CSR News & Analysis

New Address!!!

noreply@blogger.com (Melissa Paschall) — Sun, 22 Apr 2007 19:10:00 +0000

Some readers have mentioned that I seem to have disappeared from the face of the Earth... but no, never fear! I just switched my blogging platform to typepad. If you're using a newsreader, please update your links. To check out the new site directly, here's my forwarding url: www.capitalism4good.com

See you there!!!

BIG NEWS: My blog is moving!!!

noreply@blogger.com (Melissa Paschall) — Thu, 22 Feb 2007 16:33:00 +0000

I've redesigned this blog, and am now hosting it on typepad instead. Here is the cool new url that will take you there:

www.capitalism4good.com

See you on the other site!

Two sides to every CSR story?

noreply@blogger.com (Melissa Paschall) — Mon, 19 Feb 2007 18:29:00 +0000

When I put together my news briefs, I like to think that I present a balanced view. Often, this means including articles that take opposing positions on a topic - but lately, I've started to wonder if this approach doesn't introduce a different sort of bias.

I was thinking about this as I cut-and-pasted a DiversityInc article about Wal-Mart being the recent target of the Largest Discrimination Case in History, and then added another article suggesting that the big-box retailer may be creating A Blueprint for Reviving Black-Owned Banks. One count against Wal-Mart's diversity policies, and one count in favor.

But is it truly balanced?

I remembered how Wal-Mart has a "war room" of PR professionals managing its reputation, and wondered if they had been calling every news outlet in the country, trying desperately to place a pro-diversity story in order to counter news of the lawsuit. It wouldn't have surprised me; anyone in their position might do the same thing.

Next I noticed another article in The Guardian blaming a recent UK ban on junk-food advertising for draining needed funding from children's television programing. I had covered news of the ban before, and wondered if this was somehow the junk food manufacturers' response to it. Or maybe it was just reflected a reporter who, like me, wanted to present a "balanced" view.

But are two sides to a story equally valid? And in this age of proliferating information, isn't it the job of the news media (and of columnists and bloggers) to help us filter the relevant from the irrelevant, and the better arguments from the less-tenable ones?

It's a tough tightrope to walk, and reminds me of a previous post self-critical post on how our perception of the CSR news landscape can easily become skewed.

Is CSR Getting a Boost from the White House?

noreply@blogger.com (Melissa Paschall) — Sun, 18 Feb 2007 03:01:00 +0000

I realize that the title of this post is absurd: the Bush administration hasn't been all that gung-ho about climate change - or any other issues that lie at the heart of CSR.

But as Americans increasingly oppose the war in Iraq, and are increasingly frustrated with the Bush administration's obtuseness, it seems to me that backlash against the White House has taken on a more general form.

Perhaps the best thing Bush can do for climate change is to ignore it, because Americans, and even the world at large, are eager to stand for something that our President is against.

The good, the bad, and the in-between

noreply@blogger.com (Melissa Paschall) — Sat, 17 Feb 2007 03:13:00 +0000

I've been researching CSR benchmarking recently - the awards and rankings that separate the "good" companies from the "bad" ones. As I compiled a lengthy list of these, I came across an article by David Vogel, who not long ago wrote The Market for Virtue.

His article ("When do 'good' firms go 'bad'?"; L.A. Times 2/13) argues that corporations are never entirely virtuous nor entirely evil, and that to say they are is an oversimplification. He points to half a dozen extremely compelling examples:

British Petroleum (BP), which embraced alternative energy development but has struggled with industrial accidents that killed workers and destroyed Alaskan tundra.
Microsoft, despised for monopolization but forgiven for it's founders charitable deeds - even if the Gates Foundation itself has been under recent scrutiny for its investment activities.
Merck, which gives away river-blindness drugs but also failed to recall the blockbuster drug Vioxx after evidence of heart damage surfaced.
Altria, the parent company of Philip Morris, which manufactures tobacco but does so on family farms owned mostly by minorities, and gives generously to charitable causes.

As more consumers, and more companies, pay attention to the reputational value of CSR, it's important to keep in mind that companies are complex organizations with many people, and people are complex organisms with many motivations.

People-to-People Power

noreply@blogger.com (Melissa Paschall) — Thu, 15 Feb 2007 21:06:00 +0000

Have you ever tried to take out a short-term loan? If so, you might have discovered that banks don't like lending to people who actually need the money. Often, it makes more sense to ask a good friend for a loan, and let him or her benefit from your interest payment. But what if we didn’t have flushed friends to take pity on us? Where would we go?

Well, now there’s hope: at least two new websites are enabling person-to-person lending among strangers, and they’re finding some brilliantly sensible ways to do it.

The most well-known in the U.S. is Prosper, which launched in February of 2006 and already has over 100,000 members. On the site you’ll see profiles of would-be borrowers that include a photo, a description of what they plan to use the money for, and some credit ratings. Lenders can distribute funds to several borrowers in small amounts, to diversify their risk. Borrowers specify the highest interest rate they are willing to pay, the total amount they want to borrow, and the time period during which lenders can “bid” on their business. Once there are enough lenders to fund the borrower’s request, new lenders can offer lower interest rates to take the place of other bids – until the bidding period is over.

For example, Listing #90006 writes:

"Hello, I am trying to get a loan so that I can pay for advertising for my glass business that I have owned for 8 years. I also want to help my wife get her website up for her home based business so that she can stay at home with our kids. Any help would greatly be appreciated and we would also like to loan in the future. Thanks and God Bless"

He is requesting $10,000, of which 24% is already funded. His credit rating is a C, with a debt-income ratio of 19%, and he is a homeowner. He is willing to pay up to 15% interest, and plans to repay over a three-year period. The funding promised to him so far is divided among 21 different “bids” – mostly in increments of $50 or $100. The bidding is open for another six days, but the site’s forecasting chart indicates he won’t gather quite enough to make his total loan. Perhaps he’ll try again, offering a higher rate.

There are hundreds of other stories on the site too – people who want to buy an engagement ring, put inventory in a new store, send the kids to camp, or pay off credit card debt. It makes for addictive reading.

In the United Kingdom, Zopa is a similar site, and prominently displays its average gross return of 6.75% interest, after accounting for bad debt. Not too shabby. The site doesn’t let you browse borrower profiles until you sign up for an account, which is a real pain, but maybe it ensures that only serious participants are there. Or maybe it’s just a pain. It’s hard to say since I didn’t succeed in getting an account myself – the site wouldn’t accept my U.S.-format phone number.

All in all, I’m excited about the potential for sites like Prosper and Zopa to revolutionize micro-lending. They offer a many-to-many interface that can transcend both national and organizational boundaries. At the same time, there’s so much more that could be done. Many of the borrowers right now – perhaps a majority – are looking for a quick financial fix after racking up high-interest debt, sometimes carelessly. Others want to pay for things that they’ll never be able to afford, based on their current jobs and lifestyles. Some are like I was at the start of graduate school – in a tight spot for the short term.

Very, very few are entrepreneurs and small-business owners.

Even fewer are social entrepreneurs.

I think that these websites could serve a new purpose, channeling private funds from small-time investors to social-sector ventures. Right now, it’s hard to engage in socially-responsible investing that is truly tailored to your values unless you’re very wealthy. The rest of us are stuck with choosing the one “social” index in a slew of mutual funds, and hoping that whoever is throwing stocks into that pot is doing a good job. How much more exciting would it be to choose your own social investments, choose their interest rates and your risk tolerance, and allocate your meager savings across several of them?

Person-to-person lending could, in the very immediate future, allow us to choose individual investments based on their financial, social, and environmental values – in whatever balance we choose, and for whatever amount we have to invest. As social entrepreneurs, this can also become a vehicle for raising funds to jump-start our ventures. After all, wouldn’t someone rather lend money to your AIDS-education initiative than to someone else’s new-car fund? (Already, the international microfinance site Kiva does something similar for developing-world entrepreneurs.)

In fact, there’s an opportunity here for someone, or several people, to start a “fund” of social-sector projects on Prosper – by directing social entrepreneurs to the site and grouping the projects together under a guarantor’s umbrella. Then lenders who are short on time can put money in the fund, and the fund manager scours the site for appropriate projects and diversifies investments among them. Ideally, the fund manager has a good credit rating, and that helps lower the interest rates that lenders are willing to accept.

This isn’t just your ordinary microfinance. This is connecting social entrepreneurship with socially responsible investing at a micro level, through the series of tubes known as the Internet. Is there anything cooler? (Why are you still reading? Go get started!)

Note: this post is adapted from an article I wrote for 1bloc (see www.1bloc.com)

Valentine's Day: A Good Time to Buy Organic?

noreply@blogger.com (Melissa Paschall) — Tue, 13 Feb 2007 18:57:00 +0000

A friend sent me this New York Times article (from 2/12/07) on the international flower-growing industry, and it looks pretty dismal: Valentine Roses Hit With Toxic Chemicals.

Some intense pesticides and fungicides are used to grow flowers in hot buggy climates and still get them through strict U.S. import criteria. The article is downright depressing, but the solution seems fairly simple - support organic growers.

I did a quick search online, and found Organic Bouquet. They're expensive - at least $50 for a dozen red roses - but for a product that's really a luxury to begin with, it seems only fair.

And besides, what better way to show how sensitive a guy you are??

NEWS SUMMARY -- 2/5 - 2/12

noreply@blogger.com (Melissa Paschall) — Mon, 12 Feb 2007 15:40:00 +0000

CSR is in fashion, quite literally, as the trend hits the catwalk at the Copenhagen International Fashion Fair. Meanwhile, an Ethical Corporation columnist argues that making CSR a “fad” is both more difficult and more valuable than many practitioners might think (see “Reaching Beyond the Usual Suspects,” 2/6/07).

Climate change continues to dominate the CSR news, and in particular this week Virgin’s Richard Branson offered a $25 Million prize (New York Times, 2/9/07) to whoever comes up with the best technology to absorb carbon from our atmosphere. The socially-responsible index FTSE4Good also put its foot down on climate change, telling companies to clean up carbon or face de-listing (see “Firms Told to Cut CO2,” The Guardian, 2/6/07). Despite these powerful calls for action, BP is halting plans to build one of the world’s first “zero emissions” power plants due to doubts over the government’s willingness to subsidize it (see “BP Defers Decision,” The Guardian, 2/7/07).

Entering the 2007 Proxy Season, CEO pay is on investors’ minds. SocialFunds.com (1/30/07) says that “Say on Pay” will be the big issue this year, and even overseas investors have “Lectures for America Inc” (Financial Times, 2/8/07). Already, however, companies are hoping to preempt shareholder action through initiatives such “UK-style executive pay votes,” Financial Times, 2/8/07).

Private equity has been catapulted into the public consciousness over the past year, and the only thing that seems certain is that it's influence is growing rapidly. This week, then New Statesman (2/12/07) calls it “Capitalism's Dirty Business,” claiming that private equity "sacks staff, cuts wages, sells off assets, outsources, screws suppliers, and, more often than not, reduced services to customers."

The International Business Leaders Forum simultaneously calls for companies to act on Malnutrition in the developing world and Obesity in more developed markets.

In Russia, a new development in the Yukos story, as its former leader Mikhail Khodorkovsky has new charges brought against him - just in time to prevent his possible parole. This is a new chapter in a much longer story: Khodorkovsky made billions through the privatization of Russian oil assets, and was both despised as part of the "oligarchs" (who symbolized the country's rapidly-growing inequality), and also hailed as a leader in corporate social responsibility (for his company's community programs). When he seemed to have political aspirations, however, charges of tax evasion were bought against Yukos Oil - charges that many felt were flimsy and politically motivated. For more, see the Wall Street Journal, 2/9/07.

Other companies in the news include:

Wal-Mart is fighting a pay discrimination case (BBC, 2/6/07)
Exxon-Mobil “just wants to be loved” (New York Times, 2/10/07)
Syngenta is accused by the Brazilian government of illegally planting genetically-modified seeds near a nature reserve (Wall Street Journal, 2/7/07)
McDonald’s is bringing Fair Trade coffee to the mainstream (Stanford Social Innovation Review, Winter 2007)
Citigroup once led the financial industry in environmental awareness, but is now seen as a laggard (Wall Street Journal, 2/9/07)

Blood Oil: Nigeria

noreply@blogger.com (Melissa Paschall) — Mon, 12 Feb 2007 01:17:00 +0000

An in-depth article in Vanity Fair explores "Blood Oil" in Nigeria's delta region. While the perspective is one of oil-security in the U.S., the author does an excellent job describing the decades-old conflict in general: the poverty, inequality, environmental destruction, corruption, kidnappings, sabotage and violence that are part of oil sourcing in this troubled region.

Accompanying the article is a web-only slideshow of photos from the region, including some of the militants themselves - speeding through the delta with facemasks and guns. Other photos show the extreme poverty lying just outside an enormous infrastructure of oil production equipment.

My CSR Library

noreply@blogger.com (Melissa Paschall) — Thu, 08 Feb 2007 15:31:00 +0000

Last weekend, I hosted a bunch of Starting Bloc fellows, and they were all extremely interested in seeing "my library."

I do in fact have a small library of carefully-chosen CSR-related books. If you're looking to start reading about the field, perhaps I can save you some research time by listing them here:

The Market for Virtue, by David Vogel
HBR on Corporate Responsibility
Strategic Corporate Social Responsibility, by Werther and Chandler
Profits With Principles: by Ira A. Jackson and Jane Nelson
Global Business Citizenship, but Donna Wood et. al.
Capitalism at the Crossroad, by Stuart Hart
The Wal-Mart Effect, by Charles Fishman
The Civil Corporation, by Simon Zadek
Corporate Social Responsibility, by Kotler and Lee
The Triple Bottom Line, by Andrew W. Savitz
How to Change the World, by David Bornstein
True To Yourself, by Mark Albion
WorldChanging: A User's Guide to the 21st Century
Business Solutions for the Global Poor, by Rangan et. al.
The End of Poverty, by Jeffrey D. Sachs
A Corporate Solution to Global Poverty, by Lodge and Wilson
Globalization and its Discontents, but Joseph E. Stiglitz
Small Giants, by Bo Burlingham
Democracy's Edge, by Frances Moore Lappe

Soon, I'll be upgrading my blog/website to a new combined format, and posting some real book reviews - but in the meantime you can see an expanded list that I've posted here.

Open Season for CSR Conferences

noreply@blogger.com (Melissa Paschall) — Tue, 06 Feb 2007 14:34:00 +0000

In the grander vision of this blog, I'll have an entire website with an "events" section for conferences and the like - so stay tuned! In the meantime, there's a very useful list of upcoming conferences at On Philathropy, including events by:

The Conference Board (February 27-28 in New York City)
Ethical Corporation (March 21-22 in London)
The Center for Corporate Citizenship at Boston College (March 25-27 in San Francisco)
Business for Social Responsibility (October 23-26 in San Francisco)

Also, Harvard Business School (my primary employer) is holding its annual Social Enterprise Conference on March 4th. Speakers include:

Daniel Doctoroff, deputy NYC mayor
Cheryl Dorsey, president of Echoing Green
Victoria Hale, founder of One World Health
Sara Horowitz, founder of the Freelancers Union

Lunchtime activities are the "Pitch for Change" competition (deadline Feb. 23) and several small-group lunches (sign up early!). The day ends with a Career Fair. Cost is $40 for students, $90 for professionals, discounted for Harvard affiliates.

NEWS SUMMARY - 1/29-2/5

noreply@blogger.com (Melissa Paschall) — Mon, 05 Feb 2007 20:06:00 +0000

The recent meeting of the Intergovernmental Panel on Climate Change spurred a surge in climate change news. For example:

Despite its notoriety among green activists, even “ExxonMobil seeks to take its business to greener pastures” (Financial Times 2/1/07),
Lehman Brothers published a study examining how firms are adapting to the increasing relevance of climate change to their businesses, discussed by its author (“Companies must adapt or die in a changing climate”; Financial Times 1/30/07),
Goldman Sachs announced ambitious environmental measures and its general stance that climate change is both a risk and an opportunity throughout the economy ("Goldman Sachs Expects Big Returns from Going Green"; Ecosytem Marketplace 1/23/07),
Business schools are increasinly going green as the Financial Times reports that "Global Warming Has Become a Hot Topic"

A a new magazine, The Corporate Citizen, is now being published by one of my employers, the Center for Corporate Citizenship at Boston College. It will have a controlled print circulation of 50,000 - making it the most widely circulated publication in the field. The inaugural issue (available free online) "reflects much of the content from The Center’s annual conference and the practices of many of its 350-member companies."

Without explicitly mentioning the Killer Coke campaign, a Coca-Cola executive discussed the company's constructive partnerships with some external critics, and defended its choice to "vigorously confront" those who are less amenable to dialogue; see his comments in "Things Go Better With Social Justice" (Wall Street Journal, 2/3/07)

In a move that might not be so significant were it made in isolation, “Asda pledges to cut food packaging” (Financial Times 2/2/07). This follows recent eco-friendly moves by UK rivals Tesco (which plans to introduce carbon labeling on its products) and Marks & Spencer (which pledged to go carbon-neutral within five years), as well as by its parent company, Wal-Mart.

A recent HarrisInteractive poll on corporate reputation, Microsoft scored high due to its founder's personal charitable work ("How a Boss's Deeds Buff a Firm's Reputation"; Wall Street Journal 1/31/07)

As biofuels are increasingly examined for their alternative energy promise, many turn out to be somewhat less than miracles. This week the New York Times looks at palm oil and the devastating effect it can have on land in Indonesia as vast tracts of land are cleared by burning and chemical fertilizers are used indiscriminately (see "Once a Dream Fuel, Palm Oil May be an Eco-Nightmare"; 1/31/07).

The jury is still out for voluntarism, as critics say that UN Global Compact is a “Victim of Voluntarism” (Financial Express 1/30/07) while others are placing hope in new voluntary initiatives such as a new initiative to “Improve Job Prospects for Women” in the UK (Financial Times 1/30/07). Carnival Cruises voluntarily paid $30k more than necessary in an attempt at “Discharging Goodwill” after being fined for illegal pollution, but that's peanuts compared to the $20 billion that activists are asking Shell to put toward human rights issues (“Campaigners Urge Shell to Put Profits Into Clean-Up”; The Guardian 1/31/07).

NEWS SUMMARY - 1/22-1/29

noreply@blogger.com (Melissa Paschall) — Thu, 01 Feb 2007 20:46:00 +0000

Ten companies have teamed up with a surprising array of environmental activists to lobby the Bush administration for more action on climate change. The list includes General Electric, Alcoa, Dupont, BP, PG&E, Caterpillar, and others. (see, “A Coalition For Firm Limit On Emissions,” New York Times, 01/19/07)

Looking for the best blogs? On Philanthropy has gathered a list of those that are blogging about corporate philanthropy. The article “Who’s Blogging Corporate Giving?” includes links to the relevant websites.

China is awaking to the concept of CSR, as evidenced by an article in the major newspaper People’s Daily by a professor at the country’s top-ranked university; the article, entitled “Multinationals must shoulder more responsibility,” advocates that MNC’s should be treated less like guests and more like family – and be expected to contribute as family members are. Separately, Starbucks has created a “Storm in a coffee cup” over its outlet within the walls of the Forbidden City, which some activists see as an insult to Chinese culture.

As profits and mission increasingly overlap, more and more social sector organizations are creating profit-making businesses on the side, a trend covered in the Chronicle of Philanthropy’s “Making Money With a Mission.”

Also, there’s an article in the Harvard Business Review by C.K. Prahalad entitled “Cocreating Business’s New Social Compact” which describes how corporations and NGOs are increasingly working together to create economic and social success stories.

Polluters, permits and profits

noreply@blogger.com (Melissa Paschall) — Tue, 30 Jan 2007 14:22:00 +0000

The Financial Times recently reported that “loopholes” in climate change regulations are allowing Chinese factories to profit from installing scrubbers on local chemical plants (see “Chinese plants and carbon traders exploit loophole,” 1/18/07).

Personally, I thought this was actually the point of the regulations, and represented a welcome evolution from command-and-control regulations. In fact, this is essentially what I wrote my undergraduate thesis on, though I discussed the SO2 market rather than the CO2 market.

The idea of tradable pollution permits is that imposing uniform standards on all producers is disproportionately expensive for some of them. So they'll fight the policy, rightfully arguing that it would put them out of business - and policymakers respond by watering down the regulations, leading to less total abatement.

An alternative that economists tend to favor is to set the total amount of pollution that you "want" (i.e., can stand) - generally at less than its current level. Then you allocate "rights" to it, and those companies that can reduce their pollution with the lowest cost do so in order to trade their rights for money. Companies that find abatement more expensive buy these rights. The net result is that you get the amount of abatement you originally wanted, and the polluters work out among themselves who can physically accomplish it at the lowest cost - which is the economically efficient thing to do.

So, the article says that Chinese companies are installing scrubbers, and making a huge profit from cheaply reducing their pollution that way. So what? If the total amount of CO2 reduction doesn't seem like enough, it should have been set differently at the beginning. But this is exactly the sort of behavior that the system is designed to encourage.

Two neat research sites for CSR and BBOP

noreply@blogger.com (Melissa Paschall) — Thu, 25 Jan 2007 20:04:00 +0000

I've just discovered a very rough beta-version of "csr-literature.net" - which promises to be a wonderful resource of CSR-related academic papers. It seems to be affiliated with "csr-news.net/" - another great resource, but more useful if you speak German.

Also, Harvard Business School's Baker Library staff has consolidated (and in some cases summarized) a great volume of research on private-sector involvement in poverty alleviation - with the memorable acronym "BBOP" (for "Business at the Base of the Pyramid"). Those outside the Harvard intranet won't necessarily be able to link to Harvard-owned articles, but can at least know what papers and other resources to look up elsewhere.

NEWS SUMMARY -- 1/16-1/21

noreply@blogger.com (Melissa Paschall) — Mon, 22 Jan 2007 02:07:00 +0000

It seems that everyone took a couple of weeks to wake up from their holidays, but now the world wide web is overflowing with interesting CSR news. Here is a start on some of the most interesting issues and articles:

As the United Nations makes the transition to new leadership under Sec-Gen Bank Ki-Moon, it will be just as focused on CSR (“United Nations Underlines Supports for Corporate Social Responsibility” CSRwire 1/17). In fact, the UN will even be expanding the Global Compact to include schools who pledge to make CSR part of their curricula (see “A degree of ethical leadership” Financial Express 1/18).
In the wake of the Fortune survey of workplace satisfaction, the week’s news had a distinct bent toward employees. The most relevant of the magazine’s special section may be “Best employers, great returns” (Fortune 1/18); also, another survey shows that “In the War for Talent, Good Companies Finish First” (CSRwire 1/22). Finally, Diversity Inc's January issue examines “Workplace Diversity: How Do Companies Handle It Abroad?"
Supermarkets are caught between conflicting causes. On the one hand, in the UK they are making great progress in helping consumers reduce their carbon impact (see “Tesco follows M&S with climate change move” (The Independent 1/16) and “Sustainable supermarkets” (Ethical Corporation 1/12), but shifting to local production can have a detrimental effect on African economic welfare (see “Africa’s supermarkets and the poor” Ethical Corporation 1/12).
BP’s safety practices were lambasted by a panel led by James Baker, former US secretary of state but still “BP denies that it put profit over plant safety” (Financial Times 1/17).
The very concept of CSR is being examined and debated heavily, particularly in the UK as the Labour and Conservative parties embrace different philosophies (see “Carrots and sticks needed for business, say Tories” Financial Times 1/16; “Private squalor, public affluence” MP Cheryl Gillian 1/16; and “I caught a glimpse of the Cameron future: alarm bells rang”; Sunday Telegraph 1/21).
In the US, the major issue seems to be whether voluntary initiatives can ever be enough, as a Harvard study claims that “The Problem with Voluntary Corporate Initiatives Is -- Well, They Are Voluntary” (SocialFunds 1/16) and in the meantime a new voluntary partnerships and initiatives are touted in the press (see “Six power groups back bill to curb emissions” Financial Times 1/18 and “Beyond The Green Corporation” BusinessWeek 1/29).

Recycline - truly obsessive, but kinda cool

noreply@blogger.com (Melissa Paschall) — Fri, 19 Jan 2007 23:46:00 +0000

The other day I went out to dinner with some Net Impact folks, and one of them showed up with a stack of toothbrushes for us. For some reason, he thought it was funny when I assumed he was a dentist.

Anyway, it turns out that he works for Recyline, purveyor of several obsessively-environmental products, including toothbrushes. The handle is made entirely of old yogurt containers. The paper in the packaging is 100% recycled (50% post-consumer). The plastic in the packaging is touted as a re-usable carrying case (with ventilation holes!). When you're done with the toothbrush, you can send it in a pre-paid envelope back to the company, where it eventually joins other used recycline toothbrushes to become a park bench. They've truly thought of everything.

Even though I'm making it sound pretty dorky, I'm actually quite taken with the idea. Recycline is wisely founded on the belief that recycling only works if there's a market for the materials we put in those blue bins. Every trash day, I wonder if the carefully-washed tubs and milk bottles really go anywhere other than a landfill. Recycline has given me a little more faith that it does.

The company doesn't have many products yet - just dental care, razors, and disposable (I mean recyclable!) tableware. But they expect to expand the product line soon.

The Wal-Mart Conundrum

noreply@blogger.com (Melissa Paschall) — Thu, 18 Jan 2007 19:05:00 +0000

Today's post will be devoted exclusively to that behemoth of modern capitalism: Wal-Mart. Is it good or evil? Both or neither? And what can we do to steer it right?

In his aptly-named book, The Wal-Mart Effect, author Charles Fishman writes:

"Wal-Mart isn't just a store, or a huge company, or a phenomenon anymore. Wal-Mart shapes where we shop, the products we by, and the prices we pay -- even for people who never shop there.... Wal-Mart reaches around the globe, shaping the work and the lives of people who make toys in China, or raise salmon in Chile, or sew shirts in Bangladesh, even though they may never visit a Wal-Mart store in their lives."

He's right -- Wal-Mart is more than just a store now. It's a force of capitalism. And that inevitably leads people to ask whether its influence is good or bad.

Recently, a colleague at 1bloc wrote an article entitled "A Reason To Like Wal-Mart?" in which she described the company's recent efforts to open low-fee banking institutions both in the U.S. and worldwide, arguing that such operations would provide many of the benefits of microfinance to communities who often lack access to formal banking. But what struck me was the title -- "A Reason...." I think there are many reasons to like Wal-Mart. There are also many reasons to despise Wal-Mart. Here's a quick overview of the company's recent pro's and con's:

Pro's:

recently introduced sustainable fishing practices
introducing more organic foods and making them affordable
developing hybrid trucks for its fleet
convincing consumers to buy energy-efficient bulbs
providing many commonly-prescribed drugs for only $4
ongoing pressure on suppliers to reduce packaging
low prices can help poor consumers buy things they need

[Actually, when I search on that last one, all I find are reference to the high cost of low prices!]

Con's:

infamously low wages and benefits
union-busting (except in China, where the union doesn't represent workers much anyway)
using its heft to re-zone property that disallows big-box stores
creating cultural homogenization but putting mom & pop stores out of business
encouraging needless consumerism (link is a parody... or is it?)
recent fake-blogging (i.e., "flogging") debacle
generally replacing aspects of American life that we've sort of grown to like

[For a great discussion of several of these issues, see "One Two Three Four We Don't Want Your Superstore" by PBS.]

When I first started hearing about Wal-Mart (it's been a very slow infiltration here in New England), I decided to boycott it - a major step for me because it was the only store I was boycotting. Then again, it wasn't as if I had a Wal-Mart anywhere nearby anyway... so this was more personally symbolic than anything else. But I told myself if I was ever in a Wal-Mart, I wouldn't buy anything. A year later, visiting Texas, I finally had the opportunity to not buy some very tempting 16-cent avocados.

In 2005, I noticed that Wal-Mart was finally paying attention to the negative attention it was receiving, and seemed to be trying to change. CEO Lee Scott was making speeches about going green. I'm sure this was financially-motivated, but that's alright by me. Most of business is financially-motivated, and I just want to do my part to align the financial and social motivations. Based on the company's changed behavior, I decided to end my mainly-hypothetical boycott, and eventually bought a set of cheap luggage from a Wal-Mart in New Hampshire.

Now, as we enter 2007, I am again re-thinking my Wal-Mart policy. The company seems to be doing a number of good things, but that will never change the fact that its purpose in life is to be a competitive big-box retailer. And I don't happen to like big-box retailers. They depress me, and their low prices don't seem to make up for their low wages. No matter how many efficient light bulbs they sell, I don't really want to live in a world of big-box retailers.

So what do I do? Buy at Wal-Mart to signal that I support the changes they're implementing? After all, if they have to exist, I'd rather they try to be socially and environmentally conscious. Or do I boycott once more, in the hopes that they will just go away and leave the planet alone?

Decisions about where to buy a few avocados and $35 worth of luggage are not enough to make a big impact - but I like to know where I stand.

NEWS SUMMARY - 1/9-1/16

noreply@blogger.com (Melissa Paschall) — Wed, 17 Jan 2007 20:49:00 +0000

Global regulation took center stage last week:

The recently-appointed UN Sec-Gen Ban Ki-Moon addressed business leaders in New York (“Business Community and UN Must Carry On Partnership”; UN News Center; 01/10/07)
The United Nations Development Program announced an eight-country responsible-business project in Europe (“EC, UNDP Promote Responsible Business”; UNDP Newsroom; 01/11/07).
Ethical Corporation takes a step back to examine the usefulness of international law in CSR implementation (“Ultimate Governance”; 01/11/07)
Several major multinational retailers have voluntarily agreed to cooperate on supply-chain labor standards worldwide (“Big Retailers Join Forces”; Financial Times; 01/11/07).

In socially-responsible investing...

Domini charts new territory by creating two new funds focused outside the traditional investment geography; they are the “PacAsia” and “EuroPacific” Social Equity Funds (“New Domini Funds Invest in the World”; SocialFunds.com; 01/11/07)

In company news...

Bill and Melinda Gates had a busy week, as their Foundation prepares to engage in a wholesale review of investments following accusations that it funds the very social ills it seeks to repair (“Gates Foundation May Shift Billions”; The Guardian; 01/12/07); meanwhile, back at the office, Bill Gates is promoting Dell’s new tree-planting program (“Dell Unveils ‘Plant a Tree for Me’”) and encouraging other computer manufacturers to follow his lead in offering free recycling (“Dell Says Plant a Tree, Help the Envirnoment"; New York Times; 01/09/07)
Wal-Mart is also maintaining a steady stream of positive press, despite the recent fake blog scandal: a new set of TV ads touts the feel-good values of “Sam’s Dream” (Adweek, 01/09/07), and the Financial Times discusses the retailer’s recent efforts to develop a more fuel-efficient fleet (“Wal-Mart to Develop Hybrid Truck Venture”). Meanwhile, the conservative Townhall.com has the retailer in its sights for being too engaged in socially responsible practices (“Shining the Light…”; Townhall.com; 01/13/06).
General Motors seems to be leaping into the market for alternative-fuel vehicles with its development-stage Volt, an electric car that will contain both a battery and an on-board generator (“GM Looks To Electric Car To Spark Revival”; The Guardian; 01/08/07).

Finally, in academic news...

The Stanford Social Innovation Review contains an in-depth article, co-authored by social enterprise guru Jim Austin, on the trend toward blending the private and social sectors (“Capitalizing on Convergence”) - a trend also noted recently by my college at 1Bloc ("Sector Blending"; 01/02/07).
Knowledge@Wharton examines whether and when corporate philanthropy increases profits ("Corporate Philanthropy Inspires Trust; Does it Also Prompt Higher Profits?"; 01/10/07), with attention paid to the differences between 1) industries that are more competitive versus more oligopolistic/monopolistic, and 2) industries that rely more or less on marketing to drive their profits.

Green Buildings Are All The Rage

noreply@blogger.com (Melissa Paschall) — Mon, 15 Jan 2007 19:11:00 +0000

The sustainability movement has been paired with construction practices to create a "green building" boom. Essentially, green buildings may: 1) make more sustainable use of natural resources for building materials, 2) be more are energy-efficient, 3) incorporate renewable energy sources such as solar panels, 4) be aesthetically integrated with the environment, and/or 5) feature "natural" aesthetics such as sunlight or running water indoors. Advantages can include lower environmental impacts, lower operations cost, and happier/healthier/more productive inhabitants. In the U.S., the generally-accepted certification for green buildings is the LEED Green Building Rating System™, where LEED stands for Leadership in Energy and Environmental Design.

I was only vaguely aware of this movement until I attended Andy Savitz's book launch at the new Boston Headquarters of Genzyme, which is considered a model of green building practices in a commercial office building. After that, I noticed that a fellow 1Bloc writer chose to explore the idea of Green Affordable Housing for her recent article.

Then, it was just everywhere. Was I just more attuned, or was this phenomenon really passing some sort of tipping point? I can't be sure, but in late December I learned that Boston planned to amend building codes to require all large-scale private construction to meet "green" standards, and that several other cities are making similar changes in legislation.

Around the same time, the business magazine Barron's quite appropriately announced that green buildings were going mainstream (see "As Green as the Grass Outside" from the 12/25/06 issue). The article reports that, according to The Green Building Council (which runs LEED), 5% of all new U.S. commercial from 2006 construction will be LEED-certified, if the certifiers can ever dig themselves out of their vast backlog of requests.

Finally, a couple of days ago, I received an email about a new website called Rate It Green (www.rateitgreen.com) which allows individuals and professionals to share ideas about green building practices and products.

What a huge surge of news about one topic! I'm sure there's plenty more, but that should provide an introduction if you're not familiar with the topic, and some useful links if you need to know more.

Base of the Pyramid book

noreply@blogger.com (Melissa Paschall) — Mon, 15 Jan 2007 04:49:00 +0000

A quick note to regular readers: I just discovered that my blog setting was not automatically approving comments anymore, and I had quite a backlog! My apologies. I have no desire to censor any of them. Just a glitch.

Today I'd like to announce a new book that a friend of mine worked on extensively (go Brooke!), called Business Solutions for the Global Poor: Creating Social and Economic Value.

It is an edited compilation of papers and case studies presented at a Havard Business School conference in 2005. Each relates somehow to the private sector's role in poverty alleviation. Generally speaking, they are in the spirit of C.K. Prahalad's Fortune at the Bottom of the Pyramid; in fact Prahalad was a speaker at the conference.

The book is a bit pricey, but all royalties are being donated to the International Committee of the Red Cross.

I hope to read it soon and post a review - or to hear from blog readers who have read it. I swear, your comments will be posted this time!

NEWS SUMMARIES (belated)

noreply@blogger.com (Melissa Paschall) — Thu, 11 Jan 2007 15:10:00 +0000

Happy New Year! And apologies for my long lapse. No, it is not a sign that the blog is dying – just that I had a busy holiday travel schedule. I’ll be blogging onward into 2007, but first let me provide some belated news tidbits:

Swiss Re Offers Employee Rebate to Reduce Carbon Footprint
(GreenBiz.com, 5 January 2006)
The company is offering to reimburse workers for half the money they spend on carbon offsets for their mobility, heating, and energy use.

An Ousted Chief’s Going-Away Pay Is Seen by Many as Typically Excessive
(New York Times, 4 January 2006)
Gadflies Get Respect, and Not Just at Home Depot
(New York Times, 5 January 2007)
The biggest corporate scandal right now is the “resignation” (a.k.a. firing) of Bob Nardelli, formerly the overpaid and under-performing CEO of Home Depot, who received a $210 million severance package for his trouble. This story is rapidly becoming an example of both successful shareholder activism (which forced the resignation) and of rampantly excessive executive compensation.

Top Corporate Social Responsibility News of 2006
(CSRwire, 4 January 2007)
Top Five Socially Responsible Investing News Stories of 2006
(SocialFunds.com, 5 January 2007)
No point in summarizing the summaries – just follow the links for a lighting-fast review of the top issues in CSR and SRI from the past year.

Independence from the Corporate Global Economy
(Yes! Magazine, Winter 2007 Issue)
A veritable manifesto on how to live without big corporations, through buying local, recognizing non-financial “economies” such as gifts and cooperation, and mobilizing for greater awareness of these types of alternatives.

Big Dig: Mongolia Is Roiled By Miner's Huge Plans
(The Wall Street Journal, 4 January 2007)
A businessman plans to operate one of the world’s biggest copper and gold mines in the poor and land-locked country of Mongolia, and expected local residents to welcome the boost to GDP – in fact, the project might double the national income. However, as developing nations worldwide have struggled with foreign mining companies that deplete their ecosystems and engage in human rights abuses, Mongolian activists are protesting the mine and Parliament is considering withholding permission for it to operate.

Fighting Over Gold In the Land of Dracula
(The New York Times, 3 January 2007)
A poor small-time farmer in the Transylvania province of Romania is fighting a multinational mining corporation that wants his land – and attracting support from a host of celebrities and activist organizations worldwide.

Be It Ever So Homespun, There's Nothing Like Spin
(The New York Times, 3 January 2007)
Companies are waking up to the fact that a growing segment of food-shoppers are leaning toward natural, environmentally-friendly and socially-conscious purchases. However, rather than simply spurring an increase in responsible sourcing, much of this shift is fueling a change in packaging design to evoke the feeling of healthy and earth-friendly foods. The greenwashing can sometimes be difficult to discern from the real thing.

Wal-Mart Puts Some Muscle Behind Power-Sipping Bulbs
(The New York Times, 2 January 2007)
The big-box retailer is throwing its impressive weight behind efforts to switch consumers from traditional incandescent bulbs to the more energy-efficient florescent bulbs. As part of the effort, it is also leaning on suppliers to find ways to accomplish the shift. If it succeeds in its goals, Americans stand to save $3 billion in energy costs by 2008.

When 'Refurbished' Takes On an Earth-Friendly Vibe
(The New York Times, 31 December 2006)
If you’re reading this, chances are you both, 1) care about the environment, and 2) use a computer. So how about applying your environmental values next time you buy a computer? This article discusses the eco-benefits of buying a “refurbished” computer, and also a new EPA-funded rating standard called Epeat, short for “Electronic Product Environmental Assessment Tool,” which considers factors such as energy efficiency and the levels of various hazardous chemicals. Finally, it may be worth waiting a bit to purchase, as more eco-friendly models are expected to be out in 2008, as manufacturers find ways to meet Europe’s new and stricter standards.

Gentlemen, Start Your Plug-Ins
(The Wall Street Journal, 30 December 2006)
A former head of Central Intelligence wants to convince you to strive for replacements to Middle-East oil, and his favorite substitute seems to be electricity, since there would be very little new infrastructure needed. In the long run, he sets great store by new genetically modified biocatalysts that enable ethanol to be produced from a wide variety of plants – a much more efficient strategy than corn-based ethanol production.

Launch of Three New Clean Tech Indexes Culminates Banner Year for Green Investing
(SocialFunds.com, 29 December 2006)
In what some are calling the "year of green investing," 2006 ended with New York City-based investment bank Jefferies Global Clean Technology Indexes introducing three new green indexes. Altogether, the number of these indexes more than doubled last year, from five at the start of 2006 five to eleven at the close of the year.

UN Global Compact to Delist Additional 203 "Inactive" Companies
(Press Release from United Nations Global Compact, 28 December 2006)
An early criticism of the Global Compact was that it required very little of its members, but recently the UN-run organization has shown an increasing willingness to boot those companies who don’t abide by its guidelines. Those who have failed to report their efforts via the Communication on Progress framework have been dismissed – 335 of them last October, and an additional 203 as of January 1, 2007.

Illegal Power Plants, Coal Mines In China Pose Challenge for Beijing
(The Wall Street Journal, 27 December 2006)
As the Chinese economy grows by leaps and bounds, higher energy demands have spawned illegal coal-fired power plants, which it turn have spawned illegal coal mines. These add to the country’s environmental woes, and tend to lack safety standards. A power plant in the province of Inner Mongolia was discovered recently when part of it collapsed, killing six workers. Last year, most of China’s nearly 6,000 coal-mining deaths occurred in illegal mines. Sometimes the central government is unaware that these operations exist, but in some cases officials are turning a blind eye; a recent investigation found that over 4,000 Chinese officials held financial stakes in illegal mines.

As Green as the Grass Outside
(Barron's, 25 December 2006)
It looks like “green buildings” are going mainstream. The U.S. Green Building Council, which offers the Leadership in Energy and Environmental Design (LEED) certification, has a backlog of nearly 5,000 buildings to certify, and an estimated 5% of all new 2006 commercial construction will be LEED-certified once the agency can squeeze it all in. Why? Not only is it trendy and cool, but there are financial benefits too. Genzyme’s new Boston headquarters, for example, uses 42% less energy and 34% less water than other buildings its size. Plus, studies show that ecologically-designed workplaces make employees healthier, happier, and more productive. So, why only 5%?!

New Certification Standard Proposed for Climate Offset Products
(GreenBiz.com, 21 December 2006)
The Center for Resource Solutions, along with Green-e GHG Advisory Group, is proposing a new standard for carbon offsets, to ensure that providers are really offsetting the amounts they claim. The groups hope the new standard will ensure credibility and increase transparency, thereby encouraging more individuals and businesses to engage in carbon-offset practices. The draft standard, available online, will be out for comment until the end of January 2007, and a stakeholder conference call will be held in late January. For more information, contact Alex Pennock at alex@resource-solutions.org.

U.S. Companies Show Progress in Role of 'Good Corporate Citizens'
(The Chronicle of Philanthropy, 20 December 2006)
A report by the PR firm GolinHarris explores the latest trends in public perception of corporate responsibility. Dozens of companies are ranked, with high marks going to Ben & Jerry’s, Target, and Patagonia, and low marks going to Exxon, Philip-Morris, and Shell. Survey participants also ranked the factors that are most important to them in assessing a company’s goodwill: top priorities were treatment of employees and ethical business practices, and less-important was corporate philanthropy. Two-thirds said that companies should focus more on social responsibility, and nearly half believe that business today is moving in the wrong direction.

A corroded culture? How accidents in Alaska forced BP on to the defensive
(Financial Times, 18 December 2006)
British Petroleum may have re-branded itself as “Beyond Petroleum” is now struggling to maintain its reputation for enlightenment and responsibility (at least relative to its peers). After several industrial accidents and pipeline leaks over the past few years, observers are starting to claim that BP isn’t just unlucky – it has systematic problems creating a safe workplace and maintaining its operations. This investigative report pieces together the personal stories of injured workers and questions the general safety culture – or lack thereof.

How Suite It Isn’t: A Dearth of Female Bosses
(New York Times, 17 December 2006)
Since the feminist movement of the 1970s, women have been graduating from top colleges and MBA programs in ever-larger numbers – so why aren’t they taking boardrooms equally by storm? In the Fortune 500, only 16% of corporate officers and less than 2% of CEOs are women. This article explores possible reasons that women aren’t reaching the top, and what might be done to change that.
Note: for similar coverage of the same issue in the UK, see the Financial Times article of 5 January 2007: “Size of gender gap in top jobs 'woeful'” which is based on a report by the Equal Opportunities Commission.

Values-based shopping at Alonovo.com

noreply@blogger.com (Melissa Paschall) — Sat, 23 Dec 2006 17:27:00 +0000

A few days ago I came across a website that fits nicely with my shopping-season mantra of values-based consumerism: www.alonovo.com. It's slogan is "intelligent marketplace" and it's mission is "to connect the concept of corporate behavior directly to the profit motive."

Shopping from this site helps you save the world in several ways, each of which I happen to think is pretty neat:

Like many online shopping sites, this one collects revenue from Amazon for directing buyers to them - but these guys donate at least 20% of their ad revenues to charity. If you register with the site, you can choose which charity you'd like to support from a long list, but registration is not required to shop.
Next to each product is an easy-to-spot and easy-to-read chart with a "value rating" for the company that sells it, based primarily on data from KLD and the Federal Elections Commission. You can view five sub-ratings (CSR, environment, workplace, ethics, and customer focus) without registering, and more detail after you register.
After registering, you can also set your own relative values, so that the ratings become personalized to the issues that are most important to you.

There are a bunch of things that I like about this set-up. One is that it's as easy as you want it to be - no registration required and easy-t0-read charts. And yet, the more detailed data is there. In fact, accessing KLD's Socrates database is usually quite expensive, so having some of its data available for free is a huge plus. Also, indicating what's important to you as an individual has the potential to educate companies much more rapidly on what's really important to consumers. Finally, if you're using the site as an alternative to a trip to the mall, think of all that petroleum and CO2 you're saving!

GOOD's new social-networking feature

noreply@blogger.com (Melissa Paschall) — Fri, 22 Dec 2006 18:13:00 +0000

I've blogged before about the new socially-oriented social networking site Rethos and 1Bloc - and now I know of a third: the GOOD Community. This once takes being hip much more seriously as a way to engage young people in worthwhile causes. The website is still a little rough, but it's generated a lot of excitement - over 10,000 subscribers already!

Also, GOOD had an event right around the time I was writing about "Shopping for Values" - it was hosted by the Ralph Lauren "Rugby" store on Boston's swanky Newbury Street, and a portion of proceeds from sales that night went to a few GOOD-linked charities.

I met Ben Goldhirsh there, and pitched an idea to him - it's a book proposal I've been working on for a while, for something that would generate more thoughtfulness and enthusiasm among mainstream audences about the social/environmental impacts of their purchases, investments, jobs, commutes, etc. More on that idea later. It deserves it's own blog post.

Oxfam and Unilever: understanding the BoP

noreply@blogger.com (Melissa Paschall) — Wed, 20 Dec 2006 00:18:00 +0000

I was just at a meeting with Oxfam representatives, who came to Harvard Business School for feedback on a recent report, for which they had partnered with Unilever to study they company's impacts in Indonesia. The report covers a broad range of impacts - supply chain practices, value to consumers, the distribution of company profits among stakeholders, and much more. It's very lengthy, and full of useful data.

Essentially, Oxfam wants to figure out how to calculate a "poverty footprint" for a given company in a given country, and this report is the first attempt. They are now examining the methodology, and looking at what might be done better in the future.

This sort of exercise seems especially wise and timely as people in all sectors are getting excited about the "BoP" - or the Bottom of the Pyramid, a phrase coined by author C.K. Prahalad. The excitement has been good for getting business engaged in poverty reduction, but I've also been bothered by the lack of critical thought in some of these discussions. More business doesn't always or automatically help the poor. I'm glad Oxfam is trying to understand when it helps, when it hurts - and what can be done better.