A new catchphrase in today’s philanthropic and corporate circles is generating top tier media buzz, as seen in a recent Reuters’ article written by Michel Nichols, “Make money and do good is the new corporate buzz.” The catchphrase—shared value—was coined by Michael Porter of the Institute for Strategy and Competitiveness at Harvard Business School, who believes that business success needs to align with social progress. Harvard Business School is known for producing top Wall Street corporate executives, who don’t always align social progress with the bottom line in their business plans. However, this new way of conducting business is changing the corporate and philanthropic landscape.
In the article, Nichols quotes Robert Harrison of the Clinton Global Initiative, who states that “The idea of making money and at the same time achieving some social good or environmental good, I would say, is [now] the accepted ideal or the goal for many corporations.”
Although many companies are only just starting to implement social progress into their company mission, some heavy-hitting Seattle-based companies adopted this strategy at their inception—notably Starbucks and REI.
Starbucks Social Responsibility campaign “help[s] improve the lives of coffee farmers and protect the environment where they grow their beans.” The Seattle based coffee company developed C.A.F.E. Practices (Coffee and Farmer Equity Practices) back in 2001 and they make sure all coffee suppliers meet certain guidelines that address product quality, economic accountability (transparency), social responsibility, environmental leadership in coffee growing, and environmental leadership in coffee processing. In addition, Starbucks has helped to establish social development projects on the farms their coffee is sourced from. Examples have included improving local water systems and constructing coffee mills.
Another iconic Seattle company, REI, develops a yearly Stewardship Report, which outlines the company’s commitments and activities around the community and environment. In the community, REI donates 3 percent of the previous year’s operating profit to help conserve natural spaces—2 million was donated last year alone to conserve 35,306 acres of land and maintain 6,042 miles of trails. The company’s environmental strategy illustrates a comprehensive plan to reduce greenhouse gas emissions, reduce waste, create more green buildings, and work to better understand the environmental impacts of all of their products.
The development of comprehensive business strategies that align profit with the benefits accrued by the larger community is an important trend, and one that Seattle helped pioneer from the beginning.
Image courtesy of FreeWine.