Former managing director of Boston-based integrated marketing firm Polese Clancy, Christine Arena now calls the West Coast home. She is author of Cause for Success (New World Library, 2004) and The High-Purpose Company (Collins, 2006). In this interview, she describes the “litmus test” she developed to identify high-purpose companies, and provides advice on what organizations can do to meet their corporate responsibility goals.
The term “corporate social responsibility” is used quite liberally these days. How do you define it?
There are a lot of people in the business world that regard it as a form of marketing or philanthropy. When they speak about it, they think about it in terms of a company effort to do good, to give back to society or to appear as a Good Samaritan.
I disagree with that totally. In my view, and according to my research, corporate responsibility is really about being responsive and taking responsibility for companies’ past, present and future behavior. I don’t view corporate responsibility as an outcome or as an end goal, but rather as an ongoing process. Companies don’t press “pause,” they don’t press “stop” – [corporate responsibility] is something that is forever in action just as a company’s behaviors are.
What exactly is a “high-purpose company”?
I always say that high-purpose companies are some of the most valuable companies in the world. They produce more social, environmental and financial value – triple bottom line returns – than any other breed of business. That’s because they stand for something greater than the products they sell or the wealth they generate for shareholders. Interestingly, that something, whatever it is, is usually vital to humankind, and it affects most everything these companies do. It’s reflected in the products they sell and, obviously, leads to the wealth they generate for shareholders.
These companies venture to answer fundamental questions like, “What in the world are we here to do as a business?” and “What makes us invaluable to people and worthy of succeeding?” In harnessing their greatest strengths to pursue the answers [to these questions], these companies have become far more successful, and they make a big, big difference.
What is your litmus test for high-purpose companies that you developed with the help of some MBA students at McGill University? And can you give me an example of a company that passed the test?
The litmus is a very simple question that can be applied to any business no matter what size and regardless of industry: Is purpose invaluable to the company? In high-purpose companies, purpose and performance are fundamentally intertwined, meaning that the company’s growth, stature, revenues and culture are driven by this purpose. It’s not just something that exists on paper but in reality, and it is something that manifests every single day.
Here’s a controversial example of a company that passed my litmus that was just in the news: JetBlue passed the test because when we were conducting our research, and still today, the company’s purpose is to bring humanity back to air travel. When JetBlue was being designed, Dave Neeleman, the founder and CEO, made certain that everything within JetBlue – from the policies it set for its employees to the actual experience that customers have when they’re flying on the airline – reflects that humanity purpose.
One example that I think is relevant to Winning Workplaces is that, at one point, one of JetBlue’s employee surveys revealed that employees would rather work from home. That survey led to the company’s policy to have about 90 percent of its call center employees working from home. So the big joke in the press is that when you call 800-JETBLUE, you’re talking to a housewife in bunny slippers. That’s the working joke, but that’s just one out of dozens and dozens of examples of how the company has reverse engineered its services and policies around the needs of its stakeholders.
What can small and midsized businesses do to move toward their corporate responsibility goals, and how can they monitor their progress?
My advice to companies both large and small is to start small and stay focused. One of the most interesting findings from my research is that depth works better than breadth. In other words, companies that concentrated on one or two key areas that were very relevant to shareholder interests, and that attached business metrics to social environmental outcomes, were far more successful than the companies that either tried to take on everything at once, or that perceived corporate responsibility as a superficial form of marketing or philanthropy. Businesses can’t afford to keep investing in “a little bit here, a little bit there, a little bit there” and expect to get great returns. They make a bigger difference by going deep where they know they can really make a difference.
What this means for both small and large companies is that they should ask themselves two key questions:
- What ideal results in the world does your company wish to create?
- Using your company’s greatest strengths, how can you feasibly achieve these results?
When a company commits to achieving ideal results and then focuses everyone in the company on reaching those results, their goals are very likely to manifest.