Corporate citizenship has steadily been moving up the boardroom agenda for a number of years. There are now very few major companies, especially those operating globally, who don’t regularly communicate about the subject, internally and externally. In this edition of Client & Partner Briefing we outline some factors we’ve found to be critical in partnering with our clients to successfully communicate their social responsibility.

The concept is presented in a number of related guises, depending on each company’s priorities, activities, strategies – or just plain preference. The family of terms ranges from corporate governance, which is concerned with business ethics, transparency and accountability, to corporate philanthropy, which focuses on the company as benefactor of good causes. Corporate Social Responsibility (allowing the abbreviation CSR) is a popular inclusive term, while companies whose business activities may be perceived as particularly impacting the environment often prefer ‘corporate sustainability’. At Oake Communications we use ‘Community Relations’ as an umbrella term for all of the above. We view the communities within which our clients operate as one of their key stakeholders, so we include our counsel concerning communications and relationships with them at no.17. For those clients with global brands to support and promote, their communities can literally equate to the world at large.

Seriously accepting the challenge of addressing environmental, social and economic issues may have been the exception for the business world until recently, but we believe it will become the rule for internationally operating companies. How a company behaves as a ‘corporate citizen of the world’ can increasingly be shown to influence its reputation, the efficiency of its operations, its access to capital and markets, how it differentiates itself from its competitors, its ability to attract and retain employees of the highest quality, and the value of its brands.

The strength of corporate brands depends on the trust they evoke. For customers, strong corporate brands promise reliable products and services. For employees, they represent a secure place to build their careers. For shareholders, they indicate a safe and profitable investment. But businesses forget at their peril that the strength of their corporate brands is also represented by and dependent upon their values and conduct. Enron, WorldCom and others discovered how completely their misconduct eroded the trust in their brands. Similarly, companies that proactively adopt socially responsible policies and communicate these effectively strengthen their brands by associating them with positive values and high standards of behaviour. Brand strength is further reinforced when a credible CEO champions good corporate citizenship and ensures that every employee shares and adopts it as a principle of what the company stands for and how it does business.

There are detractors of course, notably among the ‘usual suspects’ resisting any change way over there on the American far right. Milton Friedman is reported as saying that the “one and only one social responsibility of business (is) to increase profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud." We strongly disagree with them, as do the many companies who are finding that creating value for society also creates bottom line value for their shareholders.

A number of leading businesses have gone so far as to use what has become known as 'triple-bottom line' accounting to report their social, environmental and economic performance. Emphasizing that practising good corporate citizenship creates commercial value for the business rather than stressing that it is motivated by ethical or philanthropic principles may initially appear counter-productive. Doesn’t this portray what would otherwise be interpreted as genuine altruism as having ulterior motives? Not if the company is candid and transparent in its communications concerning its commitment to social responsibility. We’ve demonstrated in our work with our clients that the risk of being perceived as having a hidden agenda is addressed and avoided by openly communicating the agenda from day one.

The global movement for large companies to demonstrate genuine social responsibility, and to integrate the concept into their corporate strategy, is rapidly gathering momentum. We believe that the real risk of substantial future penalties are faced by the stakeholders of those businesses that delay their commitment to good corporate citizenship, are superficial in their commitment or that fail to communicate that it is also a value driver.

Communicating social responsibility definitely needs to be handled with considerable care, but successful corporate communications requires balancing and prioritizing messages, taking a number of stakeholder audiences into account. Transparency is a perceived end product of good corporate citizenship, but it also characterizes how it’s successfully communicated.

So rule number one can be stated very simply. If you don’t mean it, you probably shouldn’t do it, and you definitely shouldn’t talk about it. Your audiences are more sophisticated and better informed today than ever before. Companies that just pay lip service to corporate citizenship by scattering the terminology around their annual reports and websites will ultimately regret their careless communications.

Creating value for its customers, employees and shareholders is what a well-managed business does. Recognizing that corporate social responsibility and sustainability values create value for all the company’s stakeholders enables them to be integrated into the company’s value based management approach. Communications that engage and stimulate a dialogue with all the stakeholders of the business provide a linchpin for corporate citizenship. When effectively managed and tailored to fit the business and its activities, the process connects the company more strongly with all the communities with which it relates and helps it keep pace with society’s changing expectations of it. Society will gain directly from good corporate citizenship. The return to businesses on their investment in socially responsible practices will be optimized when they listen, learn and adapt as well as explain, inform and persuade.

Two major international conferences focusing on this subject were held in Miami and Brussels in November 2002. We’ve included links to their websites in this issue of Client & Partner Briefing. We’d naturally be glad to discuss with you how we’re partnering with our clients to develop and communicate their corporate citizenship. Our complimentary guide to a wealth of corporate citizenship resources is available on request without obligation – contact us today.

In the third Client & Partner Briefing we discussed the blogging phenomenon and the rise of the corporate weblog.

The second Client & Partner Briefing presented our views on why 80% of CRM projects have failed in the Netherlands.

Our first Client & Partner Briefing addressed the thorny question of whether or when -ise or -ize word endings should be used.