The Responsibility Revolution

By Amanda Coffin

As Jeffrey Hollander and Bill Breen of Seventh Generation reflect upon the dismal atmosphere following the past two years’ financial upheaval, they see in it the incubator for a revolution.  Their newly-released book, The Responsibility Revolution:  How the Next Generation of Businesses Will Win, offers a review of companies that are breaking molds, designing new molds, or rejecting molds altogether, as they illustrate that doing business responsibly can pay very gratifying rewards.

Hollander started Seventh Generation twenty years ago when he wanted to manufacture recycled, unbleached toilet paper (a revolutionary idea at that time, to be sure); his company is now one of America’s leading producers of green household products.  Bill Breen is the company’s editorial director.

Unlike many of its companions on the shelf in the business section, this book is a pleasure to read.  Much of the over-used CSR jargon is absent, the authors having jettisoned “bloodless buzzwords like ‘corporate responsibility’ and ‘accountability’” in the first steps of their revolution.  The writing is vibrant, pointed, and succinct, much like the advice it imparts.  Another bright facet is the range of companies the authors have chosen to profile.  Yes, they predictably include the radical, greener-than-grass pioneers of Patagonia, but they also throw Nike and Marks & Spencer into the mix.  The former is a company that was built upon the notion of environmentalism from day one; the latter two  are having to evolve to meet external pressures.

In other words, this book has something to offer the entrepreneur who is still at the drawing board and the executive who is trying to re-tool his company for greater purpose, responsibility and success.  And the authors do stress that last point, quoting Patagonia co-founder Yvon Chouinard:  “No company will respect us… if we are not profitable.”

Breen and Hollander submit that a company must identify its greater purpose, its unique raison d’etre:

“It all starts with learning to ask better questions.  No matter what your field of endeavour, the question you ask shapes the answer you get.  If you ask, ‘What can we do to build market share?’ you will get a very different answer – and you will create a very different future – than if you ask, ‘What can we do to build a more sustainable economy?’

For too long, those of us in business have proved adept at posing the first kind of question, but all too inept at considering the second.  Here’s a question that every business leader should ask, but too few do:  ‘What does the world need most that our business is uniquely able to provide?’”

What are the underlying guiding principles?  The authors dispense with the term ‘mission statement’ in favor of ‘corporate essence,’ but their point remains:  a company that hasn’t clearly established its corporate essence will find itself either in turmoil or adrift when faced with conflicting pressures.  To illustrate, they recount the tale of Organic Valley, a company founded on the principle of supporting family-run, organic farms.  At a time when demand exceeded supply, the company was forced to choose between supplying the small whole foods retailers that had supported it from the start or supplying WalMart, which could arguably provide a colossal new market for their products.  At the end of an agonising meeting, the founders decided in favor of the former, believing it to be the choice which best represented their original purpose.  Their conclusion:  “What you stand for is more important than what you sell.”    A subsequent chapter on authenticity, “Authentically Good,” further drives this point home:  A company that cannot clearly and concisely state its purpose and values to itself and others is likely to flail, flounder, and fail.

In the chapter titled “Not a Company, But a Community,” the authors dismantle the traditional corporate hierarchy in favor of a more human and humane workplace.  They cite a 2008 poll of 90,000 employees across 18 countries:  “71 percent of the respondents said they were ‘disengaged’ or ‘disenchanted’ at work.”   Another article proposed that all too many in the corporate world are driven by “chronic dread.”  The authors conclude:

“A cynic might dismiss fear as the price that must be paid for goosing higher productivity and greater efficiency out of employees. But fear has a way of boomeranging back on performance. It turns colleagues into conscripts; they’ll work diligently, but rarely willingly. … an industrious workforce almost never outperforms an enthusiastic workforce.”

As an alternative, they hold up Linden Lab, the developers of Second Life, an on-line virtual reality universe.  This company has provided mechanisms for employees to publicly congratulate and thank each other, to dispense bonuses to their peers who have performed exceptionally, and even to review the performance of the company’s CEO by completing an anonymous questionnaire.  (The CEO, Philip Rosedale, conceded, “’You can argue with a mentor, but you can’t argue with the crowd… When every third person says you’re too scattered, it’s the truth.’”)   Linden Lab’s approach is to empower every employee to contribute whilst holding each fully accountable to the company and his peers.  As a means of inducing creativity and engagement, it’s a system that appears to work brilliantly.  The fact that these admittedly unconventional management tactics could easily be adopted by other companies – as opposed to, say, revamping manufacturing methodology – makes this an especially invigorating case study.

The authors pitch some of the book’s most radical words and ideas at the topic of transparency:  “If it’s true that CEOs really do value reputational capital, they’d better get used to wearing plastic wrap.”  They’re not exaggerating.  Don’t just reveal information selectively:  Start living and working in a glass house.  This idea is indisputably terrifying, but, they argue, the pain will be less if you reveal your weaknesses up-front than if hostile forces reveal them for you.  Here, they cite Patagonia, whose founders painfully realised that no manufacturing process is environmentally friendly:  if you make things, you leave the earth worse off for it.  They began assigning each of their products a grade, disclosing openly its environmental impact.  The authors cite a couple of other companies which at first reacted defensively when confronted by angry activists and ultimately realised that dodging and denying was getting them nowhere.  They chose to sit down with the activists and discuss the issues openly, eliciting the outsiders’ help in finding a better solution.  Conversations like these tend to increase awareness and empathy on both sides, and to transform adversaries into collaborators.  A critical skill in the Responsibility Revolution is learning to work in a glass office.

Breen and Hollender spare themselves no scrutiny, describing Seventh Generation’s stumbles and falls throughout the years, and pausing recently to review and sharpen their own purpose.  During this process, they recalled the origin of the company’s name, which was “derived from the Great Law of the Iroquois Confederacy:  ‘In our every deliberation, we must consider the impact of our decisions on the next seven generations.’”  It’s an apt war-cry for all responsibility revolutionaries.

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