Practical insights for compliance and ethics professionals and commentary on the intersection of compliance and culture.

Round-up on justice issues with marijuana legalization

The ongoing discussion about marijuana legalization has gained great momentum and now must include vital justice considerations.  As the process of decriminalizing marijuana cultivation, use, and possession gains public acceptance, the scope of the discourse must widen to include racial and social justice reforms.  These issues are critical for understanding in the mixed progress of legalization, the efficacy and impact of enforcement trends, and ongoing requirements for regulatory design and social equity gains.

Cory Booker, US Senator from the state of New Jersey, is the author of the Marijuana Justice Act and has spoken repeatedly about the need for states to consider criminal justice reforms alongside medical and recreational marijuana legalization campaigns.  As states legalize future marijuana possession, use, and distribution but do not consider corrective action for people with previous criminal convictions they create an unjust and unfair double standard where legalization benefits one set of citizens and does not alleviate what Senator Booker refers to as “collateral consequences” that seriously impair another set.


Starbucks and CSR

Starbucks is one of the best-known companies and brands in the world. The success of Starbucks in the global market is not just, or even mainly, about the popularity of the coffees, teas, and snacks it serves to guests. Customers want to know where companies like Starbucks stand on social and political issues too. They’re eager to engage with the business values and cultural strategy of the company, in order to distinguish the choice for Starbucks over any of its many other competitors they could patronize for a drink or a pastry instead.

Corporate social responsibility (CSR) is a prominent strategic consideration for many companies. Authentic and convincing expression of CSR values can gain the attention and appreciation of consumers, competitors, and stakeholders. For a broad overview on the importance of inspiring this engagement for organizations seeking to use their interest in activism or social justice issues, check out this post on CSR tips for compliance programs.


Tony’s Chocolonely and a Roadmap for CSR principles

The chocolate business has long been plagued with associations with slavery and child labor. In the countries where manufacturers buy their cocoa beans, trading companies and farmers traditionally have engaged in exploitative and unfair business practices both between each other and in employing the work of slaves, many of them children. Chocolatiers have even claimed that producing chocolate without the use of slave labor at some point in the supply chain, however remote, is impossible to prove or accomplish. Instead, the industry has focused on shifting risk or responsibility for the use of slave labor or abusive trade partnerships by moving these decisions and relationships to third parties and offering ignorance or lack of control as a defense.

Tony’s Chocolonely, a Dutch confectionary company, offers an intriguing alternative to and challenge within this market. The eponymous Tony is actually Teun van de Keuken, a Dutch investigative reporter. In 2002, van de Keuken was working on a project about chocolate manufacturers. He determined that none of the manufacturers he studied that had signed the 2001 Harkin-Engel (aka Cocoa) Protocol, an international agreement intended to end child and forced labor in chocolate production, were in full compliance with the protocol’s requirements. Therefore, all the chocolate for sale by those candy companies (including Hershey’s, M&M Mars, Nestle, and Guittard) was, in van de Keuken’s view, an illegally-manufactured product.


Compliance must-haves for changing organizational culture

The ongoing public disclosures about sexual harassment and abuse that have filled the news since mid-2017 have led to a major cultural reckoning.  Courageous people have come forward to share stories about inappropriate and dangerous behavior of high-profile individuals.  The public discourse about these people who were violated by abusers and predators with the complicity or support of other individuals or organizations has, to this point, focused largely on bringing these offenses to light, in order to listen to and believe in victims, so that they may be supported and empowered as survivors and as bearers of new societal norms.


Patagonia’s social responsibility and targeted political engagement as corporate values

The famous outdoor industry retailer Patagonia has a bold and defining mission statement: “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” In this, a company which makes its profits off selling products to people who wish to explore and enjoy the outdoors has linked its strategy, growth, and indeed reason for existing, to respecting and protecting that environment. Patagonia’s reputation has been cultivated in the public eye to carefully coincide with this intention.

In recent times, however, Patagonia has grown much more quickly than its previously modest expectations, pursuing revenues wherever consumer demand takes the company and stepping up their competition. This has been driven largely by the fact that consumers who have an affinity for the environment and its protection also, logically, are interested in driving their spending power toward companies that they feel share this value. Millennial customers are highly motivated by companies which model social, cultural, and, especially relevant in the case of Patagonia, environmental values. With the vast array of consumer choices that the retail industry offers, both in products and in outlets to purchase these products, cheapest price or easiest availability is no longer the only or the loudest driver of buying power.

Patagonia has hereby achieved the special mix of corporate ambition and conscience. The company is not just an outdoors products retailer, though it still may be thought of as that by many. Instead, it has grown into a green venture capital fund, a food producer, book and film publisher, and a political activism organization that is willing to take on the US government on environmental protection and conservation causes.

Being a company that believes in something, and being rewarded with consumer loyalty, interest, and purchasing power for it, is a powerful message for compliance programs. Creating a serious, genuine corporate image based on values and then selling that image to customers as much as any other product is a huge ambition and a dynamic identity for the organization. Companies must develop corporate cultures which drive what they do with a specificity beyond pursuing sales and dominating product markets. They must recruit leaders who embody this, reinforce this honestly with their employees, and offer integrity in this message to the consumers who will trust them with their loyalty in return.

Hereby, companies such as Patagonia can become not only revenue leaders in their industries but also corporate role models to their peers and competitors. While seeking to directly motivate positive change at the publicly traded titans of industry may be biting off too much to chew, organizations can grow themselves strategically so that their own corporate impact is bigger and better.

In Patagonia’s case, relying on direct-to-consumer business via their own stores and website means that they can take their growth and values ambitions directly to their customers and feed-forward based upon the reception they receive. This is a powerful engagement opportunity for a brand and building a political and social consciousness that is informed by it means that the company can shape itself into the type of organization its customers admire and with which they want to be associated. While Patagonia cannot force political action or change at the highest level on its own, as a company it can be forward-looking and progressive in a time when its consumers appreciate and desire these values. Hopefully, Patagonia can also be an example to other companies to raise the competitive standard for corporate cultures and relevant, genuine social responsibility as a core business value. If that is effectively accomplished, then productive change for the collective can be well within reach.

For more about the power of Patagonia’s corporate social conscious, check out Abe Streep’s story on Outside Online.