It is no longer enough to depend on politicians for action on social issues – business needs to step in, says Kate Thiele. For decades, we’ve turned to our political leaders to solve crises and advocate for change. Now, Australians are shifting their attention – and patronage – to the businesses willing to take the lead on today’s most pressing societal issues.
Last month, Edelman, a global public relations firm, published the 2022 Edelman Trust Barometer. Based on more than 36,000 online surveys in 28 nations, the findings are essential reading for all business leaders. The data is clear: Australians want more engagement from business on the country’s top societal issues.
“In the year ahead, transparency and social action will be the currency with which businesses will earn the trust of their people and the public,” says Michelle Hutton, CEO Australia and Vice Chair of Asia Pacific, Edelman. According to the study, every stakeholder group expects business to help “fill the void” on social issues such as economic inequality, workforce reskilling, discrimination, and climate change. The research is an unequivocal rallying call for businesses to step up on social issues, play a bigger role, and embed societal action at their operational core.
People’s concern on social issues
Here are the three data points that stood out to me most:
- 56% of Australian consumers will buy or advocate for brands based on their belief and values
- 57% Australian employees will choose a place to work based on their beliefs and values
- 64% of investors will invest based on their beliefs and values
- 60% of employees want their CEO to speak out on controversial issues they care about
Eight in ten people surveyed believe CEOs and industry captains must be visible discussing work their company has done to benefit society or policy with external stakeholders. Specifically, Australians expect CEOs to inform and shape conversations around subjects related to jobs and the economy (72%), wage inequality (72%), technology and automation (68%), prejudice and discrimination (64%), and climate change (61%). No pressure.
How business can embrace its expanded mandate on social issues
A couple of years ago, I overheard a conversation between two high-profile board directors. One of the directors said: “Business should focus on creating shareholder value exclusively, that’s it.” I was surprised, given the power of business to make a positive difference.
Business builds society in ways the government cannot. These findings underscore the link between shareholder value and societal leadership. By ignoring that connection, business leaders risk severe impact to the bottom line. Why? Because it affects business when consumers buy and advocate for brands based on their societal leadership. It affects business when investors make conscious investment decisions based on beliefs and values, or when employees call on their CEO to speak out on issues they care about.
How business must evolve
To support this evolved customer lifecycle – to build brand trust, win business, and retain people – businesses need to evolve in a couple of key ways:
Look inward: ask your most critical stakeholder
Your people mean more – and do more – for your bottom line than any program, tactic, or metric. Ask them. Listen to your employees and work to understand their perspectives, what motivates them and how they want to be engaged.
Be curious! I find that middle managers are a useful litmus test on the organisation. They have ears up and down the organisation. Create businesses where people want to work, have a sense they belong and feel valued. This drives performance.
Create two-way channels for communication
It’s not enough to have monthly or quarterly all-staff meetings. To create a culture of trust and transparency, organisations must create open, two-way channels for communication. Some CEOs take daily walks around their organisation. The benefit is two-fold: they are visible to their people, but also regularly available to all levels of the organisation. This creates a culture that encourages open and upward communication.
One CEO I know has done this so regularly – every day, over many years – that people feel very comfortable approaching her. They know their comments and thoughts are welcomed on all issues. Over the same period, the organisation’s performance has improved dramatically.
Get clear on your values
If consumers increasingly vote in line with their values, it’s time to get clear on your own. Values mandate how you do what you do, not the other way around. Before you start engaging on societal issues, think about the core values which drive your organisation and tap into them to build your social currency. Formalise and evangelise them.
Know where you stand
Saying nothing and doing nothing is no longer an option. How are you shaping your organisation’s decisions on these critical issues?
Engage in the conversation with your staff and stakeholders and communicate clearly where your organisation sits on these tough societal issues. By taking clear action, you will show you are actively trying to drive change within your industry or sector, something people are looking for in their business leaders.
Your commitment to societal issues should be represented internally and externally. For example, you might embed those values into your internal training and communication, or into the community projects and partnerships your company participates in.
Use diagnostics to determine strategy
A business brand and its capability and practices are market differentiators. How they are perceived influences the way people within the business think, behave and support the business. We know that a high performing culture is directly linked to success.
Businesses operate as a collective of internal societal systems that together define the culture of the organisation. If we, as leaders, build a deep understanding of where the culture is and where we aspire for it to be, we will be in a better position to support people to deliver. We can then see that there may be cultural components which are not working as effectively as they could, or indeed might be entirely broken.
Understanding these nuances allows leaders to guide, instil and support ways of working that foster a stronger culture and, in turn, support the business’s strategy and goals.
Embrace new ideas and welcome input
The era of the “all knowing” CEO is over. Instead, embrace new ideas from your team and customers. Push traditional boundaries. Listen to the other side of a given issue.
I love it when I hear a leader say, “Thank you for sharing. I’d like to work with you to address this issue. I don’t have all the answers.” Australians want their CEOs to engage externally on issues they care about, so embrace external engagement in a transparent way.
Make trust a measurable KPI
Organisations should consider measuring their trust levels internally, alongside other key metrics such as employee engagement. Giving a trust KPI to a senior executive will give this work focus and provide line of sight on the issue. This will also create a contact point for all staff to raise issues with the executive responsible for corporate and social trust issues.
A more engaged customer base is better for business
I’ve heard some pessimistic responses to the business climate I’ve described above, but I see this as a golden opportunity for positive change. People are more engaged than ever. They’re re-evaluating work and family life – the companies they buy from and the brands they support – in lockstep with what’s going on in the world.
It’s time to embrace this tremendous shift in power. It’s time for businesses to step into societal leadership and make their people and customers proud.
