Archive for November, 2008

GLOBAL RESPONSIBILITY INCORPORATED IN BUSINESS PLANS

Thursday, November 20th, 2008

IPPA advocates that social policies rooted in our shared core values serve us better than policies based primarily on a purely economic model which says that short term material profit alone is the best measure of human happiness and wellbeing.

The importance of this ethical concept in the business plan of a major industrial corporation is demonstrated in a quote from Alan Boeckman, chairman and chief executive officer of the Fluor Corporation. “As a leader in the global building and services marketplace, we focus not only on such traditional measures of success as profitability, but also on a series of broader measures that we refer to collectively as global responsibility. Simply put, this means doing the right thing to benefit our clients, shareholders, employees, suppliers and others in the communities in which we work.” [http://www.fluor.com/globalresponsibility]

This attention to both economics and social benefits as the measure of success is gaining acceptance in the business world and is well documented in the book: The Triple Bottom Line: How the Best Run Companies are Achieving Economic, Social and Environmental Success and How You Can Too. By Andrew W. Savitz with Karl Weber. [The author’s web site is www.getsustainalble.net] A review of the book at greenbiz.com quotes the authors “Every action you take in business has two components: an impact on profits and an impact on the world”. Savitz and Weber describe a path where profitability and social benefits blend and describe this overlap as the “sustainability sweet spot.” Savitz also states: “One hundred years from now, company bottom lines will include the three pillars of sustainable development (economic, environmental, and social) in a totally seamless manner.”

The reviewer points to empirical evidence in the book demonstrating that the share price of companies listed in the Dow Jones Sustainability Index have out performed various other indexes. The authors also point out that companies who belong to the World Business Council for Sustainable Development have outperformed their respective national stock exchanges by 15 to 25 percent over the past three years. [http://www.greenbiz.com]

There is a soft spot in the existing discussion of the triple bottom line. It is that the content of “social benefit”, its core ethical principles and examples of actual policies consistent with them, remains insufficiently explored. This is a place where IPPA can help.