I attended the annual meeting of the CECP, fittingly held at the board room of the New York Stock Exchange. CECP was founded 15 years ago by the late actor Paul Newman, real estate investor Peter Malkin and former Goldman Sachs CEO John Whitehead to persuade business leaders to invest in their communities. The focus of CECP has been to provide a best practices guide to companies engaging in philanthropy.
Most recent statistics from the CECP indicate that corporate philanthropy has risen by 50 percent in the past five years. The primary focus areas for corporate donations are Education (29 percent), Health and Social Services (28 percent) and Community Development (18 percent). Companies are concentrating their spending in one or two areas, instead of diffusing the money across multiple causes. The donations come in cash or in pro bono time afforded to employees seeking to give back.
Daryl Brewster, CEO of CECP and former senior executive at Campbell’s Soup Company, told the audience of CEOs and chairpersons of large companies such as General Mills, Cargill, Carlson Holdings, Chobani and Walmart that he believed deeply in the words of management guru Peter Drucker, who said, “Every single social and global issue of our day is a business opportunity in disguise.”
What I observe is an inexorable move by business leaders to go beyond philanthropy and corporate social responsibility toward a more fundamental commitment to change the reality of their company operations on the basis of a more pro-social agenda. Whether putting sustainability at the core of supply chain or raising wages for workers in order to attract the best and brightest or eliminating a certain class of products from store shelves on the basis of contradiction of corporate purpose, the CEOs are making brave moves to change the essential contract between business and society. Now it is not enough to meet the legal obligation, it is essential to reach beyond societal expectation.
I am proud that Edelman worked with CVS on its recent decision to stop selling cigarettes and other tobacco products. And yesterday in Washington, D.C., the CEO of our client GE, Jeff Immelt, delivered a stirring address on the future of energy, in which he said, “We believe in climate science and we really lead with innovation… Efficiency and economics are going to trump just green. We don’t think you have to give up on one to do the other… solving problems is what innovation is all about.”
He went on to say that GE is investing in low cost renewables, industrial water re-use, monetization of natural gas and analytics/sensors that “help the environment and drive economics at the same time.” The company is not waiting for government policy at the Federal level. “States and cities can have an immense influence,” he noted. “We are constructive about where the future could be, but we don’t wait on things to happen… (we are) willing to invest even with uncertainty to drive results.”
Aretha Franklin, noted R&B singer in the 70s and 80s, had a hit song called, “Sisters Are Doin’ It For Themselves.” Her lyrics stated, “Now there was a time when we used to say that behind every great man there had to be a great woman. But in these times of change you know that it’s no longer true, So we’re coming out of the kitchen ‘cause there’s something we forgot to say to you. We say, ‘Sisters are doing it for themselves.’”
Rather than waiting for old man government to establish new rules and set the context for change, true leaders are stepping out of the kitchen to the tune of Peter Drucker, “Business is where innovation meets unmet need.”
Richard Edelman is president and CEO.