Two new books provide some fascinating detail about how big international companies work and how those on the inside can help bring about real sustainable change
Regular Ethical Corporationreaders, observing the eight or so new books reviewed in each edition, could be forgiven for feeling overwhelmed by the constant opportunities to expand your library of books about corporate responsibility, business and society, and sustainable development.
Nevertheless, two new books, just published, have got my particular attention. Partly this is because they are both written by people I know and admire; partly because they are both written by business people from the oil industry who have both become involved in multi-stakeholder initiatives; and partly because, from different generations and levels of corporate leadership, they have both had direct experience of some of the complex issues facing business and society, in today’s global, connected world where everything is ultimately for the record.
When Girl Meets Oil: the evolution of a corporate idealist by Christine Bader [www.bibliomotion.com] describes, with humour and verve, how a Yale MBA graduate spent nearly a decade with BP. She was firstly on the front-line, handling local community engagement and consultation in Indonesia and subsequently in China, and then in BP corporate HQ, before moving to New York and an ad hoc team of volunteers, helping John Ruggie with his UN Business and Human Rights Mandate. Bader did the first-ever business human rights impact assessment – in Papua, Indonesia.
Responsible Leadership: lessons from the front line of sustainability and ethics [www.greenleaf-publishing.com] is part memoir, part erudite and philosophical reflection from Mark Moody-Stuart. It covers some of the dilemmas and challenges that senior business leaders now confront, given weak or bad governance in many parts of the world where they will operate, and the daunting challenges of working out how to run profitable business, such that nine billion people will be able to live reasonably well within the constraints of planetary boundaries by mid-century.
Working at the top
Moody-Stuart writes with the experience and authority that comes from leading Shell, then chairing Anglo-American and holding a number of other directorships with major multinationals, as well as living and working in ten different countries. As he demonstrates with many of his anecdotes of meetings with presidents and prime ministers, someone like Moody-Stuart is an exemplar of the “CEO as statesman”, the theme of an earlier EC essay, in September 2012.
For anyone interested in the evolution of the responsible business debate and practice over the past 30 years, these are very readable, fascinating and valuable books. Unsurprisingly, some of the same organisations and key figures, including John Ruggie, figure in each book. In the extract reproduced in this magazine from When Girl Meets Oil(see page 37), Bader describes how she first encountered John Ruggie and subsequently managed to job-craft in order to work with him.
Both are good at interspersing their own stories and experiences, with relevant examples from other companies. From different corporate levels, both grappled with the challenges of convincing colleagues of the “new business normal” in which businesses have to grapple not just with laws but also with a swathe of new, “soft laws” established by corporate peers and new forms of governance mechanisms.
Each provides plenty of hard evidence and practical illustrations for why companies nowadays need to manage their social, environmental and economic impacts. Each asks, as Bader puts it, “the fundamental question of our age: How does a global business operate?”
Building new structures
They both recognise that business neither has all the solutions, but equally cannot afford to be a passive observer faced with the challenges of ineffectual governance nationally and internationally. Moody-Stuart, the principled pragmatist, and Bader, the corporate idealist who has shed her illusions, accept that “Rome was not built in a day”, and that “building Rome” is messy, often frustrating, subject to reverses, and involves compromises and many new structures.
Moody-Stuart emphasises the need for patience, and for painstaking efforts to improve governance capacity, in-country. He is no fan of disengagement or sanctions or of extra-territorial legislation, as the extract from his book reproduced in this issue (see p40) makes clear. Instead, he seeks to join up and build greater connectivity between the rich mosaic of multistakeholder initiatives such as those he describes.
His candour on how long it takes for messages from the top to be truly absorbed and internalised across a large, global business, will resonate with other CEOs grappling with how to instil values and ethical principles for “how we do business around here”. He describes Shell’s commitment to health and safety, how he thought that top management had made their commitment clear but found the reality different:
An analysis of accidents showed that fatal accidents were more likely to occur when operations were started up before all was completely ready. It was also apparent that in the case of many accidents, someone had had some degree of prior concern or uneasiness about the situation but had not felt empowered to take action. So we sent out a strong message to all operations over my signature saying that anyone had a right to stop an operation if they felt that it was unsafe and that it was more important to ensure that all was ready – training and testing complete – than to meet a promised deadline.
For two or more years after that when I attended town hall type meetings with people on operations around the world, I found that at some point there would be a question along the lines of ‘Mark, are we not sending out mixed messages on the importance of production versus safety?’ Initially I was a bit irritated by the question, pointing to the letter I had signed and which I thought was absolutely clear. Could people not read? Very soberingly, I soon realised that it was not that people had not read my letter, but that they still had some doubts about what it really meant. Not to put too fine a point on it, they did not really believe the words or that I really meant what I said. The answer was not to make the message more strident, but to find operations that had been shut down for safety reasons or where start-up had been delayed and draw attention to them, publicly commending those concerned. If people see an action clearly costing the company money and yet which attracts commendation, they believe the message.
Bader offers some practical tips for anyone who wants to be a pragmatic, corporate idealist or change-maker. She emphasises the importance of getting to know key colleagues and engaging internal stakeholders; using language and arguments that they can relate to; of having emotional intelligence and capacity to be a good listener; and the value sometimes of getting external voices to make your case.
I suspect that both Bader and Moody-Stuart would recognise and empathise with the following:
There is a fundamental change under way regarding how global problems can be solved, and perhaps how we govern ourselves on this shrinking planet.
Emerging non-state networks of civil society, private sector, government and individual stakeholders are achieving new forms of cooperation, social change and even the production of global public value. They address every conceivable issue facing humanity from poverty, human rights, health and the environment, to economic policy, war and even the governance of the internet itself.
Enabled by the digital revolution and required by the challenges facing traditional global institutions, these networks are now proliferating across the planet and increasingly having an important impact in solving global problems and enabling global cooperation and governance. Call them Global Solution Networks.”
This quotation comes from a context-setting white paper prepared by a team led by the Canadian writer Don Tapscott, for a multi-year research programme being run by the Martin Prosperity Institute, at Rotman School of Management in Toronto.
This programme is seeking to map the kind of world that both Christine Bader and Mark Moody-Stuart are helping to create and some of the drivers for which they describe in their respective books. Understanding these new Global Solution Networks, identifying the critical success factors for making them work, and the skills that individuals from different sectors need to be effective in them, will all help to make the kind of multi-stakeholder collaborations embraced by Bader and Moody-Stuart, more viable and effective.
These collaborations and multistakeholder, often multisector, initiatives in some measure can be an alternative, sometimes superior, approach to governance. They cannot, however, fill the governance vacuum entirely. If the old dual polarity of markets or regulation is now transformed into something far more varied, regulation, effectively and fairly enforced, still has an important place.
Prof David Grayson is director of the Doughty centre for corporate responsibility at the Cranfield School of Management.
 Global Solution Networks Understanding the New Multi Stakeholder Models for Global Cooperation, Problem Solving and Governance, Martin Prosperity Institute, 2013, White Paper draft 3. For further information on this multi-year, international research project being conducted by Don Tapscott for the Rotman School of Management, Toronto. [see: http://gsnetworks.org]David Grayson Essay global business global CR strategy
May 2014, London, UK
Make sustainable innovation add to your bottom line. 15+ CEOs and C-Suite from leading multinationals plus heads of CSR will discuss the future of sustainability