Session

Planning for the Unplanned: The Role of Corporate Responsibility in Unforeseen Events

Most corporations have gradually built their approaches to corporate responsibility through long-term strategic planning and orderly business integration. But in some cases, major unplanned events have thrust corporations into the spotlight, requiring an immediate paradigm shift in approaches to corporate responsibility. These events can stem from a market disruption (e.g., technological breakthroughs), humanitarian crisis (e.g., natural disasters), or breaking news event (e.g., Rana Plaza). This one-hour session will explore shocks to the corporate responsibility system, how teams can better prepare for unplanned events, and how some corporations have effectively used their market presence and infrastructure to become transformational corporate responsibility leaders in times of great uncertainty.

Speakers

  • Koichi Kaneda, Senior Director, CSR, Corporate Communications, Takeda Pharmaceutical Company Ltd.
  • Gabi Zedlmayer, Vice President and Chief Progress Officer, Hewlett-Packard Company
  • Eileen Donahoe, Director, Global Affairs, Human Rights Watch
  • Paul Massey, Executive Vice President, Weber Shandwick
  • Melanie Janin, Managing Director, Communications, BSR (Moderator)

Highlights

  • Advances in technology, including Big Data and interconnected devices, are enabling companies such as HP to better predict and respond to disasters and unplanned events.

  • Some companies, including Takeda, embrace a long-term approach to disaster response that supports reconstruction and community development efforts.

  • A company can determine which disasters to respond to by considering whether its employees or infrastructure are impacted by the event, and through evaluating whether the company has unique capabilities that can be leveraged to provide needed solutions.

  • Creating a crisis plan can foster a corporate culture of crisis-readiness and provide an operational playbook for corporate crisis response.

Memorable Quotes

“Whilst technology in and of itself is not the solution, it is a phenomenal enabler that allows us to predict and respond to disasters much more effectively.” —Gabi Zedlmayer, Hewlett-Packard Company

“Broadening the vision of support following a disaster to include a long-term approach is critical to corporate response.” —Koichi Kaneda, Takeda Pharmaceutical Company Ltd.

“The real value of the crisis plan is the process you go through to create it—this helps a company to build a culture of crisis readiness.” —Paul Massey, Weber Shandwick

Overview

Moderator Melanie Janin, Managing Director of Communications at BSR, opened the session with a reminder that two years ago, Superstorm Sandy struck the New York area just days after the 2012 BSR Conference in New York. This major, unplanned event is just one example of the types of unplanned events and disasters that have an impact on business. In the context of this and other recent tragedies and unplanned events, such as the collapse at Rana Plaza in Bangladesh, stock market jolts, and major humanitarian disasters, Janin posed three key questions to frame the panel discussion: How do companies react in these situations, how does it change corporate strategy, and can you be prepared for the unplanned?

First, Zedlmayer described the ways in which advances in technology are enabling companies and society to better predict, prepare for, and respond to disasters. Recent and ongoing advancements in technology “will change every phase of disaster management,” said Zedlmayer. She offered several concrete examples of these data-enabled changes in action. HP is currently working with an airplane engine manufacturer to put sensors on airplane engines to collect performance data, identify needed repairs, and provide a red alert to airline operators in real time to prevent disaster. HP has also been using Big Data to improve disaster response in its large, complex manufacturing supply chain. In the past it took approximately 42 days to conduct a full recall of a contaminated product in the supply chain, but today the company’s cloud-based data management solution can finish this task in one hour. Following the recent tsunami in the Philippines, HP brought fully automated container health care centers to Tacloban. In addition to providing access to healthcare services, the centers uploaded patient data to the cloud, allowing public health experts to track health patterns and identify outbreaks.

Building on the conversation, Massey discussed Chobani, a New York-based Greek yogurt company and Weber Shandwick client: In response to the refugee crisis in Turkey, Chobani CEO Hamdi Ulukaya “felt a moral imperative to act,” according to Massey. Under Ulukaya’s leadership, Chobani directed US$2 million in resources to the International Rescue Committee (IRC) and the UN Refugee Agency, which provided medicines and psychological support services to refugees. Massey underscored three key points from this example. First, this was an illustration of a corporate leader who identified a need for action and used corporate resources to make an impact. Second, the intervention was a focused and clearly articulated effort, supported by credible and competent implementation partners. Third, stakeholders viewed the action as authentic and aligned with the company’s values and existing CSR strategy.

Kaneda then discussed Takeda’s long-term approach to disaster response following the 2013 Great East Japan Earthquake, in which at least 15,800 people were killed. According to the Japanese government, rebuilding after the disaster would take 10 years. Takeda responded with a long-term plan to support this effort beyond the emergency period. Kaneda said there were five key aspects to the company’s approach. First, Takeda developed a broad notion of support that went beyond emergency response to include the reconstruction period. Second, Takeda developed a plan to provide ongoing financial support to the relief effort. The company decided to funnel a portion of product sales toward disaster-relief efforts. Third, the company drew upon the purchasing power of employees, encouraging local purchasing to support the local economy. Fourth, the executive leadership channeled funding into long-term investments, such as vocational education and training for students. Finally, Kaneda described the importance of employee engagement to advance long-term support following the disaster. The Japan Network of United Nations Global Compact worked to coordinate an employee volunteer program across 14 member companies.

In the question-and-answer period, Janin asked the panelists whether a moral imperative to act helps a company to deal with disasters and unplanned events. Zedlmayer strongly agreed that moral imperative and a culture of responsibility are critical enablers to a meaningful corporate response to disaster. “Think about why companies exist,” she said, offering, “to provide shareholder value and value to society.” Kaneda proposed that Takeda’s 233-year history, coupled with a patient-centered corporate culture and broader health care industry culture, drive the company to take action in response to disasters.

Audience member Carmen Perez from CECP asked how companies determine whether to take action in response to a disaster. Massey said that key decision criteria might include whether a company has people on the ground and/or infrastructure to leverage to deliver solutions. Further, he encouraged companies to consider whether they have unique assets and capabilities to contribute. Zedlmayer said that while HP has a strategic framework to guide these decisions, the company also has a history of responding even when disasters do not fit within the framework. For example, though HP did not have employees or infrastructure in Haiti, the company organized a response to the 2010 earthquake.

Finally, Janin asked whether well-outlined crisis plans can help to prepare companies to manage the unplanned. Massey said that, in addition to being a useful operational tool, the process to create a crisis plan enables a culture of preparedness.

Date

November 4, 2014