From Our Briefings Newsletter

Published on04 SEP 2018

The article below is from our BRIEFINGS newsletter of 04 September 2018:

Briefly . . . on a New Era of Corporate Social Responsibility

At InnerCircle, a recent conference held by Ayco, a Goldman Sachs Company providing workplace financial planning, Dane Holmes, head of Goldman Sachs’ Human Capital Management, spoke with the human resource leaders at Hewlett Packard Enterprise, Northrop Grumman and Darden Restaurants about corporate and social responsibility.

Dane Holmes: Given today’s political and economic environment, corporate responsibility is a topic of conversation that matters more to people. How do your organizations think about corporate responsibility and approach it with your employees?

Alan May of Hewlett Packard Enterprise: We’ve seen corporate responsibility evolve quite a bit. It used to be that corporate responsibility was primarily regulatory driven. Today, it’s all social issues. And the definition of social responsibility has become so broad and ephemeral that it can be an issue for a few months before it subsides, or it can be something more enduring. Our challenge as a company is to determine the issues that represent our true values while also staying nimble enough to the issues that come up around the world.

Denise Peppard of Northrop Grumman: Corporate responsibility had always covered issues like diversity and inclusion under the Equal Employment Opportunity Commission rules, but it has expanded so rapidly on social issues to the point where there’s almost nothing that corporate responsibility doesn’t cover.

Sarah King of Darden Restaurants: At Darden, we have an additional complexity because we have eight brands that are very different based on the types of employees who work there and the customers who visit those restaurants. So the types of social issues that are important to an employee at Olive Garden, for example, are likely to be different than for someone who works at The Capital Grille. We could conceivably have a different approach to handling corporate responsibility for each of our brands.

Dane Holmes: How do you decide what issues to take a stand on? Our Chairman and CEO Lloyd Blankfein, for example, has been vocal on marriage equality, immigration and other issues, particularly when they affect our people. How have you been able to establish your core issues?

Alan May: On the issues that are important to our company we try to be front-footed in our communications with employees and use various forums to enable our people to discuss the types of issues that are important to them. Most people know you can’t be vocal on every single social issue, but on the ones that matter to our people, we are. One of the biggest social issues that we’re addressing is around gender equity beyond diversity and inclusion – in other words, proving to others that we’re not discriminating against women based on the way we pay. Another issue that’s emerging in our industry is the ethical implications and applications of machine learning and artificial intelligence. Who owns the data, how is that data used, and the longer-term implications around job destruction and the dehumanization of work. We believe the notion of privacy and data control will become increasingly relevant.

Denise Peppard: There’s a real balance that we have to strike in all of our businesses. What are the issues you need to stand up for and what are also in the interests of shareholders? Where we tend to be most vocal are on issues that reflect our values as a company. For example, we have been vocal on issues such as promoting equal access to bathrooms for transgender populations or denouncing white supremacy in the wake of last year’s Charlottesville, Va., riots. That’s because promoting diversity and inclusion are not only important to our employees, they’re also important for our shareholders who invest with us because of our culture and our ability to attract and retain people.

Sarah King: One of the key social issues that we’re focused on is around immigration and the increasing levels of ICE activity as they have social and economic implications for our workforce. We also hear from animal welfare reform activists who want to see how we’re supporting humane practices throughout our supply chain.

Dane Holmes: Corporate and social responsibility is also increasingly important to potential employees. How do you communicate that to potential hires? 

Denise Peppard: Gone are the days of the corporate pamphlet as a communication tool. With social media, it’s critically important to be vocal and active and to take a stand very quickly. You can’t just sit on the sidelines anymore. You have to take positions on issues that are pillars of your company and culture.