Innovation + Responsibility

Last week, as most of the world knows by now, the Olympic torch made its one and only US stop here in my beloved San Francisco.  The week started off with an inspiring protest action on the Golden Gate Bridge - after the bold protests in London and Paris, you knew San Francisco was not going to relinquish its well-deserved title of the world's hotbed of progressive activism! That being said, the San Francisco of 2008 seems more like the place people come to strike it rich than the place they come to live a life of political activism (who can afford to be a full-time activist in SF these days, anyway?).  So I wondered what kind of mass protest the Bay Area would be able to pull off, and it was with great anticipation and enthusiasm that I headed down to the Embarcadero to watch it all go down.

Full disclosure: I was planning on attending the protest anyway. My synagogue is part of a coalition of faith-based and other organizations seeking to raise awareness and action about the genocide in Darfur.  I wouldn't be able to join for the marching part (it's CSR report season for me and I couldn't take the whole day off!), but wanted to show my support for the cause. 

There were thousands of people lined up along the waterfront - many waiting for the protesters, many waiting (in vain it turns out!) for the torch itself. I saw all manner of homemade signs and banners, a sea of Chinese as well as Tibetan flags, and clever t-shirts with handwritten slogans.  And then I saw it. Hovering over the crowd in all its glossy glory - my first ever corporate-sponsored, pre-printed protest sign! 

What better to signify the San Francisco of today - the corporate excess that has come to define the Bay Area lifestyle and the activism that has long defined our fine city combine to create the perfect message vehicle for a San Francisco rally! Consumerism to clear your conscience (with no nod to the irony that consumerism itself has played a large role in China's place in today's world, both as a rising economic power and a target for progressive activism).

Yes ladies and gentlemen - San Francisco's big Olympic torch protest was brought to you in part by Credo (formerly Working Assets).

 
Initially these signs cracked me up, not only because they were like caricatures of San Francisco protest signs - "Another acupuncturist for a free Tibet;" "Another organic chef for a Free Tibet;" "Another vegetarian for a free Tibet." - but also because they reminded me of the signs I see at marathons and triathlons (sports that engage a large portion of the Bay Area population, myself included) with big corporate logos along side, "Go _____!" with the athlete's name lovingly written in the blank. 

It was one of those "only in San Francisco" moments for me. And it got me thinking: Was Credo's "sponsorship" of the protest march an innovative use of corporate responsibility as a business development tool? Or was it something else?

Certainly Credo's activist point of view is authentic - the company was founded on the idea that as a communications company, it had a unique capacity to help its customers express their citizenship through different kinds of activism and civic engagement.  But I wondered if Credo's full-fledged support of this march (the company also pre-printed signs that said, "CHINA: Listen to the Dalai Lama") would alienate as many customers as it might attract.

Like most difficult social issues, the ones associated with China and the Olympics (and all related issues) are not black and white. By coming out so forcefully on the side of one particular set of protesters - and ignoring all the other arguably legitimate protests, including the Darfur protesters and environmental activists - was Credo effectively telling those of us with nuanced or even different perspectives that it didn't really care for our business? If so, it's certainly that company's prerogative to do so. And some might argue that not only is it Credo's prerogative, it's shrewd marketing, too, because it reinforces the brand with the company's core consumers. In the competitive telecommunications market, keeping customers can be more valuable to your business than acquiring new ones.

Still, corporate sponsorship of a protest march targeting a government that is hoping to capitalize on the corporate spectacle that is the modern Olympic Games.  I don't know...does anyone else see the irony here? 

If I was better at math, things might have turned out differently for me.

"The corporate social responsibility movement is fundamentally changing the way we do business around the world and I want to re-focus my career in a way that will allow me to contribute to that change.  I want to promote business advocacy while encouraging global responsibility, with the end result being a re-definition of how we measure business success. I want to make the triple bottom line – people, planet and profits – a reality in American corporate culture.  I plan to do this by devoting my career to the field of socially responsible investing, empowering shareholders to use their influence to force companies to acknowledge and nurture the connection between corporate social responsibility and business success."  

That's the opening paragraph of my business school application essay. Then I took finance during my first year of business school and, well...I had to re-think things a little bit! But despite my inability to grasp Black Shoales or how to calculate a Beta, my interest in SRI and my belief in it as a tool for change persist to this day.

So it was with great interest that I read the Executive Summary of the Social Investment Forum's 2007 Report on Social Investing Trends in the United States (the SIF releases this trend report every two years).  Below are some key findings:

Socially Responsible Investing is Growing. Fast.
SRI is growing "at a faster pace than the broader universe of assets under professional management" in the United States.  Approximately one in nine dollars under professional management - 11% - are involved in SRI.

Since the 2005 report, assets under management that used one or more socially responsible investing strategies has increased from $2.29 trillion to $2.71 trillion.

Assets in socially and environmentally screened funds were up 13 percent, from $179 billion in 2005 to almost $202 billion in 2007.

Big Money has Big Dollars in SRI
The bulk of assets invested in socially screened investments comes from institutional investors (typically the most powerful and influential shareholders around) and high net worth individuals. 

Institutional investor assets in SRI were up 27 percent in 2007 to $1.88 trillion from $1.49 trillion in 2005.

High-net-worth clients had $39.5 billion invested in socially screened investments, up from $17.3 billion in 2005. 

The Future of SRI
SRI is continuing to grow and it's my belief that as investors become more and more hip to the shenanigans of the greediest sorts that run rampant on Wall Street and that are currently reverberating throughout our economy (because, you know, Enron wasn't enough of a wake up call!), SRI will become more and more popular.

How You Can Get In On the SRI Action
You don't have to be a high-net-worth individual or an institutional investor to be part of the socially responsible investing movement.  You know that money you put into your IRA every year? Direct it to a socially responsible mutual fund.  Check with your company's 401(k) plan - maybe you have an SRI option in there to which you can direct a portion (or all) of your investments. 

I'm pretty excited that Sun recently announced a new addition to our 401(k) plan. It's called a "brokerage window" and it allows employees to invest their 401(k) dollars into any mutual fund they want, including socially responsible mutual funds! I have been eager for Sun to provide me with an opportunity to direct my investments in a way that is consistent with my personal values and now I have one!

Do You Want a Copy of the Social Investment Forum Report?
If you are interested in seeing a copy of the Social Investment Forum's Executive Summary, post a comment below with your email address and I will send it your way. 

With all this talk of recession swirling about, and companies preparing for what may lie ahead, I am sure there is more than one person wondering what will happen to the corporate responsibility function. Will fears of - or actual - recession force companies to cut back on this area of the business and instead divert these resources into other key functions (or simply tighten the belt altogether)?  I suppose that if this question was being asked 10 or 15 years ago - before mainstream corporate people really understood the top- and bottom-line value CSR can bring to an organization - the answer might be yes. And I bet there are companies today who will cut back on their CSR "department" as a matter of economic necessity.  But my guess is that most companies will not. Because in 2008 companies are (finally) starting to understand that having a credible and productive corporate responsibility function is no longer a nice to have, it's becoming a license to operate.

Before I go on, I want to state a few caveats:

1) I am not sure what a recession will do to corporate philanthropy efforts, even at a company like Google. For a company like Patagonia, which has a corporate policy to donate 1% of sales revenue to environmental causes - philanthropy will be directly tied to sales and not the whim of possibly skiddish executives (although my guess is that at Patagonia this wouldn't be an issue anyway). My hope is that at the companies where recession (or recession fears) does impact philanthropy, the companies use it as an opportunity to get creative about what and how they give.

2) There are still quite a few companies at which CSR (or whatever they happen to call it) is not much more than a marketing program.  I am thinking these companies would reduce their CSR efforts because the companies still don't grasp the business benefits of CSR initiatives.

So why am I writing about this? Well, I think this question presents an interesting opportunity to collect some data that many in the CSR - and frankly anti-CSR - space have long lacked. The question is this:

What is the long-term impact of  CSR  on a company's performance?

I would argue that up until now, there has not been a quorum of credible CSR programs to enable anyone to answer this question. But the last few years we have seen an explosion of CSR initiatives - companies like Sun, GE and Brown-Forman have all formalized their corporate responsibility efforts - on top of a refining of CSR initiatives at early-adopter companies (like Nike, Starbucks, Vodafone, and others).  And many of these companies have embedded CSR so deeply into their operations and their brands, there is no way to let it go in tough economic times.

Here is what I propose:

Why don't  we choose a metric - stock price, revenue, profits - and use it to measure the performance of companies with CSR programs. We can do it over a five or ten year period and track and compare the performance of those companies that continue to use CSR as a key component of their overall business strategy and business operations against those that marginalize or, at worst eliminate, CSR efforts during challenging economic times.  It would be interesting to see if CSR has any measurable impact on a company's performance. I think this is a worthwhile exercise. I know it would not bear results for several years, but it could be an interesting tracking study.  I mean, why stop at five or ten years? We could go on forever. We can name it after me - I've always wanted something named after me! The Marcy Scott Lynn Sustainability Tracking Index. Hm, doesn't exactly roll off the tongue.

I feel pretty confident that the results of the study would show what I believe in my heart - that companies that truly embed corporate responsibility principles into their strategy and operations are better managed companies. Better managed companies do better in the marketplace. Therefore, companies with integrated CSR will do better in the marketplace.  I don't remember much from high school math but I think that's called a syllogism.  

Fortune's Most Admired Companies list for 2008 just came out and Sun made it this year! For the last couple of years we were listed as a "contender" - that means that we were ranked below #6 in our industry and so we were not considered to be ranked on the full list.  But this year we made it!  We are officially "Admired."

We rank #5 in the "Computers" category with a score of 6.39.  I'm not totally clear on the scoring, but Apple, which was ranked #1 in our industry (and overall), scored 7.42.  Now, I don't entirely understand that because Google, ranked 4th overall and second in their industry, had a score of 8.07 (and General Electric, which was 3rd overall, scored 7.85. Go figure). I'll leave the math to someone else and instead be happy that Sun made it onto the list this year and celebrate our continued progress in the marketplace of ideas.

Sun ranked #2 in our industry for "innovation" (behind Apple) and #3 for social responsibility (behind IBM and Xerox).  There are a few areas we didn't rank so high - namely around our financial performance. So hopefully as that continues to improve, so will our place on this list!

For more details about Sun's ranking, go here.

For more about the overall list, go here.

Well, months ago I did a blog entry about putting the "social" in social responsibility. Yesterday I decided to experiment and I formed a Facebook group called, "The Sun Employee Sustainability Network - Every Job is an Eco Job!" Okay, so it's not exactly an elegant name...a bit of a mouthful really.  But since I have been saying since I arrived at Sun, and even in this space, that it is more valuable for people to find the "eco" (or CSR) in their own job than to find a job on the eco or CSR team (and since "Every Job is an Eco Job!" has become the rallying cry for the Sun Eco staff), it seemed like a good name for the group. And with groups out there like, "National Corn Dog Day," and, "If 1,000,000 people join I'll legally change my name to McLovin," well...I realize mine is not so bad.

So, I started the group last night around 10pm PST and this morning, at 8:19am PST there are 11 members.  Mark Monroe already posted photos to get things started - he posted a mock-up of a solar array on the roof of one of our Broomfield, CO campuses. 

 
I sent invitations to the 40 or so Sun employees that I am connected to on Facebook. Hopefully all of them will join.  And then we will have to see: will more people join than just the ones I invited?  Will Sun employees (who I don't know) see that their friends have joined this group and want to join themselves? Can Facebook actually work for this? We shall see. And I'll keep you posted here!

If you are already on Facebook and want to join the group, go here.  If you are not already on Facebook and want to join...well, get on Facebook and then go here! 

Earlier this week Susan Landau, a Distinguished Engineer at Sun (one of only a few women who hold that title) was recognized with the Women of Vision Award from the Anita Borg Institute for Women and Technology.  Well, Sun engineers are pretty brilliant and win awards all the time, so why am I writing about this one? Well, the Women of Vision Award covers three categories: Innovation, Leadership and Social Impact. Susan Landau won the Social Impact category, so I thought it was worth giving her a shout out here. Susan's work is focused primarily in the area of security and its intersection with public policy.  It's interesting because Sun considers - and reports on - security and public policy as parts of our corporate responsibility profile; but you don't hear much about security as a social issue, even though the security of the network (and what it means to us as users of that network) - is one of the most important social issues of our time.  This will continue to be true as developing nations join the network at increasing rates. I like that the Anita Borg Institute recognizes Dr. Landau's work in this arena, as well as her other important work in the broader technology community, as having a meaningful social impact. Here is the blurb from the Anita Borg Institute announcement:

Susan Landau, Distinguished Engineer, Sun Microsystems Inc.

Susan Landau is the Women of Vision Award winner in the Social Impact
category. Landau’s focus is on the interplay between security and
public policy. She has profound impact in at least three areas of
computer science: as an extensive commentator and advisor on U.S.
wiretapping and encryption policy; as a world renowned expert in
computational algebra and number theory (mathematics intimately related
to cryptography), and in developing numerous programs to benefit women
in computer science. A Sun Microsystems Distinguished Engineer, Landau
is a leading scholar in all three areas and publishes widely. Her book,
co-authored with Whitfield Diffie, Privacy on the Line: the Politics of Wiretapping and Encryption, attracted immediate international attention and played a significant
role in the 2000 loosening of U.S. cryptographic export-control
regulations, stimulating the global technology economy and offering
protection to consumers in all non-embargoed countries. Her unusual
blend of technical expertise, policy insight, industry connections and
drive, along with her dedication to the advancement of Women in
Computing, make Landau a true Woman of Vision.

What is BSR Thinking?
So, I have tried to limit these blog postings to things related to my job.  Much as I would love an outlet to express myself about the other parts of my life - my marathons, the lovely Englishman I met, my family, this historic election - I am sticking to the job. But I do need to take this opportunity to merge these two worlds for the purpose of complaining a bit.  I know, nobody likes a whiner...but hear me out.

I am a politics junkie - American politics fires me up. I started my career in politics in 1992  (I'll spare you my political resume) and although I ended my professional political career in 1996 after a devastating campaign loss, I have remained active and interested in politics, particularly at a national level.  But it doesn't take a political maniac to be riveted by this year's presidential election. And you don't have to be a die-hard to be deeply invested in the election's outcome. 

 So explain to me why the premiere corporate responsibility conference - one that presumably attracts a lot of people like me who are in these jobs to align their professional pursuits with their personal values and therefore are probably quite interested in this presidential election - WHY would BSR schedule its annual conference on Election Day? 

Maybe I am making too big a deal out of this.  I don't actually need to be home on Election Day. I can vote absentee and then head to NYC for the conference. But this election is too important and I don't want to be shmoozing at a cocktail party in NY talking about CSR when I can be on the phone encouraging voters to get to the polls, and watching excitedly and nervously with my family and friends to see if our country will have a chance to get back on track or if we will be mired in Iraq for the next 100 years.  Somehow, I expected an organization that promotes social responsibility to support the social responsibility of every American to fully participate in her country's political process.

No, this isn't a Steely Dan tribute.  Today Sun was named #19 on the Top 100 Corporate Citizens list by The CRO magazine. This is the third year we have appeared on the list, which tracks companies on various dimensions of corporate responsibility, and this is our highest ranking to date.  Now, before you get too excited that we moved from #71 to #19 in one year (believe me, I nearly fell off my chair when I heard that!), it's important to note that the methodology for the list has changed considerably.  Despite that change in methodology, I am quite proud of our jump up the list.  Think about it - the examination period for this list was August 31, 2006 to August 31, 2007 and those dates just happen to coincide - almost to the day - with the first year of our formal CSR program. 

I know lists like this aren't the end-all be-all yardsticks of a good CSR program.  Only measurable goals - and progress toward those goals - will be able to tell stakeholders how we are doing.   And we can talk for hours about the methodology - for instance, is it enough for the research firm to evaluate companies on their publicly available information? Transparency is important, but is this methodology reporting quantity over quality?  And what do you think about the fact that the list is "best in class" rather than just "best" - in other words, the best oil and gas company is eligible for this list; some might argue that even the best oil and gas company is still an oil and gas company and therefore can never be a truly "top" corporate citizen. These are valid points, and we in the CSR community should continue to discuss and debate them. 

But today I am not going to debate the list and the methodology (I'll surely do that another day). Instead I am going to simply bask in Sun's accomplishment.  This list is based on the Russell 1000 - that means that compared to 1000 other companies our one-year-old program landed in the top 20.  In our industry, we ranked fourth (that news was announced in December).  Now, we know there is plenty of room for improvement, not only in our practices but also in our data collection and reporting.  And regardless of where we fall on lists like these, we will do our best to stay focused on our efforts to create meaningful, positive change for our business as well as society at large.   These lists don't direct our CSR strategy or programs.  Instead they are one of the signals we use to check if we are on the right - or wrong - track.  And when I think of all we have been doing since that August
31 cut off date for this list - all our eco responsibility progress,
our supply chain CSR program, our strides in green procurement, our
stakeholder engagement program and on and on - I get excited. Because it demonstrates our consistent commitment to transparency and progress. Regardless of what the list makers say about us.

This week's issue of The Economist has a special 14-page section dedicated to Corporate Social Responsibility.  You might think it unusual for this particular magazine to focus so intently on CSR when you consider the article from January 2005 decrying CSR as a waste of shareholders' money.  But apparently The Economist recognizes the business opportunity CSR can bring (in this case, selling more magazines), and decided to dive into the subject and make some conclusions. I suppose you can read it if you are so inclined - I just spent a solid hour and a half reading the 14-page  "special report" - but in the interest of saving people the time (and money if you are not a subscriber), I will summarize it here for you. (And by the way, let me just say that I really do like The Economist as a news source. I've been subscribing since business school - my European boyfriend at the time introduced me to it  - and have found its political and business perspectives refreshing at times.)

• A lot of companies are bought into the idea of CSR
• Not many companies are doing it well
• Many companies use CSR as a PR tool and nothing more
• If CSR is to be more than PR, it will be long, hard work
• The best kind of CSR is that which is good for business and good for society
• Much of CSR is good risk management
• Companies that pursue CSR strategies are likely to have an advantage in the competition for talent
• CSR means different things in different countries
• Emerging markets, like China and India, are likely to shake up the conventional CSR wisdom
• Many - if not most - companies are guilty of some degree of greenwashing

In other words, The Economist really did not offer anything new on the subject. 

I'll readily admit that even though it's not new for me (or anyone else in my kind of role at another company), perhaps much of it is going to be new for folks who aren't knee-deep in CSR every day.  That makes The Economist's focus on CSR particularly important. Because even though some of what I have outlined above seems like CSR-101 today, I am pretty sure this kind of thinking did not exist ten or 15 years ago at companies like Wal Mart or GE - two companies that have decided to bet their brands on this as a way of doing business (though I take issue with much of how Wal Mart runs its business, sustainability initiatives notwithstanding).

I did find some choice nuggets in the Economist piece that I want to take this opportunity to highlight.  It is not that these bits of wisdom highlight anything groundbreaking, but somethings are worth saying more than once.

"If efforts to do good become a distraction from the core business they may actually be downright irresponsible. After all, a socially conscious but bankrupt business is no good to anyone." 

"For global companies...a one-size-fits-all approach to corporate responsibiltiy may not work. What is right for Europe may not be appropriate for India..."

"The followers in the CSR industry are many...their real motive is public relations and the telltale sign is that the person responsible for CSR sits in the corporate communications department." 

"It is the interaction between a company's principles and its commercial competence that shapes the kind of business it will be." 

"In time it will simply be the way business is done in the 21st century." 

Innovative Responsibility
When I first started this blog, I wanted to focus on innovation in the area of CSR. It hasn't quite worked out that way and instead I have mostly focused on trends in CSR, Sun's efforts to embed CSR into our business and other topics that catch my fancy.   I think this is mostly because there just is not a lot of innovation happening in this space.  As is evident from this Economist piece, CSR  advocates are still trying to justify its existence as a legitimate part of business strategy, even as it becomes more widely accepted in the boardroom. Therefore, simply having a CSR function can make management feel they are going out on a limb. As a CSR person within a company, if you are spending much of your time trying to convince people of the value of your role, you are probably not rocking the boat much, which means you aren't getting a lot of opportunities to be innovative. Mostly you are probably just trying to keep pace with what other companies are doing so you don't fall behind.

The only cases in which I see companies actually innovating in how they approach their overall corporate responsibility program - not innovative products here and there, not a cool looking report, but how they function as a business - are those companies where the CEO is directly engaged and involved. Where senior management understands the value of CSR as a core business strategy. Where the person who oversees CSR is as senior as the person who oversees marketing or finance and is taken as seriously. Or maybe there isn't one person who oversees it because it is truly embedded into everyone's job responsibilities.

The Economist article mentions one of these companies - Marks & Spencer (a leading British retailer)- briefly in its report. It talks about the M&S CSR program, called Plan A (because there is no Plan B) and the executive committee responsible for the strategy and implementation of Plan A, called the "How We Do Business Committee." Simple, yes. But innovation often is just that.

There aren't many companies like this - at least not in the United States. But these kinds of companies are on the rise - perhaps because  like Lee Scott at Wal Mart, the CEO had a revelation, or because like Jeffrey Hollander at Seventh Generation, that's  how the business was set up in the first place. And the more I see it happening, the more I think that my career goals - seemingly opposed but actually quite connected - may actually come true. That I will sit at the table as a member of senior management, a full participant in setting long-term business strategy, and that the company I work for won't have a CSR or citizenship department because it will be implied in every department.

A girl can dream.

If you are at all interested in technology and you don't live under a rock, you heard the news yesterday of Sun's acquisition of MySQL. By most accounts, this is a great move on the part of Sun's business.  I'll leave it to the technologists to analyze the merits of the deal, but overall most Sun employees seem pretty fired up about it.  

I first learned of the news when I woke up yesterday morning and, as is typical for an email addict, checked my email to find a note from our CEO announcing the news. Being as self-absorbed as I am, I soon went to thoughts of "What does this mean for me?"

With no other information than what was contained in Jonathan's blog post, I was optimistic. Why? Well, mainly because MySQL was founded by Europeans, (two Swedes and a Finn, which excited me because I know two words in Finnish - hello and thank you) and everyone knows that European firms are (generally) much more sustainability minded than American companies (we can debate another time about why this is, legislation and regulation vs. free market, etc.).  And so as I wondered what this acquisition might mean for me and my job, I got excited about the possibility of an infusion of a sustainability-minded culture into our own, thus strengthening Sun's "corporate responsibility" agenda.

So when I went to the MySQL Web site and found this in the About section:

MySQL AB and the people of MySQL AB:

• Aim to be good citizens
• Prefer partners that share our values and mindset

I was thrilled. It says other things, too, but remember I was self-interested at this point so this is where I focused. It seems our values are aligned - the people of Sun also aim to be "good citizens." We prefer to work with those who value what we do - innovation, sharing, openness. In my opinion, having these core values in sync bodes well for the success of this venture.

Other points of interest:

*MySQL has a distributed, mostly virtual work environment - about 80 percent of employees do not work in an assigned office.  That probably sounds familiar to anyone who knows about Sun's Open Work program. 
*OpenEco.org, the new online community that aims to help organizations calculate, compare and reduce their environmental impact, uses MySQL.  

I have some experience (from my former life) in cultural change management, specifically with the challenges inherent in a merger of two distinct cultures. Often, the biggest roadblock to a successful merger is that the two organizations' cultures are too different to become one.  But I am confident that won't be the case with MySQL because it is clear that we share some basic values about what kind of company we want to be.

So where did I settle on the "What does this mean for me?" question? Well, I think it means that I have several hundred potential new recruits for the Sun CSR Advisory Board!

Seriously though, I want to extend a welcome to our new MySQL colleagues. I am excited about the business opportunities this merger represents as well as the opportunity to bring new blood into our quest to become a more responsible, sustainable company. 

Sun's Inaugural Employee Eco Summit
Today Sun hosted our first ever Employee Eco Summit in Santa Clara.  By all accounts, the event was a great success! Most of the credit for the day's event goes to our super eco marketing guru, Krista Van Tassel.  Krista pulled together an event that attracted about 550 Sun employees - about 400 of who were participating, in typical Sun fashion, remotely by watching online or in Second Life.

There were some interesting speakers who shared compelling information about some of the challenges we face as a planet and, most importantly, some steps each of us can take toward creating a more sustainable world, both at home and at work.

The two speakers who stood out for me were Andrew Winston, author of "Green to Gold," and Adam Werbach, founder of Act Now and best known for having been the youngest ever President of the Sierra Club (he took that position at age 23) and more recently for his work as Wal Mart's sustainability consultant.

While all the speakers provided useful information and interesting perspectives, these two were most engaging because they talked specifically about the role we as individuals could play in helping move the needle on climate change. Their optimism was uplifting - we are so accustomed to hearing what's wrong, how dire it all is.  But what people need to hear is that if we pitch in, we will be able to effect positive change. These two speakers got that message across by making us laugh while also making us think.

Power of Sun  Results
The timing of this employee summit was perfect because this week we received the results of the most recent Power of Sun survey.  Why am I telling you this? Because year over year we saw huge gains in the area of corporate responsibility. 

If you read Sun's 2007 CSR report (and, given the data, my guess is most of you haven't!), you know that in late 2006 we began measuring employee perception of Sun as a socially and environmentally responsible company.   Specifically we asked employees the following agree/disagree questions:

*It is important to me that Sun act as a socially and environmentally responsible company.
and
*Sun acts as a socially and environmentally responsible company.

The first time we asked these questions, the employee response was remarkable - 92 percent of employees agreed or strongly agreed with the first statement, with some variation based on geography (higher in Europe) and job level (higher for more senior employees).  The response to this question confirmed what we thought we already knew - people want to work for a company that shares their personal values. 

On the second question the response was still great, but significantly different.  "Only" 84 percent of employees agreed or strongly agreed that Sun acts as a socially and environmentally responsible company. That's an average 8 point gap, and an even wider gap when you dig into the details of geography (lower in Europe) and job level (higher for more senior employees, significantly lower for more junior employees).

In the 2007 CSR report, Sun stated as one of our employee engagement goals that we would seek to close the gap between employees' desire that we act as a socially and environmentally responsible company (92%) and the number of employees who think we do (84%).  Well, I am proud to report that we have, in just one year, made great strides toward closing that gap.

The latest results of the Power of Sun survey show that the percentage of survey respondents who believe that Sun acts as a socially and environmentally responsible company grew from an average of 84 percent to 89 percent.   Not only did this score improve 5 percent on the whole, it went up in every category across the board. What does that mean, exactly? Well, here is a slice of some of the data:

As you can see, the numbers went up across staff level, region and even across different business units within Sun (though I don't actually show that data here...I have to save something for the 2008 CSR report!).  The one exception is within Greater China - the overall number stayed the same but the percentage of employees who "strongly agree" dropped by six points, while the percentage who "agree" went up by the same amount.  I'm not sure what that's about but as I dig into the numbers, I hope to get a better idea.

The reason this is good news is not just that our message is getting out to our employees, although that's definitely good news! But the real good news here is that more employees believe Sun is the kind of company they want their employer to be. And maybe this means they will roll up their sleeves and pitch in as we strive to achieve more and more of our social and environmental goals. And if they pitch in - no matter their job level, job function or job location - we are more likely to meet the goals we set for ourselves - goals around product innovation, emissions reductions, global inclusion, supply chain management, community involvement, etc.

That's the headline on an article in this Sunday's New York Times that is worth reading.

A few months ago, after the untimely passing of Anita Roddick, I mentioned in my blog the trend that has been emerging over the last decade or so, in which large multinational companies buy these small outfits that have achieved a measure of success precisely because their way of doing business is different, usually more responsible/sustainable/environmentally conscious.

The New York Times article asks of Burt's Bees the question I asked (more broadly) in that blog post - can these small companies change their parents for the better? Or will they just become part of the multinational machine?

As interesting a read as the Times article is, it doesn't answer the question it poses.  But it would be great to see an analysis of what - if any - positive impact these earth-friendly companies have had on the huge companies that have purchased them.

•Has Ben & Jerry's helped shape Unilever's conscience?
•Has Aveda gotten Estee Lauder to end animal testing of its products?
•Has Tom's of Maine gotten Colgate-Palmolive to increase its use of all-natural ingredients?
•Has Stonyfield Farms been able to improve Danone's dairy production practices? 

I get that Clorox wants a piece of Burt's Bees' halo.  But I wonder if the company best known for chemical-based cleaning products and plastic garbage bags will learn from its newest, greenest brand, or will it just bask in the green glow it took Burt's Bees 20+ years to earn?

Last week Sun hosted a roundtable discussion session with The Good Business Network at our Menlo Park campus. The session topic was "employee engagement" - how companies can enlist employees in our efforts to meet - and exceed - the goals we have set for ourselves around sustainability, eco responsibility, csr - whatever you want to call it.  I wanted to host this session because I think that employee engagement is a crucial component to successfully creating a culture of sustainability within a company.  When we talk about companies it seems like we are talking about big faceless entities.  But companies are made up of people (more than 33,000 here at Sun) and it is these people that will determine our success or failure - as a business, as a steward of the earth, as a good neighbor, as a responsible member of the larger community.

Kevin Sweeney facilitated the meeting and, as usual, he did a great job. The thing Kevin touched on - and I have heard him talk about it before - is something that I think gets lost in corporate translation.  Kevin believes (and I tend to agree) that we need to engage people emotionally as well as intellectually.  Now, emotion is kind of taboo in the workplace, right?  Or is it? Companies want their employees to love working there (love is an emotion).  They want the public to be passionate about the brand (passion is an emotion).  They want people to get excited about our products (excitement is an emotion).  So why not talk about the challenges - and solutions - facing us as a civilization with that same emotion? Engage with people's passion to do good in their communities.  Talk honestly about their desire to leave a healthy planet to their children.  Encourage them to get excited about their jobs in a whole new way - a way that enables them to use their skills to have a positive impact on our business, our society and our earth. 

Okay, so it's a little melodramatic. But I think that's okay. Because actually the stakes are really high.  And when the stakes are high, emotions run high, too. And if emotion is what it is going to take to get every person at Sun to realize that they can play a role - they can be an extension of the Eco team, they can be an extension of the Citizenship team - then emotion is what I will appeal to as I try to convince every single employee in every location around the world that they can contribute to this effort.

Early next year I will be launching an internal program aimed at exactly this effort - engaging our employees so that those who are interested can become a part of our extended team. You don't have to work for Dave Douglas to be on the Eco or CSR team at Sun. You don't have to work in the Global Citizenship group to have an impact on our efforts to promote digital inclusion.  All you have to do is want to help. We will create the space for Sun employees to participate in our efforts and from there, we are pretty sure they will come up with better ideas than we could have ever dreamed of. Product ideas, ideas for better operations, innovative approaches to solving nagging Sun problems. 

See...here I am at work and I am excited. I am loving my job. I am passionate about this work and the change I know we can create.  Imagine if we could harness all that emotion that I know lives within the more than 30,000 employees at Sun.  The possibilities are endless.

I look forward to firing this up in the new year! Until then, have a safe and peaceful holiday season.  Here's to a joyous and Democratic 2008!

Update: Check out this article from the Boston College Center for Corporate Citizenship. It arrived in my inbox one day after I wrote this post.   

About three weeks ago I flew to Southeast Asia to visit some of Sun's contract manufacturers.  What an experience! I had never before been to a factory of any kind, so it was bound to be eye-opening. I was ready to put aside my Western biases and my expectations, soak it in and learn as much as I could.

I was basically tagging along with Sun's primary social auditor, Jack, as he visited two Sun factory partners. Jack has been with Sun since we signed the EICC (which, incidentally, just recently changed its name) and his primary job is to conduct the social audits of Sun's contract suppliers. 

Though I did try to keep my expectations in check, I definitely had a few. For example, I made assumptions about what the factories themselves would look like (large, smoke-belching structures), what the workers might be like (pleading at us with their eyes, seeking asylum during our one-on-one interviews), what the cafeterias would be (drab, like a soup kitchen). To my surprise, and delight, none of these were true. Not even almost. And I'm not just saying that.

Both of the factories I went to were quite modern. They were big complexes - much like office parks here in the U.S.  They had even had sports fields that the workers used to play soccer.   I'm not trying to say they were glamorous like some high tech campuses here in California, but they were certainly not drab cement buildings with smokestacks and barbed wire fences! 

There is only so much I can say about the audits themselves - as we work to build up this program, it's important we partner with our suppliers toward progress.  Any deficiencies we may have found in the course of our audit were discussed directly, openly and honestly with the factory managers. So the last thing I want to do is call them out on this blog. 

But it was a fascinating process and I would like to shed a bit of light on it, for anyone who may be interested.

Challenges (as I saw them)
In the course of our visit, we saw two factories, each for two days. The first factory we went to had a lot of experience with social audits. They even conduct their own audits of their suppliers.  But our assessment of the second supplier's factory was the first social audit ever conducted at that location.

There were definitely a few challenges associated with these audits, language being the most significant.  Jack, Sun's auditor, speaks Chinese (Mandarin primarily, but he also can speak Cantonese; incidentally, I can count to 100 and say some ice cream flavors in Cantonese, but that is generally of no use to me); the factory managers we visited with were, for the most part, not Chinese (as these factories are not in China).  Therefore, the audit was conducted primarily in English, even though the only person in the room who spoke English as a first language was me! We did have some local-language translators on hand to help smooth communications.  Needless to say, none of the factory workers spoke Chinese, and if any of them spoke English, well...they didn't speak English to us.

Another challenge was time. We had two days for each facility. Actually, given the size of these facilities, and the fact that Sun is a relatively small customer of each of them, two days should be plenty. But in fact things seemed a bit rushed.  I think this was because of the language constraints - a fair amount of the audit involves reviewing documents of all kinds -  policies, certifications, wage and attendance records.  We sent a list (in English) to each of the factories in advance detailing the kinds of things we would be asking to see.  But I guess not all of it translated perfectly, and there was some confusion. Not to mention the factory that had never done a social audit before really did not understand what exactly we were seeking. It seemed to me like we spent a lot more time on reviewing these documents than might have been necessary if everyone in the room spoke the same language with the same fluency.

The Process
Each of the factory visits was slightly different but in general we did the following:

1) Reviewed documents: environmental certifications, policies like codes of conducts, etc., wage and attendance records - we reviewed actual worker pay stubs, the computer reports of hours worked, recruiting contracts - many factories work with recruiting agencies to hire line workers.
2) Toured the factory grounds: we toured various parts of the factories, like the shipping and receiving warehouses, the chemical storage areas, cafeterias, bathrooms and the factory floor where Sun products are made. We looked at everything - the proximity of the eye-washing equipment (in case of chemical contact) to the factory line where chemicals are used, the type of fire extinguishers, unblocked exits, cafeteria cleanliness, worker stations, and more.
3) Interviewed workers: We selected workers to be interviewed in two ways - as we toured the Sun factory floor, we randomly selected workers we wanted to meet. Well, mostly randomly. We chose workers (most of whom were women) based on a few factors - if they looked especially young, we wanted to talk to them; if their job included working with chemicals, we wanted to talk to them;  if they were responsible for machine maintenance, we wanted to talk to them.  We also selected workers randomly based on the pay records the factories shared with us during the document review phase (and when we met with the workers we cross-checked their ID badges with the records to make sure management gave us the right people!) 
4) Shared our assessment: At the end of the two days, we formally shared our assessment with factory management. Except for the worker interviews, someone from management was with us the entire time, so there were few surprises during this part of the process. But it was good to re-cap, and also a great opportunity to clarify any miscommunication and misunderstandings (of which their were many).

For me, it was an incredible learning experience.  I had so many preconceived ideas about Asian factories, and so many of them were knocked away just by seeing with my own eyes. Of course I am not naive enough to believe that all factories in this part of the world are as good as these two - the fact that they are building computers and other high tech equipment surely requires different and more sophisticated management processes than, say, assembling toys or sewing t-shirts. Still, I was surprised to drive around the manufacturing districts and see huge signs proclaiming "ISO 14001 certified" - a great sign that many of these manufacturers see environmental management systems as competitive advantage. 

I was also surprised that the workers were as old as they were! Of course, I did not expect to find any 15 year olds - just the nature of the high-tech production line (not to mention the law!) would require people a bit older.  But I also did not expect to find 35, 37 and 40 year-olds (of which there were several). And I expected very high turnover - but many of the workers we talked to had been working at these factories for many years (one had been there for 13, since she was 27!).  Honestly, they seemed quite happy there.  I am sure some of them were freaked out talking to us, and several were clearly trying to tell us what they thought we wanted to hear. But overall I found them to be frank and open, and pretty happy with their employment.

Room for Improvement
Certainly there is room for improvement, not only on the part of our factory partners, but in our own audit process as well. For our part, I think one area where we can do a better
job is in preparing factory managers in advance so that there is less
confusion around things like documents, etc., when the Sun audit team
arrives. Some people might think this is a bad idea because maybe they
will fake their records or something like that. I have no doubt that
there are factories in the world that do this. I have even heard that
apparel factories are notorious for keeping two sets of books - one
that they share with auditors from US and European companies, and one
that reflects actual wages and attendance.  But after visiting these
factories I am quite sure that these suppliers have better things to
do. As it is, they had advance notice for these audits and still we saw
gaps and deficiencies.

For us and our partners, I think the most crucial area for improvement lies in how we consider the whole notion of a social audit. Based on the "gotcha" monitoring that many NGOs were fond of in the mid- and late-1990s (and some still practice today), I think manufacturers in general are wary of any kind of social audit.  It is not as strictly measurable as a quality audit or even an environmental audit - whenever you throw people into the mix, there is room for variability and the (possibly scary) element of surprise.  But we are partners in this, and even though these audits went well, there was an underlying us vs. them feeling. I am not sure what we can do to minimize that - how we can truly partner without losing the effectiveness of our authority.  But I think we need to commit to figuring it out, because I am not sure these audits can ever be truly effective if there is any mistrust or opacity.

Net Impact Conference - Nashville, TN
I have been thinking about writing this blog entry for a few weeks now - after attending the Net Impact conference in Nashville in early November.  The conference was good - Yvon Chouinard, the founder of Patagonia, was the opening keynote and he was nothing short of spectacular. It does not cease to inspire me when I listen to a successful business person live their values - actually, live my values! - and realize success, in all its meanings.

I was there to speak on a panel about trends in CSR.  I think my panel
went okay.  I generally enjoy public speaking (since my older sister
went on to become a professional actor, I needed some other way to get attention!).  In any case, I think the panel was well-received.  We all got very good
feedback from the audience (and, as a sidenote, I thought our moderator was fantastic. That's not an easy role and I thought he was superb.).

The audience members asked insightful questions and made astute observations; they seemed quite engaged. All of us on the panel (myself, someone from eBay
and someone from KPMG) stressed the value of pursuing careers outside
of the CSR "department." Instead, we encouraged the audience (mostly MBA
students) to take their CSR perspectives into traditional job
functions, like operations, finance, marketing, you name it.  Because the CSR jobs are few and far between and if we are really going to see companies evolving into organizations that integrate CSR principles into every facet of their business, it will be because every facet of their business is run by/staffed with people who share a commitment to doing business responsibly.

Since all three of us pushed this message, I am hoping it sunk in. Although the truth is, I got the same advice when I was getting my MBA and I ended up ignoring it (but in my defense, I wanted to go into a job in the finance industry until I took finance as a first-year MBA and realized it would be a futile effort!). 

At the evening cocktail event a first-year MBA from UCSD named Marc approached me.  He said that he was thinking about what I had said and wanted to talk more about taking CSR into the operations function of a company.  We had a good chat about it and I was pleasantly surprised when he emailed me a few day later to follow up and asked to be connected with someone at Sun who could talk to him more about the connection between CSR and operations. I hope he is serious - I hope he is one of many current MBAs who is looking at his career and trying to see how to combine his sought-after skills with his personal values and make positive change in the business world.

"I want to go into CSR because I don't want to work too hard."
I left Nashville early to get back to San Francisco because I needed a few days to prepare before leaving again to Asia (where I am now.  I am here to witness/participate in some factory visits with Sun suppliers who have signed our Code of Conduct. More on that later.).  I was sitting at my gate waiting for my flight when a young woman (I can say that now that I am officially in my mid-30s!) approached me.  She had been in the audience for our panel and wanted to talk a bit more about it. As we chatted she told me that despite our recommendations, she wanted to find a CSR-specific job. Of course, I can relate - that is the path I chose to follow and the job I currently do for Sun. 

But as we talked more about why she wanted to work in CSR, she said something that stuck in my head (and in my craw!).  She said, "Another reason I want to work in CSR is that I don't want to work so hard - I am getting married soon and I want to have a family, and I want balance." I found this troubling for a few reasons:

**Why do women go to business school if they are not really interested in working hard to pursue their careers? Seems like an odd amount of money to spend to not put it to good use.
**And since when are working hard and having balance mutually exclusive? I work my tail off and still find time to have a satisfying personal life - training for marathons and triathlons, spending time with friends and family, traveling.
**And, what in the world makes her think that people in CSR jobs don't work our butts off?!  I can't think of a time in my life when I have worked harder - and I had some pretty intense jobs before this one!

The implication that a CSR job won't require her to work too hard is laughable. I look around - at myself, my colleagues at Sun, at our peers at other companies - and I see people who put their hearts and souls into their jobs.  CSR jobs are tough. I don't say this to have anyone feel sorry for people in these roles - I think I am the luckiest person to be able to have a job that I feel good about every single day, a job that enables me to live my values and create truly positive change. 

But a job in CSR is no cakewalk. There is so much to do, yet usually there are few people to do it. Many people still don't understand what we do or why our company has dedicated resources to it.  Speaking of resources, companies usually do not dedicate very many resources to the CSR function - despite putting a lot of demands on it.  I bet these factors are true for lots of different jobs - in finance, strategy, product development, operations - not just CSR.  But people do not believe that, as a rule, these are not jobs that require hard work. 

So I ask, why is there this notion that a CSR job is not a "real" job? 

I spent much of last week at the annual Business for Social Responsibility conference, which was in San Francisco this year.  There were about 1400 people in attendance and in some ways it was like a reunion - running into all those people I met at last year's conference (or other conferences over the course of the year).  I wasn't sure how the conference was going to go - the agenda did not seem particularly compelling at first glance. But, to my surprise and delight, I ended up deriving a lot of value from the conference itself, as well as several of the "extra-curricular" events I attended.

Motorola
I went to several dinners last week, each one sponsored by a different company and with a different agenda.  One of the more interesting dinners I attended was one organized by the great CSR team at Motorola.  Motorola pulled together a group of people - from other companies, from NGOs, from academia - to discuss the company's latest CSR efforts, including its 2006 CSR report.  We got together for dinner at a nice San Francisco restaurant and had an engaging discussion. The folks at Motorola really take these conversations seriously - one of the participants also participated in the discussion about last year's report and he was blown away by the improvement.  Motorola took the comments to heart and made significant shifts in how they report based on those comments. So I am really looking forward to next year's report to see what role our feedback ends up playing.  

Conference Highlights and Observations
In addition to delicious and stimulating dinners, the daytime conference events also featured some highlights worth mentioning. And, as usual, I made some observations that I will share here. Among the highlights for me were running into old friends (and old bosses!), and making new connections in the CSR community - in a job that can sometimes make you feel like Sisyphus, you can never have too many people in your network to call on for help, support and plain old kvetching and kibbitzing.

There were also more cerebral highlights including:

**The incredibly compelling keynote speech from Gerd Leipold, the Executive Director of Greenpeace, who was forceful and forthright while also being generous and gracious.  He shared with us the details of a Greenpeace campaign against Cargill and its practice of tearing down the Amazon rainforest to create land to grow soy (which, like corn, is in just about every processed food people eat, including the feed of the animals that end up as our main dishes).  A representative from Cargill was present and during the Q&A he told the audience that Mr. Leipold invited him to offer a rebuttal and so he did (after which Mr. Leipold declined to comment, saying that Cargill deserved the opportunity to offer its point of view without further comment by him. Very cool.).   What I liked about this speech (and what I would have liked more of at this conference) was that he awakened the activist within us.  I think that most CSR people are activists at heart. We are working day in and day out to change the way corporations do business-as-usual - and we are doing it from the inside.  And while we may seem pretty corporate to your average Greenpeace activist, in our roles and within our companies, we tend to be the ones stirring it up - protesting this or that, trying to get some policy or practice to chance, trying to set stretch goals - generally being a thorn in someone's side!  Mr. Leipold's speech helped us feel like being an activist within your company is honorable, if not glamorous. Like all that time you spend banging your head against the wall is well worth it because we are all together in this quest for making the world a better place, the planet a sustainable home.

**The provocative breakout session about the need to push the financial community toward a more long-term view of corporate success.  Most American companies seem driven by short-term thinking - the need to meet the quarterly numbers or else face the wrath of shareholders. But this kind of short-term thinking has led to some shady corporate activities (think Enron), and there is a movement afoot to bring long-term thinking to the marketplace. (As a sidenote, all this talk of long-termism led me to ask our investor relations team if Sun gives quarterly guidance. As of Q407 we do not. Nice.)

**The engaging and often hilarious/ridiculous workshop led by the Institute for the Future entitled, "Superheroes 2.0" in which we put to the test some of the skills that will be necessary for success as the nature of how we work and the technology we use evolves. By the end of the session, IFTF declared us a Superheroes Network and I had met some incredible people working on sustainability issues at companies like UPS, Deloitte, Smith Barney, and others.

So Much to Learn
One of the great but also kind of depressing things about going to the BSR conference is the realization that there is still so much to learn and that there are so many companies doing such amazing work to lead the way.  Sometimes it feels like we'll never catch up!  Don't get me wrong, there are a whole lot of things Sun does incredibly well in this space that others don't - embedding environmental values into our core products, our commitment to transparency, our flexible work programs. And yet there is still so much we can do as a company to bring social and environmental responsibility into our core strategy and business operations.

In many respects, these improvement opportunities are motivating; but sometimes they can be downright depressing.  Because just when you feel like you've done something really great, something to move your company forward (like developing a human rights policy or inching closer to getting a socially responsible investment option into the company's 401(k) plan), you realize that these things are blips on the radar, drops in the bucket. And you can turn in any direction and see some other company doing more and doing it faster.