Miriam Rayman
Sep 20, 2017

Chief ethical officer: Your next recruit?

Commitment to a social purpose is becoming key to business success. Do companies need a high-level executive dedicated to shepherding the effort?

Unilever's longstanding dedication to doing good has proven good for business.
Unilever's longstanding dedication to doing good has proven good for business.

If there’s anything to learn from Uber’s succession of PR blunders, it’s that trading a product based on convenience and price alone is no longer enough. Brands need also to consider their broader role within society.

This isn’t just down to a whistle-blower culture. It’s also because today, consumers look past the latest ad campaign and peer into the less polished side of a business to form their opinions. Future-fit brands will be those that can handle this scrutiny. They may need to re-organise the way they operate and would do well to get in a new kind of talent, someone whose job it is to define the company’s moral and ethical strategy.

“You can't afford to stand for nothing these days, because you will get found out,” says tech philosopher and serial author Tom Chatfield. “To achieve that, brands need a bigger-picture take on values, purposes and attitudes that every aspect of the business should be working towards.”

It’s why some brands are drifting. Think of Next or J Crew, Gap or UPS to name a few. Whilst Millennial brands (such as Toms, Warby Parker, Airbnb) or Silicon Valley hot shots (such as Tesla, investing heavily in clean energy and space exploration or Google with its agenda towards artificial intelligence) are flying high. Consumers admire vision.

Stand for something, even if it gets uncomfortable

No one gets to control how they are judged these days, least of all massive organisations where information can seep out from any number of unexpected channels to then spread quickly across the internet. “People are more able and inclined to see things in a joined-up, systematic way today," Chatfield says. "We have access through technology to the stories of those inside the company and the stories of those working with it. Which means that even so-called 'reputation management' isn't enough.”

This is why it's important to have a social purpose that sits at the core of the brand, as opposed to as an add-on. Otherwise, blunders will occur. “This isn’t the ‘fence-sitting '90s’ where you had organisations who didn’t want to stand out politically, be too outrageous and upset their middle-class customers,” says Martin Raymond, co-founder of the Future Laboratory, which is currently charting the rise of civic brands and how companies are choosing to act as a force for good in society. “People want positioning clarity, they want the brand to have a point of view and a point of purpose.” We are now seeing some brands that are so strongly commited to causes that they will align with a strategy that is at times contentious to a mainstream audience.

Gucci backs female education and fights female circumcision.

Patagonia, long the pin-up for ethical business, cancelled its participation in a major trade show this year, for example, because the political stance in Utah, where the show was located, didn’t align with the brand’s core environmentalist values. Pulling out of this key outdoor-industry event will jeopordize the company’s short-term sales figures but it was an unavoidable protest against Utah's recent decision to prioritize oil, gas and mining development over the conservation of its public (recreational) land.

Now even traditional luxury brands are taking bold steps to align with long-term civic values over short-term sales. Gucci, for example, is putting a lot of investment into female education and equality via its foundation, with a particular focus on female circumcision. It’s a brave stance for a company so reliant on demand from the Arab World.

Know where you sit on the spectrum

But it’s one thing saying you need to stand for something and another actually getting it right. “What we have is a broad spectrum of what might be called social purpose,” says Gail Steeden, co-founder of Humankind Research, which focuses specifically on providing insight for organisations wanting to play in this space. That spectrum might stretch from gender-neutral brand communications such as CoverGirl appointing James Charles as their first ever ‘CoverBoy’ on one end, to impact-led initiatives such as Whirlpool’s Care Counts on the other. “We have a lot of respect for anyone being anywhere on the spectrum,” says Steeden, “but things go wrong when brands talk of purpose without acting on purpose.”

Pepsi’s recent Kendall Jenner campaign fiasco is an example of how simply attaching yourself to an issue like race relations and civic protest can go so terribly wrong. Which brings us back to the overused word, authenticity. Just as knowing what you stand for and staying true to that is what gains traction today in the online world, so too does this scale up and out to how corporations behave in the world at large. “It has never mattered more to understand yourself in a corporate sense and to be able to articulate this both internally and externally—and to see yourself in the context of the wickedly complex human and technological systems that today dominate perceptions and actions,” says Chatfield.

Don’t jump on a crisis

‘Crisis surfing’, a term marketing guru Seth Godin coined for virtuous bandwagon jumping, won’t get a business very far. A brand’s social and ethical purpose must go deeper. “Too often we say, ‘how do I news-jack this thing and get attention?’" Godin says. "And the problem is it just wears everybody out. Every time there is a crisis, it will get replaced by a different crisis. Rising above the ebbs and flows is an opportunity to say, as brands we actually have principles here, and we’re going to stick with this day after day after day.” 

One way in which companies are signing up for long-term commitment to change is through a set of internationally recognized worthwhile values via accreditation from B Corporation. Founded by the B Lab, the accreditation represents a growing a global network of businesses, not just the usual suspects such as Ben & Jerry’s, but also lesser-known brands from across the world such as MYSC from Korea, BetterBarrista from Singapore and Boond from India. All have attained B Corp status via an exacting process that takes three years or more to complete. 

B Corporation certification can takes years to secure.

The most recent major corporation to join the network is Danone, which for example, offers fair prices for dairy farmers and better packaging for its baby food. “What’s interesting is how all these businesses signing up to these commitments actually has the potential to create real change,” says Steeden, who very much believes business can be a force for change in the world. So there’s nothing contradictory about brands wanting to play a more civic role. The trick is to be clear on your intentions. Joining the B Corp family, for example, is a long process involving considerable investment. “It’s OK for brands to admit they’re just starting on this journey and they don’t have all the answers but they want to start a conversation,” says Steeden.

Start with positively impacting your employees

That conversation starts with putting the beneficiary at the centre. “We like to think about impact, and a strategy which is bottom-up," Steeden says. "A lot of things go wrong when it’s top-down and advertising-led." B Corp accreditation allows you to start off with having some kind of impact on real people on the ground, rather than just having a point of view on an issue.

This shift toward having a more ethical, moral focus is about re-establishing the job of the corporation. Contrary to the Milton Freedman view, it’s not enough to focus on maximizing shareholder value. “Companies exist for lots of reasons,” says Godin, “One of those reasons is to satisfy the needs of the people who work there. One of those needs is to make a fair return, but a bigger reason is to find meaning and leverage in the work they do.”

Unilever, which has always had strong principals in this area, is a testament that profit, people and planet don’t need to be mutually exclusive. The company's ‘Sustainable Living’ brands, which have environmental and social impact at their core, such as Hellmann’s, Dove and Ben & Jerry’s grew more than 50 percent faster than the rest of the business in 2016 and accounted for 60 percent of Unilever’s growth last year.

This means that re-orienting a business toward playing a more socially conscious role can leave plenty of money in the kitty to add a new recruit to the board. Just business acumen is no longer enough. Brands now need serious full-time thinkers in the boardroom to balance business experience with a more philosophical perspective. Philosophy graduates, get ready for your next chapter as a chief ethical officer or chief philosophy officer.

Don’t pretend you’re something you’re not

That’s assuming the brand is willing. Unilever may have decided to make this its focus, but it is only one Fortune 500 company. Many of the others still have a long way to go, and some might not want to go there at all. In this age of mass transparency, it’s always better to be yourself than pretend you’re something you’re not.

Read more on brand purpose:

 

As Chatfield explains, there are interesting parallels here between the world of branding and that of politics. “People are much more sensitive to hypocrisy than they are to just doing bad things," he says. "It's actually often better in terms of public perception to be unashamedly awful, someone who says outrageous things and doesn't appear to care about offending people (such as Boris or Trump) than it is to try to present yourself as one thing while covering up other stuff.” 

The trick then is to first decide this is for you. Then get that ethics specialists on board. Then ask what the brand means in the world and the kind of impact it wants to make and can make. Be honest about where the brand is on that journey, always starting from the bottom up with beneficiaries at the core. If the brand can commit to that and stand for those principals day after day, even when it might feel uncomfortable, then people will know what it stands for and it will be unlikely to find itself dealing with an Uber-sized ethical mess in the future.

London-based Miriam Rayman is a freelance cultural strategist and co-founder of Family Affair, a consultancy focused on parenting brands.

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