Building Businesses For a Better World Part II:
Getting an A+ in Social Responsibility
By Kathryn Schuett
If you were to be graded on your positive impact on this world, what would you score? Would you be the kid that did just enough to get by or would you be one to set the curve?
As the ones who pioneered sustainable agriculture, organic companies are already leaders in social responsibility. In fact, according to Ellis Jones, the author of The Better World Shopping Guide, which ranks businesses according to their level of social responsibility, by dedicating yourself to creating organic products versus conventional, you would already score in the range of A- to B+.
So the organic industry is doing well…but could we do even better? Could we strive to go beyond organic and widen our circle of influence, using our businesses to drive social change in our communities and around the world? Shouldn’t we reach for that A+?
The Socially Enlightened Consumer
The fact is, companies are being graded. Your actions are being scrutinized by consumers like a politician’s voting record and checkout lanes have become the place to cast ballots. More and more, with each dollar spent, consumers are looking not only to purchase a quality product, but are seeking, quite literally, to “buy in” to a philosophy that matches their value system. According to the “Hartman Report on Sustainability: Understanding the Consumer Perspective,” many consumers believe that their purchase decisions are at least as important as their votes in affecting social change and, in many instances, they feel their purchasing has a greater impact on society than their voting.
In addition, according to a 2007 survey by Cone, a brand strategy and communications agency;
• Over 66 percent of Americans consider a company’s business practices when deciding what to buy.
• 92 percent state they have a more positive image of a company that supports a cause they care about.
• 87 percent are likely to switch from one brand to another if quality and pricing are the same, but the other brand is associated with a good cause.
• 30 percent have recommended a product or company after hearing about a company’s commitment to social issues.
• 22 percent have used the Internet or other technologies to engage in grassroots activism.
• 66 percent look at what a company is doing in the community when deciding where to invest.
As a business you do have ability to make a difference, and there are more rewards than just feeling good. Numerous studies and surveys have documented the connection between corporate social responsibility (CSR) and better returns for companies and investors. According to Tina Sciabica of Social Venture Network, a nonprofit that brings companies and organizations together to use business as a force for positive social change, “Socially responsible business practices can produce a number of great benefits, including higher productivity, better employee morale and improved retention, higher returns for investors and increased profitability as well as increased customer loyalty and enhanced brand image."
In his book, Jones grades companies on many factors of CSR, ranging from human rights and animal protection to environmental stewardship and community involvement, but he says, “Overall it basically boils down to taking responsibility for the power you have to make a difference and being aware of the ripple effect you have on the world through the actions you take.”
Here are some of the ways that socially conscious companies are causing a positive ripple effect, both globally and in their own backyards.
Social Responsibility in The Global Market
Organic goji berries from the Himalayas, cocoa from Madagascar, cotton from Turkey—today, the consumer demand for exotic products grown in far reaches of the world, along with the lean domestic supply of many ingredients, has led many companies to source around the world including developing areas such as Africa, Asia and Latin America. However, as we search the globe for ingredients and manufacturing partners, we must change the way we look at the workplace. The labor rights we have in First World countries don’t apply in many of these places. Employees are often subjected to poor working and living conditions with no access to health care or education and wages that on average total less than $2 a day.
But as a business operating in the global market, you can set a positive example for the way that global business should be done. From embracing fair trade principles and investing in fair trade ingredients, to working with indigenous communities to protect their natural resources and offering educational and economic opportunities—there are many ways that companies can take action to make the world a better place.
Fair Trade. In 2007 alone, Mintel forecasted 57 percent growth of fair trade beverages and a 150 percent increase in fair trade food introductions. Fair trade guarantees a minimum price for farmers and requires that certified growers invest in community projects such as health care and education. Certified operations must also meet rigorous environmental standards that include continuous improvement, prohibitions of the most dangerous chemicals, safe handling of approved chemicals and incentives to move toward organic certification. Currently, the selection of fair trade certified organic ingredients available includes cocoa, bananas, rice, sugar, vanilla, coffee, tea and a variety of extracts including vanilla, coffee and chocolate. Fair trade organic honey recently became available as well and other options are sure to be added as TransFair, the U.S. fair trade authority, explores certifying other commodities such as spices. TransFair has also started working with Under the Canopy, an eco-textile manufacturer, to establish a pilot program for U.S.-certified fair trade organic cotton.
So what impact have fair trade programs had on developing countries? In 2007, fair trade sugar alone provided close to $500,000 in social premiums that have funded the development of everything from health and dental care clinics, schools, offices, mills and other infrastructure, to radio stations (used to communicate vital data) and crop diversification projects to promote biodiversity.
One company that has made a positive impact is Wholesome Sweeteners, one of the largest importers of organic fair trade sugar, and now organic fair trade honey. Wholesome pays premiums to a co-op in Malawi, Africa, that recently used this funding to put in a well, providing safe water to the entire village. They also brought electricity to the village and are working on a community health center and programs to combat the AIDS epidemic. Malawi has one of the worst rates of AIDS in the world. Other operations in Africa, such as Zambezi Organic Forest Honey have used fair trade dollars to provide AIDS education and essential health promotion items such as mosquito nets to protect against malaria.
Some manufacturers may not have gone through the official fair trade certification, but instead have developed other ways of ensuring fair and sustainable practices. For instance, Partnerships for a Better World, a supply network in Brazil, combines fair trade principles with organic certification for 28 different kinds of crops. Through this network, companies offer over 25 social and environmental programs.
Protecting Biodiversity. Recent controversial videos created by Greenpeace exposing Unilever for destroying Indonesian rainforests to source palm oil have heightened social awareness around this and many other rainforest products. While it’s true that this environmental degradation is taking place, there are some who are trying to reverse the negative impact. For example, Agropalma, an organic palm oil producer, is working to restore areas of the rainforest in Brazil, while at the same time creating a thriving community for their workers by providing electric power, water, medical, road construction, a school and a technology lab. In addition to this, they have also replanted almost 10 thousand hectares of rainforest.
For many companies, creating a strong community economy and protecting the area’s natural resources go hand in hand. The idea is to create a strong market value for a renewable crop that is best supported by a biodiverse environment such as the rainforest. The area in South America where Guayaki grows their yerba mate only has an estimated 5 percent of the rainforest still remaining and is on the world’s top five hotspots for conservation. Offering fair trade prices, Guayaki provides more income per acre than cattle grazing or mega-agricultural products such as corn, soy and wheat—thus native communities are encouraged to preserve the rainforest rather than cut it down to maximize profits. Guayaki calls this “Market Driven Restoration.” Companies that do this actually not only get kudos for helping the community and preserving biodiversity, but also for fighting global warming. Guayaki’s mate actually has a below zero carbon footprint. The company has also planted thousands of yerba mate trees below the rainforest canopy to provide a sustainable income for the tribe they work with and has agreed to pay the tribe royalties once the company hits $10,000,000 in annual sales.
Educating those in more developed areas of the world about the core problems affecting the rainforests is key to gaining the global participation that is needed to protect biodiversity on a large scale. Stephen Brooks, one of the owners of Kopali Organics, a personal care company, co-founded a group called Costa Rican Adventures to host eco-education trips. Every year, 400 to 500 students are shown not only the beauty of the rainforests, but are made aware of the social issues surrounding agribusiness, which has enslaved many of the native people and destroyed much of the environment. Part of this experience is Punta Mona, an 85-acre organic farm and sustainable learning center. Here students learn about sustainable alternatives like organic farming, permaculture, solar power, composting and water reuse.
Saving Endangered Species. Protecting biodiversity also helps safeguard the many endangered species that call the rainforest home. Some companies such as Endangered Species Chocolate have based their whole business plan around saving these animals, while others have taken on one or more of these endangered species as a “pet” project including Thanksgiving Coffee, which has created a “Coffee With a Cause” line featuring “Gorilla Fund Coffee,” which contributes to the Dian Fossey Gorilla Fund International project to protect the endangered mountain gorillas in Rwanda, where the beans for this coffee are sourced. The line also includes “Bat Magic” which benefits the Wildlife Trust and Bat Conservation International. Green Mountain Coffee Roasters also recently launched their “Tanzanian Gombe Reserve” in collaboration with the Jane Goodall Institute. The coffee is grown by a group of farmers who live near Gombe National Park in Tanzania, the site of Dr. Goodall’s groundbreaking research on chimpanzee behavior. Just outside that area, however, the rainforests are being cleared and the chimps in the wild are nearing extinction. This coffee will provide income and an incentive to protect the forest and its inhabitants, while also raising money for research.
This cause extends past coffee; Joli Bébé Boutique, which makes organic baby and maternity clothes, features endangered species data on each hanging tag, with each new line representing a particular animal. Barbara’s Bakery has also used their Puffins cereal to support the Audubon’s project to save the animal that is their namesake, encouraging consumers to save box tops which they can redeem to adopt a puffin.
Another take on this is to save endangered humans. Shaman Chocolates was developed to provide an income for the Huichol, a small tribe living in central western Mexico in the Sierra Madre Mountains, who are said to be the last tribe in North America to have maintained their pre-Columbian traditions. Shaman Chocolates gives all the profit back to the tribe, providing continuing economic support that enables the Huichols to live in their traditional ways rather than have to work for major agribusinesses.
Supporting Women. Developing countries also have gender equality issues and thus many companies reach out to women specifically. Elan Organic Coffee has helped women on many levels including supporting a cooperative of Nicaraguan war widows, Soppexcca, by purchasing and promoting their coffee in North America and helping create business empowerment training for women coffee growers in Columbia. Elan also helped fund the first Finca micro-loan bank for women in Cooperativa La Voz Que Clama en El Desierto of Guatemala, resulting in a successful weaving cooperative.
“Improving the status of women is widely recognized as one of the most effective strategies for addressing other challenges facing communities around the world today,” said Karen Cebreros, owner of Elan and co-founder of the International Women’s Coffee Alliance. “When women are fully involved, benefits can be seen immediately. Families are healthier because they are better fed and their income, savings and investments go up.”
For women in these countries, it’s about providing opportunities which socially or economically may have not been available. Sometimes it’s just about offering a way to earn an income. To give women a way to support themselves, yet still care for their children, Numi Tea started a program where women can assemble bamboo items from home.
Sometimes it’s about empowering women beyond just making a living wage. Working with farmers in India, Marci Zaroff, founder of Under the Canopy, discovered that many girls are denied the opportunity to go to school because families simply can’t afford it. The family may pay for the boys to go, but schooling for girls in many developing countries is considered a luxury. So, Under the Canopy worked with a non-profit to establish a school for girls and women.
In India, there is also the issue of women being ostracized from their families and blacklisted from the job market for reasons that may be unfair or discriminatory. Organic India has helped give jobs to between 700 and 1500 women and has also provided lifeskills classes to help these women become more independent.
In Burkina Faso, Africa, Dr. Hauschka helped local women establish a sustainable agriculture cooperative to produce shea butter, financing a consultant to help them set up the microenterprise and go through organic certification. This cooperative now not only provides certified organic shea butter for Dr. Hauschka’s skin care, but is able to sell their shea butter to other companies as well, improving their economic stability so they can actually afford to send all their children to school for the first time.
Microlending. Another way that many businesses are giving back to the communities that they are working in is through microlending, or microcredit, which provides small loans to entrepreneurs in developing countries to help them create successful small businesses. Many people in developing countries (women especially) don’t have access to loans, so this can provide a world of opportunity. “Microlending is probably the most promising technology to end poverty, particularly among women and families,” said Jean Weidemann, president of the Weidemann Foundation which specializes in microlending and women’s issues. She noted that many programs offer adjunct training in business skills, literacy, numeracy, health and family planning.
Groupe Danone, the parent company of Stonyfield Farm, has recently introduced a microlending project called “Yoghurt For Power” which provides a business opportunity for poor women to sell yogurt in their shops or door to door, while at the same time offering fortified and affordable yogurt for malnourished children in Bangladesh. This project has grown into a $1 million operation, with many women operating successful businesses as a part of it.
Social Responsibility in Your Own Backyard
Greening Your Community. This is not just about reducing your company’s carbon footprint (we discussed ways to do that in Part I, “Going a Deeper Shade of Green,” in OP’s March-April issue). This is about taking a step further to look at our communities and see how we can make a positive impact, instead of just reducing our own negative impact. One shining example is Kettle Foods. The potato chip manufacturer has a facility in Salem, Oregon, located near wetlands which they have adopted and restored with some sweat from their employees and corporate funding. Kettle’s processing facilities’ landscapes are now certified by the National Wildlife Federation.
Many companies have also participated in tree planting projects. FruitaBü has partnered with the Fruit Tree Planting Foundation (FTPF) to create a program called “Fruit Tree 101” which donates fruit trees and shrubs to schools nationwide in order to address important issues like caring for the environment and proper nutrition.
Instead of mailing hard copy holiday cards this past holiday season, SunOpta emailed an electronic card and used the money to plant 13,000 trees in North America in 2008 which will help offset greenhouse gas emissions and mitigate environmental damage caused by forest fires in California and spruce budworm infestations which have devastated forests in northern British Columbia.
Progressive companies are looking at ways to green transportation as well, not only by developing alternative fuels for their own company fleet, but also reaching out to the community to make an even bigger impact. T.S. Designs, which creates organic cotton T-shirts, recently built a local biodiesel filling station on the grounds of their corporate facility. As a part of Piedmont Biofuels Co-op’s B100 Community Trail, this station will provide biofuel to over 600 community members. T.S. Designs also hosts the Burlington chapter of Triad Electric Vehicle Association (TEVA) and provides space for biofuel classes taught through the local community college.
Educating the community on social and environmental issues is another way that companies are helping drive change. The Conscious Goods Alliance is a group of 14 companies (many of which are organic) that sponsor an eco-bus which travels the country on recycled veggie oil to promote sustainable living.
Some companies have even gone so far as to take on politics to save the planet. Pizza Fusion, a chain of gourmet organic pizzerias, helped lobby for Florida’s Safe Climate Act, which supports a more ecologically friendly future.
Community Giving. When we think of people living in below poverty conditions, most of us tend to think of developing countries, but there are many needy, hungry people in our own backyards.
To help struggling kids in their community start off the day with a healthy breakfast, the folks at Peace Cereal teamed up with some of their long-term ingredient suppliers, to provide single-serve packages of nutritious Vanilla Crunchies cereal. For almost two years now, FOOD for Lane County, Oregon, has distributed as many as 15,000 packages of cereal per month to local schools attended by students from low-income families. Kettle, once again, has shown their commitment to the community by donating potatoes to hunger relief agencies—last year they donated over 200 tons.
The non-profit group, Nourish America, was created to organize efforts like this on a national level, helping food and supplement companies connect with those in need. So far, several organic companies such as New Chapter, Barlean’s, Horizon and Jungle Grub, have donated items that go toward everything from disaster relief efforts and afterschool programs for inner city children, to feeding Iraq war refugees. Clif Bar also recently donated over 6000 bars for flood victims in Iowa displaced from their homes this past June.
Another approach is to make organic foods more affordable and accessible to lower income communities. Veritable Vegetable works with Literacy for Environmental Justice in the poorer neighborhoods in southeastern San Francisco to help youth set up low-cost organic produce stands in schoolyards. In addition, they work with local corner stores, going so far as to help them set up government sponsored Women, Infants and Children (WIC) nutrition programs, enabling these populations to have access to organic. They also hire challenged teens for their summer intern program, giving them work experience as well as a chance to learn about sustainable agriculture.
Giving out scholarships is another way to encourage future generations to be a part of the solution. Earthbound Farm offers several to different groups including the children of Earthbound employees, local high school students who want to pursue study in environmental stewardship and environmentally-focused students at several California state universities.
The Key to Getting an A+
Whether you’re helping children in Africa or spearheading sustainability projects in your own community, the key to really connecting with consumers is authenticity. In a world of greenwashing and corporate cover-ups, consumers are looking for companies that are not just doing something to make a buck, but that are also doing something to make a difference.
Before you go into any project, it should be about reflecting your company’s true values. And more than anything, it’s about taking action, not just talking the talk. As Gandhi once said, “Be the change you wish to see in the world.”
The organic industry is naturally positioned to be leaders of social change, and your customers are looking to you to set the gold standard on all levels of social responsibility. Are you ready to change the world?
Kathryn Schuett is the editorial director for Organic Processing Magazine. You can reach her at email@example.com.