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Socially Responsible Business Practices, Salem Style, Part 2

(Socially Responsible Business . . . )

A Little Bit O’ Background The first time I heard of the concept “socially responsible” was as it pertained to investing. In the early eighties, a couple of fledgling investment organizations established criteria against which they tested the practices of corporations before they would invest any of their clients’ funds in the corporate stock. This was cutting edge stuff! If a company supported the military complex, used or generated nuclear energy, or did not hire or promote women or minorities, your money would be directed away from their coffers. The concept took off. A measure of how politically/socially/morally correct an organization was became membership in any number of associations that cropped up with names including ‘spiritual,’ ‘ethical,’ ‘responsible.’ Social responsibility became the new green slogan.

“Environmental Studies” was new in the early ‘70s, when concerns for overpopulation and pollution were the focus. Earth Day truly brought our generation to thinking of the earth as a whole living being, needful of our compassion and attention in exchange for her continuing sustenance to our kind. Peace and love were also popular concepts. These days we speak of “the planet,” but do we really remember what we mean? “Green” has become a slogan to sell any item, from household detergents to toilet paper made with minimal amounts of recycled materials, and costing 25% more than the next item on the shelf. We politically correct creatures dutifully buy the “green” product. Do we know anything about the corporation that manufactures this toilet paper? Do we recall how intertwined we all are, we of “the planet?” Do we consider the energy, either the electrical power, or personal power or compassion of the owners and managers of that corporation toward its workers, the people-energy used to keep the company in business? Probably not. We just buy the “green” toilet paper.

“Co-op,” another hyped concept whose original meaning is tainted by marketing practices, referred to individuals working together to attain the synergy needed for a common cause. An early economic application of this involved the agricultural co-ops in the Midwest, where farmers got together to buy supplies, tools and seeds at quantity price breaks. Similarly, natural food co-ops started as food buying clubs when families would meet in someone’s house once a month to put together a large order for healthier food purchased at wholesale prices. Some of these evolved into small storefronts as the households and order sizes grew, and then turned into various incarnations of food cooperatives. Some of these have stayed true to their community roots, and others have become backdrops for food managers who get their kicks on vicarious supermarket magnate fantasies. Ahh, human nature, in all its attraction to glamour.

Image or Truth All of these concepts: environmentalism, cooperatives, ethical business, are rooted in compassion, for each other and our interdependent world. Yet there are those who have found these roots suitable for growing profit trees having little to do with the empiric qualities from which they spring. These same business practices that give employees a sense that they are cared for are great promotional devices used to attract brain-power, and highly productive workers. If the employee is able to express him/herself, and feels appreciated, the company experiences low turnover and low retraining costs. Some companies provide free minor household repairs and arrange for someone to be at the employee’s home for the cable guy, or to pick up his/her car at the auto mechanic, in an effort to reduce stress in daily life so the employee can fully be dedicated to the firm’s programs and profitability. Full-size, heavily used basketball courts on-site build cohesiveness, teamwork, and fun. Some provide for laundry to be done at the office for the cost of the soap!

Perhaps the motives to provide these benefits are truly inspired and offered in the spirit of generosity and compassion. Maybe not. All I suggest is that we walk around with our eyes open.

On Sunday, Feb. 16th, the Oregonian ran an article called “Selling out morals takes big bucks.” It appears less socially responsible firms are forced to pay a “moral premium” to attract premium workers. According to Economist Robert Frank in the new book “Codes of Conduct,” the amount of additional yearly salary it would take Cornell University graduating seniors to accept certain jobs varies with the socio-political environment of the company to which they apply. Examples follow in the chart on this page.

So some firms use increased pay, others use incentive and benefit programs. This is not new. But what can be demoralizing is when less “ethical” companies use the programs they offer as evidence of improved moral code. This same tactic is used to increase or bolster product sales if they have declined due to image problems. Nike, for example, was discovered using children, purchased by factories in other countries to produce tennis shoes in those countries. First replies to this accusation referred to ‘cultural practices’ of other countries, (“that’s how business is done there”). As public sentiment grew against Nike for doing business this way, Nike joined BSR (Business for Social Responsibility). They now attend workshops in an attempt to learn more about human nature, and how to manufacture their products in a manner consistent with having a conscience about how we treat each other, even in business. Nike has also hired personnel to oversee practices in foreign countries, to keep abuse to a minimum and create standards ascribed to by members of BSR. In this example, at least, the result of poor image, and resulting decline in profitability, contributed to better (more ethical) business practices. Perhaps this form of behavioral modification, induced by less than pure motivation, practiced regularly will ultimately lead to changes in the soul of the company.

The Subtle Soul of Salem So, back to Salem and her lack of glamour, yet surplus of soul. Consider those with whom you do business in this town: how many go out of their way for you the customer? How many are good to their employees, and contribute to good causes in the community, in their own quiet way? Is it important to exhibit the flash? Will we notice our social responsibility to each other without the hype?

It should be stated that pure social responsibility is an ideal, a goal, a standard to which few, if any, business citizens fully measure up. Yet socially responsive, socially reflective disciplines are achievable. It is important for us to at least talk more with each other, expand our horizons on this issue. We are social animals. We need to communicate more with each other to notice the support we receive even by just being who we are. And we need to have and express our self-confidence and be proud of what we each achieve. That’s what this new publication Alternatives is all about! Let’s just be sure that, especially here, in a very creative attempt to awaken ourselves to the life that surrounds us, we are ever diligent about staying true to the causes we espouse. There are plenty of others willing to use catch-phrases that now merely imply the truth they represent. Let’s stay real. Even if it’s done, as most things in Salem are, with subtlety.

By Susan J. Cassuto, Co-manager and V.P. Finance of Kettle Foods, Inc., makers of Kettle Chips right here in Salem.

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