Stakeholders and CR: Who's running the show?
By David Michael Jerome SVP Corporate Responsibility, InterContinental Hotels Group | December 02, 2012
Who sets your company's Corporate Responsibility agenda? I ask because too often Corporate Responsibility teams make the mistake of allowing their agenda to be determined externally, their activities driven only by stakeholders. Naturally, the views of stakeholders are important to all elements of an organization businesses. But while it's a rare company indeed that would permit stakeholders to govern what it should focus on, it's not unusual to see CR teams running this way today and that way tomorrow, reacting whenever a pressure group applies the heat over its latest singular concern
Surely the better, more sustainable approach is to integrate stakeholder concerns with an agenda that is set by the company and consistent with the aims of the business. That's what we've been doing at IHG. Many CR teams start out as a function bolted on to the business, with their own budget to spend on their own initiatives. But we made a concerted effort to shift from this old mental model of what CR is about to one that makes CR central to the way IHG does business, this was cemented in 2012 when our CEO made CR one of four key pillars in our business strategy.
Incorporating societal and environmental issues into a company's business strategy and operations in this way is, I believe, the next wave of how CR will be done. It's the only way that's truly sustainable for a business and the only way to create genuine shared value for your business and all groups of stakeholders.
But how do you go about it? First, you have to understand the company's business imperatives. In the case of IHG, for instance, our ambition is to become one of the world's great companies by creating Great Hotels Guests Love. Our supporting CR strategy is based on innovation and collaboration. We acknowledge there's a tension between tourism and sustainability but we believe it can be a creative one, giving us an opportunity to find innovative ways to build and run hotels that can both fulfil our brand promises and tackle the environmental and social challenges we face.
That's how we came to develop our online sustainability management system, Green Engage. Rather than reacting to pressure from outside we responded to a need that could make a real difference to our business, which is innovating in how we operate hotels. Energy is the second largest cost to running hotels. We knew that building and running our hotels more efficiently would give owners a competitive advantage and put our business in a strong position when it came to responding to rising energy prices. Having Green Engage in place gave us a significant edge, making our hotels more cost-effective and improving the value of the service we give to guests, many of whom prefer to stay in a green hotel. It also meant we were armed to respond to the UK Carbon Reduction Commitment.
And yes, our stakeholders helped us and continue to help us develop Green Engage. While the original impulse came from the business, understanding external points of view helped us make it better, and they collaborate with us to continue to help us improve the system as we go along.
The nuts and bolts of stakeholder engagement