LIFEWORTH REVIEW OF 2007: FOURTH QUARTER October to November

Dolce and Gabbana Publicly challenging corporations is considered a dangerous business in many parts of the global South, as recognised by Ethical Corporation magazine in their selection of the Best Ethical Leaders of 2007, which included the anti-corruption journalist Lala Rimando, from the Philippines, the second most dangerous place to be a reporter after Iraq.¹ But that a leading journalist on corporate irresponsibility and crime in Europe required police protection during 2007, after "highly credible death threats", was a stark reminder of the continued problems with organised crime, corruption and related commercial interests in in the 'developed' world.² Roberto Saviano had written a book on the Camorra, the lesser known yet more powerful branch of the Italian mafia, based around Naples.

Responsible Luxury How Mr Della Valle's sentiments have translated into effective action is debatable, given that his company, Tod's, came bottom of the first worldwide ranking on the social and environmental performance of the world's largest luxury brands, which was published by WWF-UK in November. 'Deeper Luxury: quality and style when the world matters'⁹ was covered by over fifty newspapers and magazines worldwide, and numerous blogs, with the Financial Times headline "Luxury brands fail to make ethical grade."¹⁰ UN corporate reporting expert Dr Anthony Miller, commented that the luxury goods industry looked like it was "having its own Nike moment," referring to the mid-90's criticism of labour practices in Nike's supply chain that made the company invest heavily in its corporate responsibility programme.¹¹ Fashion UK commented the report "could herald a huge change in the way global luxury brands operate".¹²

Outsourcing Intellects Perhaps sensing this growing attention to luxury ethics, in November the Harvard Business Review provided an in-depth case study on the commercial pros and cons of outsourcing the production of a fictional British luxury brand, which in many respects mirrored the situation with Burberry.²⁰ That British luxury apparel company had previously raised some concerns in the industry and with unions when it closed its Welsh factory in Treochy earlier in 2007 as it moved more of its production to Asia.21

Sustaining Conversation In November The A to Z of Corporate Social Responsibility was published, including over 300 entries spanning 544 pages.²⁵ A useful resource, it also highlights the growth in terminology concerning companies' relations with society. Some of the terms used the most in the West in the last 2 decades feature, such as environmental management, sustainability, stakeholders, corporate social responsibility, corporate accountability and corporate citizenship. As the Lifeworth Review of Corporate Responsibility 2006 identified, the meeting of people and organisations in discussion about CSR is a phenomenon that could tip cognitive frames about the role of business in society, so definitions are important. The concept of "luxury" was identified at the top of a pyramid of cognitive frames about progress and quality that influence the business environment and need to change as part of a cultural shift towards sustainability.²⁶

Silence is Golden In October, a conference was held at INSEAD outside Paris to discuss the findings of a major EU-funded study on corporate responsibility that had been coordinated by the European Academy of Business in Society (EABIS). It focused on the extent of alignment between stakeholders views and demands for corporate responsibility and companies own views on that and whether more alignment correlated with business performance.³⁸ The summary report concluded "those that have established processes for managing dialogue with their stakeholders are no more likely to have achieved high levels of alignment than those that take a more ad hoc approach to monitoring and responding to external concerns. Stakeholder engagement is an established touchstone of CSR best practice - but could it really be that it is a waste of everybody's time?" The overarching finding was that positive stakeholder relations are important to business performance and that these cannot be achieved by processes like structured stakeholder dialogues but perhaps by aligning core business with the interests of the most stakeholders. If companies are naturally aware of societal challenges then stakeholders will not complain, and costly add-on initiatives to engage them beyond the normal course of business will not be required. In a free society, stakeholder silence is golden. The findings were not entirely new, but the fact that an EU backed project involving esteemed management institutions and a large data set now back them up will be useful to champions of real change in corporations to create business models that benefit a broader set of stakeholders.

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