Preface

Like jumbo shrimp or military intelligence, corporate responsibility is considered an oxymoron by much of society. Corporations are among the least trusted of our institutions. As I type these words, anti-corporate sentiment has boiled over, prompting a legion of young people to protest in front of the New York Stock Exchange and across the country in the “Occupy Wall Street” movement. Confirming popular anti-corporate opinion, a global stock trader interviewed by the BBC in September 2011 summed up the current European economic crisis this way: “I go to bed every night and dream of another recession. It is an opportunity for me to make money. Governments don’t rule the world, Goldman Sachs rules the world.”

It’s no wonder that people are skeptical of corporations. The 2008 mortgage meltdown left millions of people in economic ruin. From the BP oil spill in the Gulf of Mexico, to the collapse of Enron, big companies have acted recklessly and the cost to repair the damage has been borne by society in the form of taxpayer-funded bailouts and environmental cleanup. Indeed, as the number and scale of corporate misdeeds mount, it is increasingly clear that governments are incapable or unwilling to protect the public’s interest against corporate misbehavior.

With this backdrop, what is the solution? Should policymakers try harder to rein in companies? Should we move away from a capitalist economy and toward a socialist system? Winston Churchill said that “democracy is the worst form of government except all the others.” Can the same be said about market-based economies? Without question, corporate greed and negligence have been a source of misery, but the free-market economy has also created abundance and wealth for more people than at any time in human history. Regardless of your worldview on the benefits or ills of capitalism, it is the system we have.

So, at a time when trust in corporations has reached an all-time low, why is interest in corporate responsibility at an all-time high? Skeptics may conclude that corporate responsibility is merely a smokescreen to mask misdeeds. A more plausible explanation is that increasing numbers of stakeholders are demanding responsibility from corporations. Hyper-transparency of corporate activities, fueled by disclosure laws and the Internet, has increased awareness to the point where corporate behavior is under constant scrutiny. Smart business leaders are aware of this scrutiny and of the high costs of a public scandal. They know that in the long run it is cheaper to act responsibly now than to dig out from a PR disaster later.

But there is a more human side of the story. Having spent most of my career working in large corporations, the simple reality is that companies are just groups of people that make very human judgments. Like any group of human beings, each company takes on a unique culture that can either promote ethical behavior or encourage cutting corners. Without question, business leaders are a very competitive lot, but my belief is that most are moral and ethical people.

In his book, How Good People Make Tough Choices, Rushworth Kidder defines ethics as “obedience to the unenforceable.” With this elegant phrase, Kidder has captured the essence of corporate responsibility: how a business acts when there are no laws or rules to govern its behavior. These decisions are powerful inflection points. The reason I have dedicated my career to corporate responsibility is that by working within large companies, a treehugger like me can steer these decisions toward social and environmental good. And, like steering a supertanker, sometimes a very small nudge in the right direction can produce massive change.

This book is a manual on how to steer the corporate supertanker toward doing good for people and our planet. While being a professional altruist in a for-profit company is a bit like being the designated driver at a cocktail party, it can also be very, very rewarding. There are many examples I could pull from my career, but one of the most touching came from my time as Apple’s head of supplier social responsibility. After years of work and millions invested, I could see that conditions had improved for thousands of workers. The most memorable moment was when I walked into a classroom we had set up in the factory to allow the workers to take online courses after their shifts on the manufacturing line. Hundreds of the young Chinese workers used the classroom to learn various topics, and most chose to learn English. When I entered that classroom, the students/workers mobbed me with sentiments of thanks spoken with their newly acquired language skills. In any language, their genuine gratitude for the chance to learn a skill that could improve their lives came through loud and clear.

Whether your worldview is that corporations are inherently selfish or are more prone to act in the public’s interest, it is undeniable that the free-market economy is the dominant social institution of our time. The pessimists forecast a race to the bottom where multinational corporations diminish social and environmental conditions. The optimists see an upward spiral of responsible companies working to improve conditions, even making a profit in the process. Whichever view is correct is an abstract academic argument. The reality is that the corporate responsibility movement is real and expanding at a rapid rate throughout the world economy. I wrote this book to help others who feel, as I do, that working in corporate responsibility is the most effective way to make a difference in the world.

Steve Jobs, who passed away recently, was eulogized as an innovator who changed our lives. One lesson from his iconic life that is applicable to a career in corporate responsibility is to know what you want to achieve and never compromise on your goals. Almost twenty years before his death, Jobs summed up his legacy this way: “Being the richest man in the cemetery doesn’t matter to me … Going to bed at night saying we’ve done something wonderful … that’s what matters to me” (Steve Jobs, Wall Street Journal, May 25, 1993).