Manufacturing & Society: Devising Strategies

Corporate social responsibility must be an integral part of what a company is about.

"What is our social responsibility strategy?"

It's a perfectly natural question, one that senior executives in manufacturing companies need to ask. It's also a very difficult question to answer.

The question implies that corporate social responsibility is a single careful -- or even clever -- plan that someone else needs to execute, another bullet point on a "good management" checklist that needs to be periodically, if not enthusiastically, reviewed. Indeed, that is exactly what corporate responsibility is to many manufacturers. However, no matter how it is specifically defined, corporate social responsibility can't be a separate or sometimes equal element in the collection of strategies that point a company toward its ultimate goals. Real corporate social responsibility must be an integral part of what a company is about, so essential to the enterprise's success that if the company fails to meet its defined social responsibilities, the company must itself be judged at least a partial failure.

"Procter & Gamble believes it has a responsibility to society to use its resources -- its money, people and energies -- wisely, for the long-term benefit of society as well as the company," says the Cincinnati-based consumer-packaged-goods producer. Over the years, in addition to philanthropy, P&G has pursued programs to strengthen U.S. education, to encourage employment opportunities for minorities and women, to develop and implement environment-protection technology, and to encourage employee involvement in civic activities and the political process. P&G also is one of several U.S. manufacturers participating in the South Asia tsunami disaster relief effort, contributing water purification sachets and matching employee and retiree contributions to AmeriCares, Population Services International, and the International Federation of Red Cross and Red Crescent Societies.

"As a global corporation," says Palo Alto, Calif.-based Hewlett-Packard Development Co. LP, "we have the responsibility to use our economic power and reach to have a net positive impact on the world." Specifically, "HP has chosen to focus our global citizenship agenda on environment, privacy, and e-inclusion and education. We selected these area based on their strategic importance to our business, the information technology sector and society. Each strategic initiative has specific priorities, objectives and programs that teams across HP execute every day."

Manufacturers such as P&G and HP select and implement the specific programs they believe best fit their corporate social strategies. Corporate social responsibility can be as narrow or broad as a company wants it to be. Yet, corporate social responsibility remains a tough sell among many manufacturers, especially those U.S. companies in mature industries under short-term pressures to perpetuate their business recoveries from the 2001 recession, pressures to seize new market opportunities in such countries as China, and pressures to meet and beat the new and intensifying competition from manufacturers in such countries as China. When financial survival is a hard and daily reality, it's tough to get executives -- especially C-level people in companies large or small -- focused on the seemingly soft and long-term subject of corporate social responsibility.

However, such focus and complementary strategic commitment are essential. "Long-term business success comes only from creating real value for customers and society, not the illusion of value," emphasizes Koch Industries Inc. And among the guiding principles of this successful, privately held, Wichita, Kans.-based conglomerate is this unyielding statement: "Protection of human health and safety and the environment must come first, no matter how urgent the job, project or commercial interest."

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