Companies pledge better 'corporate citizenship' BUSINESS ETHICS:
INTERNATIONAL ECONOMY & THE AMERICAS: Companies pledge better 'corporate citizenship' BUSINESS ETHICS:
Financial Times; Feb 4, 2002
By ALISON MAITLAND
Leaders of 36 international companies will today issue a "corporate citizenship" statement, committing them to making responsible behaviour a core part of their business and to forging close links with all their stakeholders.
Against the background of the Enron scandal and continuing waves of corporate lay-offs, the chief executives of companies, including Anglo American, Coca-Cola, McDonald's and Siemens, will say that "ultimate responsibility (for corporate citizenship) rests with us as chief executives, chairmen and board directors".
The business leaders will say they have an important role in spreading the benefits of globalisation, that working with stakeholder groups "makes sound business sense" and that companies must move beyond philanthropy and integrate positive practices into their business strategy.
The joint statement, accompanied by a detailed framework for putting corporate citizenship into practice, has been drawn up by a taskforce of World Economic Forum chief executives and will be launched in New York.
Other signatories include ABB, India's Infosys Technologies, Deutsche Bank, ING of the Netherlands, Rio Tinto and Phillips-Van Heusen, the US clothing and footwear company.
"This statement is designed to speak to my colleagues and peers in multinational corporations," said Bruce Klatsky, chairman and CEO of Phillips-Van Heusen.
"Many CEOs around the world are supportive of (corporate citizenship) but don't fully understand the positive impact their businesses can have on society. It is not a PR vehicle to paint corporations as white knights. There are despicable acts in corporations just as there are in any part of society."
The document says companies should promote the business case to employees and investors. Doing what is right may involve short-term costs or lost opportunities. "Defining what these are and communicating to investors and other stakeholders how they are likely to influence the company's long-term and short-term performance is a key element of business leadership."
Vernon Ellis, international chairman of Accenture, the management consultancy, and a signatory and instigator of the statement, said: "Often, corporate social responsibility is seen as an optional add-on and it becomes dispensable in hard times. That's the worst time to drop it because you need the external connections, the sense of what is going on, in order to build and preserve your reputation."
He said the statement was intended to complement voluntary codes or principles for business conduct, including the United Nations Global Compact, proposed by Kofi Annan, UN secretary-general, at Davos three years ago.
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