LinkedIn gets networked, Unilever gets children washing hands and oil sector transparency

LinkedIn joins GNI

LinkedIn, the largest online professional network, has transitioned from observer status to member of the Global Network Initiative (GNI).

Founded in 2008, GNI is a multistakeholder group of companies, civil society organisations, investors and academics with the mission to protect and advance freedom of expression and privacy on the internet. While Google, Yahoo and Microsoft served as noteworthy founding corporate members (joined by Facebook in 2013), it took two years for GNI to agree to LinkedIn’s core organising documents, which some human rights bodies such as Amnesty International and Reporters sans Frontières still felt lacked sufficient rigour.

As LinkedIn expands its operations in China, the company will be susceptible to China’s censorship requirements on internet platforms. LinkedIn founder Jeff Weiner says, however, that the company will undertake “extensive measures” to safeguard its members’ rights and data by implementing government restrictions on content only to the minimum extent required, and by being transparent about its practices by notifying members through “multiple avenues”.

As a member, LinkedIn will also be required to undergo independent assessments of its record in implementing GNI’s principles and guidelines, in order to ensure that the company is responding to government requests in a way that still protects members’ privacy and right to free speech.

“GNI was created to help companies operate responsibly in as many markets as possible,” says David Sullivan, policy and communications director at GNI. “But there is no ‘one size fits all’ answer to how companies should operate in specific countries. As LinkedIn expands internationally, they can benefit from using GNI’s principles and guidelines, and from engaging with other participants, including companies, human rights groups, investors and academics.”

Oil firm reveals government payments

Tullow Oil is the first extractive company in the world to publish its revenue payments to governments project by project. The development comes a year ahead of the revised EU accounting directive, which will require extractive firms to disclose tax payments to governments at a project or company level in 2015.

Tullow Oil is an oil and gas exploration and production company headquartered in London, which earns nearly all of its revenue in Africa. In 2012 the company voluntarily published its payments to governments and other major stakeholders in its annual corporate responsibility report. In 2013, Tullow stayed ahead of the competition by aligning its payment disclosures with the new EU directive – those payments amounted to $881m paid in taxes to African governments.

“It’s the biggest impact that we have in the countries in which we work,” says George Cazenove, head of media relations at Tullow Oil. “For years, it’s been assumed that traditional CSR work has been the limit of the oil companies’ impact in developing countries. In fact, that sort of spend is low compared to the sums of money paid in taxes and royalties to government and the money we spend with local companies in the supply chain.”

For that reason, Cazenove says the company also calculates its wider socio-economic impact, including discretionary spend on social investment projects, the money spent with local suppliers, and employee salaries.

“Tullow’s disclosures show that project-level reporting is entirely practicable, and debunks the alarmist claims made by some oil companies that such disclosures would harm their commercial viability,” says Dominic Eagleton, senior campaigner at Global Witness. “Citizens in resource-rich but economically poor countries, including communities living near extraction sites, will be able to monitor public revenue payments that globally are worth many hundreds of billions of dollars a year. The data will also provide investors with information needed to assess risk and make better investment decisions, as well as being useful for anti-corruption agencies, parliamentarians and journalists.”

While Cazenove says the disclosures required a good deal extra work from Tullow’s tax and accounting teams, the company’s relatively small size in comparison with other extractive companies (producing about 80,000 barrels per day from 10 countries) – simply illustrated by its ability to fit the disclosures on just two pages in its corporate responsibility report – makes Tullow substantially more nimble.

Unilever soap campaign cuts disease in children

Unilever’s Lifebuoy brand of soap has reduced the incidence of disease through a handwashing behaviour change programme, which seeks to change the hygiene behaviour of one billion people across Asia, Africa and Latin America by 2015.

One child dies from diarrhoea or pneumonia on average every 15 seconds – a staggering 2.1 million deaths each year. India has the highest reported number of children under the age of five that die from diarrhoea, amounting to roughly 1,000 deaths a day. Research shows that simply washing hands with soap is one of the easiest and most affordable solutions, and can reduce the risk of the condition by up to 45%.

The company’s Help a Child Reach 5 handwashing campaign was launched in Thesgora, India, in 2013, and has succeeded in reducing the incidence of diarrhoea from 36% to 5% across 1,485 households. The programme has also made an impact on parents, as 33% more mothers are now washing their hands with soap, positively affecting the family’s health overall.

Lifebuoy’s successful handwashing programmes are being expanded to villages across 14 countries including Bangladesh, Brazil, Egypt, Ghana, India, Indonesia, Kenya, Malaysia, Nigeria, Pakistan, South Africa, Sudan, Uganda and Vietnam. The programme has reached 183 million people since its launch in 2010.

Toms steps into coffee

The Toms brand is stepping into new shoes with Toms Roasting Co, its third One for One line and its first foray into coffee.

Through the shoe company’s existing ventures in developing countries, it became clear that the people who produce coffee – an industry that relies heavily on water – lacked access to clean and safe drinking water for their own communities. According to a 2012 study by the World Health Organisation and Unicef, 11% of the global population, or 783 million people, lack access to clean water, and more than 605 million will still go without safe drinking water in 2015.

Toms has partnered with the non-profit Water for Peoples with the goal of sustainable long-term giving. Thus, Toms Roasting Co was born, providing one week of clean water to a person in need for every bag of coffee purchased.

The new venture began nine months ago, when the company partnered with industry experts to vet coffee growers and co-ops that “fit our ethos of being socially active and go beyond expectation in supporting their workers”, explains Rachel Halliburton, vice-president for marketing and branding at Toms. The new line launched with six coffee varieties that use beans sourced through direct trade efforts in Rwanda, Honduras, Peru, Guatemala and Malawi.

Down the road, as the coffee line expands in other countries, so too will Toms’s non-profit partnerships. “Respect for those in the field and their expertise has been the key to ensuring that this project was stable and could truly make change for people in need,” says Halliburton.

Pharma companies fined for hiding risk

Japan’s largest pharmaceutical company Takeda and its American pharma partner Eli Lilly have been ordered to pay $9bn in punitive damages for concealing the cancer risks associated with its type 2 diabetes drug Actos.

More specifically, the jury awarded $1.5m in compensatory damages, $6bn in punitive damages from Takeda, and $3bn from Eli Lilly. The combined award is the seventh largest in American history, though precedent would suggest the settlement will be reduced, as the US Supreme Court has said that punitive awards should not exceed 10 times the amount of the compensatory award.

Following the verdict, Takeda’s shares fell 8.8% to an eight-month low.

“Takeda respectfully disagrees with the verdict and we intend to vigorously challenge this outcome through all available legal means, including possible post-trial motions and an appeal,” says Kenneth D Greisman, senior vice-president, general counsel at Takeda Pharmaceuticals USA. “We have empathy for the [plaintiff], but we believe the evidence did not support a finding that Actos caused his bladder cancer. We also believe we demonstrated that Takeda acted responsibly with regard to Actos.”

There are currently 2,500 additional lawsuits over Actos pending in American federal courts, all claiming a direct link between the drug and an increased risk of cancer.

coffee  GNI  LinkedIn  pharma  Toms  Tullow Oil  Unilever