Impact Stories: Issue #4

Welcome to the fourth issue of Impact Stories from the Past Week. During the past seven days, I found five stories of impact addressing workplace giving, diversity in the C-Suite, purposeful brands, and impact investing. There's lots to cover, so let's dive in.

#1. Why Workplace Giving Programs Work: In this story from Forbes, we learn about a recent study from the Association of Corporate Citizenship Professionals and Fidelity Investments titled "Doing Well by Doing Good." The study found what I think is fairly obvious, which is that workplace giving programs are growing in popularity. I have direct experience in this topic as in 2017, I launched the Tap Into Giving, which encourages our U.S. colleagues to support their favorite 501(c)(3) nonprofit(s) and have that donation matched by the Anheuser-Busch Foundation.

The article quotes Carolyn Berkowitz, president and CEO of ACCP stating “In just the first six months of this year, we’ve seen an unprecedented level of support and engagement for these issues, and companies want to create that connection with their employees, customers and communities.” This is consistent with my own experience with the Tap Into Giving program. During the past six months, we've experienced huge levels of engagement as employees look to respond to community needs around COVID-19 and social justice. It's a win-win-win. It's a win for our employees who want to take action. It's a win for the nonprofits who benefit from the donation and match. And it's a win for the company as it drives employee engagement and loyalty.

Does your company offer a similar workplace giving program? And do you participate?

#2. How to Diversity the C-Suite: This is a thread in which LinkedIn members discuss the steps that companies should take to diversify their leadership teams. I have my own recommendations, which are based on my years of experience working in the diversity, inclusion, and corporate affairs fields at three large publicly traded companies. I've also founded, lead and work closely with employee resource groups. So, here are my recommendations.

1. Incorporate diversity and inclusion metrics into the compensation of the company's C-Suite team. It's common sense that if it impacts their pay, C-Suite members will pay attention.
2. The company's board of directors nominating and governance committees should adopt diversity and inclusion goals. In other words, when there is a board vacancy, who is being considered to fill that open spot? Consider, who are the company's customers/clients? Who are you marketing to? For context, almost all consumer focused companies market heavily to U.S. Latino consumers, but how many of them have Latinos in their board of directors? Very few. Not that women and other minority groups are doing that much better. According to a 2018 report by Deloitte and the Alliance for Board Diversity, a meager 3.8% of all the available spots on the boards of directors of Fortune 500 firms are Hispanic/Latino (see slide 19). Compare that to the fact that Latinos make up 18% of the U.S. population and growing. A big gap, right?
3. The company's Talent Acquisition and Leadership Development functions should have clear diversity and inclusion objectives. What is the diversity of your new hire class? What is the composition of the individuals participating in leadership development programs?
4. Diversify the Chief Diversity Officers and their teams. These roles should reflect the diversity of the company's workforce and its customers base. I could write a lot more on this topic, but this should be obvious, right?

Am I missing any critical steps? Please note that I am passionate about this topic and would welcome your input.

#3. In the Wake of the Pandemic and the Protests, Purpose is Suddenly a Superpower: In this story from Fast Company, the author argues that COVID-19 and the Black Lives Matter protests have raised consumers expectations on the brands they select to purchase. This means that brands that are genuinely built on purpose, such as Patagonia, Newman's Own and Ben & Jerry's, will have an upper hand on their competitors, who are simply pretending or at times stumbling in their responses. It's an interesting theory and I certainly hope that he is right. However, I am not fully convinced. History has shown that consumers memories are short. What is important today, may not be important tomorrow. The issues that are relevant now, may not be top of mind in the future. In addition, the economic downturn is likely to result in consumers being even more price sensitive. That means that while consumer may want to support a brand that stands for purpose, they may have to purchase the brand that they can actually afford.

#4. Wealthy Millennials Not So Concerned with Socially Responsible Investing: Research from the past decade has indicated that Millennials are more socially and environmentally conscious that past generations. This has resulted in companies placing a higher priority on CSR issues and investment banks prioritizing ESG investing and impact investing funds. Unfortunately, a recent study by UBS Group AG suggests that "high net worth Millennial investors have relatively little interest in ESG and other varieties of socially responsible investing." This is disappointing news considering that as billionaires are predicted to pass on more than $2 trillion of wealth within the next two decades. Let's hope that the conclusions of this study are incorrect. We need Millennials, particularly the wealthy ones to invest their wealth in projects that benefit the planet and society.

#5. Impact Investing Won't Save Capitalism: This piece comes from the Harvard Business Review. For years, impact investing has been pitched as the cure that will help solve many of the worlds greatest problems. The authors argue that while impact investing is indeed important, it cannot deliver on its promise without the support of governments. The article includes a compelling example on the various technologies used to reduce greenhouse gas emissions. Unless governments provide the right incentives, investors are simply unable to allocate the resources needed to build the most effective technologies that will deliver the greatest impact on greenhouse gas emissions. This includes some wind technologies and pretty much all biomass projects. In other words, for as ineffective as governments can be, we still need them to play an important role in addressing environmental and social issues.

OK. Sorry if I went long with this issue. There were just too many compelling stories this past week. Hopefully you find at least one that you find relevant or that drives you to learn more on the topic.

Please remember to wear a mask while in public - #YoCubroSTL. Stay healthy everyone!