Over the last 15 years, we’ve seen the tech sector come into the spotlight, initially for its positive, world-changing potential, and more recently for the negative impacts technology can have. Tech in and of itself is not inherently good nor evil – it is the people who decide how technology is applied and governed that determine whether it saves the world or deepens inequality, erodes democracy, and props up existing power structures.
The world is starting to care a lot about these effects, with many of this sector’s practices coming under heavy scrutiny in recent years. Corporate social responsibility, a realm that was in recent history reserved for established companies, is becoming more important at an earlier stage.
As a new decade approaches, trends we’ve seen building over the last few years will dominate the conversation.
Here I’ve highlighted the six key trends that I’m seeing large and small tech companies embrace, that will become increasingly relevant as we launch into the new decade.
Alignment with the United Nations’ Sustainable Development Goals
The Sustainable Development Goals (SDGs) are the ‘world’s to do list’ – the 17 biggest challenges facing the world today, as declared by the United Nations.
“Over the years we’ve seen a 10x return from spending on CSR.”
– Marc Castel, founder, Fiix Software
Unlike the earlier millennium development goals (MDGs), which were focused mainly on reducing extreme poverty, the SDGs apply universally. The SDGs create a common language enabling governments, businesses, and NGOs to focus on, collaborate around, and take action to move the dial on the world’s biggest problems.
Next year has been called the ‘make or break’ year, and the 2020s have been dubbed ‘the decade of action.’
Unlike the MDGs, this time businesses are turning out to be the leaders of this movement, reflective of a larger shift in responsibility from government to the private sector.
The SDGs were a core theme of Salesforce’s Dreamforce conference in San Francisco this year, with opportunities for attendees to take a quiz to understand which SDG resonates with them, onsite activations to make tangible contributions to the goals, and sessions to learn about how businesses are tackling the SDGs.
Marc Benioff, chairman, co-CEO and founder of Salesforce, has noted that Salesforce’s success is directly tied to being a values-driven company. Salesforce selected six SDGs to rally around as a company (Quality Education, Gender Equality, Affordable and Clean Energy, Decent Work and Economic Growth, Sustainable Cities and Communities, and Climate Action) and has set specific targets for what it plans to accomplish for each.
Toronto-based company Fiix Software has identified five SDGs it will focus on (Quality Education, Gender Equality, Decent Work and Economic Growth, Responsible Consumption and Production, and Life on Land) and is tracking the company’s progress in its annual CSR report.
“Doing good is good for business,” said Marc Castel, founder of Fiix Software. “At Fiix, we introduced Corporate Social Responsibility as a business department when we had 20 employees. It’s embedded into every part of our business: governance, finance, marketing, people. Over the years we’ve seen a 10x return from spending on CSR. This kind of thinking is becoming table stakes for all companies who want to succeed in today’s economy.”
Social purpose ventures
Historically, charities focused on maximizing impact, while businesses maximized profits. Over the last 20 years, we’ve seen the rise of the social enterprise, which typically looks and feels more like a charity, but with a focus on sustainability through revenue.
Recently, we’re seeing a new form of enterprise – one that more closely resembles a business, but has social impact at its core. There are a few terms for these types of organizations; I call these ‘social purpose ventures’, and they are becoming increasingly common.
Jenn Patterson, chief marketing officer at NEXT Canada, noted that nearly 50 percent of the 80 finalists for NEXT Canada’s National Selection Weekend this year had a social impact mission at the core of their business.
“There was a significant increase from previous years,” Patterson said. “There is starting to be a recognition that these types of businesses can be just as economically successful as their more traditional business-focused counterparts.”
Expanded scope of responsibility
Tech companies seem to be getting in trouble a lot these days. This is at least partly because the scope of what they are being held accountable for is expanding.
As we saw with Shopify’s hosting of a Breitbart store, Salesforce’s contract with US Border Control, and Facebook’s political ads that are deemed to have swayed the last US election, tech companies are increasingly being held to account for who is using their products, and how they are using them.
Policing these platforms and imposing guidelines on users is not something that has been popular, or easy to navigate.
“Solely deferring to the law, in this age of political gridlock, is too idealistic.”
After initially citing freedom of speech as a reason to not interfere with the Breitbart store, Shopify later implemented a policy against hosting stores that incited hatred or violence, restricting thier ability to operate on Shopify’s platform.
As Tobi Lutke, CEO of Shopify, shared in a 2018 post, “Solely deferring to the law, in this age of political gridlock, is too idealistic and functionally unworkable on the fast moving internet.”
The days of, ‘let’s see what we can get away with’ are quickly coming to an end, as transparency increases and companies are just a blog post away from a scandal. The most forward thinking companies know that it’s better to fix the problems proactively before someone else uncovers the problem and causes a public uproar.
Governance is king
The Reputation Institute’s Global Corporate Responsibility Reptrak Study shows that governance is the number two factor influencing a company’s reputation, after products and services. Core elements of governance include perceptions of whether a company behaves ethically, is fair in the way it does business, and is open and transparent.
The public has high expectations of companies’ abilities to balance the interests of many stakeholders, and are increasingly unforgiving when the board and senior management appear to have an imbalanced approach. And the law is unable to keep pace with rapidly changing technological advances.
In Toronto, we’ve seen groups raise concerns about data use and privacy in Sidewalk Labs’ Master Innovation and Development Plan. Significant concerns have also been raised about the ethical development and use of artificial intelligence, for example, with regards to face recognition technology. The World Economic Forum has published guidelines on Ethical AI, advising an approach of self-regulation in the absence of government legislation.
With calls from groups like The Business Roundtable to redefine the purpose of a corporation, expectations of companies to fairly balance the interests of shareholders, employees, customers, suppliers, the government, and the community will continue to rise.
From diversity, to inclusion, to belonging
The conversation has shifted beyond the desire for a diverse workforce, to the more fundamental need for an inclusive workforce, and now to whether people truly feel they belong.
“Most diversity initiatives fail because they focus on the wrong things.”
After decades of diversity and inclusion initiatives with limited results, people are realizing that until the underlying cultural framework of the workplace reflects the needs of a wide variety of people, diversity recruitment efforts will yield little results. Employees will quickly depart from companies where they feel uncomfortable.
Ceridian, for example, has initiated a “take two” policy, where anyone could have two hours to take care of something in their personal life, with no questions asked. On the leadership team, Justine Janssen (SVP strategic initiatives) works remotely most days of the week and CEO David Ossip will share pictures of himself going for a bike ride in the middle of the day.
Mesh/Diversity takes a deeply scientific and business-relevant approach to diversity and inclusion, focusing on the behaviours that drive belonging. The company’s data and metrics-based approach to addressing unconscious bias and systemic barriers is led by chief diversity officer, Leeno Karumanchery, who has over 25 years of experience and is world-renowned for his expertise in the field of ‘Diversity-based Organizational Change.’
“Most diversity initiatives fail because they focus on the wrong things,” said Karumanchery. “Research shows clearly that getting ‘diverse’ bodies in the door won’t matter if the receiving culture doesn’t resonate safety, belonging, and inclusion.”
Time to step out of your lane
As the role and capacity of government has, in many ways, diminished over the years, businesses, especially those in the technology sector, are being asked to take on a bigger role in addressing the world’s biggest problems. It is quickly being accepted that all sectors must work together if we are to be successful in creating tangible social changes.
There has been a major resurgence of activity to bring the tech and philanthropic sectors together, including roundtables hosted recently by the Toronto Foundation and Civic Action, and Capital One’s Digital For Good Tech Jam & Summit, where tech leaders helped design tech solutions for charities.
“The cost of inaction is starting to become bigger than the cost of action.”
Furthermore, many billionaires have spoken out recently advocating for higher taxes on the ultra-wealthy. Benioff was a vocal champion for Proposition C, which added a new tax for the largest Silicon Valley companies to help fight San Francisco’s homelessness problem and successfully passed last year.
These kinds of corporate advocacy and action usher in a new era where business and its leaders take more responsibility for the broader impacts they are having in society, rather than focusing exclusively on profit margins.
In 2020, this kind of behaviour will shift from being championed by a few to becoming necessary to meet expectations from employees, customers, investors, and the public. As Paul Polman, ex-CEO of Unilever, said, “The cost of inaction is starting to become bigger than the cost of action.”
So, in 2020, how will you set your company up to be socially responsible? The approach varies based on company stage and size, but all companies have an opportunity to make thoughtful choices about their business model, governance, talent strategy, and community impact. Your business will have an impact on the world…the question is whether you will be proactive and purposeful to ensure that that impact is positive.
Image courtesy Jennifer Couldrey
UPDATE 11/12/19 – this story has been updated to reflect that the Breitbart store was not restricted from using Shopify’s platform under the new policies.