," he said.

INFLUENCING CHANGE

While companies like VanCity are reaping benefits from transparency, others are not as forthcoming with employees and customers, and communicators within those organizations may face scrutiny as a result. At the session on "Business Ethics: The Communicator's Role," presenter Alan Lane questioned where the communicators were as the scandals built at companies like Parmalat, Shell and Enron. "Didn't they see it coming? Were they in the circle of influence? Will they face criminal charges?" All are serious questions for communicators to contemplate, noted Lane, founder and CEO of VASGAMA, a U.K.-based consultancy advising international clients on reputation management.

Because communicators have a bird's-eye view of their organization through daily contact with employees at all levels and are in tune with the public's taste and perceptions, they have an important role to play in steering the organization ethically, Lane said.

Communicators can also work to integrate ethical performance tracking into corporate performance measurement, he suggested. One idea is a regular ethics health check to see if your company is living up to its stated values. "What about getting CEOs to sign off on IABC's Code of Ethics?" he queried.

"The world is changing," Lane emphasized. "Ethical performance is no longer a business add-on," he noted, citing the U.S. Sarbanes-Oxley law, which established a public company accounting oversight board. Similar laws exist in the European Union, and the World Economic Forum has begun reviews of corporate crime. The United Nations is also working to hold multinational corporations liable for human rights violations.

As the public backlash against corporate ethics abuse continues, Lane said the worst case scenario for communicators is to be "judged guilty by association with unethical practices."

Communicators in the audience voiced strong support for speaking up early and working within their organizations to avert an ethical crisis. "If you are ethically troubled by an action, then you must do something," one communicator said. "If you say nothing at all, you'll compromise your own ethics little by little," noted another audience member. "Say you disagree; say something."

READ MORE ONLINE

About the film and book:

www.thecorporation.com

CSR-related links:

www.bsr.org

www.ethicalcorp.com

www.csreurope.org

www.cswire.com

IABC INTERNATIONAL CONFERENCE HIGHLIGHTS

* ATTENDEES: Nearly 1,200 members from 33 countries

* LOCATION: Los Angeles, Calif., USA

* CONTENT: More than 70 educational sessions led by veteran communicators and organizational leaders worldwide

* BIZ BUZZ: How to rebuild organizational trust internally and externally

* THOUGHT LEADERS: Salman Rushdie (keynote speaker), Joel Bakan ("The Corporation" co-creator) and John J. Ryan (EXCEL winner)

* GOLD QUILL: Communicators celebrate winners of 38 Excellence and 76 Merit awards

* NETWORKING: Receptions, beach party, dine-arounds, lunch and learning, business breakfasts

* ALL-STAR SESSIONS: A return of best-rated speakers from the last five international conferences

* AUDIO RECORDINGS: Conference session tapes and CDs are now available at www.conventioncassettes.com/iabc, or by calling 800.776.5454

* LOOKING AHEAD: 2005 International Conference, 26-29 June, Washington, D.C., USA

RELATED ARTICLE: are corporations pathological?

At IABC's international conference, Joel Bakan, author of "The Corporation: The Pathological Pursuit of Profit and Power," and co-creator of the documentary "The Corporation," gave a special screening of the provocative film, which won the Documentary Audience Award for World Cinema at the 2004 Sundance Film Festival. Bakan discussed the book/film project with IABC audiences and weighed in on corporate responsibility during an interview with CW.

Your film shows organizations making token gestures in corporate responsibility as a way of masking bad behavior. How can communicators help develop meaningful corporate social responsibility programs?

What is most meaningful is to show top-level management that it's to the company's advantage to have good strong social responsibility programs. They won't be persuaded by arguments that they should do it to be nice. But there's a lot there to make arguments that it's in the company's long-term interest to use best practices in relation to the environment, have good labor practices and respect human rights. The best case is around long-term viability by sustaining the community, which in turn sustains the business. You can go far with those arguments, and that's what you have to do.

Should a corporation adhere to its core product on such programs?

Yes. The more that a company gets away from what it does best, the more these programs become just window dressing. A corporation needs to do good things in [its] area of business. For instance, if they're producing paper, they should try to do it in a more environmentally sustainable way. Or they could donate paper. But the further afield they get, the more likely the programs will not be as strong.

The film talks about some companies like Interface that have made huge inroads into being good corporate citizens. What other companies are making gains toward this end?

Some companies try harder than others. Interface is a company with a visionary CEO who is helping the company to have some impact on the world. In the oil industry, British Petroleum stands out because it has taken a stance on the Kyoto Accord, which is very important. While other companies used their efforts to lobby against Kyoto, BP worked to successfully apply the Kyoto standards and reported no net cost to the company. That's an important initiative. But all of this, in the end, is not a substitute for effective legal standards and effective agencies to implement them. There's only so far that corporations can go in terms of their own desire or need to be socially responsible. In the end, if we leave social responsibility as a purely voluntary idea, there are problems with that.

What type of structural change would lend itself best to good corporate citizenship?

People have suggested a stakeholder model, a kind of multiple bottom-line model, where there's not just profit, but also environment, social

and labor standards. And it is possible. It's legally possible that legislatures could change laws so that corporate directors and managers had an obligation to balance competing interests. However, realistically, I don't think there's much political movement toward changing the corporate structure. Revitalizing the regulatory system, where agencies oversee what corporations are doing and make sure that they respect social and environmental standards, is a more pragmatic way to go. Maybe 100 years from now it will be different, but in terms of tomorrow, or a week from now, this is probably our best option.

You've said that communication professionals are in a unique position to influence a corporation in a positive way. Can you give some specifics around that?

As business communicators, you are situated between the corporation and the communities that it affects. Communicators can make certain choices about what voices they want to give credence to within a community. They can be more proactive in hearing what is going on in the community and take that message back to the company. They can take messages back in a way that gives credibility to it, that fairly represents it, and that sometimes even advocates for it on behalf of the community and of the people in it.

Within the current structure of the corporation, if there were one change that could happen, what would it be?

I'd say it would be a recommitment to the idea that there are values and domains of society where it's inappropriate for commercial exploitation to be involved. That it's important certain values be protected--whether it's limitations on advertising aimed at children or preserving parks or various other public spheres. I think we need to break out of this mindset that everything and anything should be under the governance of the commercial corporate model. And that's a mindset that is increasingly limiting our imaginations about what is possible. We have to recognize as people we are much more complicated than that, and we have to create societies that balance all of these competing values that reflect who we are.

--Natasha Spring

Virginia Sowers is managing editor of Communication World. She can be reached at virginia.sowers@douglasmurphy.com.
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Author:Sowers, Virginia
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Date:Jul 1, 2004
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