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Submitted by Guest Contributor

By Nancy Lee, President, Social Marketing Services

What do heart attacks, traffic fatalities and landfills have in common?

The incidence of each can be reduced through Corporate Social Marketing (CSM), one of six major types of marketing and corporate social initiatives described in Good Works!, a book I recently co-authored with David Hessekiel, president of Cause Marketing Forum.

Corporate social marketing uses business resources to develop and/or implement a behavior change campaign intended to improve public health, safety, the environment, or community well-being.  Because beneficial behavior change is always the focus and intended outcome, real differences are made for individuals, society, and the corporation.  Three examples support this promise, each described in more detail in Good Works!:

Supporting Brand Positioning: Subway Restaurants & the American Heart Association

If you were responsible for securing a brand positioning for SUBWAY as the healthy fast food option, you would no doubt be grateful for your company's long-term partnership with the American Heart Association. The company's logo appears front and center on the Heart Association's website, most recently (June 2012) when it was announced that the Subway restaurant chain would be the first to display the association's Heart-Check Meal Certification logo next to certain selected meals.

Building Traffic: Best Buy & e-cycle

“No matter where you bought it, we’ll recycle it” is the headline on Best Buy's e-cycle website with information on recycling old, unused or unwanted consumer electronics including computers, keyboards, monitors, cell phones, TVs, and more.

Best Buy's 2011 Sustainability Report highlights the impact of their global sustainability strategies including the outcome that they collected 83 million pounds of consumer electronics and 73 million pounds of old appliances, averaging 387 pounds of e-waste each minute in U.S. Best Buy stores.  Although they don't report on the traffic and sales these customer contacts generated, it would be substantial, as those bringing their used and unwanted items in were likely looking for replacements.

Improving Profits: Allstate & Teen Pledging Not to Text and Drive

Given the statistics that, according to the Centers for Disease Control and Prevention, car crashes are the number one killer of U.S. teenagers, it might not be surprising to find that Allstate Insurance is interested in influencing safer teen driving. Messages on Allstate's website impress parents with the tragic facts that nearly 11 teens die in car crashes every day, and nearly 1,000 more are injured. 

Allstate's social marketing effort encourages teens and their families to pledge not to text and drive.  The movement began in November 2009, with every participant pledging receiving a thumb band with the words TXTNG KLLS, to wear as a daily reminder of their commitment.

 Two years after its launch, Allstate had received more than 250,000 “X the TXT” pledges.

To garner maximum marketing benefits, a corporate social marketing campaign should target behaviors that directly relate to one or more of the company's products or services. And as these campaigns increasingly leave their positive mark on society, from reducing heart attacks to landfills to traffic fatalities, the lingering issue of whether it's somehow wrong to gain a competitive edge from a social issue will lose steam.

About the Author:

Nancy Lee is President of Social Marketing Services, Inc., adjunct faculty at the University of Washington, co-author of Good Works! Marketing and Corporate Initiatives that Build a Better World and the Bottom Line (Wiley 2012), and co-author (with Professor Philip Kotler) of nine other books.

Previously:

Three Types of Marketing Initiatives That Do Well by Doing Good

Cause vs. Marketing: Good Works! (If Done Right)

Submitted by Guest Contributor

By Myriam Sidibe, Global Social Mission Director, Unilever-Lifebuoy

It’s common knowledge that prevention is better than cure; yet, every year an estimated 2 million children don’t reach their fifth birthday due to the largely preventable diseases diarrhea and pneumonia. Prevention need not be complicated; for diarrhea and pneumonia the simple practice of regular handwashing with soap is one of the most effective and low-cost public health interventions available.

From a health and hygiene perspective, the power of prevention is massive.

Saving 600,000 Lives Every Year

Research demonstrates that handwashing with soap reduces the risk of diarrhea by 45 percent, pneumonia by 23 percent, and improves levels of school absenteeism by approximately 20 to  50 percent.  The London School of Hygiene and Tropical Medicine estimates handwashing with soap could save the lives of over 600,000 children every year - the equivalent of 10 jumbo planes of children saved every day [UNICEF]. 

While most people do have access to soap, the number of people who regularly wash their hands at the right times – such as before eating and after using the toilet – is worryingly low. For example, India is the leading market for Unilever’s health soap brand, Lifebuoy, in terms of soap penetration – 99 percent of homes report having soap present - yet the country has the highest child mortality related to diarrheal disease. Further, across a global review of 11 countries, the average rate of handwashing after using the toilet is only 17 percent. This dips as low as 3 percent in Ghana and 1 percent in rural India.

And this reality is not just confined to countries where child mortality is high – rates of handwashing in the U.K. and U.S. are surprisingly low - proving that handwashing with soap is by no means an integral part of everyone’s daily routine. 

Addressing the Gap Between Hygiene and Prevention

Unilever’s health soap brand, Lifebuoy, is uniquely placed to address this gap and help reposition hygiene habits as new norms, especially where a new habit can mean a matter of life and death. Right from the beginning, Lifebuoy was born as a brand with a social purpose – it was literally marketed as a “lifesaving product” to help Victorian England tackle cholera outbreaks.

Well over 100 years later, Lifebuoy still saves lives by making handwashing with soap a reality for millions of people. Indeed, today Lifebuoy reaches over 55 countries including eight out of the 10 countries with the worst childhood mortality related to diarrhea disease. Every second, 111 mothers across Asia, Africa and Latin America buy a Lifebuoy product to help protect their families’ health and hygiene. 

But there are clear challenges, despite our widespread reach. So in addition to our historical efforts, Lifebuoy has set out a bold and ambitious challenge to positively impact the health and hygiene behavior of one billion people by 2015, a commitment that was publicly stated as part of Unilever’s Sustainable Living Plan in 2010.

Whilst inspiring people to change their behavior is not easy, getting them to integrate these new behaviors into their daily routine is even more challenging. We have learned so much about how to influence habits and constantly build these insights into our programs.

Influencing Behavior: Affecting Social Norms & Commitments

For example: fear of diseases is not a motivator; peer pressure is crucial. Habits don’t come over night and need to be practiced for a certain period of time before they become ingrained in a daily routine. Pledging in front of people that matter encourages people to hold themselves accountable and stick to their commitment.

And we don’t stop there! We partner with leading hygiene, behavioral sciences, marketing and digital experts to ensure that our behavioral change program continues to resonate effectively with mothers and children across the world. 

Our results are increasingly encouraging. We have seen double-digit growth in soap consumption along with a direct correlation with an increase of handwashing habits at crucial occasions in key countries. We also see that our results last beyond the duration of the program, giving us even more confidence in our ability to make a difference to society as well as the bottom line. 

Now we have taken this collaborative approach one step further by partnering with public organizations and governments to expand and deepen our expertise, maximize our resources, share costs and, most importantly, ensure greater scale and impact. With organizations like Populations Services International [PSI], Millennium Villages Project [MVP], Water, Sanitation for the Urban Poor [WSUP], London School of Hygiene and Tropical Medicine [LSHTM] and governments across the world, we are scaling up our handwashing programs and enhancing the health impact of our programs. 

Millennium Development Goal 4

This approach is going to prove crucial as we work with our partners to make handwashing with soap a reality for all and achieve Millennium Development Goal 4 to reduce child mortality levels by two thirds. However, there is so much more we can do.

We are increasingly pioneering new models of co-investments from both public and private sector resources to ensure the scale of hygiene promotion programs is enhanced and targeted towards the most vulnerable demographics– under-fives and their families in most at need countries. Of course, there has been skepticism along the way. But it is diminishing as levels of scientific proof and the long-term commitment we put forward in our joint programs show increasingly positive results. 

As we gear-up to celebrate this year’s Global Handwashing Day on October 15th, let’s put the spotlight on governments, international institutions, civil society organizations, NGOs, and the soap industry to push hygiene up on the global health agenda and unlock the true potential of handwashing with soap.

Everyone has a role to play and can help by telling friends and family about the importance of washing their hands with soap to get more people practicing this important, lifesaving habit. You can also show your support and help more children reach their fifth birthday by pledging on our Facebook page. With every pledge, Lifebuoy and its partners will help more children receive hygiene education through their dedicated handwashing behavior change programs.

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Editor's Note: Join the conversation with Unilever and its partners at #IWashMyHands as they launch a worldwide dialogue on pushing handwashing up the global health agenda. Weigh in on Twitter, make a pledge on Facebook -- and let's join hands on saving 600,000 children every year.

About the Author:

Myriam Sidibe is Lifebuoy’s Global Social Mission Director and is one of the only people in the world with a doctorate in public health, focused on handwashing with soap. She has spent 14 years working with thousands of children understanding the most effective ways to get them to wash their hands with soap at key occasions like before eating or after using the bathroom. Myriam leads Social Mission activity in 55 countries throughout Asia, Africa, the Middle East, and Latin America with the aim of changing handwashing behaviors of one billion people by 2015 – that’s the biggest hygiene behavior change program in the world.

Myriam is one of the driving forces behind the creation of Global Handwashing Day, which recognizes the need to raise awareness of handwashing with soap as a simple but lifesaving habit that can prevent disease. She represents Unilever and often partners with organizations such as Millennium Villages, the World Bank, PSI, WSUP, MCHIP and USAID to educate people about the importance of handwashing with soap, and run programs that will help form healthy handwashing habits for life.

Would you buy a carrot if it looked like something that belonged in the Sexmuseum Amsterdam instead of a prop in a Bugs Bunny cartoon? Well, if you live in the United Kingdom and do not mind the sight of carrots like the ones pictured here, shopping for produce other than cucumbers will become a tad more exciting. Confronting diminished supplies, the venerable supermarket chain Sainsbury’s has announced that “ugly fruits and vegetables” will now be available for purchase. The company has no choice but to greenlight the sales of produce that looks as if it belongs in a red light district.

The core reason, however, is not to spice up a mundane trip to the grocery store, but to confront the UK’s driest spring in almost 60 years. Add the triple whammy of a very wet June and an unseasonably rainy fall, the aftermath has been a 25 percent drop in the UK’s total farm production yield. Meanwhile, food waste continues as an unending problem on both sides of the pond and retailers’ emphasis on having only perfectly shaped produce in their stores only adds to the problem. Now it is time for food retailers to join other companies and take a more practical approach towards this issue.

For years British supermarket chains leaned on their produce suppliers to meet a high standards appearance with the result that perfectly edible food often ended up in the dustbin. But according to The Guardian, the recent odd weather patterns have led to even more produce showing blemishes or scars. The lack of perfect and pretty produce has been a financial strain on farmers already flummoxed by constant climate volatility as they have less product to sell on the market.

Therefore, Sainsbury’s, which dates back to the Victorian era and now operates over 1100 stores, has embraced this year’s “bumper crop” of ugly vegetables and fruits. The company has pledged to use dowdy looking fruits and vegetables for its prepared foods and baked goods. Meanwhile, Sainsbury’s has promised an education campaign to encourage its customers to accept imperfect produce, teach them how to prepare it and, in the meantime, support British farming. One of the company’s executives, Judith Batchelar, attempted to engage Sainsbury’s customers by asking questions such as “How do you feel about ‘ugly’ fruits and vegetables?” and whether they would be willing to buy and eat them.

At a time when foods prices are on a trajectory going nowhere but up, the sudden affection for doppelgänger fruits and veggies is actually a slick business opportunity. With both sides of the Atlantic suffering during this relentless 2012 drought, and hunger a growing social problem, the hunt for frumpy looking veggies is an opportunity to change consumer behavior--and maybe even lead to a little mischief in your local produce section.

Image credit: Unsplash

Submitted by Jay Coen Gilbert

By Jay Coen Gilbert, Bart Houlahan, Andrew Kassoy, Co-founders, B Lab

The Truth About Ben & Jerry’s presents a dangerously inaccurate legal analysis of current corporate law and completely misses the point about the need for new corporate form legislation.

The sale of Ben & Jerry’s is a distraction. 

Authors Anthony Page and Robert A. Katz, by generalizing their analysis of the unique situation of the sale of Ben & Jerry’s to conclude that there is no need for new corporate forms designed to serve the needs of social entrepreneurs, impact investors, and the public interest, have failed completely to account for:

1. The facts of Delaware corporate law, arguably the only corporate law that matters when it comes to scaling high impact businesses,
2. The practical reality of how corporate law is applied in the boardroom given the lack of clarity in existing corporate statutes across the country,
3. The needs of the growing marketplace of impact investors who are demanding greater accountability and transparency,
4. The needs of social entrepreneurs as shareholders to have additional legal rights to ensure, not simply hope, that directors consider social mission not just profit margin when making decisions, and
5. The needs of some social entrepreneurs and impact investors to have the freedom and legal protection to build businesses that seek to optimize impact rather than profit. 

The primary objective of the benefit corporation is to enable mission-driven businesses to be built to last and scale with their missions intact, not to entrench individual charismatic leaders. Once elected by the shareholders of the corporation, benefit corporation status, ensures, as existing corporate forms to do not, that a company and its directors and officers are clearly empowered to pursue the creation of value for the public even if doing so fails to maximize value for shareholders, and that impact investors are clearly empowered to hold a company accountable for maintaining the mission in which they invested.   

On both accounts, existing corporate law – both the letter of the law and the practical reality of how it is interpreted, in operating and in liquidity scenarios – fails the test. Benefit corporations meet the test.  Becoming a benefit corporation gives a company more choice and, as we’ll point out, it also gives social entrepreneurs and impact investors more power and consumers more protection from greenwashing.

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It is true there are dissenting voices in the academy on whether or not current corporate law actually requires corporations to maximize shareholder value, but that misses the point for two reasons: 

First, because the legal establishment believes otherwise. The authors fail to acknowledge this by failing to reference any Delaware case law since Dodge v Ford in 1919 (most famously, Unocal v Mesa, 1985 and Revlon v MacAndrews, 1986). Specifically, the most recent past and current Chancellors of the Delaware Court of Chancery think otherwise.  Think of the Chancellors as something like the Chief Justices of the Supreme Court for business in the United States because the majority of public traded corporations, 63 percent of the Fortune 500, and most corporations that seek venture capital, are incorporated in Delaware.

In EBay v Craigslist, 2010, then Chancellor William B. Chandler III said, “Directors of a for-profit Delaware corporation cannot deploy a [policy] to defend a business strategy that openly eschews stockholder wealth maximization - at least not consistent with the directors' fiduciary duties under Delaware law.” And in Wake Forest Law Review, 2012, current Chancellor Leo E. Strine, Jr. says:

“These commentators seem dismayed when anyone starkly recognizes that as a matter of corporate law, the object of the corporation is to produce profits for the stockholders and that the social beliefs of the managers, no more than their own financial interests, cannot be their end in managing the corporation.”

Second, it misses the point because, not surprisingly given the above, practicing corporate attorneys think and act otherwise, and therefore corporate culture operates otherwise. If electing benefit corporation status does nothing other than create clarity between entrepreneur, directors, and investors, that the directors of a benefit corporation are required, not just permitted, to consider the impact of their decisions on stakeholders, then, as the authors themselves state in their conclusion, it is a useful innovation. 

Even in a state with a permissive constituency statute like Vermont that allows directors to consider non-shareholder interests when making decisions, as the Vermont Assistant Attorney General wrote in an informal opinion sent to the Vermont Secretary of Commerce and Community Development in March 2000 in reference to a hypothetical scenario involving the sale of a Vermont corporation (remember, Ben & Jerry’s coincidentally announced their sale in April 2000), there is a hard to quantify limit to the latitude directors are given to turn down a purchase offer. 

That latitude would be greater for a benefit corporation. Benefit corporations would not only enjoy greater legal protection to choose to remain independent, or to choose to sell to a non-high bidder that would better meet the needs of workers, communities, and the environment, but also to choose to make decisions that create incremental value for society even if at the expense of maximizing value for shareholders. 

But benefit corporation status does more than that. 

Benefit corporation status also requires that the corporation seek to create a material positive impact on society and the environment as assessed and publicly reported against a credible and comprehensive third party standard. Current corporate law does not address these issues of corporate purpose or transparency, but increasingly, entrepreneurs and investors care about these issues, as does, and perhaps because so does, a skeptical public that wants to support a better way to do business.

In their conclusion, the authors state that ‘proponents of benefit corporations . . . should be pressed to identify real and unavoidable instances of the Ben & Jerry’s scenario.’  Based on our analysis above, here are two:

1. If Ben & Jerry’s were incorporated in any of the roughly 20 states in which no constituency statute exists, including Delaware; and
2. If Ben & Jerry’s justified any corporate decision on the benefits that might accrue to society and not to shareholders.

The latter would seem particularly relevant for social entrepreneurs or impact investors, if not also for consumers, policy makers, and those of us that make up society.

Additionally, as about 20 practicing corporate attorneys, including a former President of the American Bar Association, stated in a White Paper entitled The Need and Rationale for the Benefit Corporation (Clark et al, 2011), and as the Vermont Assistant Attorney General seems to concur in her informal opinion, ‘Based on the limited case law available, courts [even in states with constituency statutes] seem reluctant to wade into these issues and often fall back on shareholder primacy [i.e. maximizing shareholder value as the de facto sole legitimate corporate purpose].’ Here is the relevant section from the White Paper:

While it is clear that directors of mission-driven companies incorporated in constituency statute jurisdictions may take into consideration the interests of various constituencies when exercising their business judgment, the lack of case law interpreting constituency statutes, coupled with the context in which many of these statutes were enacted, makes it difficult for directors to know exactly how, when and to what extent they can consider those interests.  . . . Based on the limited case law available, courts seem reluctant to wade into these issues and often fall back on shareholder primacy.

Without clear authority explicitly permitting directors to pursue both profit and a company’s mission, even directors of mission-driven companies in constituency statute jurisdictions may be hesitant to “consider” their social missions for fear of breaching their fiduciary duty...

Further, permissive constituency statutes only create the option (and not the requirement) for directors to consider interests of constituencies other than shareholders. Thus, directors have the permission not to consider interests other than shareholder maximization of value. Mission-driven executives and investors are often in minority shareholder positions and would prefer that directors and officers be required to consider these expanded interests when making decisions, with a shareholder right of action providing the “teeth” to enforce such consideration. This is particularly true in situations where a company is considering strategic alternatives and directors’ discretion in making business decisions is more limited by traditional principles requiring shareholder value maximization.

The authors draw three lessons for social entrepreneurs which we address in order. 

Lesson #1: A hybrid legal form is neither necessary nor sufficient to maintain a social enterprise.

Whether or not a benefit corporation is necessary (it is in the circumstances discussed above) or sufficient (it is not), as the authors themselves state in their conclusion, electing benefit corporation status might prove useful, not to mention easier and less expensive than hiring ‘shrewder’ lawyers to ‘(re)discover tested solutions to perennial challenges’, particularly in aligning expectations between executives, directors, and investors, and ‘cultivating consumer loyalty.’

Lesson #2: Financial success is critical to maintaining control.

We agree: no margin, no mission. The authors are correct in stating that the biggest threat to an entrepreneur losing control of her or his mission-driven business is running the business poorly.  This is too often overlooked or underestimated and can’t be said loudly enough.  But it is equally critical to remember that benefit corporation legislation seeks to enhance mission control, not entrepreneur control.

The objective of a mission-driven business ought to be to create value for society, not to create long term control for the entrepreneur. That’s why benefit corporation legislation creates accountability to shareholders (to create value for shareholders and to create value for society) that simply doesn’t exist in the constituency statute states that the authors laud.  In this important respect, benefit corporation legislation recognizes that it’s not about the people, it’s about the system. Which brings us to lesson number three.

Lesson #3: It’s the people!

While this is true enough, it is also true that people are enabled or constrained by the system in which they operate. As a point of law, no matter how thoughtful or noble or harebrained the people, depending upon your point of view, there is zero flexibility for the people (in this instance a company’s directors and officers) to decide to pursue a corporate purpose other than maximizing value to shareholders. 

As the authors themselves state, ‘executives at [benefit corporations] likely feel less pressure to maximize profits at society’s expense.’  Their ensuing question regarding causation (i.e. whether [benefit corporations] make directors ‘more virtuous’ or vice versa) is like asking which came first the chicken or the egg.  The practical thing to know is that chickens lay eggs. And that benefit corporations, assuming they ultimately behave like Certified B Corporations, will create higher quality jobs and improve the quality of life in their communities more so than ordinary businesses.

Whether causal or correlated, let’s have more of them, please.

What about the authors’ remaining point that, in the end, directors don’t make the final decision, shareholders do?

True, but shareholders don’t get to vote until a sale offer is presented to them.  The negotiations over the terms of the sale have already taken place, so shareholders only choice is to say no.  Ignoring how infrequently less-informed shareholders vote against the recommendations of a board, simply exercising the right to say no is not a very compelling method for scaling high impact social enterprises that are built to last. 

Moreover, the authors miss several important elements of benefit corporation legislation that give ‘the people’ more power.  Shareholders of benefit corporations have additional rights of action (i.e. the legal standing to bring a lawsuit) –- rights that do not exist under existing corporate law, even in states with permissive constituency statutes like Vermont -- to hold directors accountable to consider the impact of their decisions on all stakeholders and to pursue the creation of a material positive impact on society and the environment as assessed against a credible and comprehensive third party standard. 

That positive impact can now be judged more easily not only by shareholders, directors, or if need be a judge, but also by the general public (aka ‘the people’) for whom the benefit corporation is required to publish publically their annual benefit report which includes that assessment of their overall social and environmental performance against a third party standard.  It is largely this transparency provision in benefit corporation legislation that would give ‘the people’ (whether they be investors, consumers, policy makers, or employees) useful information to form an educated opinion about, for example, whether or not they feel Chevron’s ad in this same Fall issue of SSIR about their support for education in America tells a complete story about their overall corporate social and environmental impact.

Because benefit corporations meet clear and higher standards of corporate purpose, accountability and transparency, it offers entrepreneurs clear differentiation and it offers investors and consumers additional protection.  Rather than a potential ‘unhelpful distraction’, benefit corporations are making it easier for social entrepreneurs, impact investors, and we the people to create the change we wish to see in the world. 

Perhaps most importantly, the authors’ exclusive focus on a legal analysis of the Ben & Jerry’s sale misses something crucial – that ultimately performance matters more than policy. Lost in the inordinate focus on whether Ben & Jerry’s could’ve or should’ve resisted the sale to Unilever is an examination of what matters most to many observers – namely, what has happened to Ben & Jerry’s post sale?  

The best way to judge the sale of a mission-driven business is to assess to what extent that mission has been maintained post sale as evidenced by its ongoing performance. And in a world in which the public (perhaps appropriately) doesn’t trust what a company says about itself, maybe especially so for a business that claims to be one of the good guys, verified performance matters even more.

We’ll examine this lingering question soon in Part 2. Stay tuned.

About B Lab:

B Lab is a nonprofit organization whose mission is to harness the power of business to solve social and environmental problems, and whose activities include working with businesses and investors to advance benefit corporation legislation and certifying businesses that have met rigorous and independent standards of performance as Certified B Corporations. For inquiries, contact Jay Coen Gilbert at jay@bcorporation.net or 610-296-8283.

Related:

SSIR Article Attacks B Corps, Points the Finger at Ben & Jerry's

Some Real “Truth” About Ben & Jerry’s: A Lawyer's Perspective

Submitted by Guest Contributor

By James G. Steiker

In the jurisdiction of Oz, where Messrs. Page and Katz apparently believe most corporations are domiciled, all Ben Cohen and Jerry Greenfield would have needed to do to resist unwanted suitors was to have clicked their heels three times and incanted “there’s no place like home”.

For better or worse, Ben & Jerry’s Homemade was a Vermont corporation subject to Vermont corporate law and, as a public company, regulation by the United States Securities Exchange Commission. Messrs. Page and Katz hypothesize in their article, The Truth about Ben and Jerry’s, what the company and Ben Cohen might have reasoned and done.

Unfortunately, they are misguided. I know as I was there and represented first a group of independent “socially responsible” investors that would take Ben & Jerry’s private and then Ben Cohen individually as the company was sold to Unilever.

Ben & Jerry's: The Story

Let’s stipulate some of the facts.

Ben & Jerry’s stock, after initially providing large gains for investors, languished a bit in the late ‘90s. Prior to the board’s announcement that it would need to consider outside offers, it was trading in the low $20s. It became clear to the company and its board that several outside suitors, notably Dreyer's and Unilever, would pay a significant premium to the then-current stock price to acquire all of the outstanding Ben & Jerry’s stock.

Maintaining the Company's Social Mission

Messrs. Page and Katz state that the purpose of their article is “to dispel the idée fixe that corporate law compelled Ben & Jerry’s directors to accept Unilever’s rich offer, overwhelming Cohen and Greenfield’s dogged efforts to maintain the company’s social mission and independence.” They make light of “the stock analyst who claimed in 2000 that “Ben & Jerry’s had a legal responsibility to consider the takeover bids. … That responsibility is what forced a sale,”, ignoring that that stock market evidently believed this to be the case as the Ben & Jerry’s stock price rose significantly after the initial offers, despite clear signals from Ben Cohen that he personally preferred not to sell the company.

The authors go on to argue first that the Ben and Jerry’s board did not have a legal obligation to consider third-party offers to purchase the company and second that it had no obligation to accept even a high-premium offer. They claim, without any support, that

“In practice, courts are deferential to board decision making. Under a doctrine called the business judgment rule, unless the directors have a conflict of interest, nearly all board business decisions are beyond judicial review. If there is a potential benefit to shareholders, the courts will not interfere. In this way board decisions advancing a social mission are effectively immune from challenge; there’s no limit to the human mind’s ability to conceive of some benefit accruing to shareholders at some point, even if in the far-distant future. Absent special circumstances, a board’s decision to reject a proposed merger would easily survive a court challenge.”

One would hope that such statements, presenting as conclusions without evidence, and ignoring a long line of Delaware corporate takeover cases, such as Revlon v MacAndrews (1986), if presented by a second-year law student in one of their classes, would receive the “C” it so richly deserves.

Legalities

No practicing attorney would, in my view, advise their corporate client that a clear conscience and an empty head would be good enough to prevail against a high-premium takeover bid in all circumstances. Indeed, as Ben & Jerry’s shares were acquired by Wall Street arbitragers betting on the likelihood of the sale of the company, there can be little doubt that the board refusing an offer of nearly double the pre-sale discussion share price, would provoke significant legal action. One only needs to consider the current plethora of “stock-drop” cases brought against public companies and their directors to understand that litigation in this situation would be a near certainty.

The authors go on to conclude that even if there was litigation, the company would have been required to indemnify the directors, implying that any fear of personal risk or loss was ill-founded. Again one might suspect the authors have never been sued as directors of a company. The time, personal cost and difficulty of defending a well-funded and reasonably founded lawsuit, even if indemnification applies, would and should be enough to scare even the most hardy director.

Blocking the Sale

Finally, the authors argue that Ben Cohen and Jerry Greenfield could have blocked the sale simply by using their super-majority voting power and blocking any merger or tender as shareholders. They further assert that it would be unlikely that the super-majority voting stock could be forcibly redeemed. Again, this assumes a high appetite for litigation risk on behalf of both the directors and shareholders.

The authors’ arguments that Ben & Jerry’s founders had the ability to preserve the social mission goals of the Company by blocking a sale either via a friendly board or through well-designed poison pill supermajority stock have some theoretical merit but absolutely fail in the real world.

In theory, theory and practice are the same. In practice, they are different. The board, the company and the shareholders would likely have found themselves in protracted and expensive litigation with an uncertain outcome.

The Benefit Corporation: Unnecessary?

Messrs. Page and Katz then assert that the new Benefit Corporation legislation and related special forms of limited liability corporations (LLCs) with social mission provisions are unnecessary. In their view, the Vermont “constituency” statutes are enough and add sufficient additional heft to takeover defenses so as to make these new forms unnecessary or irrelevant.

Moreover, the authors believe that clever lawyers can achieve the same results as the new benefit corporation statutes through smart design and use of traditional takeover protections.

The authors miss the point mightily.

There is a large distance from statutes that merely allow directors to consider formally other stakeholders and tricked-up governance structures to the Benefit Corporation statutes that actively identify a public benefit of the corporation, state a duty and accountability to this public benefit, and provide formal exculpation for directors from the Revlon standard and its progeny in other states.

Lessons from the Ben & Jerry Sale

There are some real and less appreciated lessons from the Ben & Jerry’s situation. There was no mechanism in the 1980s to access the public markets, accept capital from anonymous investors, and make clear that the corporate directors could pay unfettered loyalty to social mission and other corporate goals without exclusive focus on shareholder value. He who took the king’s shilling would ultimately need to play the king’s tune.

In short, there could be no “social contract” among the shareholders of Ben & Jerry’s as a public corporation with numerous shareholders that would enable the corporation’s directors to set a balance among the corporation’s various bottom lines.

Corporate governance matters a lot when there are several or many shareholders.

The rules about the conduct of directors and shareholders define the things the corporation must focus on and the things that directors and shareholders may consider and do in conducting the business of the corporation. Ben & Jerry’s had anti-takeover poison pills and long-standing corporate practices around multiple bottom lines but there was no fundamental agreement among the shareholders to ensure that these “social mission” practices would be perpetuated. The Ben & Jerry’s directors and shareholders, without a “benefit corporation” or similar hook to hang their hats on, rightly feared for both themselves and the company in considering Unilever’s takeover offer.

One can argue whether the Unilever acquisition was ultimately better or worse for Ben & Jerry’s as a company or for its constituents or for it “social mission” It does seem clear though, that corporate shareholders ought to be permitted to agree among themselves about a corporation’s mission, constituents and practices. Ben & Jerry’s shareholders did not have this opportunity.

The outcome, had Ben & Jerry’s shareholders been permitted to elect to be a “Benefit Corporation” under the emerging statutes, would likely have been different.

About the Author

James G. Steiker is the founder of Steiker, Fischer, Edwards & Greenapple, P.C., a Philadelphia-based law firm that focuses on employee-owned companies and socially responsible businesses. He represented a group of independent investors and then Ben Cohen during the sale process of Ben & Jerry’s. He is a trustee of the Employee Ownership Foundation, Chair of the ESOP Association Finance Committee, and a member of the board of directors of the National Center for Employee Ownership. He also serves as a board member of eight privately-held employee-owned companies. He can be reached at jsteiker@sesadvisors.com and 215-508-5643.

Related:

SSIR Article Attacks B Corps, Points the Finger at Ben & Jerry's

The Real Truth About Ben & Jerry’s and the Benefit Corporation: Part 1

Over the next couple of weeks, we’ve asked our writers (and guests) to respond to the question: "What is the Social Responsibility of Business?”  Please comment away or contact us if you’d like to offer an opinion.

One cannot write about the 'social responsibility of business' without mentioning Milton Friedman who stated in 1970 that, "There is one and only one social responsibility of business — to use its resources and engage in activities designed to increase its profits.”

This view is now considered to be outdated and conservative as more and more businesses are finding their value outside of simply making a profit. I do not disagree with the notion that the primary purpose of any business is to make profits - indeed that is how any business can stay afloat. I disagree that it is the only purpose of business, as it takes away from the aspect of capitalism that is ultimately very humanitarian.

One of the reasons that making a profit cannot be the only responsibility of business is the increasing resource crunch. During the age of the Industrial Revolution and up until Friedman's time there was little talk of natural resource depletion. Indeed, pollution was still an externality and the great cogs of industry made up society.

Now however, current economics prove that functioning without any regard to natural resources leads to the destruction of the ecological system, which leads to eventual collapse of the economic system. The social responsibility of business therefore is to protect the economic system and by implication the bigger socio-environmental system upon which it rests.

Business has the social responsibility to factor in 'negative externalities' like pollution -  in fact any economic model that still regards the environment as an externality is ultimately an anti-growth model. As the economic system has grown more interconnected and vast over the years, so too has the idea of business itself.

Today business has a responsibility towards its stakeholders - customers and society at large are more aware of the negative impacts of business as usual. They want cleaner and more ethical products and services. Business today also has a responsibility towards the environment - it cannot keep endlessly extracting resources without consequence.

Resources like air, water, biodiversity, fossil fuels are the very building blocks upon which a successful business is built. With the rapid depletion of these essentials, business needs to learn to deal with the ominous constraint of environmental degradation. Even big business today needs to adapt towards a social entrepreneurship model in order to survive.

The social responsibility of business is not just the limiting aspect of its responsibility towards societal and environmental protection, but it is towards the protection of the notion of business itself. The responsibility of business therefore is to not merely to generate profit, but to ensure a steady flow of capital that can be diverted towards the higher pursuits of society building. Without the realization of this responsibility, business will soon burn itself out.

Image Credit: Unsplash

Submitted by Guest Contributor

By Michael Replogle and Colin Hughes

(In collaboration with the Worldwatch Institute)

Perhaps it should come as no surprise that the commitments to sustainable transportation were some of the greatest achievements of June’s Rio+20 United Nations Conference on Sustainable Development (UNCSD).

Very little could exemplify the world’s need for sustainable transport to the delegates better than the average of six cumulative hours they spent on buses in a traffic-choked commute to the exurban conference site every day. It was a clear sign that despite having adopted strong language for sustainable transport 20 years earlier at the first CSD in Rio, the transportation sector needs to shift to a more sustainable path.

Transportation, after all, is a primary public good and critical to the sustainability of our economies, societies, and natural environments. Without sustainable transportation, children cannot go safely to school, goods cannot efficiently reach markets, and harmful emissions will exacerbate climate change.

Needed: A Global Shift To A Sustainable Transport Paradigm

As we discussed in our chapter, Moving Toward Sustainable Transport, in Worldwatch Institute’s State of the World 2012, the current model for transportation development – one of mismanaged motorization – is highly unsustainable: rapid growth in automobile travel and concomitant growth in fossil fuel use, traffic congestion, air pollution, greenhouse gases, and traffic fatalities is degrading the quality of life for people around the world. 

A global shift to a sustainable transport paradigm is desperately needed.

This new archetype must become a central part of economic, social, and environmental agendas. Sustainable transport, similar to other developmental issues, is not a problem for a single group: for urban planners or freight shippers, slum dwellers or suburbanites, the urban or rural, the rich or poor – transport is inextricably linked to the quality of life for each and every human. While momentum for sustainable transport is growing worldwide, a more broad-based and urgent campaign calling for sustainable transport policy is needed worldwide.

Partnership for Sustainable Low-Carbon Transport

Rio+20 provided a major opportunity to coalesce governments around commitments to sustainable development, including transportation. Though there was virtually no mention of transport in the original draft of the political outcome document, Rio+20 became a major breakthrough for sustainable transportation initiatives within the global sustainable development dialogue.

This success was largely achieved by the Partnership for Sustainable Low-Carbon Transport, a coalition of over 60 diverse transport-related organizations. Through direct outreach to governments and many high profile events within the UNCSD process, the Partnership strengthened the language regarding the need for sustainable transport in Rio+20’s final outcome document.

Yet, historically, agreements that were supportive of sustainable transport have had little to no impact in making transport more sustainable.

Rio+20 broke away from tradition and was a breakthrough for sustainable transport because the Partnership coordinated 16 voluntary commitments from NGO’s and multilateral institutions.

Most notably, the world’s eight largest multilateral banks (MDBs), committed to invest $175 billion over 10 years to advance more sustainable transport, with annual reporting and monitoring.

These commitments exemplify the array of stakeholders committed to achieving sustainability in the transport sector. Independent oversight will be needed to encourage effective follow-up.

Pushing National Governments To Create Sustainable Transport Systems

Despite this, significant work remains to ensure the momentum for sustainable transport emerging from Rio+20 translates into real change. Most crucially, citizens, businesses, and environmentalists everywhere must continue to push national governments to adopt sustainable transport policies, standards, and funding strategies.

Transport is a primary public good and its sustainability will be determined by the policies and investments made by national governments. Over half of the approximately one trillion dollars annually invested in transport infrastructure and operation worldwide comes from governments, which also set the policies that shape the remaining investment from the private sector.

Sustainable Transport Solutions

Sustainable transport solutions are well known and tested. They include avoiding automobile travel through denser, mixed-use urban development, shifting transport to more cost effective, low-carbon modes like bicycling and rapid bus transit, and improving the energy efficiency of vehicles.

The returns on such investments, in terms of economic, energy, health, and environmental impacts, are greater than that of automobile-focused investments. The success of these solutions is not a question of technology or effectiveness, but of generating sufficient political will and institutional capacity to implement them. 

More and better-targeted investment in transport would be beneficial, but these need to be accompanied by governance reforms to facilitate improved operations of transport systems, with more accountability for performance. It is time for civil society, businesses, and environmentalists worldwide to join forces to foster lower-cost, energy efficient, universally accessible transportation investments, and to cultivate local and global leadership to advance that agenda.

A growing number of cities, from Guangzhou to New York, supported by various leading businesses, are showing how sustainable transport progress can be achieved. New initiatives are coming from national governments in countries like India, Mexico, and Brazil, as well as from United Nations agencies to integrate sustainable transport as a core element of a sustainable development agenda.

As an increasingly urbanized world adds the next billion urban residents in a little more than a decade, it could not be more timely for this paradigm shift in transportation to unfold.

About the Authors:

Colin K. Hughes is a Global Policy Analyst at the Institute for Transportation and Development Policy [ITDP]. Before joining ITDP full-time, Hughes worked as a consultant with ITDP and the Global Environmental Facility to develop greenhouse gas analysis methodologies, developed sustainable urbanism projects with the Asian Development Bank, and planned bike-lane networks and bike-sharing facilities in Guangzhou, China. 

Michael A. Replogle is the Global Policy Director and Founder of the Institute for Transportation and Development Policy, a nonprofit organization that since 1985 has worked with city governments and local advocacy groups worldwide to implement projects that reduce poverty, pollution, and oil dependence. He is a strategic advisor on transportation to the Environmental Defense Fund, where he served as transportation director from 1992 to 2009. 

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More from The Worldwatch Institute:

Making the Green Economy Go: Scaling Sustainable Energy For All

Desperately Seeking: A Sustainable, Climate-Friendly Food System

Management Education: Planting The Seeds Of Sustainable Education

Adam Smith, an 18th century economist and author of The Wealth of Nations, is often viewed as the father of modern capitalism. Smith's three main underlying concepts were the "invisible hand," that individuals pursuing their own best self-interest would result in the greatest overall good to society, and that levels and kinds of goods and services in the market should be determined by the free market alone (i.e., not by government).

The first notion, that of the invisible hand, suggests that people essentially vote with their dollars. If we want a society with nothing but solar energy and organic food, we'd all go out and buy those things and not buy GMO or factory-farmed foods or coal-fired energy. This invisible hand would guide the suppliers in the marketplace to provide those goods and services for us, and there would be no such thing as coal power or GMO food.

The second notion, that an individual seeking his/her own best self-interest is actually the best thing that the person can do for society, indicated Smith's belief that, given sufficient motivation for personal gain, each person would work hard, and as a result, society as a whole would benefit with more jobs, more competition, and better quality goods and services.

The third notion effectively just means that government should stay out of the market, and limit their role to police.

Smith is often held up by modern conservatives as a hero of capitalism and freedom, and a reason that subsidies for things like solar and wind power should not exist. Smith acknowledged the concept of externalities and other free market breakdowns, but didn't really address them as a major challenge to society. Smith can be forgiven: when he was alive, there were less than one billion people on the planet, and the concept of externalities (mercury emissions, DDT, polychlorinated biphenols, stillbirths, cancer, and other disease caused by, but not paid for by, a business seeking its own self-interest) would have been foreign even to the most progressive economist.

Milton Friedman, a modern disciple of Adam Smith, is now often championed by conservatives for furthering Smith's line of thinking, with perhaps his most famous quote underscoring the concept of the social responsibility of business from a conservative point of view:

"There is one and only one social responsibility of business -- to use its resources and engage in activities designed to increase its profits."

It's a line that is often repeated by conservatives as a defense against claims that companies should be doing more. The challenges with this line of thinking, of course, is that single-minded focus on profit maximization is what led to the creation of bundled mortgage backed securities that led to the housing bubble that virtually melted down the global economy in 2008 (and realistically, to pretty much every speculative bubble in economic history). Friedman did eventually go on to add, "So long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud." And of course, deception and fraud can be defined in many ways.  (Friedman was also fervently against privatization of jails and openly supportive of the legalization of drugs, which is often overlooked by conservatives).

The main challenge to this Smith-Friedman version of reality is that it can never be so simple.

Corporations doing business create side effects, and if they are not responsible for those side effects, the whole free market system breaks down. It's factory farms using antibiotics for their own gain (faster fattening of animals to bring to market) and causing antibiotic resistant bacteria that is now a public menace. It's pesticide use that is killing honeybees and causing a decline in pollination for other farmers. It's coal plants that produce mercury emissions and cause birth defects and respiratory ailments. The list can go on and on and on.

Smith, to his credit, at least acknowledged it. Joseph Stiglitz, a modern Nobel Prize winning Economist, said, "Whenever there are externalities--where the actions of an individual have impacts on others for which they do not pay, or for which they are not compensated--markets will not work well."

Conversely, Friedman, according to the otherwise conservative Motley Fool Stock Advisor, had it dead wrong with his quote on profit being the only social responsibility of business. The Fool suggests that, as opposed to Friedman's singular vision, investors take the long view, rather than focusing on quarterly reports, in part because quarterly reports give companies incentives to finagle and fudge on their responsibility to society for openness, corporate citizenship, and well, social responsibility.

Follow Scott Cooney on twitter and read his writings at the Inspired Economist.

Image credit: Pexels

Could Costco possibly be the most genuine leader when it comes to corporate social responsibility (CSR) and governance?

Retailers across the country constantly crow about the achievements they have made on a bevy of issues from more sustainable fish (Safeway) to solar installations (Walmart). Other retailers are yanking the chains on pork producers to cease the cruel use of gestation crates and of course just about everyone is on the organic and local produce bandwagon.

These shifts in business practices are great news for fish, pigs and of course, the environment and our health. But what about people who work in these stores, who stack, haul and crate the fish, pork and produce, whether they are free range, cruelty-free, duty free, or not? While most big box retailers insist on paying low wages with the claim that thin margins require reduced labor costs, Costco for years has been breaking the mold.

Wall Street squawks that the membership warehouse giant should push for higher profit margins and reduced labor costs, meanwhile the company, led by its iconoclastic founder and former CEO, Jim Sinegal, constantly flicks his chin at The Street and its yammering analysts. The results: happy employees, enviable stock performance and a brilliant shopping model that, let’s face it, bludgeons consumers into shopping happily for more.

So what makes Costco so successful? Arguably the biggest difference is how the retailer treats its workers. Walk into any Costco and look at the name tags. Chances are you will read the phrases “since 2002,” “since 1999” and “since 1995.” Costco workers get paid very well compared to their counterparts at chains including Walmart. In fact, employees working on the floor can make a salary that reaches the mid-$40,000 range; not bad for someone who starts working for the company out of high school.

And while the vast majority of Costco’s employees are not unionized (most of those are legacy employees from Price Club that the Teamsters represent), over 80 percent have competitively priced health insurance plans. The outcome includes more productive workers, lower turnover and for what it’s worth, relatively high job satisfaction.

Meanwhile Sinegal, who stepped down as the company’s CEO on December 31, earned a spartan salary compared to the vast majority of his counterparts. For years his salary, not including bonuses and stock options, hovered at $350,000. Critics lashed out when the company announced that current CEO Craig Jelinek would pull a salary of $650,000, but that is still a tepid amount compared to average CEO salaries, which are still on an upward trend despite the recent surge in “say-on-pay” shareholder votes.

Meanwhile Costco's stock has performed well, sliding only when the rest of the economy took a dive during the post 9/11 aftershock and the 2008 fiscal crisis. If you bought Costco stock a decade ago, your investment has roughly tripled in value. So, along with happier workers come fair prices and a commitment to local companies. Take those famous Calvin Klein jeans that have been a mainstay at Costco over the years. Depending on the price, they could be marked at $29.99, but if the company can snag millions more, they could be $22.99. Wall Street would insist that regardless of the wholesale price, Costco should maximize its profit. But the company’s philosophy has long been that it will pass on savings to its customers.

Most products in its warehouses are well-known national brands, but Costco does purchase local products. Karoun Armenian string cheese in Los Feliz, Goldilocks bread in Vallejo, hemp seeds in Santa Cruz and fruit from small San Joaquin Valley farms in Fresno are just a few examples that can be found in Costco’s warehouses.

Not everything at Costco is perfect: some products are well, dubious; Joan Rivers chained herself to a shopping cart after the chain stopped selling her book; and some suppliers have landed Costco into hot water. But in the end, the company treats its employees and shareholders more than decently. And sales continue to trend upwards. If you believe all workers should have the chance to earn a decent wage and be rewarded for hard work, shopping at Costco is an easy choice to make.

Leon Kaye, based in Fresno, California, is a sustainability consultant and the editor of GreenGoPost.com. He also contributes to Guardian Sustainable Business and covers sustainable architecture and design for Inhabitat. You can follow him on Twitter. Photo courtesy Wikipedia.

Image credit: Unsplash

Submitted by Earth Share

By Kal Stein, President & CEO, EarthShare

The journey towards truly responsible corporations has seen many landmarks along the way so far. One of the most important is the rise of the sustainability officer within companies. The appearance of a dedicated CSR professional—especially those in the executive suite—is a sign that a company has truly begun to grasp the value, both social and financial, of being green.

But what about companies where it just isn't feasible for one person to dedicate themselves to environmental issues? Or those companies that want to tackle more issues than they have bandwidth for at the executive level? One solution: the concept of a 'green team'—a cross-functional, often cross-departmental collection of employees, who unite to solve problems within the company.

What can a green team do?

A green team can have a dramatic benefit on a company's environmental and financial performance. Often, green teams are constructive in realizing reduced costs associated with resources and energy consumption through peer networking, forums, interactive sessions and change management across their departments. Its one thing for the company to decide on a goal of reducing its energy usage by 25 percent, but quite another to convince colleagues to change their habits in order to meet those goals.

Don't they take a lot of oversight?

One of the keys to the success of green teams is that they don't have to be top-down initiatives. In fact, many successful green teams have started without any management buy-in. All it takes is for a group of interested employees to commit to solving a problem. It's that simple.

However, there's no question that the success of any initiative within an organization--and especially those that hinge on changing people's habits--are greatly enhanced by the level of management buy-in.

At Citi, for example, the company blends top-down and grassroots approaches: while the organization of the teams and the initiatives they work on come from employees at a local level, the decision to create a network for the internal green teams to share best practices was a management-level initiative aimed at creating a supportive environment for the teams to grow and new teams to develop.

As the firm's Vice President for Sustainability Communications, Tyler Daluz suggests, the scale of the firm means that any attempt at controlling these initiatives could have easily become quite unmanageable: "We have over 12,000 facilities globally. These teams have been [successful because they have been] organic and grassroots."

So how do I foster a green team in my own company?

Beyond simply starting a green team, the biggest challenge lies in keeping participants constantly interested, and equipping them with the skills and knowledge necessary to tackle the problems that they've elected to work on. Within larger companies, that may be as simple as convening a regular meeting of all interested parties and bringing in specialists when required. For those seeking to make a difference where resources are more constrained or needing fresh ideas on addressing internal and external challenges, green team networks can be a crucial tool for sharing, learning, best practice ideas and encouragement.

External Forums: EarthShare's Green Team Meetings

Our team at EarthShare began convening Green Team forums several years ago--an initiative aimed at bringing sustainability professionals together to build strong networks of like-minded people to share best practices. Comprised of professionals from companies and institutions such as Marriot, Time Warner, the World Bank, Accenture, United Health Group, and more, this network bring together businesses and communities, regardless of their affiliation with EarthShare, to brainstorm solutions, learn from each other and share best practices.

As my colleague – and EarthShare's SVP for National Business Development and Managing Director of EarthShare NY – Mary MacDonald recently wrote on GreenBiz, "The focus of these meetings is to allow change leaders to meet in a safe zone to discuss challenges (such as lack of buy-in from executive leadership, low employee engagement, budget cuts, lack of information, too much conflicting information, etc.), and crowdsource solutions to those challenges. We also discuss emerging issues in sustainability and the environment."

But what they often become are discussions about how sustainability managers can engage their employees in understanding these causes and taking action. The value of such forums is impossible to overstate. In addition to offering a rare, focused opportunity for sustainability professionals to expand and strengthen their networks, the ability to learn from experts on everything from LEED certification to supply chain sustainability is a major benefit.

As Lauren Wylie, Head of Internal Sustainability at consulting firm Oliver Wyman puts it, "I am fortunate to be a part of a company that recognizes the importance of sustainability at the highest levels. They are open to my ideas and that's why it is important for me to keep those ideas fresh and innovative. Hearing the successes and challenges from other Green Team members offers a unique way for me to validate or modify my ideas and to feel confident that we are moving in the right direction."

Green Teams at Citi

Citi also became an active participant in our Green Team meetings because its employees "wanted to hear from other sustainability practitioners in the area, share best practices and talk about some common challenges," according to Daluz. The benefit of spreading the responsibility for sustainability throughout the company is not lost to participants: because no one person is responsible for everything. Companies send team members interchangeably to really maximize the forum – and the participants' time.

For Daluz, that has meant inviting "the person internally who is best for the topic to learn more about the issue or share their expertise."

And because "the agenda is set by attendees," Daluz feels participants don't just make small talk: "We talk about our approach to specific issues and goals, so the meetings are productive."

As for the importance of employee-led green teams, Daluz points out that, while Citi has "had an environmental footprint reduction goal for a few years," the firm realized that "we cannot reach those goals without employee engagement." And in Citi's case, the results have gone beyond even the engagement question and are now actively adding to the bottom line.

The Green Team in St. Louis, for instance, reduced waste and saved the local office nearly $10,000 through a simple excess office supply exchange program. "This initiative might seem small by itself, but if you encourage the replication of successful programs or behaviors across your footprint you realize how meaningful each action is."

Still think pursuing a triple bottom line is idealistic? Just look around. There is immense potentiality represented by your employees. Encourage their passion and their dedication to your organization by giving them the tools and a place to start.

Then watch the change take place.

Previously:

4 Environmental Issues That Matter to Employees – and Employers

Progress or Propaganda? The Corporation's Role in Promoting Workplace Giving

The Virtuous Cycle of Workplace Philanthropy

The Basic Rules of Impact: EarthShare CEO Connects the Dots