Monday, October 21, 2019

From the Public to the Private Sector: Jane Madden Brings a New Vision to Corporate Responsibility

Jane Madden 
It’s always interesting, I think, to speak with someone involved in corporate responsibility who did not start off in the corporate sector. Often they bring a different perspective to the conversation and expertise to their work. That was certainly the case when I spoke recently with Jane Madden, Managing Partner of Global Sustainability and Social Impact at Finn Partners.

Jane is a former World Bank staffer and NGO board member with 25 years of experience in 30 countries. From her office in Chicago, Jane talked with me about how her past work has influenced her, the role of business in addressing global issues, and trends that she believes are here to stay.

MK: You worked for nearly 12 years at the World Bank before jumping into the corporate world. How did that shape your vision of business in society and lead you on this path?

JM: My work at the World Bank not only shaped my view but it drove my decision to move from the public to the corporate sector. I experienced first hand how companies are crucial to economic development by providing jobs and services. But I also saw that businesses weren’t always working in the best interest of society — some where not providing health services to employees, some were not taking care of workers on the front line [eg, in high-risk industries such as mining]. Moreover, this behavior was not in the best interest of the companies themselves. It dawned on me that there was much to be done to help companies and using the power of the private sector to drive positive economic, social and environmental results. Integrating sustainability into the business model and bottom line would ensure that it would be long-lasting and not a collection of one-off projects. So the evolution from advising governments on emerging ESG issues to advising companies has actually been very linear.

MK: As a communications professional, you help clients raise awareness of their positive impacts. But, there is always the risk of green washing, blue washing, etc. What is your approach when you suspect this may be happening?

JM: We see green, blue, pink, SDG [Sustainable Development Goals] washing … a lot comes out of good intentions. But for this [corporate responsibility] to work, it has to be integrated into the business. My approach is always to, first, talk to the client and ask for the data — It’s all about data. Clients need to support their ESG or SDG claims with performance numbers. I ask them “Do you have goals? How does this program help achieve those goals?” The second part, I always counsel clients to be honest and modest when making their claims. That includes being transparent and talking about challenges when they don’t make their goals. If you didn’t [make your goal], you should say why you didn’t, what happened, and what you are doing to change — just like when a company doesn’t make its financial goals, it needs to be the same approach. You actually get a lot of credit when you talk about challenges — it ultimately builds trust.

MK: Have you seen an evolution in how clients are approaching CSR?

JM: Ten years ago, clients said to us “We do all these great things but we don’t get any credit.” We saw a lot of cause marketing and one-off corporate giving and community programs that were not integrated into the business. Now, clients are saying they need to develop a strategy because their board of directors, CEO, or investors are asking for this. It’s not only about the communications, but about integrating ESG performance into their business — this has been a huge shift. 

We are also seeing more mainstream investors looking at sustainability. If you look at materiality analyses, philanthropy is a much lower priority than say cybersecurity, climate change and resiliency and attracting and retaining the best talent. There remains an expectation of community engagement and giving, but it’s not critical to the core business. We’re seeing more focus on and interest in ESG strategies that are integrated into the business and operations. For corporate responsibility to get results, it needs to achieve business goals by mitigating risk and maximizing opportunity.

MK: What are effective ways for companies to bring the voice of stakeholders into their businesses? Why is it so important?

JM: It depends, of course, on the company, but I always say engage with your stakeholders early and often to understand the needs of a particular group. NGO’s will have different questions, demands, and concerns than employees, investors, unions or  regulators. Companies need to map their stakeholders and develop an engagement calendar to share information and to listen. You learn so much by listening. Engagement has to be a two-way street — it’s not just sending out email alerts. Of course, you can’t meet with everyone, but by prioritizing your stakeholders and their issues, you can develop your strategy. It’s also important to engage with your critics. You may not like what you hear, but you need to hear it.

MK: Let’s turn to the environment. What corporate actions stand out? What more is needed?

JM: Corporations —not all, but many -- are making changes and certainly Fortune 500 companies were a strong force behind the Paris Accord. They saw it as beneficial to their business. After President Trump was elected, we saw dozens of CEOs write to him urging him to stay in. These companies are not going back on their commitments. They want a level playing field and more companies to make climate commitments.

But companies need to do more. Policies and commitments are the first step. Then there must be action — and it must be more than carbon credits and planting trees. It has to be integrating environmental goals into business strategy. We are seeing companies taking steps to reduce their carbon emissions and also produce products with lower environmental impacts — low-carbon products, or products that use less water. And we also see real leaders such as Microsoft, which has put a price on carbon, and Adidas, which has been practicing environmental accounting for years.

Quick-fire Round:
  • Name an industry that needs to do more in ESG: Extractives
  • What should leaders do more of? Integrate ESG performance into their business.
  • What should they do less of? Take stands on issues not central to their core business.
  • What trend will continue in 2020? Interest from mainstream investors in ESG.

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