Recently I was honored to be asked to guest lecture at California State University, Dominguez Hills. My topic was Corporate Social Behavior and I covered advertising, junk science (see tobacco and oil companies), externalities, lobbying and how consumers can (and must engage) as government regulation, enforcement and protection ebbs and flows based upon the political climate (as does the ability to obtain protection through the courts).
The presentation is available at http://www.slideshare.net/georgepolisner/csudh-april-2012-1 and the terrific questions and my hopefully adequate responses follow.
Question: Alonovo allows consumers to generally understand a company's values. But how do you get consumers to care about a company's social/environmental responsibility? Especially to care enough to stop shopping with a specific company.
Answer: Many people already care and will avoid –generally on the basis of an egregious and very visible event or labor/environmental action. The issue is really sustaining consumer behavior –and not just boycotting/avoidance –but offering good alternatives that will not impose significant economic or convenience barriers.
Question: The website states that when we spend our money to purchase a product or a service we are supporting behaviors of the company. That is understandable but how difficult does it become to choose a company with a positive supportive culture? Many companies outsource, our do not have morally right behaviors, however when money is a main concern on many minds it becomes difficult to ignore other factors. Do you ever think it is a better idea to change the companies behavior or the purchasers support?
Answer: True –many companies (large and small) have a vast array of suppliers. We want to hold them accountable for their supplier choices and therefore –supply chain selectivity is one of the attributes we will use to provide a grade. And I think we want to really affect both company and consumer behavior –although our first priority is to mitigate corporate externalities.
Question: I have been following the controversy surrounding the Shell Corporation, and I am wondering how you would frame the issue of sustainability in terms of the oil business? I think Shell is attempting to drill in Alaska presently, and the oil business is very destructive to the environment--would this mean the focus would be on outside contributions more so than sustainability?
Answer: When all companies within an industry segment are poorly rated on environmental issues –we can certainly look at other attributes –such as labor issues, ethics/governance issues, etc (although my best advice would be that if an entire industry is harming a critical social/environmental factor –perhaps we should be abandoning consumption that is perpetuating behavior –ie.- moving to walking, biking, mass transit and electric vehicles to reduce our participation.)
Question: How can we be socially conscious when buying clothes, since very few clothes are made in the U.S. anymore? Is it always possible to vote with our dollars?
Answer: Supply chain selectivity allows us to hold GAP, Old Navy and others accountable for their supplier/textile choices. And yes –especially within a sometimes capitalist system (bailing out banks and insurance companies isn’t necessarily a behavior one would expect of Milton Friedman’s idea of a free market) –it is always possible and important to try to do so.
Question: What has been the most difficult part about talking to consumers?
Answer: The most difficult is our reach –getting the word out about alonovo is incredibly expensive so we rely on earned media (news stories, blogs and articles about our new/emerging industry).
Question: In your experience, has there been a turn around about how consumers spend their money?
Answer: Yes- when there is a sustained action or campaign –there is absolutely direct evidence that consumers will avoid and drive collective action. We hope to evolve and refine such collective action by not only targeting avoidance –but positive alternatives.
Question: What are your techniques to empower consumers?
Answer: It comes down to knowledge is power. It really is.
Question: What impact will the outcome of the presidential election have on corporate ethics in the not so distant future? How much different will things be with an Obama victory vs. a Romney victory?
Answer: If Romney wins –alonovo and concepts like it will be even more important –it may be the last piece of societal protection we have against a profit motive that is not tempered by sustainability. We’d also likely see less transparency in reporting of toxic emissions, labor issues and class action lawsuits.
Question: Do you think the major corporations are harmful to society even though they give jobs to a lot of people, how so?
Answer: My perspective is that I want an array of legal operating structures for business (such as a corporation) –that best support economic growth and expansion –provided it is accomplished in a manner that is sustainable and will have a positive outcome for society without diminishing our environment, resources and commons. Some corporations that attempt to externalize a significant part of the costs to drive profit –in my mind are criminal.
Question: What made you decide to start alonovo? What experience did you have starting your own company?
Answer: I actually didn’t want to start it. I was well-compensated at Oracle –and as I thought of the concept tried to get Working Assets (now CREDO Mobile) behind the idea. When they couldn’t –I felt I had to –when we know that something is right –and has the potential of improving the quality and dignity of life everywhere –what could be more important? While I had not formed a business –I surrounded myself in 2005 with some great mentors with a track record of startup through successful IPO’s (initial public offerings)
Question: Since the founding of Alonovo.com have you seen an increase or
decrease in companies becoming sustainably ethical?
Answer: There is a decided increase –that I cannot take credit for. It is concern over climate change, ethical concerns about sweatshop labor conditions, media exposure of runaway executive pay ratio and unethical behavior by financial institutions that have created more focus.
Question: What is being rated in the companies what work with amazon? And if their ratings are very low, does amazon stop doing business with them?
Answer: We no longer have a relationship with amazon because of their labor and lobbying practices. Nevertheless –we do not seek to cause products to no longer be available (except of course for something toxic or unsafe) –we want to report and then allow consumers to (hopefully) make informed decisions.
Question: How can we find out what corporation's motives are or what they stand for or support in regards to greed? For example we know things about wal mart but how can we find out things about other corporations that we are not aware if as the public?
Answer: We hope to do that for you –by acquiring data about the attributes that are published on alonovo.com (as well as the sources of such data) we hope to be a one-stop shop to help you and others understand the social, labor and environmental behaviors of a company.
Question: Considering the unique rating system of Alonovo, has there been any cases of opposition and support from different organizations (aside from Amazon)?
Answer: We’ve not had any opposition as yet –I suspect we are too small and in our infancy. We’ve had decent support from the executives/ceo’s and CSR leads of companies that are actually evolving toward sustainability –and are anxious to have their results published in a trusted and independent manner.
Question: What benefits or empowerment does the low socioeconomic consumers gain from participating in your program? Seems like this program is designed for the privileged who already have everything they need?
Answer: I’m very sensitive to digital and economic divide –I want the service to be available and to be used by all. Realistically –the closer we get to the poverty line and below –the less (if any) price elasticity a consumer has. By focusing those that are using the system on fair labor issues –we hope to direct more purchases toward companies supporting a living wage –and therefore have less people at or below poverty.
Question: Is consumer empowerment a luxury only for the middle class?
Answer: Good question –consider this –the success of Cesar Chavez and the UFW –was the impact limited to the middle class? I’d say consumer empowerment through knowledge will benefit all.
Question: How do we empower ourselves as consumers? Is this even possible?
Answer: Knowledge is power –don’t perpetuate egregious/harmful behavior by directing your purchases toward evolved/evolving companies whenever possible.
Question: What happens after society is informed about cooperate behavior, but are still forced to shop at these companies because they can't afford to shop at other companies?
Answer: What impact do you think there would be on WalMart if 10% of WalMart consumers switched to Costco? The impact on their quarterly results (and Costco’s) would be dramatic and force change. We don’t need everyone to drive sweeping environmental, labor and social reform (although I want everyone!)
Question: How should consumers consider ethical consumerism during economic hardships when companies like Wal-Mart appease consumers' wallets but have unethical practices?
Answer: Price elasticity expands and contracts on the basis of economic strength. Nevertheless –even a small percentage of demographic can make a significant difference in the corporate profit/loss statement –and if we can get Wal*Mart (and other poorly performing companies) to start incrementally changing behavior to reacquire customers –I’d be delighted.
Question: What inspired you to create an organization like Alonovo?
Answer: I think many people are politically disenfranchised –however economics is the real battlefield. I want to empower our society –so whether it is a Wal*Mart greeter or a textile worker in a developing country –people and planet are treated with respect.
Question: How does Polisner market alonovo.com to the public and how will it continue to help the environmental movement? Are there any changes that can still be done better? I've not been aware of alonovo.com until today
Answer: Yes –marketing and advertising is very expensive –as we develop our product –and when it is ready we will work with media to try to get news stories, articles and blogs about us.
Question: What is your biggest concern regarding corporate behavior?
Answer: Really all of it. I think there should be an absolute partnership between business and society. I think economic growth and opportunity is important –but not at the expense of life, nature and the beauty that surrounds us. There is a balance which has been largely ignored for the pure pursuit of profit. As America is the most significant consumer base in the world –it is important for us to drive sustainable and responsible business behavior –and without adequate and consistent government regulation and enforcement it is up to each of us.