If American crooner Billy Joel ever re-releases his hit song New York State of Mind, he might do well to check first with Beatriz Loizillon. The global indirect procurement professional for The Estee Lauder Companies is chairperson of the ISM-New York Sustainability and Social Responsibility Committee. She could tell him that “when it comes down to reality,” as the songwriter would say, sustainability efforts are among the top concerns on the minds of procurement executives in New York City.
That may or may not have been the case in 1976 when Joel first recorded the song. Although that was the year of the infamous Love Canal chemical leak in Niagara Falls, NY, one of the worst environmental disasters in US history, the concept of corporate social responsibility (CSR) was then only in its infancy. And assertions that CSR could actually be a competitive advantage for companies drew protests from cynics, who said it was a distraction that drained profits.
There are still cynics today, though they are fewer in number. The surprising thing is that there are any cynics at all. Depending on your politics, there may be an argument about whether governments should force businesses to adopt sustainability practices. But those who argue that there is no business justification for CSR perhaps have trouble reading.
Voluminous studies have proven the business case for CSR, including reports from AT Kearney, Strandberg Consulting, BSR Global Scan, articles and presentations on the Procurement Leaders Corporate Social Responsibility Knowledge Group site, and other sources. There are even reports that sustainability efforts are taking hold in China, though some observers say the record among Chinese manufacturers is mixed.
No one could accuse the members of the committee Loizillon chairs of having a mixed record. Procurement executives in companies with New York offices - American Express, Citigroup, Colgate Palmolive, Morgan Stanley, Pfizer, IBM, and Goldman Sachs, to name a few - talk at their meetings about the savings in such areas as energy, paper usage, fleet, and packaging, as well as increased revenue from CSR activities.
“CSR is one way they differentiate their brands,” says Loizillon, who has a good story to tell herself about Estee Lauder’s prodigious CSR efforts, including an emphasis on strengthening its supplier-oversight programs. Like her peers on the committee and elsewhere, and as my colleague Steve Hall has blogged, she says it’s critical to get suppliers involved for sustainable efforts to succeed.
CSR has come a long way since 1968, when UNESCO (the United Nations Educational, Scientific, and Cultural Organization) held its first conference on the subject. Companies from Premier Foods in the UK to Veolia Water in Indianapolis, among many others, have launched far-reaching sustainability programs, some of which I will describe in future posts. To understand the evolution of thinking on the subject, you can read a timeline on global sustainability efforts here.