Business Leadership Today

Leadership Vision

2012-01-08T02:09:00.000-05:00

"Leadership is lifting a person's vision to high sights, the raising of a person's performance to a higher standard, the building of a personality beyond its normal limitations." --Peter F. Drucker

Let the Sun Shine In

2011-11-11T16:11:00.000-05:00

One of the enduring effects of corporate governance reform has been transparency. In today's digital environment, it is easy to obtain reams and streams of information about almost any company, particularly if it is publicly held.

From conference calls to shareholder meetings, and more, the amount of sunshine required of today's corporation in the U.S. is remarkable, and certainly overshadows that of other countries. Even so, we are told there are some companies that remain extraordinarily secret. Without any endorsement or independent investigation on our part, here is a list compiled by the folks at Online MBA, titled the 12 Most Secretive Companies in America. Very interesting.

The Media Institute's Leading Edge

2011-10-19T18:57:00.000-04:00

Headquartered in a quiet suburban office building a few miles west of the White House, The Media Institute's unassuming plant belies its immense influence and impact on communications policy in Washington. Few organizations can convene a gathering where the captains of the media and communications industry, leaders of the FCC, an elite group of lawyers and lobbyists, public interest and civil rights advocates, and members of the working press, all sit down over dinner and agree on the topic of conversation.

Yet, that is what The Media Institute has done successfully, year after year, with its singular and unwavering focus on the importance of protecting the First Amendment. Every October, without fail, two things happen in Washington--the Supreme Court convenes on the first Monday of the month, and The Media Institute elevates the First Amendment onto the global stage through its founding sponsorship and promotion of National Freedom of Speech Week and awards dinner.

Of course, none of this would be possible without the visionary leadership of the Institute's President and intellectual anchor, Patrick Maines, and its can-do chairman, the ubiquitous and indomitable former FCC Chairman, Dick Wiley. It also helps that A-list companies like AT&T, CBS, LG, NBCUniversal, News Corporation, Time Warner, Viacom, Clear Channel, DirecTV, T-Mobile, Gannett, Microsoft, Verizon, Walt Disney, the Motion Picture Association of America. and others recognize the unique leadership and legacy of The Media Institute and its staff, and provide support for its programs.

In befitting bipartisan fashion, The Media Institute gave voice to Democratic Senator Mark Warner (D-VA), Republican FCC Commissioner Robert McDowell, NAACP President Ben Jealous, ATT President Randall Stephenson, and First Amendment scholar Rodney Smolla, as each extolled the value and virtue of free expression as a sine qua non cornerstone of a democratic society.

And in an unexpected, but not uncharacteristic, expression of exemplary corporate citizenship, Maines announced that a portion of the proceeds from the institute's annual dinner would be donated to the Music Maker Relief Foundation, a nonprofit organization in rural North Carolina founded by Tim Duffy that helps the pioneers and forgotten heroes of Southern music to gain recognition and dignity by providing grants to meet the basic life needs of aging blues artists and helping to keep their musical traditions alive for future generations.

Full disclosure: Adonis Hoffman is a member of the Media Institute's First Amendment Advisory Council.

(c)2011. Adonis Hoffman

Silent Leadership

2011-10-05T10:33:00.000-04:00

"We must be silent before we can listen.
We must listen before we can learn.
We must learn before we can prepare.
We must prepare before we can serve.
We must serve before we can lead."

--William A. Ward

Beyond these poignant words, I am not sure what other advice today's business leaders should heed.

California Invites More Corporate Board Diversity

2011-09-26T13:33:00.002-04:00

As the nation's largest public pension fund, with over $224 billion in assets, the California Public Employees' Retirement System (CalPERS) recognized two years ago the need for more diversity on corporate boards. Today, CalPERS announced that it was taking the next step in the inclusion journey by inviting applicants to submit their information to the Diverse Director DataSource .

Ostensibly, the registry will be a resource for institutional investors, public companies and others who want to tap into the reservoir of diverse talent for corporate directors. According to one key observer, "investors looking for ways to increase corporate value will find such voices in the corporate boardroom indispensable to boosting the bottom line."

As a director, lawyer, and longtime observer of board practices, I hope more jurisdictions follow the California lead. A broader set of experiences and perspectives, typically brought by diverse directors, should allow corporations to become more sensitive to consumer concerns in a down economy, while not sacrificing the duty to improve shareholder value.

Ikea's $62 M Pledge for African Relief is Leadership In Deed

2011-09-02T14:21:00.002-04:00

When Ikea announced its foundation would send $62 million to help the victims of the Kenyan famine, the world's largest furniture chain reached another milestone. Ikea's pledge is the largest private donation to go to a UN relief agency in the agency's 60-year history. At a time when national governments and transnational corporations seem impervious to the suffering in that region, Ikea's business leadership speaks volumes through its deeds. Critics have taken on the Swedish company over labor and supplier matters. But if Ikea's commitment to salve the human condition is any indication of its character as a company, the other issues should be easily solved.

More Than Money

2011-08-31T04:18:00.000-04:00

In a curious piece in the New York Times, Andrew Ross Sorkin questioned why there was no public record of Apple founder Steve Jobs' philanthropy. Despite a net worth in the billions, Jobs and his wife appear to leave no trace of charitable giving to any organization. They do not belong to the exclusive "Giving Pledge" group led by billionaires Warren Buffett and Bill Gates, and a whispering campaign is now audible about Jobs' commitment to philanthropy.

I'm sure the opinions of other billionaires and the media are far from Steve Jobs' psyche these days as he battles for his life and continues to fret over his company's fate from the chairman's office. Whatever money Mr. Jobs chose to give (or not) to worthy causes is a personal matter between him and the good Lord. If he never gave a dime to a down-on-his-luck panhandler on the corner, Jobs could still rest easy for all the good he has caused in this world through his works.

We should keep in mind that several of the fabled 20th century robber-barons and industrialists cleansed their hands and souls by establishing huge endowments to aid the public good. Today their foundations carry on their legacies by doing good throughout the land in their names. Steve Jobs may end up bequeathing a well-funded foundation or something of the sort, which would cast him into posterity. On the other hand, he may very well let his marvelous products, and the joy they bring to hundreds of millions of people, quietly extol his virtue.

Netflix Just for Kids

2011-08-16T13:41:00.000-04:00

Recent news by Netflix that it will launch a "just for kids" tab on its online offerings is cool, but wrought with landmines. The company must be careful to safeguard the data and privacy of its underage users. It should proceed step-by-step with self-regulatory privacy enforcement, and shore up its data security mechanisms. If Netflix can perfect this model, it could be come a strong competitor in the online children's content space. Stay tuned.

Save the Children

2011-08-15T11:30:00.000-04:00

Children under the age of 13 are inherently vulnerable to marketing messages. That is the rationale behind the Children's Online Privacy Protection Act (COPPA), which requires, among other things, that online marketers get parental consent before engaging these young consumers.

When the FTC found out that a company was using a mobile app to collect the data of thousands of kids, and did not notify their parents, it filed a case and compelled the company to stop the practice and pay a fine. That was the right thing to do. Although the choice of communications platforms have expanded, the basic principles remain the same. Children are a special and protected category, and responsible marketers should go the extra mile to take care of them, even as they employ new and cool ways to connect.

Day-to-Day Leadership

2011-08-10T15:04:00.000-04:00

"Any idiot can face a crisis. It's day-to-day living that wears you out," Anton Chekhov, the noted Russian physician and playwright once said.

So it seems with the state of business in America these days. We move from one crisis to another, each coming much too quickly in succession. For the most part, though, leaders rise to the occasion, as evidenced by the debt ceiling debate (debacle), the Standard & Poor's downgrading, and the chronic and continued joblessness.

What our business and political leaders have significantly less success addressing, however, is the day-to-day drudgery that saddles most Americans. Making the ends meet is a constant and consistent challenge for the average family. Whether it is paying the mortgage, coming up with college tuition, or handling higher gas prices, the day-to-day living is wearing the public out.

Now that business leaders, especially the big guys, know these things, we all must wonder what they can do on a day-to-day basis to help their employees, staffs, small business partners, vendors and suppliers weather the daily storm.

Corporate Integrity and Transparency

2011-07-22T11:24:00.000-04:00

"It's Not the Crime; It's the Cover-Up."

So goes the adage decrying the tendency by wrongdoers to deny, deceive and deflect the truth when things go awry.

The re-emergence of integrity as a watchword in the realm of corporate affairs is long overdue. As consumers, government and media uncover the deeds of a few corporate miscreants, the case gets stronger for greater transparency in the business and financial practices of (especially big) corporations.

While all of us should bristle at the notion of intrusive government, there is something to be said for better oversight and control when it comes to business. In lieu of that, companies should just take it upon themselves to be more transparent.

Innovation as Leadership

2011-07-19T09:08:00.001-04:00

"Innovation distinguishes between a leader and a follower. To turn really interesting ideas and fledgling technologies into a company that can continue to innovate for years, it requires a lot of discipline."

This advice from Steve Jobs provides a key insight into the philosophy that drives a company like Apple.

Apple's innovation in consumer technology has outpaced almost every other competitor in the marketplace. Remarkably, Apple's leadership has been accomplished by sheer performance. It is not known for its philanthropy, or for its political influence, or for its corporate sponsorships. Apple's solid reputation as a good corporate citizen emanates from its ability to deliver what consumers want, even before they know it.

This form of social leadership through innovation seems to be a model that new technology companies are most comfortable in following. The challenge for other companies, however, will be to remain as innovative as Apple in the long run. Otherwise, they should be prepared to bolster their leadership through more recognized avenues of corporate citizenship.

Leadership by Legerdemain

2011-07-14T13:06:00.000-04:00

What happens when a leading company is found to be a cheater? Does it shake the confidence of investors, employees, partners and customers? Will it suffer legal consequences? Will it lose market share or go under altogether?

I do not know the answer to these questions, but I am sure that Rupert Murdoch and his team of advisors are pondering these and more. The success of Mr. Murdoch's media empire is virtually unrivaled, bur rumors of foul play--or at least hard checking-- have been whispered for years by those in the know.

If the allegations in England hold true, and the transgressions there were done in the U.S.too, then the much-heralded Murdoch leadership legacy may be overshadowed by a few sleight of hand shortcuts that were completely unnecessary to beat the competition.

Value and Values

2011-07-12T09:58:00.000-04:00

The late senator from California, Alan Cranston, once remarked: "Unless you have a sense of values that's shared by people and turns them loose to do certain things on their own within those sets of values, the organization, whether a nation or citizen or group, just doesn't work very well." Average customers today are looking for value, but they also are looking for values from companies they patronize. One of the challenges for business leaders is to marry these two offerings. Those who succeed develop loyal and enduring customers who come to see the organization as something more than a purveyor of goods or services.

Business and the Needs of Society

2011-07-10T14:50:00.000-04:00

"Many business leaders are asking fundamental questions about what business they're in, why they're doing it and how it can be used as a means of healing human and natural communities." This statement by Amory Lovins, an influential advocate for sustainable energy and a cleaner environment, and CEO of the Rocky Mountain Institute, summarizes a new and pressing mandate for today's entrepreneurs and business initiators. I suggest that whatever business or industry a company is involved in, it can be instrumental in meeting the needs of society without veering from its corporate mission.

(c) Adonis Hoffman

China, Taiwan and the Prospects for American Business

2011-02-23T12:12:00.000-05:00

World in View, Journal of International Affairs, recently published my article, Will America's Hot New Courtship of China Leave Taiwan in the Cold? In the article, I ask a few questions about the complicated relationship between the U.S., mainland China, and Taiwan and the implications for American business and public policy.

Not a day goes by without a glowing report on the new bond between China and the United States. From panda bears to people-to-people exchanges and more, America’s hot new courtship of China is in full bloom, and President Obama is leading the charm offensive. As the BBC suggests, "almost everyone is animated by the idea that we are witnessing an historic shift."

Before, during, and after the heralded visit of Chinese President Hu Jintao, the U.S. was abuzz about China. In fairness, much of this is owed to China's own progress -- or liberalization -- in economic, cultural and trade affairs. To be sure, today's China is not the same country Presidents Nixon, Carter, Reagan, Bush, Clinton or Bush II encountered. China today is a much more benign behemoth. It is far less menacing and mysterious. It is a land of boundless aspiration and energy, as evidenced by the 2008 Beijing Olympics, where showmanship was eclipsed by scale. But those descriptions only go so far. While there are many words apt for the new China, "democratic" is not one of them.

Amidst the fanfare, Taiwan--one of the most critical issues in U.S. - China relations--has received remarkably little attention. Yet, since 1949, America has not had a more reliable or stable economic partner in Asia. Taiwan is an unwavering bastion of Western-style democracy. As such, it presents an enigmatic policy decision for Obama, as it has for his predecessors. The President must preserve the "one China policy" which means formal recognition of the mainland, while relegating U.S. contacts with Taiwan to the "unofficial" category, as required by the spirit of the Taiwan Relations Act enacted in 1979.

But balancing two Chinas is no small feat of policy or diplomacy, and it will become more, not less, challenging in the future.

On the one hand is the Peoples Republic. With a youthful population exceeding 1.3 billion people, and the world's largest army, China cannot be ignored. Because its citizens yearn for Western accoutrements long denied, it is the mother lode of markets for American products. Money is being made, consumerism is on the rise, and the future looks bright for any company that can crack the Confucian code to doing business there profitably.

According to a recent Pew study, nearly half of all Americans say Asia is more important to U.S. interests than any other region, including Europe. 47% say China is the world's leading economic power, and 58 % believe it is very important for the U.S. to build a stronger relationship with China.

On the other hand is Taiwan, a small nation of 23 million people, also known as the Republic of China. A model of multiparty democracy and free market capitalism, Taiwan's rapid economic growth in the decades after World War II transformed it into a developed industrialized country and one of the Four Asian Tigers. Its economic rise has been hailed as the “Taiwan Miracle,” and the IMF and World Bank categorize it as an advanced, high-end economy. Through its sophisticated technology sector, led by consumer electronics, Taiwan plays a major role in today's global economy. It ranks 25th on the Heritage Foundation's 2011 Index of Economic Freedom, above Norway, Spain, Belgium and South Korea, as compared with China's much lower ranking of 135.

In Taiwan, a free press and free elections thrive. In China, by contrast, government censorship reigns supreme--both online and offline, and there are no elections. According to the International Federation of Journalists, media coverage of such issues as domestic politics, public health, corruption, internet freedom, and developments in Korea, Vietnam and the Philippines require a government review or are restricted altogether. China has been quick to crack down on any semblance of protest taking cues from the popular uprisings in the Middle East today.

China considers Taiwan to be a breakaway province subject to its sovereign jurisdiction. Taiwan sees itself as a free and independent nation. This divergence has led to Chinese saber rattling across the Straits of Taiwan, and has prompted the Taiwanese to spend billions on advanced U.S. weaponry for self-defense.

In the comprehensive, forty-one paragraph, U.S. - China Joint Statement issued during the Hu visit, there was short shrift given to Taiwan. Both sides "underscored the importance of the Taiwan issue." China emphasized "the Taiwan issue concerns China’s sovereignty and territorial integrity," and expressed hope that the U.S. will honor its relevant commitments. The U.S. reiterated its support for a "one China policy" and encouraged the two Chinas to continue their dialogue. Beyond that, not much more was said about the country. Thus, the road ahead for U.S. - China relations is clear. America wants to balance the huge trade deficit it has with the Peoples Republic of China. The U.S. exports $82 billion to China, but China exports $344 billion to the U.S, and holds much of America’s official debt.

The two countries admit there are differences over human rights, but agree to continue a dialogue on the issue. They agreed to establish military-to-military talks, and to cooperate on space exploration, law enforcement, the rule of law, science and technology, climate control, and the exchange of 100,000 American and Chinese students. With plans to institutionalize exchanges between the National People’s Congress of China and the U.S. Congress; to cooperate on global issues involving nuclear weapons, North Korea, the future of Sudan and intellectual property rights, and to expedite the pace and frequency of more dialogue, Obama and Hu Jintao have authored a new chapter in Sino - American relations.

But beware of change.

Several experts predict it will be impossible to relegate Taiwan to the margins of the U.S. - China narrative much longer. In his earnest effort to be on the right side of history, President Obama should find a way to match America's deepening dependence on China with more tacit assurances for Taiwan. Anything less would be anathema to America's long-term interests in the Asia Pacific region and would dishonor the U.S. commitment to promote democracy abroad.

Business Need Not Fear Obama--Anymore

2011-02-07T10:41:00.015-05:00

With uncharacteristic prescience, I wrote in Broadcasting & Cable Magazine in December 2008 that the big business community had nothing to fear from an Obama presidency. While it has taken almost two years, and a few public chastenings, it seems that Obama is doing what it takes to reassure the corporate sector that he is a friend, not a foe.

As he crosses the Lafayette Park Rubicon to speak with the U.S. Chamber of Commerce, there may be no turning back. After breaking bread with Tom Donahue and the corporate titans he represents, Obama has cast his future lot with business over labor. While this may be a masterfully necessary move for the adroitly pragmatic Obama, it may not be sufficient for the Chamber to abnegate the hundreds of millions it will pump into Congressional races next year.

These political considerations aside, here is why business need not fear Obama, anymore.

Acumen over Antagonism, Results over Retribution

For all of the campaign bluster blaming big business for American economic woes, Obama is not and never has been an anti-corporate crusader. He is much more interested in results than retribution. Obama’s key economic appointments suggest his administration will pursue acumen over antagonism when it comes to the business sector. The designation of Daley as chief of staff says it all.

Deal-Making over Dogma

If Obama has proven anything, it is that he is an uber pragmatist who prefers practical solutions over dogmatic ties to political philosophy. While business may have taken solace in the mainstream Republican ideology, it will be surprised at how non-ideological Obama may prove to be. After all, he has shown a willingness to borrow from the best of conservative, liberal, progressive and libertarian thinking in the development of his own unique world view. His commitment to success will compel him to think and act far outside the constraints of predictable political dogma. His call to review anti-business regulations is the height of mid-stream correction.

Balancing Commerce and the Constitution

More than any other president before, save Thomas Jefferson and James Madison, Barack Obama is acutely aware of both the expanse and the limitations of government power. His facility with constitutional law may be unparalleled in American presidential history. As a constitutional scholar, Obama knows, or should know, the balance that must be struck between permissible government regulation of business, trade and commerce on the one hand, and the light touch of regulation on the other that fuels innovation and investment in the marketplace. Above all, he should appreciate the wide swath that the commerce clause of the constitution cuts through our lives and should direct his cabinet and his erstwhile Congressional cohorts to err on the side of less—not more—government regulation.

In the area of commercial marketing and advertising, for example, a string of successive Supreme Court decisions have struck down burdensome restrictions on commercial speech as impermissible under First Amendment jurisprudence. The president-elect should recognize that heavier regulation in that sector, alone, will mean less revenue for many, many industries.

It will be important for the President to send clear, unambiguous signals to his fellow Democrats in Congress that he expects them to treat business with prudence and pragmatism, and cooperate with the House Republican leadership. He must develop a better working relationship with Energy and Commerce Chairman Fred Upton (R-MI) and stalwart committee members Joe Barton (R-TX) and Cliff Stearns (R-FL), if any reasonable headway is to be made.

Of course, as with any other administration, the business community will have its differences and spates with Obama. The healthcare law overhaul is a mixed blessing for business, but the principle remains anathema to the GOP. Reducing regulation remains the Republican mantra, especially following remembrances of Ronald Reagan's 100th birthday

Whatever the issues that will bring business and Obama face-to-face, I would bet that the president's goal every time will be to carve out a win-win scenario so the public good does not obstruct the gains of the private sector. Last but not least, all indications are that Barack will challenge big business—as he has challenged us all—to become its best; to live up to higher standards and ideals, and to contribute to society and humanity in a way that it has never done before. Such an outcome surely would profit our nation and the dividend would go directly to the bottom line.

Quality and Transparency Help Corporate Reputation

2011-02-01T00:36:00.010-05:00

Not surprisingly, the more open and trustworthy a company is, the better its reputation. According to an annual survey, only 45% of Americans trust business. This is a decline from previous years where more than half of Americans had greater faith in the corporate sector. The proliferation of negative news reports and the availability of more information on the activities of big corporations, apparently are contributing factors.

With the advent of "information ubiquity", the primary way a company can maintain or improve its sterling corporate reputation is to provide quality, become more transparent, ensure employee welfare, and be more trustworthy. Of course, this mandates more, not less, communication across various platforms for CEOs and other business leaders.

In the U.S. 85% of "informed publics" aged 25-64 believe corporations should create shareholder value in a way that aligns with society’s interests, even if that means sacrificing shareholder value. Another 61% believe government should regulate corporations’ activities to ensure business behaves responsibly. The U.S. is surpassed only by Germany, the U.K., Ireland and (surprisingly) China in these opinions.

For much greater detail, check out the Edelman Trust Barometer, a useful study of how well-informed people across the world feel about business. Thanks Edelman.

Marriott Rejects Porn

2011-01-26T01:39:00.007-05:00

Congratulations to the Marriott Corporation for its decision to not broadcast adult-oriented movies in its hotel properties in the future. As reported in the media, this move will affect over 600,000 rooms throughout the system when Marriott changes from the current in-room video offerings to an Internet based, video-on-demand, system.

As one of the world's most identifiably wholesome hotel brands, we would expect nothing less from Marriott. I know many families, including ours, that build their vacations around Marriott hotels because it engenders an environment in which kids of all ages feel welcome and included.

I don't know how much money will be lost from this decision, but the benefits in corporate reputation and business leadership will far outweigh the costs.

50 Excellent Lectures for Business

2011-01-18T13:32:00.003-05:00

Having just been informed of this site, I wanted to pass it along to you right away. Excellent Business Lectures

If you are interested in entrepreneurship, business leadership and technology, you will enjoy the presentations by corporate execs, academics and visionaries.

Lessons from Bank of America

2010-12-08T15:13:00.011-05:00

Widely honored for its corporate philanthropy and community involvement, Bank of America suffered a reputational setback when it admitted to the Justice Department that it had engaged in a conspiracy to rig bids in the municipal bond derivatives market. Story here.

To its credit, the Bank stepped forth willingly to report its misconduct and was granted leniency as part of the Justice Department's Antitrust Corporate Leniency Program. Nevertheless, Bank of America must pay $137 million in restitution.

Going forward, it helps the Bank that several employees were convicted of wrongdoing, and the abuse was not widespread. Nevertheless, this case points up the importance of strong financial controls and accountability--even for the most responsible corporate citizens. It also points out the importance of immediate remedial action by a corporation, once it discovers bad behavior.

Hooray for Huggies

2010-12-03T09:50:00.006-05:00

It has been a long time since my two kids were in diapers, so I do not pay attention to anything remotely related to babies' bottoms. Thus, although it is not a new story, I was surprised and impressed to learn that Huggies has a national campaign which donates diapers to needy families. The background is here.

Huggies, of course, is a well-known brand of disposable diapers made by Kimberley-Clark. The arrangement seems to be simple and straightforward: for every diaper purchased by consumers, Huggies will donate a diaper to a designated diaper bank in the U.S. Needy families can go to a diaper bank and receive ample supplies of clean, new, disposable diapers.

Why is this so good?

Apparently one in three moms in America cannot afford to buy enough diapers for their children. Most daycare centers require a full day's supply of clean diapers. If a family cannot provide the required complement of diapers, the child cannot attend daycare. Beyond that, a recent study found that many needy moms throughout America are washing and re-using disposable diapers because they cannot afford fresh ones. Yes, in America, this simple convenience escapes many in need.

Huggies campaign to meet this need by allowing customers to contribute and participate suggests a level of corporate responsibility not manifest in many organizations. The company saw a need, and designed an innovative, simple solution that goes a long way to solving the problem.

To be sure, the cynics among us will point out that Huggies is in the business of selling diapers, and the more goodwill they develop through this campaign will help them sell more diapers. Well, yeah. In a capitalist, free-market economy, the first order of business is to profit. If a company can master that feat, it can turn its attention to helping society by combining its core business with a good cause.

It seems the folks at Kimberley Clark and Huggies have mastered this balance. They have done well and are doing good. Hooray for Huggies.

Fighting Hunger in America the Wal-Mart Way

2010-11-16T16:14:00.005-05:00

Almost everybody has a big, bad Wal-Mart story that disses the Bentonville, Arkansas chain store for one reason or another. From the everyday low wages it pays to its associates to the arm-twisting pressure it puts on suppliers to wring out the absolute lowest price, Wal-Mart is notorious for its bare-knuckle business practices. As defendant in one of the biggest class-action discrimination cases brought on behalf of women in the workforce, Wal-Mart also is no stranger to damning media reports that question whether it hurts the little people its business is devoted to serving more than it helps.

To its credit, Wal-Mart has addressed many of these claims with remedial programs that focus on the underlying problem. While its journey to corporate citizenship has been dismissed by activists as self-serving, Wal-Mart has found that doing good leads to a better reputation. But it has not been easy or quick.

Thus, it is not insignificant that Wal-Mart has announced perhaps the biggest private effort in history to fight one of America's most embarrassing ills: hunger. The $2 billion commitment to fight hunger demonstrates that Wal-Mart has its finger on the pulse of America's problems. As much as jobs, the economy or taxes may be on the agendas of politicians, it is a sad commentary that hunger is a more pressing problem for millions of Americans.

Kudos to Wal-Mart for recognizing and understanding this basic human need, and even more props for taking the steps with partnering organizations to do something about it.

Better Business Bureau Needs Oversight Following Charges of Pay-to-Rate

2010-11-12T19:46:00.006-05:00

The Better Business Bureau could benefit from tighter government oversight following recent allegations that it has maintained a pay-to-rate scheme for years.

For decades, the Better Business Bureau has been the gold standard for the validation of solid business practices. We all rely on the BBB's ratings system to determine whether a company is worthy of our dollars or not. To learn now that the BBB might have been scamming us all this time is heartbreaking. If these charges are true, it is betrayal at the most basic level. If these charges are true, and I hope they are not, the Federal Trade Commission needs to take a long hard look at how to cure the damage that has been done to consumers.

The other problem here is that the Better Business Bureau manages several industry self-regulatory schemes. These include the very successful program guarding children's advertising to the newly-developed program to monitor the marketing of so-called junk foods by 16 of the top food and beverage manufacturers, and the monitoring of infomercials. While those programs are self-contained, the BBB's actions cast a very dark cloud over the practice of self-regulation altogether.

In the interest of consumer confidence, the FTC needs to take a much closer look at the BBB--a consumer icon that may have fallen on the wrong side of the ethical line.

Are We Putting Undue Burdens on Business to be Socially Responsible?

2010-11-10T12:24:00.005-05:00

Does Society Expect Too Much from Corporations?

Corporations need to re-think how they are doing business today if they want to stay in the good graces of customers, investors and the government.

It is not enough for companies to be competitive and do well. We also want corporations to help protect the environment, build roads, fight corruption, advance human rights, support the arts, contribute to local communities, compete globally, and create immense shareholder value, all at the same time.

While these are real concerns, the expectations may be a bit too high. After all, the main duty of a corporation is to provide a quality good or service and return a reasonable profit to its shareholders. If they can find a way to do that, and be socially responsible too, they will be rewarded in the marketplace, but it is not easy.

Among the companies who have balanced these challenges successfully, I cite the following:

Microsoft; Wal-Mart; Exxon-Mobil; Chevron; General Motors; Conoco Phillips; Ford Motor; Citigroup; Bank of America; ATT; JP Morgan Chase; HP; IBM; Valero Energy; Verizon; McKesson; Procter & Gamble; United Health Group; Kroger; Boeing; Target; State Farm; Well Point; Marathon Oil; United Technologies; 3M; Aetna; the Walt Disney Company; Home Depot; Johnson & Johnson, and Marriott.

My new book, Doing Good--the New Rules of Corporate Responsibility, Conscience & Character lays out 55 simple, easy-to-follow rules for CEOs and business leaders to succeed amids the new challenges of today's global marketplace in the areas of ethics, governance, citizenship, philanthropy, diversity, privacy and public policy.

Balancing these competing expectations remains a daunting challenge for many corporations, but with focus and commitment, they can succeed.

2010

ISO Publishes New International Standards on Social Responsibility

2010-11-09T16:34:00.007-05:00

On November 1, 2010, the International Standards Organization (ISO) launched ISO 26000, a long-awaited guidance for business and public sector organizations on social responsibility (SR).

ISO Secretary-General Rob Steele commented: “The publication of ISO 26000 is eagerly awaited by organizations worldwide, whether they are business enterprises, or public sector organizations. Operating in a socially responsible manner is no longer an option. It is becoming a requirement of society worldwide. What makes ISO 26000 exceptional among the many already existing social responsibility initiatives is that it distils a truly international consensus on what social responsibility means and what core subjects need to be addressed to implement it. In addition, it is based on broad stakeholder input, including from developing countries, business, government, consumers, labour, nongovernmental organizations and others.”

According to the standard, the perception and reality of an organization's performance on social responsibility can influence, among other things:

Competitive advantage
Reputation
Ability to attract and retain workers, members, customers, clients or users
Maintenance of employees' morale, commitment and productivity
View of investors, owners, donors, sponsors and the financial community
Relationship with companies, governments, the media, suppliers, peers, customers and the community in which it operates.

The development of ISO 26000 began in 2005; it is the work of the ISO Working Group on Social Responsibility (ISO/WG SR) whose membership was the largest and the most broadly based in terms of stakeholder representation of any single group formed to develop an ISO standard.

Six main stakeholder groups were engaged: industry; government; labour; consumers: nongovernmental organiza tions; and service, support, research and others, as well as a geographical and gender-based bal ance of participants.

It was made up of experts from ISO members (national standards bodies – NSBs) and from liaison organizations (associations representing business, consumers or labour, or inter-governmental or nongovernmental organizations).

At the last meeting of the ISO/WG SR, in July 2010, there were 450 participating experts and 210 observers from 99 ISO member countries and 42 liaison organizations involved in the work, including the United States.

ISO 26000 provides guidance for all types of organization, regardless of their size or location, on:

1. Concepts, terms and definitions related to social responsibility

2. Background, trends and characteristics of social responsibility

3. Principles and practices relating to social responsibility

4. Core subjects and issues of social responsibility

5. Integrating, implementing and promoting socially responsible behaviour throughout the organization and, through its policies and practices, within its sphere of influence

6. Identifying and engaging with stakeholders

7. Communicating commitments, performance and other information related to social responsibility.

ISO 26000 is a voluntary guidance standard that is not to be used for certification, unlike other ISO standards.

This is a major step toward global standards for acceptable corporate behavior and should be monitored closely by every major corporation throughout the world.

Not Above the Fray--Corporations Contribute Dollars and Deeds to Haiti

2010-01-25T07:22:00.029-05:00

As the sad news of devastation and despair in Haiti recedes from the national headlines, there is an enduring good news story not receiving its due: corporations have taken the mandate of global corporate citizenship to higher and unprecedented levels.

The early aftermath of Haiti's earthquake found national governments and international NGOs hastening to the aid of the suffering masses in the western hemisphere's poorest nation. We all expect developed countries and organizations like the Red Cross to spring into action when there are major crises. Corporations, we assume, would be supportive, if at all, with dollars but not with deeds.

But after a series of hurricanes, earthquakes, tsunamis, famines and other natural disasters over the last two decades, the corporate sector has changed the script and heightened our expectations. Our society can now reasonably expect corporations--large and small--to play an active and indispensable role in international relief efforts. This assumed duty stands in stark contrast to the all-too-familiar dirge of corporate scandal, misdeed and malfeasance, and is the latest step along the continuum of responsible corporate citizenship.

Remarkably, a healthy level of competition has ensued. One company after another has been spurred on by the charitable efforts of its corporate rivals. While the commercial contests among companies to dominate market share in goods and services will and should continue, it is good to see that the competition to give more time, talent and treasure to help relieve human suffering has become an entrenched pillar in the corporate landscape. In fact, those companies who, for whatever reason, fail to show up, become spotlighted by their breach.

As we enter the second decade of the second millennium, the societal mandate for corporations to do good has fully matured. While we may cringe when a company toots its own horn too loudly, or carp that corporate profit should inure more fairly to society's needy, let us at least celebrate the commitment of many, many companies to be not above the fray.

(c) 2010. Adonis E. Hoffman.

Mr. Hoffman is a lawyer in Washington, DC and is the founder and chairman of the American Business Leadership Institute. He teaches Corporate Responsibility at Georgetown University.

Moving with Speed to Do the Right Thing

2010-01-14T08:16:00.010-05:00

The sudden resignation of Arbitron's president and CEO Michael Skarzynski came as a shock to both the media and investor communities. Barely a year into the top post, Skarzynski seemed to be the right guy to address the mounting challenges facing Arbitron--heat at the FCC; investigations by state attorneys general; hostile Congressional hearings, and unrelenting criticism from minority broadcasters over the PPM ratings measurement system.

Against this backdrop, the swift and savvy move by the board and top executives at Arbitron to: (1) admit that Skarzynski had not told the truth to a congressional panel, and (2) rapidly replace him was commendable.

Since being dragged unwittingly into the spotlight by activists, policymakers and broadcasters, Arbitron has proven to be a company that is unaccustomed to excessive criticism and political scrutiny. While it has superior technological capability that should be warmly embraced by its many customers throughout the broadcast and advertising industry, Arbitron has not found a way to earn credit for what it does well. In fact, the company has often resembled an awkward dance partner in a media business that values flash and fleetness of foot.

But Arbitron's deft and timely handling of the Skarzynski matter was the right move at the right time. It signals that the team in place at the ratings company in suburban Maryland understands the mandate for accountability and is ready to embrace the new rules of corporate citizenship and responsibility.

(c) 2010 Adonis Hoffman

Fiduciaries Need to Proactively Raise Corporate Responsibility Matters

2009-07-22T13:56:00.008-04:00

As the global financial crisis moves into maturity, it is clear that novel solutions must be found to a novel set of problems. The United Nations Environment Programme Finance Initiative(UNEP) proffers such a new approach.

According to its most recent report, investment advisors have a fiduciary responsibility to proactively raise environmental, social and governance (ESG) issues, in addition to other financial matters.

KEY HIGHTLIGHTS OF THE REPORT:

* The global economy has now reached the point where ESG issues are a critical consideration for all institutional investors and their agents.

* Investment consultants and asset managers have a duty to proactively raise ESG issues within their advice and services to institutional investors.

* ESG issues must be embedded in the legal contracts between institutional investors and their asset managers to hold asset managers to account, and that ESG issues should be included in periodic reporting by asset managers. Equally, the performance of asset managers should be assessed on a longer-term basis and linked to long-term incentives.

* Institutional investors will increasingly come to understand the financial materiality of ESG issues and the systemic risk they pose, and the profound long-term costs of unsustainable development and the consequent impacts on the long-term value of their investment portfolios.

* Institutional investors will increasingly apply pressure to their asset managers to develop robust investment strategies that integrate ESG issues into financial analysis, and to engage with companies in order to encourage more responsible and sustainable business practices.

* Policymakers should ensure prudential regulatory frameworks that enable greater transparency and disclosure from institutional investors and their agents on the integration of ESG issues into their investment process--as well as from companies on their performance on ESG issues.

* Civil society institutions should collectively bolster their understanding of capital markets such that they can play a full role in ensuring that capital markets are sustainable and delivering responsible ownership practices.

* Market incentives that reward long-term investment must be made to help create responsible and sustainable capital markets that would help identify future challenges in the financial system, reduce the chances of further crises and help avert a "Natural Resources Crisis"--and accelerate the transformational process to a green, inclusive and sustainable global economy.

It will not be long before corporate directors, as fiduciaries, should have to play by the same rules. Stay tuned. . . .

(c) 2009 Adonis E. Hoffman

Supporting the United Nations Global Compact

2009-07-18T12:34:00.020-04:00

As the founder and chairman of the American Business Leadership Institute, I am proud to announce our support of the United Nations Global Compact, and our subsequent acceptance as a signatory by UN Secretary-General, Ban-Ki Moon.

The Ten Principles

The UN Global Compact's ten principles in the areas of human rights, labour, the environment and anti-corruption enjoy universal consensus and are derived from:

The Universal Declaration of Human Rights
The ILO's Declaration on Fundamental Principles and Rights at Work
The Rio Declaration on Environment and Development
The United Nations Convention Against Corruption

The Global Compact asks companies to embrace, support and enact, within their sphere of influence, a set of core values in the areas of human rights, labour standards, the environment, and anti-corruption:

Human Rights

Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights;

Principle 2: make sure that they are not complicit in human rights abuses.

Labour Standards

Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;

Principle 4: the elimination of all forms of forced and compulsory labour;

Principle 5: the effective abolition of child labour;

Principle 6: the elimination of discrimination in respect of employment and occupation.

Environment

Principle 7: Businesses should support a precautionary approach to environmental challenges;

Principle 8: undertake initiatives to promote greater environmental responsibility;

Principle 9: encourage the development and diffusion of environmentally friendly technologies.

Anti-Corruption

Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

Technology, Society & Corporate Responsibility

2009-07-15T19:44:00.016-04:00

In a thought-provoking article in Information Week entitled, "Can Tech Companies Do the Right Thing?", Michael Hickins points out that some technology companies who have been held up as model corporate citizens in one continent are being castigated as bad actors in another.

He is referring to the recent allegation by Iranian protesters that Nokia--by use of its advanced technology by the Iranian government to spy on and track demonstrators--is complicit in the denial of basic of human rights to Iranians.

The irony, Hickins points out, is that Nokia recently was lauded as a leading socially responsible company for all of its good work in the U.S.

What this all suggests to me is that norms of corporate behavior can be adjusted to fact-specific situations and cited as either positive or negative.

Moreover, technology, which is normally thought of as a neutral tool (or force) that can be utilized for good or evil, may not be so innocent. I hesitate, though, to jump to the conclusion reached by the Iranian democracy dissidents that mere usage of a technological tool by a repressive regime, renders the technology inherently bad.

In their earnest efforts to draw international condemnation on the Iranian government, the democracy demonstrators have directed their wrath in the wrong direction.

(c) 2009 Adonis E. Hoffman

Responsibility of the Faithful

2009-07-13T18:26:00.006-04:00

Faith-based socially-responsible investors generally, and those in the Catholic faith particularly, have not always been welcome voices among the chorus of corporate responsibility activists. But that is changing.

Occasionally shrill on the issues, these conscientious monitors remind us that there is more to the call for socially-responsible investment than the usual list of do-good stakeholder demands. Dare we say they are truly focused on how companies do business and how those business decisions will affect the whole of society.

Thus, Sister Patricia Daly of the Sisters of St. Dominic, who is director of the Tri-State Coalition for Responsible Investment should be commended for her principled stance on environmental and governance issues.

It is hard to argue with an order that takes a vow of poverty, chastity and obedience--and still finds room to make money for their investors.

(c) 2009 Adonis E. Hoffman

Has Corporate Responsibility Reached a Plateau?

2009-07-01T17:58:00.009-04:00

If we believe the recent results of an IBM annual survey, it would appear that corporate responsibility in practice may have reached a plateau.

In a recent article in Forbes, two IBM execs point out that across the globe, managers are committed to sustainable practices, but don't always do the necessary follow-through. I've re-published the salient comments and advise you to read the findings for yourself.

"IBM recently completed its second annual survey of senior executives around the world asking them how they are handling green and sustainability issues in their corporate strategies. The results are encouraging in some respects, but they show how very far businesses still need to go to truly be on the road to sustainability.

"The overwhelming majority of the 224 respondents said they are committed to incorporating principles of corporate social responsibility into their business strategies--despite the global recession--as a way to improve their business performance, their contribution to society and their reputation. Some 60% said this was more important to them than a year ago; only 6% said it was less."

"And businesses, for the most part, are no longer just paying lip service to sustainability. They're trying to optimize their operations to reduce environmental impact and improve social effects while also improving business performance.

"But our survey shows a significant gap between the business and sustainability goals companies are setting for themselves and what they are actually doing to attain them. And information is at the heart of the problem.

"Specifically, our survey findings show that:

--Companies aren't collecting and analyzing the information they really need or aggregating it often enough. Because of that, they can't implement real changes to fundamentally increase efficiency, lower costs, reduce environmental impact and improve their reputations with key stakeholders.

--Few are collecting enough data from their global supply chain partners, so they're missing major opportunities to reduce the inconsistency, inefficiency, waste and risk that can ripple through a global supply network.

--Most still don't understand the concerns of their key stakeholders, particularly customers, and they're not actively engaging them to find out. That means they're missing out on knowledge that could improve their businesses and lead to new opportunities."

I suppose that means there's still a long way to go.

(c) 2009

Wal-Mart's Everyday Responsibility

2009-07-01T17:12:00.006-04:00

As a company known for "everyday low prices", Wal-Mart has not exactly been known as a champion of corporate responsibility, primarily due to its employment and benefits policies that seem to shortchange employees in terms of healthcare coverage.

Whether that reputation is earned or not is debatable; what is indisputable today, though, is that Wal-Mart's tune has changed.

Along with the Service Employees International Union (SEIU) and the Center for American Progress, Wal-Mart--the nation's largest employer--has endorsed the so-called "employer mandate" which requires businesses to provide health insurance coverage in a letter to President Obama.

As Obama called for a new era of responsibility in his inaugural address, it looks as if the guys in Bentonville were listening. Bravo!

(c) Adonis Hoffman 2009

Contribution to Humanity

2009-06-11T15:53:00.002-04:00

Leadership in business and in life is all about contribution to our society.

Here is something to think about.

The Power of Social Responsibility

2009-05-25T11:36:00.004-04:00

I could not agree more with Lisa Hickey, the former president of the National Association of Women Business Owners, who wrote an op-ed for the Lakeland, FL. Ledger.

She points out that in our pursuit of profitable business, we should not overlook the power of social responsibility.

In fact, the point that corporate responsibility can differentiate a business and lead to customer preference is more of a hard business rationale than any "do-good" notion.

And finally, there is the timeless observation by Bill Gates, that the pervasive power of business is to execute change through innovation and competence as creative capitalism.

(c) 2009. Adonis Hoffman

Whither Good Works

2009-02-26T12:05:00.000-05:00

The global economic recession has precipitated enormous changes in the way business conducts itself. One of the more unfortunate consequences has been a retrenchment by corporations on their good works, philanthropy and volunteerism.

To be sure, fiscal prudence dictates that companies must put their own financial homes in order before extending helping hands to others. Few major corporations are so flush with hard cash that they can continue to operate at the same pre-recessionary levels.

And yet, amidst this crisis, there are those companies that continue to contribute to society and mankind in ways that are nothing short of admirable. Pfizer's Patient Assistance programs come to mind as reflecting the kind of help big corporations need to provide to those in need. As does Johnson & Johnson's Access to Medicines programs that gave away 2.3 million units of medicine to over 300,000 people across the globe. In the mega-buck world of pharmaceuticals and medicine, these are two companies that appear to be leading the way on what it means to be good corporate citizens.

There are other examples out there across the industrial landscape. My recommendation is that we continue to look for the good works that companies are doing, if for no other reason than it makes the world better and makes us all stand a bit stronger. For the cynics out there who say this is meaningless corporate blather, I suggest you visit the dusty streets of Yaounde, Cameroon or the crowded slums outside Lusaka, Zambia for a firsthand view of the impact of free medicine on the life of those who are in need.

Establish a Development Fund

2008-02-18T11:00:00.000-05:00

"I believe that Silicon Valley is truly a place of excellence and the impact of this tiny community on the world is completely disproportionate to its size. We are the undisputed leaders of technological change. But with our abundance of talent and resources, we also have the opportunity to be the pioneers of social change and, ultimately, this may be our greatest contribution."

Jeff Skoll, businessman, founder, The Skoll Foundation

A few years ago, a pioneering company decided to start a capital fund that would help new companies, small firms and disadvantaged companies get into business and grow.

The thought was that these new companies eventually would become dedicated contractors and suppliers to the big company—a sure way to help them grow large enough to compete with others. It is a model that has worked well in several industries like auto dealerships and fast-food franchising.

Although this is not really philanthropy, more companies should consider using this approach as a way to make a meaningful contribution to society. A development fund can be established to support or advance any number of charitable and philanthropic endeavors, in addition to those with a commercial basis.

The societal impact of financing a business and subsequently providing a ready source of contract opportunities cannot be understated; it promotes economic development, growth and employment for new entrants and at the same time increases the tax revenue base of local cities and counties.

These are all good things.

(c) Adonis E. Hoffman, 2008.

Lead the Way in Philanthropy

2008-02-15T12:00:00.000-05:00

"There is a natural law, a Divine law that obliges you and me to relieve the suffering, the distressed and the destitute. . . The practice of charity will bind us... will bind all men in one great brotherhood."

Conrad Hilton, founder, Hilton Hotels

Corporate philanthropy is a good thing and there can never be too much of a good thing. Today, we find a handful of companies at the top of the chart in corporate philanthropy, while many more companies barely register.

The wonderful thing about philanthropy is that it has a multiplier effect. When your company makes a contribution to a worthy organization, event or program, it strengthens the capacity of the recipient to deliver the benefits it promises.

But philanthropy is not without some controversy. There are some who believe that the role of business is to provide better goods and services at better prices so that consumers can have better lives. Philanthropy, they assert, is better left to foundations and individuals rather than to corporations.

I disagree. There are many ways to give to charity—money, in-kind donations, product giveaways, volunteerism, loaning executives and other opportunities to make a difference. As a business leader, you can develop a wide range of strategies that will position your company in the forefront of corporate philanthropy. Your reputation will be enhanced.

(c) Adonis E. Hoffman, 2008.

Establish a Community Advisory Board

2008-02-14T07:39:00.000-05:00

In every city, in every town, in every state, there are people who make things happen. As a business leader you should have a relationship with those people.

Churches, civic organizations, civil rights groups, parent councils, fraternities, professional organizations, small businesses, political groups and many others make up the civil society that keeps our system free and prosperous.

Leaders of these organizations and community groups can be immensely valuable to a business leader. They can provide you with more informed opinions and insights into your business than most well-orchestrated focus groups or research surveys. They can tell you how your company is perceived in the community. In short, they can provide the kind of rich feedback and information that a concerned business leader needs to receive on a regular basis

Seize the opportunity to tap into this resource by establishing a community advisory board. Find the leaders of the community and meet regularly to discuss matters of concern to them and to you. Don’t limit your discussions to company matters. There just might be something about your industry or region that you discover as a result of the interactions with the group.

(c) Adonis E. Hoffman, 2008.

Engage Critics

2008-02-13T12:00:00.000-05:00

"Statistics suggest that when customers complain, business owners and managers ought to get excited about it. The complaining customer represents a huge opportunity for more business."

Zig Ziglar, Business and Motivational Speaker

If you don’t talk to your enemies; you’ll never reach a compromise. With all of the scrutiny on the actions of corporations and their leadership today, you are bound to have conflicts and critics. It is inevitable but not insurmountable.

A new approach has developed over the last few years wherein corporations are actively engaging their critics. Environmental activists, consumer advocates, and human rights groups, among others are finding corporations much more willing and available to meet and openly discuss their gripes. In the process, both the business and activist leaders are discovering they may have more in common than in conflict.

There is no right or wrong way to go about establishing dialogue. In today’s world, industry knows where the criticism is coming from and who the loudest voices are. A company can set up an informal process or it can formalize the dialogue by establishing a committee or council or group of some kind.

Whatever approach you take, it is important to have an ongoing mechanism for engaging dissident voices from outside. Many a corporate leader has been undone by refusing to “give in” to those on the outside throwing rocks. Talking is a sign of strength, not weakness.

(c) Adonis E. Hoffman, 2008

Market Responsibly

2008-02-12T07:31:00.000-05:00

"Ethics or simple honesty is the building blocks upon which our whole society is based, and business is a part of our society, and it's integral to the practice of being able to conduct business, that you have a set of honest standards. And it's much easier to do business with someone when you look them in the eye and say, 'This is what we're going to do,' and you understand what you each mean, and you can go away and get it done."

Kerry Stokes, Chairman, Seven Networks, Australia

There is more focus today on the public behavior of companies than ever before. Consumers, public interest groups, shareholders, policymakers and the media all pay close attention to what companies do and don’t do.

In this new environment, there are high expectations for the way companies market and advertise their goods and services. If your marketing message is inappropriate for, or offensive to, children, people of color, gays, the aged, the environment, the physically handicapped or other classes of persons, you risk a sharp response from the media and the marketplace. A number of companies have found out the latent power of a constituency that was offended by images or content contained in their marketing or advertising.

Beyond these concerns, you also should be aware that the very practice of marketing itself, has come under scrutiny in industries such as snack foods, beer, alcoholic beverages, video games and other products.

You don’t have to stop marketing and advertising but you should know there are forces out there that exist for no other reason but to challenge what you do and how you communicate your business in the marketplace. Beware of marketing that is too edgy or too cute—it could be your undoing.

(c) Adonis E. Hoffman, 2008.

Become the Champion

2008-02-11T12:00:00.000-05:00

"We don't think of ourselves as do-gooders or altruists. It's just that somehow we're trying our best to be run with some sense of moral compass even in a business environment that is growing."

Craig Newmark, founder, Craig’s List

Do you remember the true-life story of a major American shoe manufacturer in the northeast who refused to shut down his plant even as the shoe making business was migrating offshore?

That CEO said he could not in good conscience close his factory and devastate the small New England community in which he had been operating for decades.

Needless to say he became a beloved figure in that community and his reputation for embodying corporate responsibility became a national story. His retort was simply: “I care about the community in which our company lives.”

I’m not sure how many other CEOs would have chosen to make the same decision, after all there were big dollars at stake. I suppose the point of all this is to reinforce the notion that companies are responsible to more than shareholders in today’s market.

Putting the needs and interests of communities in which you operate may not be at the top of the corporate agenda—but it should never be left off the agenda altogether. Championing the community is good.

(c) Adonis E. Hoffman, 2008

Support Local Communities

2008-02-08T12:00:00.000-05:00

"Many business leaders are asking fundamental questions about what business they’re in, why they are doing it and how it can be used as a means of healing human and natural communities."

Amory Lovins, Chairman, Rocky Mountain Institute

In many communities throughout the United States, and indeed throughout the world, corporations have the largest single footprint and impact. Aside from providing jobs for the citizens and tax revenue for the city and state, corporations also help local communities to develop and shape their identities.

With that in mind, it is a good thing for your company to actively support the local communities in which it operates. Support in this regard means that you give of your money, your people and your time. So many companies believe their commitment stops at the first level—giving money. But your good citizenship depends on how engaged your company is in local affairs.

Do you support the local soccer team(s)? Are your employees volunteering at the local schools, community centers and civic groups? Have you taken the time to get to know the local leaders, movers and shakers in the community?

Keep in mind you are much more than a source of jobs—you are an institutional part of the communities in which you operate, and the people of those communities will look to you for more than money.

(c) Adonis E. Hoffman, 2008.

Go Green

2008-02-07T12:00:00.000-05:00

"Business is recognizing the role it can play in combating climate change. Thank God, is all I can say, for there is a desperately urgent need for business to play that role. Your lobbying influence can be substantial, but together, united and in large enough numbers it could prove decisive in turning the tide."

Prince Charles

If you have not yet realized the impact of the green revolution on business, you should accelerate your learning curve. Eco-friendly environmentally-conscious policies and practices are the order of the day for corporations, and consumers, policymakers and the media all expect companies to play by the new rules.

After decades of carping from the outside, environmental activists have succeeding in placing the environment on the corporate agenda. Today, environmentally conscious policies are a major part of the sustainability standards that all companies are expected to adopt if they are going to be considered responsible citizens. In addition to lowering carbon emissions and greenhouse gases, green policies and practices are proving to impact the bottom line quite favorably through reduced costs and increased energy savings.

Of course your commitment to going green will require your organization to make both short-term and long-term commitments and to open itself to even more scrutiny. But consider the impact made when private equity financiers made an environmental group a key part of the deal for a natural gas plant. In the end, leadership in this area will pay great dividends in corporate reputation, good will and consumer satisfaction.

(c) Adonis E. Hoffman, 2008

Avoid Corruption

2008-02-06T12:00:00.000-05:00

Corporate crime was the biggest story of the 1990s not because it was new, but because it had grown to such huge dimensions. The lives of hundreds of thousands of hard-working people got destroyed by the ethical lapse and corruption of a relative few at the top.

Don’t let it happen to you.

While there are scores of regulatory and statutory safeguards that have been put into place, the onus is on you to avoid corruption. From small scale matters to backdating options, the temptations are great all throughout the supply chain.

Put the necessary systems in place that will help everyone in your organization to understand the spirit and the law of corruption. Install a chief compliance officer with broad authority.

Think of your corporate leadership role as a public trust—even if you’re in a smaller organization or private company.

Go the extra mile in compliance and due diligence analysis such that at the end of your tenure, there will be no doubt about your ethical, moral or legal character.

(c) Adonis E. Hoffman, 2008

Uphold Human Rights

2008-02-05T12:00:00.000-05:00

span style="font-weight:bold;">"We can ignore human rights violations in other countries, or we can take these things on as true leaders ought to and accept the inspiring challenge of America for the future. I am not here as a public official, but as a citizen of a troubled world who finds hope in a growing consensus that the generally accepted goals of society are peace, freedom, human rights, environmental quality, the alleviation of suffering, and the rule of law."

Jimmy Carter, 39th President of the United States

What CEO or company in its right mind could be against human rights, one might ask? Respecting fundamental rights of people throughout the world seems to be a no-brainer. And yet, transnational corporations today are under major scrutiny from corporate watchdogs for violations of human rights.

Activists have sought to bring legal action under the Alien Tort Claims Act, a law that allows citizens of any nationality to sue in US federal courts for violations of international rights or treaties against leading companies for environmental destruction, health violations, water privatization, union busting, aggressively marketing lethal products, and an expanded range of so-called economic and social rights.

In the global economy, companies face far greater challenges in being seen as good corporate citizens. By virtue of their size and dominant presence in many developing countries, a large corporation can be associated with just about any problem that exists in the society. A major oil company has recently come under attack for its investments in Myanmar, a notorious violator of human rights.

As your company develops and maintains its operations internationally, you will want to devote a special degree of care to how you engage these evolving definitions of human rights. The important point is to be aware and proactive.

(c) Adonis E. Hoffman, 2008

Respect Workers' Rights

2008-02-04T12:00:00.000-05:00

"The only society that works today is also one founded on mutual respect, on a recognition that we have a responsibility collectively and individually, to help each other on the basis of each other's equal worth. A selfish society is a contradiction in terms."

Tony Blair, former British Prime Minister

We often read of violent clashes, large-scale demonstrations and lawsuits arising in foreign countries as a result of irresponsible business practices. In many cases, there is a fragile relationship between the company and its workers abroad. Sometimes its politics; other times it is the economy.

The matter of workers rights presents thorny issues and challenges for trans-national corporations. There are countless international treaties, conventions and protocols covering the treatment of indigenous workers.

Together these constitute a set of “internationally recognized” workers rights, including: the right of association; the right to organize and bargain collectively; prohibition of forced or compulsory labor; minimum age for employment; and acceptable conditions of work with respect to minimum wages, hours of work, and occupational health and safety.

As a corporate leader, you should be guided by these international standards and take the lead in establishing your company as a global respecter and defender of workers rights. Your reputation as a good corporate citizen will soar and the number of awards you will be given by international advocacy groups will multiply.

(c) Adonis E. Hoffman, 2008

Embrace Globalism

2008-02-01T12:00:00.000-05:00

"We all have to expand our capabilities to encompass the changing world, its growing diversity and,indeed, its complexity."

Lachlan Murdoch, Businessman

Corporations today are citizens of the world. Companies draw on employees, suppliers, manufacturers, raw materials, and capital from around the globe to sell products and services to consumers and customers virtually anywhere on earth. In today’s global marketplace, what happens in Indonesia can have a direct effect on a company’s home base in Indiana.

Embracing globalism is a necessity in today’s business environment. Business leadership requires you to view things through a much wider prism than “working at headquarters” or “staffing the Tulsa field office”. It requires a company-wide appreciation of the global dimensions of business.

Today’s business leader must seize every opportunity to communicate the global realities and a global vision with employees and managers—in written communications, in speeches, in policies and practices, and in the intangible ways that CEOs provide leadership.

Globalism also requires that you become intimately involved in the communities where you are located. Sponsoring local soccer teams, dance troupes, and art galleries easily qualifies, but more importantly, companies must seek deep roots in these communities. As the slogan goes: “think globally—act locally.”

(c) Adonis E. Hoffman, 2008

Be Not Above the Fray

2008-01-31T12:00:00.000-05:00

"Example is not the main thing in influencing others. It is the only thing."

Albert Schweitzer

Your example as a chief executive officer is more meaningful than a handful of speeches on what the company should be doing.

To be sure, there is a time for rallying the troops through inspiring words and writings. But there is nothing more inspiring than your deeds. How many CEOs give you the feeling that they’re just too good to get dirt under their manicured nails? How many executives look down with disdain at the trivial, mundane or grunt work that exists in every company?

Those attitudes reflect a patent lack of humanity, but more importantly they demonstrate a clear lack of understanding of human nature. Your employees will follow you into battle, and some will even willingly fall on their swords for you. But only if they believe that you’re in the fray with them-side-by-side.

It’s been said that good leaders don’t force people to follow—they invite them on a journey. As a corporate leader, your success depends on your ability to invite people to come along with you on the journey.

(c) Adonis E. Hoffman, 2008.

Nurture Leadership from Below

2008-01-30T06:50:00.000-05:00

"Leaders are made, not born. You learn to become a leader by doing what other excellent leaders have done before you. You become proficient in your job or skill, and then you become proficient at understanding the motivations and behaviors of other people."

Brian Tracy

Every leader started somewhere, and typically it was at or near the bottom. A big part of your job as a corporate leader is to recognize the innate and latent leadership ability in your subordinates and nurture those future leaders.

Ralph Nader once remarked that “the function of leadership is to produce more leaders, not more followers.” Successful and responsible leaders are always on the lookout for talented people within their organizations. They ask their managers for recommendations of employees with leadership potential, and they seek out potential leaders from outside the organization.

Formalize your leadership development programs. Make sure they are well-organized and providing the right opportunities for new leaders in the company. Take an active role in leadership development by regularly communicating with top prospects and building a solid pipeline for the future.

Last but not least, speak about the importance of leadership for the company. Communicate to your employees the importance of their leadership role within the organization. Inspire them to aspire to take your place. If you care about the organization, then you will inculcate leadership lessons in new generations.

(c) Adonis E. Hoffman, 2008.

Commit to Compromise

2008-01-29T06:48:00.001-05:00

"I have found no greater satisfaction than achieving success through honest dealing and strict adherence to the view that, for you to gain, those you deal with should gain as well."

Alan Greenspan, Retired Chairman,Federal Reserve Board

A good leader understands the value of compromise. Knowing when to yield and when to push is an art and learned skill which every corporate leader should master. In the words of Edmund Burke, “Every prudent act is founded on compromise.”

Remember that a compromise usually requires each party to gain a little and give a little in the interest of reaching a solution. The best leaders know how to compromise without caving or making the other party feel as if it has completely caved—even if that is the case.

Compromise is especially important when it comes to your employees and workers. It does not suggest weakness, but strength. When you indicate a willingness to allow another viewpoint, another approach, another position, you have built a better and more inclusive process.

As in politics, corporate hard-liners rarely survive. There is much progress to be made in the middle ground. Use this principle to bolster your own position and propel your company to the lead. Finally, compromise does not have to be the last-minute effort reached after days, weeks, months of strenuous negotiations. Stating up front what you’re willing to compromise on is a great, counter-intuitive position to take.

(c) Adonis E. Hoffman, 2008

Develop Dialogue

2008-01-28T13:01:00.000-05:00

"When employees and employers, even coworkers, have a commitment to one another, everyone benefits. I have people who have been in business with me for decades. I reward their loyalty to the organization and to me. I know that they'll always be dedicated to what we're trying to accomplish."

Donald Trump, Businessman

Communication conquers many ills. Business leadership requires that you communicate with a number of different “publics” in different ways at different times. Not the least of these is your group of employees.

Study after study reveals that employees are more satisfied and more productive when they feel they can communicate openly with their leaders. But it is your job to create a corporate culture and environment where dialogue is promoted and encouraged.

Don’t delegate this responsibility to underlings. Do this yourself. Take the initiative to establish formal and informal venues for dialogue with employees, investors, and stakeholders.

The quarterly conference call may be necessary, but it is not sufficient as a communications tool. You should be in regular contact with your constituencies. Walk around the plant, the office, the site—wherever your people are. Resist the easy temptation to be a figurehead.

Instill a sense of connection, affinity and loyalty in your employees, whether you have fifteen or fifty-thousand. They will love you for it and work even harder.

(c) Adonis E. Hoffman, 2008

Do Right by Your Employees

2008-01-25T12:58:00.000-05:00

"Our mission statement about treating people with respect and dignity is not just words but a creed we live by every day. You can't expect your employees to exceed the expectations of your customers if you don't exceed the employees' expectations of management."

Howard Schultz, President Starbucks

In any company, people are your greatest assets. In the run-up to increase revenues, boost profits, and build shareholder value, many leaders forget about the employees and workers who make up the backbone of their company.

It takes followers to be a leader. Great leaders take the time to develop their people by treating them fairly, righteously and judiciously. Your reputation as a corporate boss will turn not only on the bottom line, but how you manage and treat people.

If you came up through the ranks, don’t forget how it feels to be in the lower and middle rungs of the corporate ladder. If you helicoptered in from a top post at another company, you might want to spend a little time getting to know the people who make up your workforce. It will be time well spent.

Finally, try your best not to isolate yourself and your top executives from the people who work for your company. Avoid the bubble syndrome.

I know it’s hard to identify with regular people now that you have use of the corporate jet, limousines, executive retreats, exclusive clubs, golf memberships and other great perks. But be sensitive, be engaged, and be righteous. Your people want to work for a “good guy.”

(c) Adonis E. Hoffman, 2008.

Seek External Guidance

2008-01-24T12:50:00.000-05:00

It is not easy to allow outsiders into your corporate world and ask them to critically assess how well you are doing business. But that is exactly what you as a good leader must do to get the best results for your organization and its customers, shareholders and employees.

External validation goes a long way toward establishing a great corporate reputation, if it is conducted with transparency, integrity, and purposefulness. For example, compliance audits, corporate social responsibility assessments, diversity assessments and audits, in addition to the mandatory Sarbanes-Oxley reviews, are a few ways you can obtain the considered opinions of others.

When you engage outside consultants, do your best to go beyond the big three consulting firms. You just might find that smaller, niche, firms will do just as good a job and be easier to work with. More law firms are providing these types of assessments or “audits”.

After it’s all done, report to the public on your status, especially if the assessment is mostly positive. Convene a press conference and tell your shareholders, just how good you are, and allow surrogates from your outside advisory groups to give their assessments too.

(c) Adonis E. Hoffman, 2008.

Look Outside Yourself

2008-01-23T12:46:00.000-05:00

"You can overcome any obstacles by asking the right questions of the right people at the right time, then act on that advice with passion."

Dan Surface, author of The One Business Book You Absolutely Must Own

Neither one leader nor one company can have all the answers. There are many, many external sources for business leadership and guidance today, and you should look outside of your organization for solutions. There is wisdom in a multitude of counselors.

Business organizations, trade associations, international organizations, interest groups, universities and academic experts all have weighed in on best practices and corporate leadership.

Study these resources for practical tips and insights from those who spend a lot of time trying to figure out what companies and their leaders should do. More companies have discovered that great ideas come not only from their paid employees, but also from their loyal customers.

Take a cue from marketers who have asked customers to submit their own ads and commercials. Set up an informal group that meets once a year just to sound off on what you’re doing right and what you’re doing wrong. Tap into a social network of people who pay attention to your industry or who have been affected by it in some way.

Don’t be afraid to look outside yourself for answers, solutions, strategies and techniques to improve your corporate position.

(c) Adonis E. Hoffman, 2008.

Build An Advisory Board

2008-01-22T12:40:00.000-05:00

"Many companies have discovered first-hand that an Advisory Board can serve as a valuable complement to the Management Team. In fact, in today's increasingly complex and competitive marketplace, the proliferation of Advisory Boards is helping companies develop crisp strategies with clear and effective value propositions in order to deliver a sustainable competitive advantage."

www.geehanadvisoryboards.com/advisory

Every American president since George Washington has had a “kitchen cabinet” of advisors—people whose opinions, values and experience are invaluable to helping the leader achieve his goals.

Likewise, as a corporate leader, you need to establish your own kitchen cabinet of external advisors with whom you can discuss ideas, proposals and future plans. Some companies just don’t understand the value of having outsiders who have no stake in the corporation tell them what to do. But that is exactly what an advisory board does.

The value of these independent advisory boards is that they provide a perspective that leaders need to hear, but rarely do from their own employees, directors, or consultants. These are people who are not afraid to offend the CEO and who are independent enough to call things as they see them.

Every CEO needs an advisory board, if for nothing else than to tell him / her when the emperor has no clothes. Again, look to the academic, non-profit, association, faith-based, activist and civil-rights sectors for leading persons to participate in your advisory board. Pay them just enough to respect their time and cover their expenses, but not enough to be seen as a payoff. Meet with them regularly and informally, and listen to their advice.

(c) 2008 Adonis E. Hoffman

Pursue Best Practices

2008-01-21T14:55:00.000-05:00

"I’ve heard it said that best practices aren’t a sustainable competitive advantage because they are so easy to copy. That’s nonsense. It’s true that, once a best practice is out there, everybody can imitate it, but companies that win do two things:
they imitate and improve."

Jack Welch, former chairman, GE, author, Winning

Best practices are documented strategies, policies and procedures used by leading companies to accomplish their strategic business and marketplace goals. They are identifiable examples of business policies and practices that produce superior performance. Every organization does something extremely well—whether it is training, marketing, strategic planning, labor management, community participation or philanthropy.

Starting internally, companies should build their own best practices guide in each core operations area. By benchmarking their own performances, and comparing the practices of competitors and other organizations, corporations can develop a valuable best practices guide for its managers and employees.

This is a good place for you to take a visible leadership role. Remember that some of the most celebrated corporate leaders in recent memory were masters of best practices—think about Jack Welch and Lee Iacocca.

Be guided by what leading companies do well and not so well. Look at the mistakes of competitors and determine where they could have done better. Invite thought from academics and analysts who study these things, and then create your own model.

(c) 2008 Adonis E. Hoffman

Create a Code of Conduct

2008-01-20T14:51:00.000-05:00

"There is no such thing as business ethics. There is only one kind - you have to adhere to the highest standards."

Marvin Bower, former managing partner of McKinsey & Company

Codes of conduct have found favor and acceptance among many leading companies and are popular today. In essence, a code of conduct refers to a set of behavioral principles or standards that companies pledge to follow voluntarily.

In addition to their own codes, many companies are endorsing codes developed by organizations such as the United Nations and chambers of commerce. Codes tend to be responses to concerns raised by consumers and other stakeholders, and as such are market-driven. For the most part, they are not legally binding, although it is not good to violate a code you have voluntarily adopted.

A good company code of conduct will address at least five main areas: (1) fair business practices; (2) rule of law; (3) fair employment and labor; (4) environmental issues; and (5) corporate citizenship.

If your company does not have a code of conduct, or if it does not endorse any external codes, change this right away. Directors, officers and managers, as well as senior employees should be encouraged to submit suggestions for the code. This process reinforces so many other positive components of good corporate citizenship that it, alone, is worth the effort.

(c) 2008 Adonis E. Hoffman

Self Regulate

2008-01-18T12:00:00.000-05:00

From a corporate perspective, self-regulation is better than government regulation in every way. Some industries regulate their own behavior so well that they are able to stave off burdensome governmental regulation altogether.

But self regulation requires taking the initiative—seizing the momentum from outsiders who want to impose their will on your organization. You will have to figure out which areas you can make a difference in, and which areas you cannot. Then proceed to act in those areas.

Involve outsiders. Find a small group of experts from the business, academic and non-profit world to plug into your self-regulatory body. Give it a charter with teeth.

When you have created a successful self-regulatory program (whatever it is) make a big deal of it. Give it an important name and take credit for recognizing the need to move in the right direction.

After you have done that, then issue a challenge to the entire industry to follow your lead. Develop a company manifesto or an industry call to action extolling the importance of self-regulation as a benchmark of corporate responsibility and good governance. Self-regulation can be good for all stakeholders.

(c) 2008 Adonis E. Hoffman

Mind the Money

2008-01-17T14:30:00.000-05:00

"The essence of a successful business is really quite simple. It is your ability to offer a product or service that people will pay for at a price sufficiently above your costs, ideally three or four or five times your cost, thereby giving you a profit that enables you to buy and to offer more products and services."

Brian Tracy, personal and business success author

The old adage among prosecutors and investigators is: “follow the money”. By doing so, financial improprieties are inevitably discovered and many a corporate chief has fallen from grace.

There is no justifiable excuse for financial mis-deeds today, especially with the generous compensation packages abounding in most companies. Corporate treasurers, accountants and chief financial officers are under enormous scrutiny and pressure to demonstrate they have prudently managed the finances. Otherwise they face the wrath of the market, and more significantly, the risk of civil and criminal prosecution.

Your job as a corporate leader is to make sure that the money is handled prudently. You must put in place the people, frameworks and checkpoints for a credible system of financial accountability. A socially responsible company manages its finances prudently. A CEO should never be able to hide behind—as one leader claimed—a financial system that was so complex he did not quite understand it.

The company’s balance sheet is not the sole province of the CEO, but it should be one of her main concerns. Increasing profit and shareholder value should not be subordinate to prudent financial management.

(c) 2008 Adonis E. Hoffman

Respect Directors

2008-01-15T13:33:00.000-05:00

“The director has obligations to all shareholders. Beyond his legal duties, he must recognize the broad social responsibilities he has to the general public and to the country. A director of a company must keep a broad outlook, high hopes and believe in the future of this country. He must keep his feet on the ground, but this need not keep him from looking off to the horizon.”

--Sidney J. Weinberg, Former Managing Partner, Goldman Sachs Address before Harvard Club of Cleveland, May 1949

The era of the independent corporate director is upon us. In response to the financial abuse that results from too-cozy relationships among directors, today’s new public board has at least one or two independent directors, and sometimes more. Some may even be a bit too activist for your taste.

Of course new requirements for director independence under Sarbanes-Oxley, NYSE and NASDAQ mean that regulators also are focusing on this area. But the real challenge for CEOs is not to fight the trend.

Mutual funds, rating agencies, analysts and investors look for fissures within the board. Remember how Hewlett Packard imploded because there was a fundamental lack of respect among the board itself, with leaks, spying and betrayal of trust.

Whether the directors are called “independent”, “outside” or “non-management”, the principle is that they function as a surrogate for external—and in many cases—governmental regulation.

Your legacy as a business leader will depend on how well you can work with these independents, and still maintain control of the board—good luck.

(c) 2008 Adonis E. Hoffman

Do Business in the Sunshine

2008-01-12T12:30:00.000-05:00

“Because transparency increases the fairness and efficiency of markets and fosters investor confidence in those markets, it has the added benefit of encouraging greater participation by investors. This participation means more trading, more market liquidity, and perhaps even new business. .... Thus, we believe that a sound and sensible approach to . . . market transparency will benefit almost everyone -- investors, dealers, and the economy as a whole.”

--Arthur Levitt, former Chairman of the SEC, Testimony Before the House Subcommittee on Finance and Hazardous Materials, Concerning Hedge Fund Activities in the U.S. Financial Markets, March 18,1999

The corporate scandals of the late 1990s forever changed the expectations of shareholders, investors and government regulators as to how open corporations should be in their operations. For public companies, disclosure is a major requirement, and while the private equity players would disagree, I believe even large private companies should follow this rule today.

Conducting business in the open gives investors, customers and business partners more confidence in the company itself. Following Enron and the demise of Arthur Andersen, the mandate for more disclosure of financial dealings, procedures and arrangements inside the corporation grew louder.

Today, there are great expectations that companies will open themselves up not only to shareholders but also to the growing number of business media who want to know just about anything and everything about the CEO and his/her life. The lack of disclosure on everything from foreign operations to executive pay is seen as a sign of poor citizenship.

Press releases and media relations are important, but a dialogue without spin is more valuable. If you’re doing good, you have nothing to worry about.

(c) 2008 Adonis E. Hoffman

Respect Shareholders

2008-01-11T12:30:00.000-05:00

"No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under a leadership composed of average human beings."
--Peter F. Drucker, Management Guru

Long before there was Sarbanes-Oxley, there was a well-recognized duty by the CEO to be accountable to shareholders. By virtue of your position as leader of the company, you must use your best efforts and best judgment on all matters related to the corporation.

Being accountable to shareholders means that you must make the hard financial, management, business and labor decisions in the best interests of the company, but it also requires you to protect the long-term interests of its equity owners.

Respecting shareholders means that you don’t lie, you don’t hide the ball, and you don’t employ sleight-of-hand tricks that make you look good today, but leaves them holding the bag tomorrow.

In essence, you work for the shareholders, the owners of the company. Treat them as if they were your boss, and you will not go wrong. Communicate openly and often. Open up the company to its owners and investors and find a way to invite them in.

After all, respect is a two-way street—it goes both ways.

(c) 2008 Adonis E. Hoffman

Admit Mistakes

2008-01-10T12:00:00.000-05:00

Nothing suggests strength so much as the ability to admit when you are wrong. It is nothing unusual for CEOs to make mistakes. It is a rare, indeed, for a CEO to admit mistakes. Strong leaders can admit their shortcomings.

Studies show that consumers respect a company that admits mistakes readily and corrects mistakes quickly. Think about product recalls and auto recalls. Most customers willingly return or exchange their product for a new or repaired version. And they tend not to hold these mistakes against the manufacturer for long. As Steve Jobs noted, “. . . when you innovate, you make mistakes... Admit them quickly and get on with improving your innovations.”

Of course, if you attempt to cover up or hide them, the company opens itself not only to any legal liability for the underlying actions, but also to the cover-up charges as well.

To be sure, litigation, class actions and other risks are important considerations. But as a leader, you need to find a way with your lawyers to recognize your mistakes and address them publicly. Your personal stock will soar, and your company will be known as a good corporate citizen. It can be a win-win.

(c) 2008 Adonis E. Hoffman

Reject Bad Behavior

2008-01-09T12:20:00.000-05:00

“The truth is that good ethics sometimes is good business, but sometimes it's not. It depends on one's goals and how one defines good business. Sometimes, good ethics can end in bankruptcy. Of course, so can bad ethics. A fairer statement is that good ethics can be a very powerful business asset and that good things tend to happen to companies and individuals that consistently do the right thing and bad things tend to happen to those that even occasionally do the wrong thing. The moral obligation to live according to ethical principles is not dependent on whether it's advantageous. People of character do the right thing in the pursuit of virtue, not self-interest.”

--Michael Josephson, Founder & President Josephson Institute

Throughout history, it was perfectly acceptable for companies to engage in a conspiracy of silence. See no evil, hear no evil, speak no evil was a familiar veil behind which most companies could hide and get away with virtually anything.

But that is not the standard or expectation in today’s world. Bad corporate behavior by one company hurts all companies within that sector. It colors the public perception of corporations, leads to a lack of investor confidence, and invites unwanted regulatory scrutiny.

While no one wants to be known as a snitch, calling something out of bounds is not quite the same thing. Blowing the whistle on the bad guys sets you up as a leader with a conscience. Telling the referees that a corporate player is violating the rules of the game not only is responsible, but it is the right thing to do. Of course that makes you fair game for others. But the bottom line is that you must establish yourself as a straight shooter—a tell-the-truth-at-all-costs type of leader or you will face a credibility gap.

Don’t be afraid to step up to this level of leadership.
On the upside, you gain immense credibility among shareholders, investors, customers, the media and policymakers. The choice is yours.

(c) 2008 Adonis E. Hoffman

Engage Public Policy

2008-01-08T12:56:00.000-05:00

"The price good men pay for indifference to public affairs is to be ruled by evil men."
--Plato

Political consciousness and political engagement are hallmarks of leading companies. Public policy at the federal, state, and local level affects not only the functions of government and citizens, but the functions of companies as well.

Any business leader who believes he / she can stick its head in the sand and avoid politics or policy, is in for a rude awakening. Corporate leaders who ignore this aspect of business do so at their peril as Microsoft learned in the 1990s.

If your company does not have a political action committee (or PAC), organize one. If your company does not have a committee on its board that deals with public policy, establish one. If your company does not know its elected representatives at the local, state and federal levels, learn them. If your company does not have a go-to person or group that is responsible for public policy, get one. And if you are not using your industry trade association to the fullest, start now.

Finally, if you are not personally contributing to political candidates from both parties you are missing a golden opportunity to establish yourself as a leader. Politics and policy are embedded in our system. Embracing this reality is good business, plus the policymakers need to hear your voice.

(c) 2008 Adonis E. Hoffman

Influence Others to Do Good

2008-01-07T12:51:00.000-05:00

“There is but one rule of conduct for a man to do the right thing. The cost may be dear in money, in friends, in influence, in labor, in a prolonged and painful sacrifice, but the cost not to do right is far more dear: You pay in the integrity of your manhood, in your honor, in strength of character; and, for a timely gain, you barter the infinite.”
--Archer G. Jones

Competition not only is good for business, it is good for society. When one company sees its competitors behaving responsibly, its own competitive instincts get into gear, especially when those competitors are being rewarded and recognized in the marketplace as is often the case.

In the same way as a company establishes itself as the pacesetter for an entire industry, it can lead the way in other areas. I am reminded of organizations such as Levi Strauss, Johnson & Johnson, and Starbucks who, by their consistent examples, have prompted their industry competitors to strive to do good things.

Corporate leaders set positive examples for others to follow. All too often, corporations are influenced by the wrong kinds of actions—spiraling executive pay, more and more perks for the board, and stupendous stock grants—while many of the basic issues that matter to their customers go overlooked.

True corporate leadership propels a company to influence others to make lasting investments in underserved communities, to take extraordinary measures to preserve the environment, and to promote sustainable development throughout the world, for example. Doing well, alone, is never enough. A corporate leader must seek to do good for others, too.

(c) 2008 Adonis E. Hoffman

Set High Standards

2008-01-06T12:31:00.000-05:00

Some people have greatness thrust upon them. Few have excellence thrust upon them. . . . They achieve it. They do not achieve it unwittingly by doing what comes naturally and they don't stumble into it in the course of amusing themselves. All excellence involves discipline and tenacity of purpose.”
-John W. Gardner, Founder Common Cause and The Independent Sector

According to popular evangelist Joel Osteen, Americans often suffer from low expectations and low self-esteem. We fail to set high standards for ourselves, and as a result we fail to achieve at higher levels.

Many companies fall prey to the same syndrome. They lapse into a comfort zone, relying on tried and true systems, the usual procedures, and the same old standards that were established at a different time and place than today. Critics of the American automotive industry cite its failure in this area as a key factor in the rise and eventual dominance of the Japanese auto industry.

Our society today expects corporations and their leaders to set high standards for performance, accountability and quality. The higher the standards, the more respect and esteem consumers and shareholders will attribute to the company.

As a CEO, it is up to you to set and keep lofty standards. CEO easily could stand for “chief excellence officer” in today’s world, because of the demand for quality.

Within the structure of your own organization, you have to find a way to communicate the importance of high standards. It will set you apart from the competition, if you do it correctly.

(c) 2008 Adonis E. Hoffman

Expect Excellence

2008-01-05T12:19:00.000-05:00

Excellence has been defined as “possessing good qualities in an eminent degree; exalted merit; superiority in virtue.” Several years ago, In Search of Excellence, by Tom Peters became a New York Times bestseller, and “excellence” became a corporate watchword.

Today, excellence is still important to consumers and shareholders.

While many companies vie for competitive dominance, we know that not all number one companies are excellent—they’re just number one. “In the past, corporate excellence has been defined in terms of product quality, price, delivery time and profitability. But this definition will no longer suffice in the 21st century; excellent companies not only must pursue economic rationality, but social and environmental rationality.”

CEOs that make it clear to their employees, managers, officers and directors that they expect excellence are more likely to achieve such a goal, and be viewed by essential stakeholders as “excelling”. Today, “defining excellence – let alone searching for it – will prove more and more elusive”.

(c) 2008 Adonis E. Hoffman

Be Good For Something

2008-01-04T12:13:00.000-05:00

“It cannot suffice to invent new machines, new regulations, new institutions. It is necessary to change and improve our understanding of the true purpose of what we are and what we do in the world. Only such a new understanding will allow us to develop new models of behavior, new scales of values and goals, and thereby invest the global regulations, treaties and institutions with a new spirit and meaning.”
-Vaclav Havel, former President, Czech Republic

Martin Luther King, Jr. once said, “If you don’t stand for something, you’ll fall for anything”. His words were a clarion call to his countrymen to become people of principle and to work for the greater good. It was a reminder that unless our lives and work are tied to bigger things, we risk failure and marginality.

As it applies to business leaders, the notion of goodness presents an entirely new set of thorny issues. Corporations exist to produce and to profit. By design, they are not persons, but institutions of commerce, trade and service. In human terms, companies don’t have a heart or a soul. Morality—beyond what is legally required and expected—has no place on the corporate agenda, some would argue.

But they would be wrong.

Today, society expects corporations to act differently than in the past. Consumers, activists, regulators and policymakers have come to believe that corporations should have a heart, if not a soul. Some even believe that companies should wear their hearts on their sleeves. As a society, we embrace the view that a company must stand for something other than productivity and profit—as a leader, this is one of your greatest challenges.

(c) 2008 Adonis E. Hoffman

Put A Value on Values

2008-01-03T12:07:00.000-05:00

“Ultimately, what distinguishes a company’s practice of corporate citizenship is expressed by the way in which it delivers its core values. The competitive companies of the future will find how to fundamentally align and embed their core values — including the values that society expects them to hold. Values are becoming a new strategic asset and tool that establishes the basis of trust and cooperation.”
--Boston College Center for Corporate Citizenship

Values are as important as brands. Corporations should seek to reflect, and be associated with, good values. Developing, defining and articulating those values are among the CEO’s most difficult, but important, challenges.

In a recent survey of leading CEOs, “the internal communication of values and policies” received more votes than any other option as a key way to measure the integration of corporate citizenship into the performance of corporate leaders.

As fundamental as this may be, many leaders fail to state their values explicitly, even though doing so provides their customers, clients and partners with a great sense of comfort. In essence, they undervalue their values!

When the leadership of a company lays out its values, it is telling customers, investors, and the market what it believes, and what it aspires to become. This allows the corporation’s employees, business partners, and stakeholders to know what values a corporation are guided by, and to what values it can be held accountable.

For many, it is comforting to know the values that are prioritized and important in a corporation.

(c) 2008 Adonis E. Hoffman

Develop Vision

2008-01-02T12:02:00.000-05:00

"A visionary company doesn't simply balance between idealism and profitability: it seeks to be highly idealistic and highly profitable. A visionary company doesn't simply balance between preserving a tightly held core ideology and stimulating vigorous change and movement; it does both to an extreme."

--Jim Collins, author, Good to Great

According to the Proverbs: “Without vision, the people perish”. Likewise, without a clear vision, a business leader cannot effectively lead an organization in today’s highly competitive marketplace.

Very few people are born visionaries—most work hard at becoming so. By carefully following trends, studying all of the factors that affect your company, your industry, your line of work, and projecting ahead, you too, can achieve visionary status.

But it won’t be easy. First, you must develop a broad view of the world—well beyond the narrow interests of your company or your industry. Look at the world. Where does your organization fit? Where does it want to be? How will your company operate in today’s political and economic climate?

Next comes the need to project your vision broadly. How will your employees, customers and shareholders buy into your vision, and how will you communicate those things to them in a way that inspires confidence and action?

All challenges for you as the leader, but not insurmountable when you develop a clear vision of what is possible, what is likely and what can be avoided. Develop a vision and let it guide your actions.

(c) 2008 Adonis E. Hoffman

The Buck Stops With You

2008-01-01T09:00:00.001-05:00

“You are not here merely to make a living. You are here to enable the world to live more amply, with greater vision, and with a finer spirit of hope and achievement. You are here to enrich the world. You impoverish yourself if you forget this errand.” Woodrow Wilson, 28th President of the United States

Harry Truman epitomized responsibility in a chief executive. His now famous words, “the buck stops here,” became part of the national lexicon and changed the way Americans viewed their leaders. “The Buck Stops Here” became an instant euphemism for responsible leadership.

President Truman’s sense of accountability and his acceptance of responsibility for the actions of his administration fundamentally changed the way all chief executives were to be viewed from that point forward. It was a classic lesson in the principle that responsibility begins at the top.

In today’s business environment, leadership must come from the top. CEOs and key executives should establish the tone for the rest of the company. That’s why they’re paid the big bucks. If your name is at the top of the organization chart, like or not, you are responsible for just about everything that happens below.

CEOs, directors, and senior executives are expected to provide leadership in every facet of corporate affairs, recognizing that their employees, shareholders, investors, and customers will be judging their actions.

(c) 2007-2008
Adonis E. Hoffman

The Buck Stops With You

2008-01-01T09:00:00.000-05:00

"You are not here merely to make a living. You are here to enable the world to live more amply, with greater vision, and with a finer spirit of hope and achievement. You are here to enrich the world. You impoverish yourself if you forget this errand."

Woodrow Wilson, 28th President of the United States

Harry Truman epitomized responsibility in a chief executive. His now famous words, “the buck stops here,” became part of the national lexicon and changed the way Americans viewed their leaders. “The Buck Stops Here” became an instant euphemism for responsible leadership.

President Truman’s sense of accountability and his acceptance of responsibility for the actions of his administration fundamentally changed the way all chief executives were to be viewed from that point forward. It was a classic lesson in the principle that responsibility begins at the top.

In today’s business environment, leadership must come from the top. CEOs and key executives should establish the tone for the rest of the company. That’s why they’re paid the big bucks. If your name is at the top of the organization chart, like or not, you are responsible for just about everything that happens below.

CEOs, directors, and senior executives are expected to provide leadership in every facet of corporate affairs, recognizing that their employees, shareholders, investors, and customers will be judging their actions.

(c) Adonis E. Hoffman, 2007.

The Challenges of Today's CSR 3.0

2007-12-30T21:06:00.000-05:00

We are in the early stages of an era that I like to call "corporate responsibility 3.0."

The first and longest stage of modern corporate responsibility was characterized by companies developing codes of corporate conduct, CSR initiatives and socially responsible investing (SRI). It was, in essence, a feeling out period to determine whether corporate responsibility had staying power.

CSR 2.0 was ushered in by Sarbanes-Oxley and was largely a response to well-documented scandals, abuse and corporate misbehavior.

In today's new era of CSR 3.o, the corporate sector faces the challenge of independence. Consumers and customers are increasingly independent-minded in their purchasing decisions. Investment capital is increasingly independent as private equity plays a larger role. And new regulatory mandates have convinced shareholders that public companies need to be guided by independent directors with little connection to the companies.

As higher profits abound in some sectors--energy, financial services, and technology, more companies will have to figure out how to make their contributions to society consistent with the new requirements of CSR 3.0.

(c) 2008 Adonis E. Hoffman

Do Not Discriminate

2007-12-29T12:00:00.000-05:00

"The divide of race has been America’s constant curse. Each new wave of immigrants gives new targets to old prejudices. Prejudice and contempt, cloaked in the pretense of religious or political conviction are not different. They have nearly destroyed us in the past. They plague us still. They fuel the fanaticism of terror. They torment the lives of millions in fractured nations around the world. These obsessions cripple both those who are hated and, of course those who hate, robbing both of what they might become."

William Jefferson Clinton,42nd President of the United States

Discrimination can be an insidious and hidden practice within any organization. Executives in many companies can engage in subtle forms of bias without any specific intent to do harm or discriminate against an individual or group of people. Simple carelessness or ignorance can perpetuate a climate of discrimination.

Well, how do you know you or your company might be discriminating? If your boardroom, executive suites, or senior managers all tend to look alike, this is a strong indication that there might be discrimination in your organization. Even if you have a measure of diversity, if key assignments or major projects, or prime territories tend to be allocated to a certain group of individuals, you may have a problem.

The important thing to remember about discrimination is how easy it is to do. There is a certain human tendency to gravitate toward the familiar, the known, and the comfortable. In a business context, you must guard against your natural tendency to favor like-minded people from like-minded backgrounds.

Even in casual or jocular conversation it is important to demonstrate a respect for all persons. Avoid jokes touching on race, ethnicity, gender, physical condition, religion, sexual orientation.

(c) Adonis E. Hoffman, 2008

Not Business as Usual--The Business Challenge for the Democratic Party

2006-11-09T18:42:00.000-05:00

Now that the Democratic Party is firmly in control of the United States Congress, the party of the people will have to figure out how to handle the power of the purse.

With major appropriations for domestic programs, the war on terror, military commitment in Iraq and other must-fund items, Democrats face a daunting task. They must transform themselves from naysayers to do-gooders--all in time for the 2008 elections.

It's not that Democrats are unaccustomed to handling the nation's business agenda. To the contrary, some of the best things for the business sector happened under the Clinton Administration's eight year reign over record growth and prosperity.

The challenge for post-Clinton congressional Democrats will be to balance their desire to make inroads on Wall Street with their promise to revive Main Street. This will be no easy task. In the meantime, business leaders throughout the country are hedging their bets and playing a very cautious waiting game, giving liberally to both Dems and Republicans.