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Every day, more companies come to value the opportunities that corporate citizenship presents — both to business and society. Becoming a leading citizen requires companies to institutionalize and integrate corporate citizenship into company strategy, operations and policies, in all areas and at all levels.
In our direct research with leading companies, The Center has analyzed the tactics that conventional wisdom suggests are essential to integrating corporate citizenship, from making the business case to producing a social report. These "10 Half Truths of Corporate Citizenship" describes ten tactics, but also reveal the half-truths behind them: that although they can spark momentum, they can also act as traps or hinder progress
The bottom line? Consider each tactic within the broader corporate strategy and business environment to drive corporate citizenship forward. Each tactic is a means to an end rather than an end in itself, and several tactics should be pursued simultaneously to maximize their potential benefits.
The following chart provides an overview of each tactic’s strengths and weaknesses. Click on the text in the center column to view a more detailed explanation of what each tactic means and its implications for your company.
The Ten Half Truths are also available in a pdf format; click here to download.
Make the business case
Skeptics and believers alike often think that executive endorsement of corporate citizenship relies on a business case that demonstrates bottom-line financial results. However, practitioners frequently overvalue what the business case can deliver, relying on it as the ultimate tool for convincing nonbelievers.
Yes, the business case …
 Connects corporate citizenship to your company’s business agenda
Builds confidence that corporate citizenship will help -- not hinder -- business success
Articulates the “why” and “what” of corporate citizenship for your company
But the business case can …
 Ignore nonfinancial ways of articulating value
Create internal resistance from those who prefer to emphasize the company’s core values
Overpromise and underdeliver with thin financial data
Position corporate citizenship as a support function, not a core operating value
Exploit a canned pitch that is not relevant to your company
The bottom line
A financial justification does not capture the full value of corporate citizenship and does not always generate action. The business case is more about laying the initial groundwork. Use financial data to open the door for a conversation around the value and strategy of corporate citizenship at your company.
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Adopt an external code or standard
With the urging of external advocates, many companies voluntarily adopt an external code or standard that covers elements of “triple bottom line” (economic, environmental, and social) performance and processes. Many of these standards require companies to measure performance and publicly disclose results.
Yes, adopting a code or standard …
Publicly ties the company to performance expectations
Provides specific objectives and targets backed by measures
Helps to allocate internal resources (budget and staff) to manage elements of the code or standard
Connects core operating functions to societal stakeholders beyond governments and grantees
Provides an early warning system for revealing problems that current systems are not designed to catch
Increases issues management capabilities
Responds to stakeholder concerns by using a third-party resource
But adopting a code or standard can …
Become reactive and make corporate citizenship a “box-checking” compliance exercise at the expense of focused strategic planning
Cause companies to measure things that are not germane to the business or its impact on society and divert already scarce resources
Be a resource-intensive effort that obscures the need to ask the bigger questions
Focus on data at the expense of real intelligence
Lose internal coherence of the greater corporate citizenship work by focusing on external criteria
Generate internal resistance and resentment for yet another compliance program
The bottom line
Adopting a code or standard is not a substitute for the company’s vision of corporate citizenship. It should reflect an established vision and support performance goals.
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Make risk mitigation a primary driver Many managers see corporate citizenship as a way to avoid or minimize risk. Managing stakeholder expectations helps companies protect their license to operate. Indeed, risk mitigation can provide a powerful argument to convince skeptics that corporate citizenship can diminish the potential costs incurred from environmental and social risk factors.
Yes, making risk mitigation a primary driver …
Is a powerful motivator and a well-established business concept
Captures top-level attention
On paper, aligns corporate citizenship with strategic business concerns
But making risk mitigation a primary driver can …
Put the company into a reactive mode and drive the corporate citizenship agenda in a particular direction
Lose the upside of corporate citizenship or the potential for opportunity
Cause a loss of motivation when the threat of crisis subsides
Invite backlash from NGOs and stakeholder groups if efforts are seen as a public-relations initiative intended to mask risks
Face limits, as risk managers are often not chiefly concerned with social and environmental factors
The bottom line
Risk management is a potential driver, but it shouldn’t be the only motivation behind a company’s corporate citizenship efforts. Because not everyone in the company will agree that social and environmental factors pose significant risks, heightening awareness can be a more appropriate strategy.
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Get buy-in from the top Widely regarded as a natural first step for a groundbreaking initiative like corporate citizenship, garnering C-level endorsement is often seen as essential to paving the way toward company-wide acceptance.
Yes, getting buy-in from the top …
Secures resources and permission
Keeps corporate citizenship a priority in the face of competing demandsMoves corporate citizenship forward into company consciousness
Expedites decision-making
But getting buy-in from the top can …
Impede buy-in and activity at mid and lower levels where much initial movement happens
Overlook those who know the business best
Create a “waiting game” which paralyzes action or justifies inaction among those who can really advance corporate citizenship
Create the impression that those responsible for corporate citizenship sit exclusively at the top
The bottom line
Drive the process from all levels and find allies in all areas of your company to support change from the middle. While you might need executive permission or “benign neglect” to move forward in some areas, most executives look to their staffs to identify and advance new ideas. Our experience with companies shows that effective work can happen before active C-level support is secured and that it does not necessarily pave the way to organization-wide buy-in.
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Designate an owner of corporate citizenship
With its diffuse set of responsibilities, corporate citizenship is often the domain of everyone and no one at the same time. Internal advocates of corporate citizenship often possess a strong inclination to secure resources for a dedicated position and owner who typically resides within the corporate structure. While this makes sense in many companies, not all corporate cultures support this type of centralized approach.
Yes, designating an owner…
Provides focused energy to push for greater alignment, integration, and a long-term vision
Endows someone with a bird’s-eye view of corporate citizenship events in the company
Grant someone the authority to raise the right questions in order to identify corporate citizenship gaps that fall outside of traditional staff or line responsibilities
Dedicates a budget to corporate citizenship
Facilitates connections with the external corporate citizenship community
But designating an owner can …
Cause corporate citizenship to be seen as a corporate headquarters function
Inhibit a sense of responsibility felt throughout the company
Create a gatekeeper who “blocks” innovation or creates a bottleneck
The bottom line
The corporate citizenship expert should ask the right questions, not answer them. This role is meant to mobilize attention to and action around corporate citizenship at all levels and across all operations.
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Produce a social report Social reports can help focus attention on “triple bottom line” performance. An expectation among advocates is that these reports serve as powerful change drivers by fostering accountability through disclosure.
Yes, producing a social report …
Puts your company “on the record” for its corporate citizenship performance
Drives corporate citizenship via measurement and accountability
Encourages cross-functional interaction in gathering and compiling information
Mobilizes attention by engaging employees in the process of developing the report
Communicates to employees, shareholders, customers, NGOs, and other stakeholders
Tells your story
Tracks progress over the years
Garners recognition for your corporate citizenship efforts
Identifies performance gaps through measurement and cross-functional interaction
But producing a social report can …
Be perceived as a substitute for corporate citizenship strategy and activity
Inundate staff with additional work at the expense of other activities if the appropriate resources are not in place
Yield a glossy publication that lacks substance and allows the rhetoric to become more important than the reality of performance
Hinder goal-setting and performance improvement if the process of producing a report overpowers and the finished product sits on a shelf
Damage stakeholder trust and dialogue if the report omits tough questions and glosses over pressing issues
The bottom line
Producing a social report is not the same as being a good corporate citizen. Time it right to ensure that sufficient resources are in place so as not to detract from other corporate citizenship activities. Remember that social reports are a management tool first, a vehicle to disclose material risks second, and a communications vehicle third.
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Convene a cross-functional committee There is no question that a successful citizenship effort involves representatives from across the company. Engaging these representatives in a meaningful, productive way is essential in order to capture the synergies that make the whole greater than the sum of its parts.
Yes, cross-functional committees …
Encourage broad-based buy-in by engaging key internal leaders and peers in planning and decision-making
Facilitate knowledge-sharing across the corporation
Create multiple points of energy and influence
Complete discrete company-wide projects around corporate citizenship, such as reports, surveys, and measurement programs
Define clear ownership and goals around different aspects of citizenship
Help garner buy-in across the company
But convening a cross-functional committee can …
Make meetings a forum for the staff functions and exclude the lines of business
Slow progress and get bogged down by tight schedules and bureaucracy
Create office politics by not establishing clear ownership
Become another directionless ad hoc committee – a meeting for meeting’s sake
The bottom line
Convening cross-functional committees is a common tactic for other business initiatives, but the breadth of corporate citizenship requires unique discipline around planning, goals, and ownership. Committees are a means to a greater end. For success, clearly establish owners and commitment to bold goals, and establish a senior champion.
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Engage the line organization While many corporate citizenship initiatives grow out of existing staff or corporate functions, involvement with the lines of business is essential to creating a corporate citizenship initiative that is relevant and beneficial to the business. Unless everyone -- from the leadership to the line -- owns corporate citizenship, it cannot be considered a full-fledged company-wide initiative.
Yes, engaging the line organization …
Broadens buy-in and connects with the workforce
Establishes credibility within the business
Increases intelligence about ways to make corporate citizenship more relevant to your business
Opens doors for new sources of innovation
But engaging the line organization can …
Disengage efforts from the company’s overall business strategy
Without unifying mechanisms, become a fragmented and inconsistent effort
Allow the initiative to become programmatic and fail to address the range of issues relevant to the entire company
Limit scope of work or understanding of issues that go beyond company walls
Lose priority status with executives if efforts seep into the company and lack visibility
The bottom line
Corporate citizenship staff must function as internal consultants, strategists, boundary-spanners, and innovators, but ultimately the line must own corporate citizenship.
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Build on existing policies and systems
Instead of inventing new systems and structures, piggybacking on existing initiatives that have buy-in and credibility throughout the organization can be an effective way to build momentum for corporate citizenship. Examples include internal audit reviews, human resource performance reviews, new business assessment and measurement tools (e.g., balanced scorecard), public relations and reputation-management teams, and existing employee and customer satisfaction surveys.
Yes, building on existing policies and systems …
Speeds up early progress and establishes quick wins
Institutionalizes corporate citizenship by making use of already-accepted tools and programs
Increases internal stakeholders’ comfort level and reduces resistance by taking the tried-and-true approach
But building on existing policies and systems can …
Allow the status quo and a company’s cultural inertia to dampen energy and innovation over time
Permit isolated, tactical efforts to obscure the need for a more systematic change approach
The bottom line
First make sure that the policies are up-to-date and still relevant to your business. If they are, modify existing structures to deliver on corporate citizenship objectives, but don’t force a fit.
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Form cross-sectoral partnerships
Cross-sectoral partnerships among companies, governments, and NGOs are becoming more and more common. They leverage the geographic, cultural, and issue-oriented expertise of the partners to make corporate efforts more impactful. These partnerships can help the company develop fuller relationships with stakeholders and a deeper understanding of the context in which your business is operating.
Yes, forming partnerships …
Builds a connection with and accountability to stakeholders
Opens doors for new sources of innovation
Engages a partner familiar with the audience and issues
Expands the scope of traditional philanthropy work
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