Tata Sons was founded in 1868 and the founders planted the seeds of the philanthropic trusts which now own two-thirds of the Tata group. Image: Amit Dave/Reuters A
s a student and practitioner of marketing sociology I believe that driving positive social change is one of the most distinguishing marks of great brands. Any business can contribute some resources to causes. But, to run a business such that it makes a significant, sustainable positive impact on society, by design, is special.
Tata Sons was founded in 1868 and the founders planted the seeds of the philanthropic trusts which now own two-thirds of the Tata group. It is an economic powerhouse effectively anchored in its commitment to charity. A diversified global enterprise, philanthropic at its core. In the Tata group, CSV is an initiating vision. Society is a vital fourth stakeholder alongside shareholders, employees and customers.
John Hume, recipient of the Nobel Peace Prize, the Gandhi Peace Prize and the Martin Luther King Award commented “During a time of global challenge and change, it is more vital than ever that the practice of business be underscored by a clear and thoughtful, environmentally responsible, person centred ethic….Tata provides a fascinating study of how a clear ethical code can ensure that business serves the need of communities rather than communities serving the needs of business.”
In his book “The greatest company in the world? The Story of Tata”, Peter Casey notes that there is simply no other business like the Tata group – a company whose bottom line is doing the right thing for society. “Jamsetji's commitment to philanthropy, his dedication to serving the needs of others and to improving the lives of all, his intense Indian patriotism, his innovative approach to practically everything, his refusal to compromise on ethics, his commitment to public transparency, his embrace of independence within a core corporate community, his passion for setting massive goals and doing great things, his aim to create evolutionary and enduring transformation, and his style of servant leadership-each of these, through time, has continued as a theme in the narrative of the company he founded.”
The outdoor clothing retailer Patagonia ran one of the most unusual Black Friday ads in the history of the New York Times on November 25, 2012. A full-page ad declared in large, bold lettering: “DON’T BUY THIS JACKET.” The text below the image of its most popular jacket explained that the holiday season was a good time to consider the environmental impact of modern consumerism. “Because Patagonia wants to be in business for a good long time, and leave a world inhabitable for our kids—we want to do the opposite of every other business today. We ask you to buy less and to reflect before you spend a dime on this jacket or anything else.” That’s gutsy, impactful and vision aligned all at the same time.Also read: Why Mindtree co-founders Subroto Bagchi and NS Parthasarathy are betting big on health care philanthropy
Patagonia’s ‘Common Threads Initiative’ engages the company in a promissory capacity to repair damaged Patagonia products and help owners resell their used Patagonia products. As a brand this commitment to sell long-lasting goods, be willing to repair the goods when they break, and encouraging buyers to resell, reuse, recycle what they no longer need is quite laudable. But is it scalable? Are all things ‘woke’ consigned to only niche adoration? Will the world see commercially viable, attractive woke brands building operations on a global scale? Is being woke only a state of affluent guilt being assuaged? These are questions that merit more debate and research.
This sentiment of every dime a consumer spends is an assertion of building the kind of world they care about is at the heart of woke consumerism.
Is Patagonia a great brand because it is committed to a cause? Is that a criterion for greatness? What happens when a brand is committed but as a participant and follower and not necessarily at the forefront of a social and cultural movements – will it diminish its claim to greatness?Also read: Patagonia billionaire founder gives away $3 billion company to save planet
Creating Social Value - CSV - for customers, employees, partners, investors, and communities is about making a real difference in vital and pervasive areas.
So, great brands are themselves a force for positive social change, rather than simply supporting external programs. They design their businesses and products to address social issues. This brand-as-business approach to bettering the world is a profound leap forward in supporting the case for capitalism as a practical way to a better world.
Denise Lee Yohn describes the awareness building up against “Goodwashing” in her book describing the practices of great brands. In September 2010 Facebook founder and CEO Mark Zuckerberg, donated $100 million to help fix schools in Newark, New Jersey. This was a gift many times larger than the school system—one of the country’s worst at the time—had ever received. But it was just that. There was no tie-in to Facebook, its values, or its employees, nor to Zuckerberg’s own personal brand. There was no formal initiative to harness Facebook’s considerable brainpower to transform the education process or put Facebook’s resources and know-how to work on its behalf.
Many companies awakening to the realization that it takes more than large attention-getting gestures to be truly socially responsible and moving towards an integrated approach. They want companies to stop doing a few virtuous things to bolster their reputations, and instead start using the power of their brands to inspire real change and have an overall beneficial impact on society.
Doing well by doing good is not a new idea. But the integrity with which it should be pursued is. Corporate reputation and brand management are one and the same.
In their article ‘Reputation, Purpose and Profits: Bridging the Gap’ John Gerzema and David Roth point to an integrated four-point model of reputation made up of success, fairness, responsibility, and trust.Also read: Rainmatter Foundation: When bias is good
Till recently, the hard and practical business considerations of success and fairness drove business while the soft considerations of responsibility and trust formed a protective moat around them. In an integrated approach there is a synthesis at all levels of the business. This approach produces brand integrity, which is much more desirable and durable than any moat.
CSV is about business strategy, operations, and brand proposition. It enables long-term competitiveness. The integration of reputation and brand management means that the creation of social value and business value become one and the same.
The Patagonia brand is all about courage, commitment, and challenging conventions—in everything it does. In his book, ‘Let My People Go Surfing’, founder Yvon Chouinard explains, that having quality, useful products anchors the business yet the company mission is beyond product excellence. It elevates “causing no unnecessary harm” to a mission. Patagonia developed ‘The Footprint Chronicles,’ an online resource that offers documentation on every product the company makes, where it came from, and how it was made, starting with the raw materials.
‘The Earth’s favourite little food company.’ - U.K. smoothie-maker Innocent Drinks made its products with only fresh fruit, with no preservatives. They worked with the Rainforest Alliance to ensure that fruit is grown sustainably with energy efficiency and water conservation.
The Swedish brand IKEA is about improving people’s lives. They offer home furnishings at low, accessible prices. Design smarts are deployed to help secure the lowest possible price. Innovative, low-cost manufacturing processes create functional products. How to manufacture, transport, assemble – all of this is thought of in an integrative manner, so that its offerings can be purchased and enjoyed by as many people as possible.
Free choice and free enterprise are at the heart of the market system of economics. Brands are its lighthouses. Marketing is its language. The great challenges that face the world require brands and businesses to come together, with complementary goals, convergent plans and pool their resources. Effective coalition building is the key to a woke and not broke world of sustainable good.Shubhranshu Singh is vice president, marketing - domestic & IB, CVBU, Tata Motors. He writes Simply Speaking, a weekly column on Storyboard18. Views expressed are personal.