Symbiotic Dance: The Intimate Link Between Companies and Stakeholders

Commentary by Murninghan Post Editor Bill Baue

The TakeAway: Last week’s Business for Social Responsibility Conference focused on corporate-stakeholder collaboration for sustainability solutions.

I learned about the new Chevron “We Agree” campaign, an attempt to spit-clean the company’s image after years of activist campaigning, not directly, but from – well, activist campaigning.   The Yes Men and Rainforest Action Network “punk’d” the company’s earnest ads (which ask readers if they agree that “oil companies should get behind the development of renewable energy”) with deadpan spoofs asking if you agree that “oil companies should clean up their messes.”  One way to view the company and activists: as antagonists inhabiting opposite ends of the sustainability spectrum.  But I also see them as partners in a symbiotic dance, linked in the intimacy of conflict, each strangely dependent on the other.  Corporate malfeasance plays the music that puts the groove into activism, and by the same token, companies were wallflowers in the sustainability party until activists pulled them on the floor, coaxing companies to adopt environmental, social, and governance (ESG) policies and practices – and to continually improve sustainability performance.

The company-stakeholder dance continued at last week’s Business for Social Responsibility Conference, but with a different twist: enmity has given way to empathy. Company executives, NGO leaders, and investment professionals sang the praises of corporate-stakeholder collaboration to benefit both sides – and society more broadly.  Perhaps most eloquently, Women for Women International Founder Zainab Salbi quoted the mystic poet Rumi in her call for bridging the for-profit / non-profit divide through a more holistic approach:

Out beyond ideas of wrong-doing and right-doing, 
there is a field.

I will meet you there.

When the soul lies down in that grass,
 the world is too full to talk about
language.

Ideas, even the phrase each other,
 doesn’t make any sense.

Atop the spiritual case, she added the business case, citing studies that consumers are 50 percent more likely to buy products with NGO partnership associated.

Monsanto CEO Hugh Grant, a more controversial figure when it comes to stakeholder relations, voiced a surprisingly similar message: it’s key “to collaborate, to work across boundaries, to form links and partnerships with groups and individuals who have historically declared very opposing views,” he said.  But, he admitted, stakeholder engagement is hard work: “it’s hard enough in partnerships when you love somebody,” he quipped. “You have to learn to compromise, you have to be patient, but [partnership] is still faster than policy.”

Zach Karabell, co-author with BSR President & CEO Aron Cramer of Sustainable Excellence (Rodale 2010), challenged Grant on the legacy of distrust in Monsanto.  “Trust and reputation take a long time to build – they’re earned one spring at a time, like planted seeds,” Grant responded, riffing on the debate over the company’s near-Machiavellian control of genetically modified seeds (and legal harassment of non-GMO seed savers).

Grant pointed out that Monsanto is scaling up its partnerships in Africa by providing royalty-free access to some of its technologies, and donating the genome for drought-tolerant GMO rice and white corn.  This isn’t philanthropy, Grant clarified, but rather a forward-looking business model to access customers who otherwise wouldn’t be able to afford Monsanto’s products.  Questions left unanswered, however, include what percent of Monsanto’s overall sales this model represents (a tiny sliver?), and whether the move sets the stage for the same kinds of coercive tactics that have led to criticism in the past (will African farmers become addicted to Roundup-Ready seed?)

At the same time, a transformed Monsanto that works in the interests of its stakeholders (not against them) holds promise to effect the kind of step-change that Walmart has achieved by pushing sustainability across its value chain.  The key distinction is whether Monsanto’s talk of partnering with stakeholders amounts to window dressing, lulling potential opponents into poppy-induced sleep (à la Wizard of Oz), or if stakeholder engagement will prompt the company to abandon its domineering tactics.

Other luminaries echoed similar messages on the value of stakeholder engagement:

• Rockefeller Foundation President Judith Rodin sees an evaporation of the lines separating business, government, and philanthropy, shifting toward integration.  “We need to do better job to bridge perceived divides to find common cause that transcends Right and Left,” she said, specifically citing Hybrid Value Chains as a way businesses can partner in different ways.
• KKR’s Kenneth Mehlman (who ran George W. Bush’s re-election campaign) said to Left and Right alike, “You won’t understand the complexity of the world if you only interact with people who think like you.”  Peter Knight (who ran Bill Clinton’s re-election campaign) added that Generation Investment Management finds correlations between stakeholder engagement and a company’s financial valuation.

This attitude toward stakeholder engagement represents a major advance since my first BSR Conference in 2004, when I moderated a panel entitled Shareholder Activism and Governance: What Lies Ahead? The thesis I explored with David Schilling of the Interfaith Center on Corporate Responsibility and David Russell of the Universities Superannuation Scheme: the nascent shift away from antagonistic and toward more cooperative engagement between shareowners and companies.

Now, forward progress toward a just, sustainable, and prosperous world will likely still require radical activists to mosh with companies, antagonizing them over egregious practices.  But, we may not be able to afford the luxury of maintaining this sense of “otherness” when we share vulnerability to global threats and consequences.  Given the urgency of the social and environmental crises we face, direct corporate-stakeholder collaboration represents a much more efficient and effective use of collective resources.  And, attraction makes for a much more fun dance than repulsion.