All in Current Affairs

Debate about the future of newspapers won't die for some time yet I think . . . at least among journalists, news media watchers, some bloggers and Clay Shirky.

Roy Greenslade on Greenslade Blog wrote this week on newspapers and magazines charging for their online content. Greenslade's title alone raises the key question: "Paid content is all the rage with US publishers - but where's the proof that anyone will pay?"

I chuckled over the comment from Steven Brill, founder of Journalism Online, in the piece that JO "has helped shift the debate over charging for online news from 'if' to 'when and how'" because beleaguered publishers have moved past the "abstract debate" to agree that paid content is the way ahead." (JO's goal is to help them get there.)

Now there's a shock right? Publishers think the solution to declining print revenues is to charge people for accessing onlne content.

Megan McArdlein The Atlantic online framed the debate marvellously this way "The problem besetting newspapers is not that there are hordes of bloggers giving it away for free . . . Even if every newspaper and magazine in the country entered into a binding cartel agreement not to put more than a smidgen of free content on their websites, newspapers would still be losing money, and closing by the dozens.  It's the economics, stupid . . . We're witnessing the death of a business model."

So how exactly is pushing people to pay for online content recognizing, as people like Shirky and McArdle (and dozens of others) have been rightly trying to point out, that the paid online content model which has been tried many times before will not revive the fortunes of "old" media.

Some bickering broke out this week between Michael Arrington at TechCrunch and the folks at Twitter about some documents leaked to Mr. Arrington and then published in a column/post. I haven't been following the chatter about it, but there is a good summary at Social Media Today.

What caught my eye from Amy Mengel's report was this comment:

"But, let’s all remember that bloggers, like Arrington, aren’t journalists. They don’t operate under a professional code of ethics. they don’t report to an editor or publisher who tells them what to write about or what they can or can’t reveal. Many of them are ethical, many of them are former journalists, many of them would have chosen not to publish the documents."

Separate from the facts or otherwise of the particular events (now heading to the courts apparently), the question in my mind is this: When does a blogger who writes for a group-edited blog become de facto a journalist and perhaps subject to the same standards of ethical conduct to which journalists are expected to adhere (to the extent that they do in reality anyway)?

Wikipedia describes Mr. Arrington -- a lawyer -- as a "founder/co-editor" of TechCrunch. Many think of TechCrunch as an online news source. So, if it walks like a duck and talks like a duck . . . ?

Newcastle United FC is a storied franchise in English football and 'my club' in the sense that I was born a Geordie (the name used to describe people from the northeast of England) and therefore am genetically predisposed to being a member of The Toon Army, as frustrating as that can be. My father (long deceased) was a friend of one of the team's legends, Jackie Milburn ('Wor Jackie' as he is known), from when they both lived in Ashington in the 1940s.

This past season was a disaster for the club, with managers changing three times during a 38-game season and poor performances on the field by highly paid "stars'. The result is an ignominious demotion to the Coca-Cola Championship from the Barclays Premier League (where such other well-known franchises as Manchester United, Chelsea, Arsenal and Liverpool play).

The owner -- Mike Ashley, who has been problematic, if not a disaster, from the beginning according to most reports -- has been trying to sell the club since at least the last day of the Premiership season. It is now being coached by an interim manager.The players are furious and many of the first string players are asking for transfers. Even Ashley admits he has made a mess of things: “It has been catastrophic for everybody. I’ve lost my money and I’ve made terrible decisions. Now I want to sell it as soon as I can."

I have watched the public relations calamity unfold online on an almost daily basis through news reports from British newspapers and the NUFC's website (which tends to report absolutely zilch about what is going on). The extraordinary thing is that management appears to be saying naught. News reports are based almost exclusively on comments by players or "sources' close to the club.

From what I can tell, management has said nothing to reassure the city of Newcastle nor the club's extraordinarily devoted fans that the coming season in the lower division will be nothing short of a debacle. No reassurances are being given; no sympathy expressed; no plans outlined; no time frames given; no deadlines offered . . . in other words, completely counter to basic crisis communications principles.

Okay, maybe management doesn't see the situation as a crisis. Maybe management's solicitors or investment bankers have said it must say nothing. Maybe it is sending out news updates that no news outlet is picking up. Maybe it has a social network, YouTube channel, blog or Twitter presence which I just haven't been able to find. Or maybe management simply doesn't recognize the damage that is being done to its reputation.

The supporters will be there for the players on the pitch when the dust settles: but when Geordies are called on to support an NUFC management business initiative, when the city is asked for a concession or a tax, or when the club's history is written, who will be there to defend management's interest and its "license to operate" the Geordies' club?

Social media pundits are often critical of bloggers who devote too much of their digital space to referring to the posts of others. It is looked on as a form of solipsistic hackery.

But from time to time a writer posts something that is so to our advantage that it makes the charge worth bearing. So here goes.

Euan Semple, a fine writer and an intelligent, relaxed speaker (I heard him at an IPRA conference in London about three years ago) starts a short post with this almost axiomatic observation on the resistance of some in business (and to a frightful extent many communicators) to social computing:

"On an almost daily basis I am faced with someone asking me to tell them the return on investment of social computing in business or proclaiming that Twitter is all about people telling us what they had for breakfast. These interactions are always delivered in a particular tone -- at best pompous, at worst sneering and condescending."

Read the rest of the post here and be delighted that someone is pointing out what a waste of time - and how counterproductive - such conceit is.

Lots of juicy factoids and information today that add a little more to my thinking on new communication memes:

  • Twitter_logo_header Of the many striking statistics in a report called 'Inside Twitter' out of Canada's Sysomos people, this one stands out for evidence of the sheer stupidity of the hordes who now call themselves  'social media consultants': "Of people who identify themselves as social media marketers, 65.5% have never posted an update (on Twitter)."  I guess they just can't be bothered . . . or don't have time?
  • To be filed under the tab 'Public Relations Through the Rear View Mirror', according to an article today in the Ottawa Citizen Canada's National Defence HQ has a new 'conduit' approach to public relations (in which all media questions are funneled through public affairs staff, with the journalist never allowed to speak to a subject matter expert directly) that the writer calls the 24 DAY news cycle: "Into this brave new world of hyper-speed news gathering, NDHQ has rolled out what I’ve termed, the “24-day news cycle. Yes, 24 days…..That’s about the length of time I figure that it takes NDHQ to answer a question from the news media…..if it is answered at all."

  • Bear with me on this one. Those who follow me on Twitter will know that as a native 'Geordie' I am an ardent -- and frustrated, some would say foolish -- supporter of the Newcastle United football club, formerly of the English Premier League now relegated to tier two football as a result of an abysmal season this past year. Thankfully, the owner has put the club up for sale (at 0,,10278~3488677,00 about US$200 million). Before he did so, he published a statement in which he said "I'm sorry" about four or five times. Frankly, it sounded hollow given Ashley's unwillingness to invest in the club and his lack of commitment to its success in spite of having one of the most loyal fan bases of any football club. The lesson here is simple . . . saying 'Im sorry' in a crisis is not enough. An apology has to be backed up by action to resolve the underlying problem. In this case, the owner getting out is the right move, although that is not counsel I would give to many CEOs.

  • Finally, this about philanthropic giving . . . "Today, the Committee Encouraging Corporate Philanthropy (CECP) shares a first-look at results from its annual philanthropy survey of nearly 140 leading companies, revealing that 53% of companies increased their total philanthropic donations in 2008, and 27% increased their giving by more than 10% year-over-year." So things are not as bad as the CR critics would have us believe.


Reputation risk for companies is an underestimated consequence of global concern about climate change. Rather than expending more inventive energy on denying a relationship between CO2 concentrations and global temperature, smart businesses should be looking for ways to gain come reputation capital by managing climate change risks in cooperation with communities and global agencies.

Last week, the UN Global Compact and the Pacific Institute released a short paper on climate change and its impact on water which recommends a number of sensible management strategies. The context for the paper is the statement that:

"There is overwhelming scientific evidence that burning fossil fuels has altered the chemistry of the atmosphere. Figure 1 shows that atmospheric CO2 concentrations are reaching levels that are likely higher than in the last 20 million years.Rising CO2 concentrations along with other greenhouse gases (GHG) are changing the planet’s climate. Global mean temperatures have increased three-quarters of a degree Celsius since 1900 and 11 of the 12 warmest years since 1850 have occurred since 1996.These climatic changes are expected to accelerate over the coming decades."

The paper argues that a significant body of scientific evidence suggests climate change will affect the scarcity, sustainability and quality of the global water supply, which increases business risk, especially with respect to energy supply management, raw material inventories, industrial production systems and the associated financing costs.

Reputation risks can easily follow, for example as "people become more aware of their rights to access water . . . local businesses may find themselves using copious amounts of water in regions where people lack sufficient water to meet basic needs."

The paper outlines some business strategies which mirror two dominant themes on how businesses today need to think of corporate responsibility (CR): CR as part of business strategy discussions (integrating "water and climate change into strategic business planning and operational activities") and engagement of stakeholders in responsible planning (engaging "key stakeholders as a part of water and climate risk assessment, long-term planning and implementation activities").

Philip Sheppard, a past president of the International Public Relations Association, brought to my attention this exhilarating and numbing video called Did You KNow? posted on the Pilot Theatre (from Wakefield West Yorkshire) website . . . Lots to make you think about business, communications, knowledge management and North American education (strengths and failures).

The stock of CSX Corp., a Jacksonville Florida-based railway company has been discounted as a result of lingering criticism of "poor management", according to UBS analyst Rick Paterson as reported today in the Financial Post. (I can't find a link: The Financial Post's website doesn't make it easy.) It should be trading at a premium to its competitors according to Paterson.

He goes on to say "Four or five years ago that ("poor management") was probably true, but we think these days are long gone and (mis)perception is lagging reality."

If that's the case (and I have no idea if the company has been actively trying to restore its reputation), then why is it that investment bankers and equity analysts stubbornly resist the idea that a good reputation, consciously developed, nurtured and communicated, can have a measurable impact on valuation? And why is it that some companies have such a hard time understanding that reputations don't recover solely through solid financial performance?

There are strategies for reputation recovery. But they require commitment, humility and honesty . . . and the support of financial advisers, lenders and legal counsel.

The Economist, not normally a booster of corporate social responsibility (CSR) or sustainability as it  tends to be known in Europe, this week has a piece on CSR that hits the mark. The author concludes that corporate philanthropy (contributions to charitable causes) is being cleaved but the attention being paid to behaviour -- ethics and governance in particular -- is holding steady, as it should.

"There is one other important reason for thinking that companies will maintain their commitments to sustainability through the downturn and beyond: the need to restore confidence in business. The financial crisis was triggered by a bout of corporate social irresponsibility on a massive scale that has tarnished the reputations of even the bluest of blue-chip companies. Now corporate leaders have a chance to show that they are not just motivated by short-termism after all."

As Intel (a client) says in the management analysis and strategy portion of its 2008 corporate responsibility report (Note . . . I agree with ridding CSR of its restrictive 'S'),  "By incorporating corporate responsibility directly into our strategy and objectives, we manage our business more effectively and understand our impact on the world more clearly."

Corporate or 'strategic' philanthropy is a programmatic means by which a company contributes to its community. Philanthropy evidences a corporate recognition that profits are derived from the community and that a return to the community in the form of wages paid for labor and consistent dividend payments to shareholders as well as steady share price growth is -- at least in terms of today's social expectations -- insufficient.

Communities expect companies to give back, and companies have obliged either through random acts of kindness or more structured investments in causes which match company values or business goals.

But let's be honest. Philanthropy is unlikely to define or affect company behaviour when it comes to choosing business strategy, rewarding employees, managing supply chain relationships, committing to respectful and sensitive business principles and overseeing board and C-suite conduct. 

A generous philanthropy program, and commitment to a cause, can comfortably sit side-by-side with dishonest accounting, excessive senior executive compensation, autocratic and harsh management, deferential governance, poor labour and sourcing practices, and denial of environmental impact. Philanthropy provides a reputational sheen, but it doesn't de facto require ethical conduct or a socially astute business strategy. Philanthropy buys goodwill but it doesn't drive responsible behaviour nor build social trust.

If The Economist is right, and I think it is, and the decline in spending on smoke-screen philanthropy is NOT being matched by a retreat from investment (time, focus, intensity) in better behaviour, then maybe out of the current crisis we will see a steady push-back within companies against insular corporate boards, inappropriate rock star-like CEO salaries, and short-sighted and opaque business strategies.

CEOs must have a tough time deciding what to read among all the blogs, online news sites, management school journals and mainstream media which offer points of view on how CEOs can lead better. Alright, they likely don't read any of them.

Should they change their minds, here is a recent addition to the plethora of leadership punditry that may be worth watching: The Syd Blog is by Sydney Finkelstein, the Steven Roth Professor of Management at the Tuck School of Business at Dartmouth College. The blog is subtitled "Insight into the force and follies of leaders."  His latest post looks at how Bank of America CEO Ken Lewis, who was stripped of his chairman title last week, may still lose his CEO position even though Bank Of America is run by what Finkelstein calls a "rubber-stamp board."

Sounds like Finkelstein would not be displeased.

The legislators in the Canadian province in which I live recently charged the Ontario Securities Commission with reviewing corporate reporting standards in order to establish best practices for disclosure of environmental, social and governance practices. The commission has been asked to report back to the House by January 1st of this year. The announcement warranted only about 125 words in Canada's national newspaper which means it can easily die a languid death.

Behind the order to review disclosure practices (other than the standard opportunism of politicians looking to take personal advantage of a crisis in trust), is acknowledgment that the public and minority shareholders have this indistinct but genuine feeling no one in corporate boardrooms is championing good behaviour.

Never having sat on a corporate board (I have been a director on a hospital foundation board) I have no idea how discussions about things like executive compensation, minority shareholder rights, and environmental and social commitments are raised and debated. Having read Dickens, Marx, Althusser and Levy, and being ready to believe anything Gretchen Morgenson writes about boardroom mischief, I do feel a sort of native mistrust that the impact of a decision or policy on ordinary shareholders or a community ever factors into the colloquy. Worse, I end up silently cheering regulators (although seldom legislators) when they study corporate reporting standards and insist on more transparency, even though I know I shouldn't given the nasty stuff they can foist on business.

By all appearances, I'm not alone in mistrust.

But I also know that many corporate directors are honest and ethical people. They work hard to balance conflicting interests and to do what is right for the company, its shareholders and the community. So let's hope that out of the OSC's review the government doesn't default to punitive regulation. Rather it should encourage board-lead custody of ethical, inclusive and open behaviour. A good start would be to put forward suggestions for ways boards can collect and aggregate meaningful contributions (not just by shareholder resolutions and voting proxies)from people who deserve to have a say in crucial (not all) decisions -- in particular minority shareholders and 'communities of interest'.

I have no idea if this post from Molly Wood truly reflects Apple's approach to public relations ("hammer and hammer and hammer and hammer"), or if it is just the usual journalistic hectoring of public relations people doing their job.

But the pull-out quotation from the Wall Street Journal that prompted the piece demonstrates why many business people (and the demos at large) occasionally -- okay, often -- question the devotion of journalists to seeking truth from facts. Since the WSJ article uses as its source "people familiar with the matter", "these people say" and "they say" it is also fair game to conjecture, as The Molly does, whether the publication has been spun by a zealous public relations "machine".

The blame, though isn't with the public relations people, as Wood accedes, but with lame and now inadequately supported journalism:

"It’s not a crime for a company to have a good PR machine. It’s working for Apple and it has for a long time. But this is a nation that is, at the moment, finding itself in quite a pickle because we blindly believed everything that companies were telling us. So, if we’re trying to be skeptical about, say, large financial institutions and their outlandish and/or reassuring claims, shouldn’t we also cast the same critical eye on a convenient flood of information that does little other than improve Apple’s stock price a week before they have to answer to angry and worried shareholders? Or, hey, maybe the Wall Street Journal just trying to boost the Nasdaq on purpose. You know, to help the economy."

Buried in a recent survey of corporate directors conducted by McKinsey is a finding that 29% of respondents report that one of the procedural changes corporate boards are making to deal with economic turmoil is "Promoting conversations that are more frank than usual"; further, 24% believe this is an additional change boards should make "to become more effective in managing the global economic crisis".

No mention is made of whether Twitter is a preferred tool for intermediating this new focus on conversation.

An extensive analysis in Toronto's The Globe and Mail newspaper by Sinclair Stewart and Grant Robertson repeats a popular question: "(I)f print is a dinosaur, what will take up its traditional roles -- informing the public, animating civic culture and holding government accountable?" Jon Slattery picks it up in the U.K.'s The Guardian in a piece with the earthy title 'Where the hell do we go now?' And Canadian blogger and former journalist Mark Evans chimes in with his worry about maintaining the quality of journalism in the face of dissection of the newsroom . . . . without, however, taking a stand on the future of news journalism and without drawing a picture of an alternative news cosmos.

The background to the soul-searching is the precipitous disappearance of major newspapers in print form (The Seattle Intelligencer most recently and The San Francisco Chronicle likely next). At the core of the discussion, other than the loss of jobs and the "decline" of quality (The quotation marks are purposeful since quality has been in retreat in broadcast and print journalism from before social media became a threat.) is the question of whether social discourse, investigative inquiry and democracy will suffer without an energetic and well-financed fourth estate playing the role of critical watchdog.

The model is changing. That much is self-evident. But there is an embryonic new model within the decline (which nearly always happens in transition periods) and it is based on an unprecedented ability to gather, share and act collectively. Clay Shirky in 'Here Comes Everybody' calls it a new communications "ecology":

"The change isn't a shift from one kind of news institution to another, but rather in the definition of news: from news as an institutional prerogative to news as part of a communications ecosystem, occupied by a mix of formal organizations, informal collectives, and individuals."

Some of the critical pieces of the prototype are already in place.

The ability of people using social networks to form and act together in groups means that problems like corruption and malfeasance among legislators, clergy and citizens can be discovered and fought with even greater speed than when we depended on investigative journalism to root it out. Shirky again . . . "social tools don't create collective action - they merely remove the obstacles to it." Without the obstacles to discovery and action, the social criminals and demagogues won't be able to hide for long.

With the ability of anyone to publish, for the time being we have lost the beauty of fine writing. But not the capacity to find and report significant events. In exchange, we've got speed in reporting news, depth, breadth and personality in what is understood as "news", and often now quirky and energetic prose. The result may be hyper-local community reportage (and publications), but it can also become national and international news if warranted or needed. The disappearance of some print and broadcast outlets doesn't mean that news is not being revealed, or that criticism isn't being coalesced into opposition, only that the agent has changed.

As for print newspapers providing a sense of community and hence their disappearance leading to a decline in a sense of place, this is silly. Where we get a sense of community is simply shifting to social networks built around communities and communities of interest. I can learn as much (and find out more immediately) about Toronto from torontoist.com as from the Toronto Star or the Toronto Sun.

Newspapers as we know them won't all disappear. We need journalistic models of quality, thoroughness and objectivity to learn from and against which to measure citizen journalism. And they're wonderful to sit with on a Sunday morning while enjoying a cappuccino. Nevertheless, their influence will surely continue to decline. However, democracy is safe in the hands of all of us.

What I like about Sun Life Financial Inc. giving shareholders an advisory vote on executive compensation (joining seven other Canadian financial institutions including most of the large banks, although not Toronto-Dominion Bank and Manulife Financial Corp.)is that the company has evidently recognized something has to be done by business to rebuild shareholder and public trust.

Since the Enron years, most polling acknowledges a steady decline in trust in business and financial institutions. Any doubts about the extent of the decline are obviated when you look at the results of a recent Harris Poll:

"Those who think 'most people on Wall Street would be willing to break the law if they believed that they could make a lot of money and get away with it' are up to 71%. The highest number previously was 64% in 1996"

True, this is Wall Street we are talking about, ground zero for dishonest and manipulative practices in investment and compensation strategies. But mistrust is becoming indiscriminate and ubiquitous.

There are those who think this trust deficit is temporary, a function of the economic tsunami hitting global finance. Once things go back to "normal", the argument goes, the pressure for greater transparency in compensation policies and increased board oversight will whither away in a sea of fatter profits.

Ian Davis, worldwide managing director of McKinsey, arguing the contrary, is closer to the truth: He has written a piece called 'The New Normal' in which he forecasts that:

". . . around the world governments will be calling the shots in sectors (such as debt insurance) that were once only lightly regulated. They will also be demanding new levels of transparency and disclosure for investment vehicles such as hedge funds and getting involved in decisions that were once the sole province of corporate boards, including executive compensation."

This will be the new normal, and without actions similar to that of Sun Life and the seven other Canadian financial institutions increased shareholder activism, loud public displeasure, media sniping, punishment by consumers and abrupt regulation will surely follow.

Spirited debates happen all the time when people talk about corporate responsibility (CR) especially now that our economies are stumbling along and evidence continues to leak out about the governance missteps that led to egregious examples of greed-driven shortsightedness.

Research studies and white papers on the subject also proliferate, at least as fast and as often as politicians blaming their predecessors for current problems.

Here are a few that have made their appearance recently:

  • The Conference Board released the results of a survey yesterday on the future of corporate giving programs. Corporate giving officers are noticing their companies are concerned about their overall financial health when considering the allotment of their philanthropy dollars. Not surprising. But remember, public expectations about behavior -- and the punishment it inflicts on transgressors -- are not significantly influenced by random acts of kindness no matter how generous or strategic.
  • Yesterday, the Rotman/AIC Institute for Corporate Citizenship also released what it calls "a real-world guide that helps business leaders understand and prioritize key social and environmental issues and identify opportunities as well as potential risks." Called 'What's a CEO to do?", it is described as a toolkit and is built on a model introduced by Rotman School of Management dean, Roger Martin, called the "virtue matrix" which he wrote about in HBR a few  years ago. I haven't had a chance yet to do a deep dive into it, but Rotman often produces worthwhile management frameworks. (Disclosure . . . I have an M.B.A. from Rotman.)
  • The third is truly timely . . . an article in the Deloitte Review called "The Responsible and Sustainable Board. (Sorry I can't find a link to it but it is Issue #4, 2009). It includes a warning to boards of directors that "Even if your organization is disinclined to tackle CR&S issues voluntarily, you may ultimately have no choice if, as expected, regulatory requirements take hold." 

Maybe there will be some kind of retrenchment back into the philosophy of 'the business of business is business'. (Simply wishful thinking on the part of cave-dwellers?) Evidently though it doesn't stop the think tanks from thinking about it.

Since I have such respect for the quality of writing and ideas (although not always the politics) in the British magazine The Spectator, I am always delighted when the point of view of an editor or writer corresponds to my own. (I am not foolish enough to think there is any correlation between the two other than coincidence).

So imagine my contentment in reading the February 14th number when both the lead editorial and a column by Sarah Standing echoed comments I have posted here and here over the past few weeks.

Sarah Standing on saying sorry:

" 'Sorry' has lost its mojo for me, it's gone mainstream. It's one of those words that began life as a covetable Chanel handbag only to end up as a worthless flake flogged on eBay . . . I no longer believe in all these force-fed public apologies. They're starting to sound very hollow . . . I'm old school and from where I stand a true apology should come from the heart."

And not, I would add, because a crisis communications or political consultant has said it is necessary to apologize when harm has been caused. Without sincerity an apology is nothing more than gamesmanship. 

The editorial 'Bonus Points' calls out many British bankers for the damage caused by the huge payouts they received, which lead as the editors conclude to the wrong balancing of risk and reward

"Bankers must face reality and bring about changes themselves, rather than trying to face down public disgust with a last-ditch defence of the status quo. Their profession has to revert to being dull but respectable, decently but not lavishly paid, transparent in its accounting practices and the way it measures profits, intelligently regulated, and by nature risk-averse. And if that means talented people drift away from the banking sector, so be it: there are plenty of other parts of the economy that urgently need them".

Better said than by me, but at least my ideas are in line with some top notch writers.

It should be unnecessary after so many years of the corporate responsibility (CR) "movement" -- if it is right to call it that -- to have to jump to its defense and provide arguments for why CR makes a difference. But the harrumphing of the troglodytes has started again, this time under the pretext of determining whether our wretched global economy will cause companies to re-think CR actions and investments.

In one of those dismissive, glib pieces favored by business journalists when writing about CR, Stefan Stern of the Financial Times (registration required) writes from Davos "Thank goodness, now the recession’s here we can forget all that nonsense about corporate social responsibility (CSR) and get back to trying to make some money." Canada's own Terence Corcoran followed suit in his remarks to a recent panel on CR reported in one of Canada's national newspapers.

Communications professional Paul Seaman takes up the discussion in his blog and comes down somewhere in between supporting the preeminent goal of business to make profit yet recognizing that "Traditional values and professional ethics will become highly valued virtues and the true measure of corporate responsibility."

More often than not, the critics use ideology rather than evidence to back up their arguments. They ignore books like Lynn Sharp Paine's exhaustive study of the financial benefits of responsible conduct called Value Shift (Sharp Paine is the John G. McLean professor of business administration at Harvard Business School), or a recent study published in MIT's Sloan Management Review called Does it Pay to be Good? The conclusion of this study by two professors at Canada's Ivey School of Business about consumer behaviour and sustainability:

"Yes customers will pay a premium for ethically produced goods. Conversely, they will punish companies (by demanding a lower price) that are not seen as ethical. The punishment exacted is greater than the premium customers are willing to pay. Companies need to be 100% ethical to be rewarded."

Detractors like Stern and David Henderson (author of Misguided Virtue: False Notions of Corporate Social Responsibility) also don't seem to be able to make the connection between the frequent lapses in ethical judgment of some senior executives and the idea that "profit" at any cost -- without the filter of some moral or ethical framework (a basic tenet of corporate responsibility especially as it relates to governance)-- can be a precursor to greed. And look at what unrestrained greed has wrought today.

Will there be a step back from good governance, social engagement, committed citizenship, defense of human rights, product innovation driven by environmental concerns, willing social and environmental problem identification and resolution, and efforts by companies to control their GHG emissions? I doubt it. Why would companies set aside years of building reputation capital (an intangible with enormous financial value) for a short-term retreat from responsible conduct? Why would senior executives look on now as an appropriate time to set aside public concerns, when trust in many of them has eroded even further over the past six months and led to precipitous government and regulatory action?

Bruce Sewell, posting on Intel's CSR blog from Davos, (disclosure . . . my company's client although I don't work on the account) made this observation about the mood of the meetings: "Gone was the patina of entitlement, replaced instead with a palpable sense that at some profound level this collection of bankers, regulators and politicians had failed to read the writing on the wall, and for that omission the world as we know it will pay a stiff price."

The CR "movement" can only benefit from a flight from entitlement, from some sense of guilt about transgressions, from a recognition that a "stiff price" may be exacted from those who don't take care to act responsibly . . . or are dismissive.