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June 2010 issue first five pages

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June 2010 issue first five pages

  1. 1. Banking and finance Reputation recovery target number one Wal-Mart's supply chain Get sustainable and grow the bottom line Ethical Corporation Awards Responsible business recognition June 2010 India gets the message Business-led sustainability in a fast-growing economy
  2. 2. Sa you g M by on uoti ve r t ag q $20 icke 20 0 t 0 n Meet the UK Serious Fraud Office and get answers to how the new Bribery Act will affect YOU The UK SFO is confirmed to speak at the 3rd Global Anti-Corruption Summit > PUT THESE DATES IN YOUR DIARY NOW! 23-24 JUNE 2010, WASHINGTON D.C. The focus this year is on: ‘How to protect your business and yourself – Your blueprint to effectively managing corporate & compliance risks’ Other heavyweight speakers include: UK Serious Fraud Office US Department of Justice Robert Amaee Mark Mendelsohn Head of Domain Deputy Chief, Fraud Section AstraZeneca Tyco International Glenn Engelmann Matthew Tanzer General Counsel VP & Chief Compliance Counsel Weatherford Baker Hughes William Jacobson Jay Martin VP, Co-General Counsel & Chief Compliance Officer & Chief Compliance Officer Senior Deputy General Counsel I’ve seldom seen a conference run so smoothly, and the caliber of the attendees and speakers was top-notch. There was a real energy about it, which carried over into lunchtime discussions and breaks. I know I learned a lot. USAID, Arnold Haiman, Deputy General Counsel > Places are limited, don’t miss out on your chance to attend. Call us on 0207 375 7573 or email to
  3. 3. Ethical Corporation • June 2010 Contents 3 Contents 4 What’s on the web 20 CRWatch Simple sanitation 4 Ethical Corporation research 5 Letter from the editors 22 Ethical Corporation Awards The best of the best EthicsWatch 6 BP oil spill Long-term consequences 26 Brendan May Handling NGOs 7 New UK government Coalition politics 8 Cotton from Uzbekistan Country briefing: India Child labour still there 27 A culture of giving 9 UK anti-corruption laws A welcome crackdown 29 Responsible pioneers lead the pack 33 Government getting tough 35 Civil society’s crucial role 10 Mallen Baker p27 A developing ethical-entrepreneur mix Agreement is better than argument Strategy and management 36 Bhopal Briefing: banks and finance Union Carbide’s toxic legacy 12 Kicking against reform 40 Wal-Mart 14 Leading institutions regain the high Supply chain revolution? ground 18 Campaigners keep up the pressure 44 Peter Knight Anti-obesity starts at home p11 Banking sector rebound? Review 45 Academic news 46 Report: Barclays 47 Report: BAE Systems 48 New books 49 People on the move 50 The last word We need to change how we consume, p36 Bhopal, 25 years on says Jon Entine
  4. 4. 4 Ethical Corporation • June 2010 What’s on the web There’s more comment and analysis available online In an online opinion story, Carbon Smart’s Esther rather than helps. In some circumstances, Baker directors will have to explain how their companies Rodriguez argues there is now little argument that argues, gut instinct may in fact be more accurate are to deliver prosperity without growth. sustainability is a buzzword for corporate perform- than any other test of what makes a “good” ance. It is, she suggests, now an important company. The Ethical Corporation team has continued to benchmark on which investment decisions are But, what to look out for? Baker’s view is that interview leading responsible business figures. based. Published sustainability data allows anyone can cobble together a programme and call China editor Paul French recently spoke to Suzhou- investors to assess the extent to which a company is it CSR. It is, however, companies with integrity based consultant Bill Dodson about the persistent “future proofed”, how much it is anticipating and embedded in corporate culture that will be kick-back culture in China’s manufacturing supply addressing potential risk. consistent when faced with business choices. chain. French and Dodson discussed how this works And following the lead of companies such as and what foreign companies can do to limit their Novo Nordisk, integrated reporting – where a Making a company grow while remaining exposure. company’s green credentials are seamlessly integrated sustainable is a big challenge, says Howard Paul French also spoke to Nick Gerritsen from with its financial performance – is gaining Sharman, managing director of ERD Associates New Zealand companies Carbonscape and momentum, Rodriguez says. It is, she concludes, time and a senior consultant for AdvanceAid. There Aquaflow about developing green technology for companies to engage with stakeholders and move is a growing number of people, he says, who projects in China. Gerritsen discussed how to sustainability reporting fully into the mainstream as a consider this to be the underlying problem that microwave charcoal for carbon capture and how method of determining business performance. all companies are going to have to address before to turn algae from pollutant discharge into fuel. long. The conundrum is that all of our collective And Ethical Corporation founder Toby Webb In an online-only column, Mallen Baker ponders financial and social capital is built on a foundation spoke with global brewer SABMiller’s head of the problems of spotting what makes a responsible of environmental capital, and this capital is being sustainable development Andy Wales about water business and how to spot it. He says that sometimes used up at an entirely unsustainable rate. Before use and planning, engaging suppliers and how all the information now available gets in the way long, Sharman argues, corporate responsibility to use socio-economic impact research. I Research review Corporate responsibility should respond to local circumstances, Ethical Corporation’s research finds thical Corporation has been exploring how needed at the local level and how companies are consume the majority of your time? The results E companies can successfully adapt their corporate responsibility and sustainability strategies to local adapting CR strategies to the local environment. After surveying four countries, it is already show that how CR professionals fill their schedules differs significantly. business environments. evident that sustainability in practice differs Sustainable business opportunities vary as Each month, we analyse one country in-depth, substantially, depending on the local context. well.German companies are vying for leadership and survey local professionals. Take core responsibilities, for example. One in green technology and energy, and in positioning Our analysts have been asking what skills are survey question asks: what three activities their company as a sustainability leader. In South Africa, opportunistic companies are What three activities consume the majority of your time? addressing energy efficiency, water management and education/technical skill development. Community socio-economic support, water Germany China management and education are at the top prospects of Indian sustainability professionals. 52% reporting 50% partnerships and collaboration Professionals operating in China prioritise 42% performance measurement opportunities through collaboration with 33% energy efficiency stakeholders, specifically civil society and with 38% partnerships and collaboration 33% performance management leading corporations. I A new country briefing will be published each month India South Africa and also posted online at For more information about Ethical Corporation 41% community engagement 52% reporting reports and bespoke research, contact Pam Muckosy, 33% reporting 33% community engagement head of research, at 28% employee engagement 28% performance measurement or +44(0) 20 7375 7554, or browse our reports at
  5. 5. Ethical Corporation • June 2010 From the editors 5 Welcome to the June 2010 issue his month, we’re analysing our usual wide variety of respon- Our country briefing this month is on India, the second largest T sible business stories. First up, the biggest event of the year will undoubtedly be the emerging market. The country has come a long way on the global stage in the last 15 years, from protectionism to much ongoing oil spill in the Gulf of Mexico. As Bob Moser points out on greater openness. As our resident India expert Oliver Balch, p6, and as BP’s chief executive Tony Hayward has admitted, the who is writing a book on the country, points out in the event will change forever how the offshore oil industry, at least in nine-page briefing starting on p27: “The notion of giving back to the US, is regulated and how risks are assessed. It’s too early to society is deeply engrained in Indian corporate culture. So too is judge the long term ramifications for the companies involved, the ability to improvise and innovate in the face of challenging particularly BP but it will be interesting to see how much political , circumstances.” donations from company coffers and their political action commit- Also in this month’s issue, we tees rise over the next year. Overall, the awful events may provide look at what was learned from the a fillip for offshore wind in particular. disastrous poisonous gas leak at Unethical Uzbek cotton and how to track it and remove it from Union Carbide’s plant in Bhopal 25 the supply chain remains an important issue for many European years ago. And we focus on how and US retailers in 2010. We’re delving back into the story to look at Wal-Mart’s work with suppliers current progress on p8. Brand boycotts are all very well, but when may revolutionise how many of they fail to deliver political change, the limits of corporate action them operate. are revealed all too clearly. We’ve also got our round up of We’re also looking at trust in banking in this issue. Perhaps a the latest books on corporate modern oxymoron for almost everyone, we wanted to find out responsibility, reviews of the BAE what plans, if any, the bigger banks have to try and rebuild Systems and Barclays sustainability trust, and what they can learn from smaller finance firms. Our reports, and our usual people specialist finance writer Oliver Wagg finds out from p11. The moves on p49. picture appears mixed at best. Many banks appear to have their And if you’re still stuck for a good new read, I’d particularly heads, unfortunately, still in the sand. What the politicians do next, recommend Jeffrey Hollender ’s new book The Responsibility should they have the courage, may come as deserved shock Revolution. therapy. Enjoy the June issue, and please email me if you have any This month we’re also publishing some analysis of who came comments or suggestions on how we can improve at top in the first Ethical Corporation Awards. Congratulations to the winners, which include PepsiCo, Timberland, Continental Clothing, F&C Investments, Greenpeace, Carlson, GSK, Interface and ProduceWorld. Our greenwasher of the year award went to Sinar Mas, owner of Asia Pulp and Paper, a company that finally appears to be receiving its comeuppance as brands such as Nestlé belatedly cancel contracts after pressure from campaigners. Starting on p22 Toby Webb you can see why our worthy winners won. Founding editor and publisher Founding editor & publisher: Toby Webb Contributors: Mallen Baker, Oliver Balch, Jeni Bauser, Rajesh Chhabara, Zoë Cokeliss, Peter Davis, Jon Entine, Commissioning & production editor: Ian Welsh Aleksandra Dobkowski-Joy, Stephen Gardner, Miriam Heale, Mark Hodge, Amita Joseph, Peter Knight, Gopa Kumar, Bob Moser, Ben Schiller, Oliver Wagg Head of research: Pam Muckosy Business Intelligence for Sustainability Sub editors: Sarah Burton, Gareth Overton Contributing editor: Brendan May 7-9 Fashion St, London E1 6PX UK People on the move Advertising and sales: Andrew Bold Design: Alex Chilton Design Ltd Subscriptions: +44 (0) 20 7375 7575 | +44 (0) 20 7375 7188 | +44 (0) 20 8762 6198 Editorial: +44 (0) 20 7375 7213 Subscriptions Corporate subscription Ethical Corporation is printed by Four Way Print Ltd on Green Coat plus paper, which ISSN 1758-1575 | +44 (0) 20 7375 7575 packages from £495 comprises 80% recycled and 20% Forest Stewardship Council certified source material.