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Global leadership demands social responsibility, say Kellogg experts

By Ed Finkel

10/1/2005 - Corporations that pay attention to the “triple bottom line” of financial, social and environmental outcomes come out ahead in all three areas, said panelists at the Kellogg School’s Innovating Social Change Conference, held Oct. 5 at the James L. Allen Center.

All sectors, organizations and individuals have a social responsibility that flows from individual values and personal integrity, said Cassandra Pulley ’76, vice president of corporate responsibility for Sara Lee Corp. and president of the Sara Lee Foundation.

“Social responsibility begins with the individual,” Pulley said an at alumni breakfast preceding the formal conference. Referring to Enron and other corporate scandals, she said, “No code of conduct … will ensure that people do the right thing.”

Pulley acknowledged that it is difficult to think about social responsibility during trying economic times because “a social investment is a long-term outcome,” she said. But “that short-term focus is part of what’s wrong with corporate America right now.”

Paul Dolan, partner with the Mendocino Wine Co., presented his own longer-term focus as the morning keynote speaker. Dolan discovered he could produce a better-tasting wine without using chemicals — a process that would also be environmentally friendlier.

This discovery led his firm to take several other steps to protect the Earth, including the use of treeless paper, soy inks and beeswax rather than foil for wine bottle wrappers. He buys “green power” and bio-diesel fuel and recycles 97 percent of the company’s waste, Dolan said, while growing the business 15 to 20 percent per year.

“The game played by my generation and generations past is not the one you get to play [today],” Dolan said. “We can’t treat the Earth as our superstore or the forests as our lumber yard.” Business executives generally do not follow these enlightened principles because “it’s just outside of their comfort zone,” he said. “They don’t take the first step, of [gaining] awareness.”

Experts on a panel titled “Does Responsibility Lead to Profitability?” answered that question with a resounding yes and discussed how they had become more socially aware.

Tom Wistar, senior program manager for global care initiatives at conference sponsor Abbott Laboratories, travels throughout Africa to assist children orphaned by HIV/AIDS. He believes such initiatives, and the opportunities for employees to participate in them, help the company’s recruiting and retention efforts. “People want to know the company they’re working for is doing the right thing,” Wistar said.

Starbucks became the first publicly traded company to provide health insurance to part-time workers in part due to its founder’s hardscrabble background growing up in a family that lacked such benefits, said Sue Mecklenberg, vice president of business practices and corporate social responsibility at the Seattle-based coffee retailer. As a result, her firm has enjoyed less employee turnover, lower training costs and greater morale, she said.

Companies need to provide incentives to make corporate social responsibility a priority, said Joyce LaValle, senior vice president of human services for Interface Flooring Systems. “Now, we’re more oriented toward cost-cutting,” she said, referring broadly to the corporate sector, not her own company. “We don’t count the right things. As long as we’re doing that, we’ll keep making the wrong choices.”

The conference, an annual student-run event initiated in 1998, is produced by members of the Kellogg School’s Social Impact Club.