Thank You for Disrupting

by Jean-Marie Dru

  rations. . . . I have built my own factory on my own ground.”2

  Her products gradually became more and more successful.

  Then, in 1920, Josephine Baker, the famous American-born

  French entertainer, began using them, and Breedlove’s success

  became international. Today, you can still find products with the

  Madam C. J. Walker label in luxury cosmetics outlets like Sephora.

  Madam C. J. Walker was a pioneer in three domains: peer-

  to-peer marketing, community marketing, and cause marketing.

  The enterprise she founded counted a sales force of up to

  3,000 employees, whose job was to present the Walker System of

  Beauty Culture door to door. The role of these Walker Agents”3

  was not just to sell products, but also to promote Madam

  C. J. Walker’s philosophy of “cleanliness and loveliness,”4 which

  consisted of educating people in the community about hygiene,

  personal pride, and the value of good appearance. Breedlove also

  owned several beauty salons throughout New York City. Cli-

  ents were encouraged to promote the products to other potential

  clients. Over 25,000 of them eventually became agents for the

  brand. Madam C. J. Walker called them, back then, her “Beauty

  Culturists.”5

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  She maintained very close ties with the African-American

  community and with the multitude of parish church micro-

  communities in particular. She allowed thousands of black workers

  to achieve financial emancipation and she became both a role

  model and spokesperson for the black community.

  More than a century before the expression was first employed,

  she became an authentic activist CEO. She fought with all

  her strength against the poor treatment of Blacks, and played

  an active role at the Negro Silent Protest Parade in 1917. She

  financed campaigns pushing for legislation to protect the rights

  of Blacks. She actively supported a great number of associa-

  tions and organizations, such as the National Association for the

  Advancement of Colored People, serving the African-American

  community. She founded philanthropies, donated homes to the

  elderly, and funded orphanages. And 100 years before Warren

  Buffet, Bill Gates, or Mark Zuckerberg chose to donate a large

  part of their fortunes to philanthropic organizations, she had

  decided to bequeath two-thirds of her wealth6 to charities that

  helped the Black community and people of color throughout the

  country.

  The subject of corporate social responsibility has always gen-

  erated a considerable body of literature. It goes all the way back

  to the Industrial Revolution, a time when observers accused the

  factory system as being the source of numerous social problems,

  including poverty, labor unrest, illiteracy, child labor, and the

  proliferation of slums. This gave birth to what was called the

  “welfare movement.”

  In the century since Breedlove’s time, the perception of cor-

  porate social responsibility has never ceased to evolve. It has also

  expanded. At first, philanthropy manifested itself exclusively

  through charitable contributions. Then came the era of giving

  back, which saw firms and individuals returning to society part

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  of what they had taken on their paths to success. Most companies

  now demonstrate their commitment to compensating any neg-

  ative impact they may have on the world. The cumulative effect

  of their efforts is having a great influence on society, culture, and

  the environment. In a world where most governments’ resources

  are stagnating, the private sector can and must help support pub-

  lic authorities. Today, of the 100 leading economic entities, 69

  are corporations and 31 states.7

  Younger generations are lucid about what governments are

  actually in a position to accomplish, so they expect more from

  business. A 2015 Nielsen report8 revealed that the percentage

  of global consumers willing to pay higher prices for sustainable

  goods had grown by 11 points in one year, from 55 percent in

  2014 to 66 percent in 2015. And among millennials, the number

  shifted by a staggering 23 points, from 50 percent to 73 percent.

  This study leads us to believe that consumer-goods brands that

  are committed to sustainability will end up overtaking those that

  are not.

  Grinnell College, in Iowa, traditionally directs its research

  and publications toward the subject of social justice. Over 60 years

  ago, its president at the time, Howard Bowen, was the first to

  use the expression “corporate social responsibility.”9 He defined

  the social obligation of businessmen to concern themselves with

  the values and expectations of society. As explained one of his

  colleagues, “[Bowen] extended the domain of moral responsibil-

  ity into the territory of corporate capitalism.”10 Since then, the

  concept has continued to strengthen and spread. Today, chief

  sustainability officers, who look after the triple bottom line—

  financial, environmental, and social—report directly to CEOs in

  companies everywhere.

  The business world has become more aware of the win/

  win opportunity at hand, for both the company and for society,

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  through the combining of business and social responsibility.

  Unilever’s Chief Marketing and Communications Officer, Keith

  Weed, describes himself as a firm believer in business ability to

  be “a force for good.”11

  But this is not yet the case for everyone. Some executives

  still remain somewhat skeptical. Others are simply not receptive

  to the idea. They often hide behind Milton Friedman’s famous

  affirmation in a 1970 New York Times article: “The social

  responsibility of business is to increase its profit.”12 This state-

  ment is based on the idea that the company is already contribut-

  ing its share to society through the salaries and the taxes it pays.

  According to Milton Friedman, it is precisely because the com-

  pany seeks to maximize its profits that it can pay consequential

  amounts in taxes. With these funds, governments can finance

  their efforts in the fields of society and environment. It’s up to

  all to respect their particular role. The argument appears irre-

  futable, but Friedman’s supporters and critics have been arguing

  about it for 50 years.

  Michael Porter, in a paper13 co-authored with Mark Kramer

  in 2011, brings arguments that go beyond this ongoing debate.

  Central to their ideas is the concept of “shared value creation”

  (SVC), which is progressively replacing that of CSR among

  experts and specialists on the subject. There already exists a

  plethora of publications comparing CSR and SVC. According to

  Porter, the shared value creation concept focuses on the idea that

  doing good in the end also drives “productivity growth.”14 To

  do so, he exhorts companies to look for the right kind of profit,

 
profit that creates rather than reduces social benefits. It’s no lon-

  ger a case of choosing between two types of priorities, as if priv-

  ileging one would necessarily be to the detriment of the other.

  With SVC, environmental, cultural, and societal activi-

  ties are no longer peripheral concerns for companies. Social

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  responsibility has become mainstream. It is not something that

  companies begin to think about after they have made their

  money, but rather that they contemplate upstream by asking how

  that money should be made in the first place.

  CSR is a vast subject and companies address it in many differ-

  ent ways. I will describe very briefly some examples before con-

  centrating on three major multinationals making a big impact.

  First, I would like to say a few words about those firms that

  built their business models on CSR from the outset. This includes

  one-for-one companies like Toms or Warby Parker. The first

  gives away a pair of shoes, the other a pair of eyeglasses, to needy

  people in poor countries each time a customer from a wealthy

  country buys a pair. These enterprises are proof that CSR can be

  a core business driver. The CEO of Toms, Blake Mycoskie, goes

  as far as to assert “giving helps generate revenue.”15

  Second, I wish to mention companies that concentrate a

  major part of their activities on social purpose, but not in the

  one-to-one way. I’m thinking here of organizations like the

  Unreasonable Group, Care.com, and Make.org. The cumulative

  effect of their activities helps to make the world a better place,

  for the benefit of all.

  Third, I would like to acknowledge the great foundations,

  such as that of Bill and Melinda Gates, which allocates up to

  $4 billion every year to multiple causes. They can never receive

  enough praise.

  We are living in a world of social responsibility that is mul-

  tifaceted, generous, and inventive. Each day sees the birth of

  promising new ideas and initiatives, such as those inspired by

  the three multinationals that I chose to concentrate on in the

  following chapters. Two are from the old economy and one is

  from the new: Unilever, Danone, and Salesforce. None of these

  companies were born from CSR, and yet, it has become central

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  to all of their activities. Unilever, under the leadership of Paul

  Polman, is without doubt the firm that has deployed CSR in the

  most explicit and comprehensive way. Danone, a company that

  has been pioneering social responsibility since 1970, and whose

  current CEO, Emmanuel Faber, is committed more than ever

  to making social issues and business work hand in hand. Finally,

  I will discuss Salesforce, whose co-founder Marc Benioff has

  become the standard bearer for CSR in the business world.

  Social responsibility has become so much part of these three

  corporations that I cannot imagine them ever going back. Their

  employees, their clients, their suppliers, and their shareholders

  would simply not understand.

  Chapter 18

  Paul Polman

  ON COMPLETE CSR AND

  CORPORATE ACTIVISM

  at the beginning of 2009, on one of his first days as head of

  Unilever, Paul Polman informed the financial world that

  he would no longer be giving earnings forecasts to the firm’s

  investors. He likes to say that he felt empowered to do this right

  away because “the day they hire you, they are not going to fire

  you.”1

  Well aware of the mixed reactions this bold move would

  create among potential investors, he explained that his priority

  was now the creation of long-term value. And he thought that

  the only possible path to achieve this was to put social purpose at

  the heart of his enterprise.

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  a Force for Good

  Polman is the very example of the chief executive convinced of

  the soundness of shared value creation. No one has been more

  determined than he has been in putting into place what has

  become an extremely comprehensive CSR program—perhaps

  the most far-reaching to have ever been undertaken by a large

  corporation. He has always believed in the idea that looking

  after the least fortunate and protecting the planet were equal

  parts business opportunity and moral obligation. For him, it’s

  impossible to build a strong, sustainable business in a world of

  increasing inequality, poverty, and climate change.

  His program is called the Unilever Sustainable Living Plan.

  It is multifaceted, and founded on three overarching objectives:

  to improve the health and well-being of over one billion people,

  to halve the impact his company and its supply chain have on the

  environment, and to upgrade the living conditions of hundreds

  of millions of people. This plan has led the company to respond

  to many different environmental issues, such as greenhouse-gas

  emissions, water preservation, waste treatment, and sustain-

  able supplies, and has resulted in Unilever’s confronting social

  topics such as working conditions, equity in the workplace, gen-

  der equality, health, and education. The company implements

  hund reds of different initiatives every year on all these key sub-

  jects, in the countries in which it operates, in each of the sectors

  it occupies, and for each of its different brands.

  The Sustainable Living Plan replies to a dual objective: to

  minimize Unilever’s negative impact, while at the same time

  maximizing its positive one. By minimizing, the company intends

  to repair some of the damage it has caused, like many companies

  around the world, in the normal course of business. By maximiz-

  ing, Unilever means developing innovative social policies that

  have a long-term beneficial impact on society.

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  Polman’s bold strategy has paid off financially. The Unilever

  Sustainable Living Plan he launched in 2010 has been a great

  success, despite the initial doubt of critics and investors. The

  Plan proved that there does not have to be a trade-off between

  sustainability and profitable growth. The numbers have clearly

  proven him right. In nine years, Unilever’s sales have increased

  on average at twice the rate of the market. They delivered a 290

  percent return on investment to shareholders, much higher than

  the average overall stock market returns. Polman has thus pro-

  vided a formal rebuttal to those who thought that a responsible

  business model could not serve long-term shareholder value. It

  should be added that Unilever’s shareholders also remain with

  the company much longer than the average, with an unheard of

  70 percent staying seven years or more.

  After nearly 10 years at the head of Unilever, Polman is now

  handing the reins to his successor. This book is dedicated to those

  who will leave their mark in the business world in a way that goes

/>   beyond the boundaries of their own companies; in this, Polman

  will occupy a special place. Better than anyone, he represents

  what is expected of a great business leader, and in particular by

  millennials, who will soon make up 50 percent2 of the workforce.

  People want business leaders to be actively concerned about the

  state of the world.

  Investors needed to be convinced and consumers also had

  to be persuaded to change their behavior. The way in which

  products are used can actually directly reduce their negative

  impact on the environment. The company measured3 the

  environmental footprints of 2,000 of its different products.

  It discovered that 68 percent of its greenhouse-gas emissions

  occurred after the products were in the hands of the end user.

  Ordinary but energy-intensive activities, like boiling water to

  make the tea or doing the laundry, are how these emissions are

  created.

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  This led Polman to draw up a list of what he calls The Five

  Levers for Change. Often, people don’t know how they should

  behave and why. They are more likely to act if it’s easy for

  them, but not if it requires extra effort. Once they have changed their

  behavior, it is important to find ways to help them maintain

  their good new habits over time. To help other businesses edu-

  cate their consumers, Unilever’s CEO suggested that companies

  use these five levers: “make it understood, make it easy, make it

  desirable, make it rewarding, and make it a habit.”4 The goal is to

  make good behavior commonplace.

  Polman is an environmental evangelist. For him, business is

  part of the solution, not of the problem. Sustainability is a pow-

  erful business driver; it guarantees the longevity of business as

  well as the future of our planet. This belief is also the credo of the

  Business & Sustainable Development Commission, which was

  launched in 2016 and of which Polman is a co-founder. The aim

  of this commission is to push industry leaders around the world to

  embrace the UN 2030 Sustainability Development Goals agenda

  and to incorporate it as a key driver for their business strategies,

  innovation, and investment decisions. Polman cites the conclu-

  sions of the prospective study carried out by the commission: “If

  we help harness markets—and all the financial, human and inno-

  vation capital they represent—to deliver the world we want, it