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October 11, 2005
Business Roundtable May Be Seeing the Light with New Initiative
by William Baue
The SEE Change program hints at a tipping point for US business community engagement of social,
environmental, and economic issues, but the program's success may depend on how critics view its
performance.
SocialFunds.com --
Recent developments suggest that a paradigm shift is transforming the corporate world from
exclusively assessing financial impacts of decisions to integrating social, environmental, and
economic (SEE) considerations into corporate policies and practices. One such development is the
announcement late last month by the Business Roundtable, an association of US corporate
CEOs, of its SEE Change initiative that seeks to create synergies between environmental
stewardship, social improvement, and bottom-line performance.
 The initiative plays off the term
"sea-change," invented by Shakespeare to describe a profound bodily transmutation wrought by the
sea (bones to coral, eyes to pearls), to suggest that business community acceptance of corporate
social responsibility (CSR) may be passing the tipping point.
"We expect that SEE Change
will result in a transformation in how business leaders approach sustainable growth," said Marian
Hopkins, the Roundtable's director of public policy as well as of its Environment, Technology, and
the Economy Task Force. "While many companies now embrace this concept individually, SEE Change
breaks new ground by making sustainable growth a concentrated focus for leading US companies from
every sector of the economy."
"We want the public to literally 'see change' in key areas
of social and environmental well-being, such as energy efficiency, water conservation and quality,
reduction of disease and increased literacy, while economic growth is enhanced," Ms. Hopkins told
SocialFunds.com.
The initiative specifically focuses on water sustainability, asking
participant companies to engage in projects that improve water quality, quantity, and availability.
"Without water, nothing is sustainable," said Charles Holliday, CEO of DuPont (ticker: DD) and chair of the
Environment, Technology, and the Economy Task Force. "It's not a requirement, but we're urging
every company to consider a sustainable growth project that addresses water."
Participant
companies include Coca-Cola (KO), Dow (DOW), Eastman Kodak (EK), General
Electric (GE),
Procter & Gamble (PG), Weyerhaeuser (WY), and Xerox (XRX). The first
company on this list, Coke, illustrates the tension between the initiative's aspirations and
corporate reality.
Coke's Plachimada bottling plant, the company's largest in India, has
been shut down since March 2004 when the local village council (or panchayat) refused to renew a
license to operate due to "overexploitation" of groundwater, which the council considers to be a
common resource. Coke appealed the decision to the state court in Kerala, and last month the
Kerala state government appealed the case to the Indian Supreme Court.
"While we welcome
any initiative that supposedly promotes sustainability, we also view the Business Roundtable
initiative, SEE Change, with a great deal of skepticism," said Amit Srivastava, director of Global
Resistance, a California-based group opposing corporate globalization. He also coordinates the India Resource Center, a project of Global
Resistance, which focuses on corporate globalization in India. "We do so because we are adamant
that there can be no sustainable strategies on sustainability if the primary stakeholders--the
community itself--is not at the table."
While this particular issue in Plachimada has yet
to be resolved, it illuminates the double-edged sword of SEE Change. On the one hand, the
initiative could inspire companies to develop truly sustainable, innovative solutions to such
pressing problems. On the other hand, it could present opportunities for companies to greenwash,
or mask environmentally and socially destructive or benign projects as if they are beneficial.
"We want this program to be judged by its results--we believe the accomplishments of our
companies will answer any criticism that SEE Change is just about 'greenwash,'" said Ms. Hopkins.
"That's why we're asking participating companies to commit to specific goals and metrics and report
publicly on their progress."
To give "teeth" to the initiative, the Roundtable requires
participant companies to measure improvement in SEE performance, but allows companies to choose
which metrics to employ. The chosen metrics must be "material" in addressing social and
environmental needs, "raise the bar" by implementing long-term improvements, be transparent,
meaningful, and reliable, and be in place for significant periods--5, 10, or 15 years depending on
the company.
This flexibility encourages more companies to participate but it lays the
initiative open to a standard criticism of voluntary CSR programs; specifically, that a lack of
standardized metrics allows companies to focus on their social and environmental strengths while
downplaying or altogether hiding their social and environmental weaknesses. Stakeholders may
ultimately decide if the initiative is substantive or greenwash by closely examining the changes
they see in corporate performance.
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SRI World Group, Inc. All Rights Reserved.
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