Monday, April 19, 2010

Good and Evil

Umair Haque has written an article entitled, The Case for Being Disruptively Good.

In it he discusses the way in which businesses who used to get away with bad practice are now far more exposed than they used to be, due to the information age - news travels fast, in other words. Purely from a shareholding viewpoint, he notes: being a good guy pays. The best corporate citizens list, which includes Hewlett-Packard, Intel, General Mills, I.B.M. and Kimberly-Clark, had a total return on shareholder value of 2.37 percent over three years. But the 30 worst had a negative 7.38 percent return".

But this is far more than an article about shareholders. It's about the fact that big businesses that are thriving are doing so more because they have decided to follow 'good' practices more than 'evil' ones. But even those who are doing good vary in the extent to which they're doing good.

He lists a ladder with five steps and shows how various well-known companies are learning the ropes of doing good: Pepsi's on the bottom rung, having done a "marginal bit of good"; Nestle is on the next rung, having got itself a 'black eye' for not being as open and honest as it claimed (thanks for Facebook!).

Google's just got itself back on the third rung by pulling out of China, avoiding the compromises that would have been required of it, if it had stayed. Apple's on the fourth rung - though Haque doesn't seem convinced it'll stay there, and Wal Mart (surprise!) is on the fifth rung due to its Sustainability Index which 'lays down new rules for every single supplier in its vast, globe-spanning ecosystem.'

Haque doesn't see anyone on the top rung as yet, but is waiting.

The ladder image is only part of what he has to say. Check out the rest: the historic viewpoint, the revolutions, the changes.

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