Henk Campher has an interesting blog contrasting CSR in the USA vs. the UK. He questions the conventional wisdom that the United States is behind Europe in CSR issues. He thinks the two are just different. He oversimplifies, but in interesting ways. At the end, I will say what I believe he is missing, something very important. He picks out three areas where the two countries differ and shows how they affect their approaches to CSR:
1. The United States Has Less of a Safety Net. Government intervention is resisted to a greater extent in the United States. That means, says Henk, that CSR in the United States has more to do with corporate citizenship, i.e., relations with the community, whereas in the UK it has more to do with company operations.
The clearest area where this resonates is in the area of corporate philanthropy. Expectations for corporate charitable support are higher in the United States. Philanthropy is more encouraged by U.S. tax laws than UK tax laws - certainly at the individual level and probably at the corporate level. In the United States, you get an immediate tax break up front - which is more of an incentive than a covenant of a minimum number of years that results eventually in H.M. Treasury topping up the gift.
However, on the other side, the Business in the Community initiative of the Prince of Wales is heavily concentrated in community involvement. There is nothing quite as major on the U.S. side. Meanwhile, U.S. companies like Gap Inc. and Chiquita have been leaders in bringing their supply chain operations into compliance with workplace and environmental standards. It's not so clear.
2. UK and European Corporations Are More Heavily Regulated than U.S. Corporations. His second point is related to the first. The United States is more decentralized and less regulated. Washington rules at home with a light touch. As a result, says Henk, states and localities are more independent than local units of government in the UK, and U.S. corporations have more room for creativity. That could be.
But how does that affect CSR? Americans are outraged by Chinese factories that make drugs that are poisonous and are allowed to be shipped overseas without inspection. But how much damage will U.S. CDOs be causing in 2008 and how much inspection did they get? This room for experimentation has side effects that should be listed on any prescription for laisser-faire.
3. Celebrities Are More Important in the United States. Henk argues that celebrities play a more important role in the United States. He does not entirely approve of this. CEOs tend to be covered in the news as personifying their companies. He does not like television news in part for this reason. He contrasts the BBC with local television news. What he is saying, I think, is that CSR initiatives in the UK and Europe come via committees whereas in the United States they are led by individuals.
A contrary example would be Anita Roddick and the Body Shop, or the Prince of Wales and his eco-efforts. And there's nothing in the United States quite like the celebrity-worship of the British royals. The BBC has no shortage of coverage of them. Queen Elizabeth has personified the UK for 55 years - not necessarily a bad thing, but it undercuts Henk's argument.
Missing Element: the Difference between the UK and U.S. Consumer. What Henk fails to see, I think, is the great difference between the U.S. and UK consumer. The shopping for a better world movement, like the socially responsible investment movement, started in the United States but it took root more deeply in Europe than here. If you go into high-end Waitrose or low-end Tesco, you see the same signs informing you which items are organic or fair-traded or hormone-free or low-energy. Environmental seals and labor certifications are taken seriously. The UK-European shopper is an amazing human being, able to keep quality and price considerations straight and at the same time care about the globe.
The United States is catching up. The EcoMom is tearing up a storm, but it is still early-stage stuff and only the number of brands that are affected is still small, nothing like Europe. Chiquita is putting its environmental co-brand (the Rainforest Alliance frog) only on bananas destined for the European market - because American shoppers don't care enough yet.
All this is in flux. But meanwhile, for my money I submit that it's the difference between the UK and U.S. shopper that puts the conventional wisdom on the money.
Information, news and commentary on corporate social responsibility, especially in the New York City area.
Maintained by John Tepper Marlin, Principal of CSRNYC, www.csrnyc.com.
Saturday, February 16, 2008
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