How far does corporate responsibility go?

November 25, 2013

By: Betsy Neville

Do companies have a responsibility beyond their core business to ensure the individual health and well-being of people?

Clearly companies should do no harm to their employees and consumers. Today the question extends to whether or not it is the responsibility of a company to proactively ensure that its products or services are contributing to the health and well-being of people. For example, a car company could have a responsibility to create ergonomic seats. A computer gaming company could be held accountable for averting obesity. An airline could insist its passengers do minor exercises during long flights.

I recently attended a business school symposium where representatives from 25 companies were brought together to deliberate on solutions to healthy living challenges that were facing their businesses. Some of the people in the room were those you would expect to be problem solving on this topic: pharmaceutical and healthcare executives, representatives from a nutrition company and food manufacturers, but others were not directly operating in the healthy living space. Also participating was an executive from an electronics company, a beer producer, and a waste hauler. You see where I’m going with this.

It raised the question in my mind about increasing expectations for companies pertaining to their social responsibility. Is it moving beyond providing solutions for society and toward increased proactive responsibility for individuals’ personal health and well-being? Where is it headed? It’s a provocative suggestion with serious implications for companies and it could represent a definitive shift in expectations related to corporate responsibility. I wanted to learn more.

Let’s keep in mind that corporate responsibility has risen rapidly and keeps advancing at a brisk pace. Let’s not forget that we are also living in a world today where public expectations eclipse corporate power. The Harvard Kennedy School’s Corporate Social Responsibility Initiative has pointed out, “throughout the industrialized world and in many developing countries there has been a sharp escalation in the social roles corporations are expected to play.”

In 1970 Milton Friedman may have written his famous The New York Times magazine piece, “The Social Responsibility of Business Is to Increase Its Profits,” but the past ten years have proven that companies in all sectors are willing to take on more responsibility. Ten years ago, only about a dozen of the Fortune 500 issued a CSR or sustainability report. Today, more than 8,000 companies have signed the UN Global Compact pledging to show good global citizenship. Could healthy living become the next generation of corporate responsibility? When I looked, I found that the answer is “yes.”

Business for Social Responsibility (BSR) just issued a report, A New CSR Frontier: Business and Population Health.

BSR’s research shows “that the nation’s largest companies face increasing pressure to improve health outcomes by promoting wellness and prevention—not only for their employees, but for the broader population that is impacted by corporate actions.” It predicts growing corporate investment in population wellness and talks about the pioneers:

  • Walmart is working to provide better access to affordable and nutritious food in lower-income neighborhoods and communities.
  • Qualcomm with WebMD is creating tools so customers can access and manage wireless health data from devices.
  • PepsiCo is improving the health, wellness, and safety of farmers who produce raw materials for the company.
  • Healthcare provider Kaiser Permanente is partnering with media company Home Box Office to raise awareness about the obesity epidemic in the United States.

While the BSR report says that most companies are focused on employees today, it concludes that society expects companies to play an increasing role in strengthening not just employee but the greater population’s health. It suggests that healthcare challenges and costs might be driving innovation. The U.S. spends more on healthcare than any other industrialized nation, but has the most illness, injuries and the shortest lifespans of other high-income countries. These factors are having a profound impact on business and hamstringing America’s competiveness. As a result, companies are moving to find solutions through not only state-of-the-art workplace wellness programs but also in some cases, like the companies mentioned above, to major advances in health and healthcare by bringing new products, services, and technologies to market.

Betsy Neville is FleishmanHillard’s Reputation Practice Lead in North America. You can reach her at betsy.neville@fleishman.com.