Grown-up corporate social responsibility and the regulatory environment – Strategy book on “Aligning for advantage” by Professor Thomas Lawton

I’ve always been a bit dubious about the role of Corporate Social Responsibility (CSR) in the business world and the professions and, at an event at the Open Business School in London last night to launch a new strategy book Professor Lawton reminded us of the quote by Milton Friedman “The business of business is business” which may partly explain my viewpoint.

Yet I’m a strong advocate of the Sun Tzu philosophy of “Those who do not know the lay of the land cannot manoeuvre their forces” and always look to the broader external environment when crafting strategy.

The book (“Aligning for advantage – Competitive strategies for the political and social arena” which is co-authored with Jonathan P Doh and Tazeeb Rajwani) is based on research interviews with 100 CEOs, strategists, government affairs managers and leaders of CSR from across the globe and explores built-in and bolt-on approaches to tackling the ever growing array of social, environmental, political and regulatory issues encroaching on business strategy.

Professor Lawton talked about the three main ideas from the research:

1. In a multipolar economy, competitive advantage is partly dependent on proactively synchronising with the external environment
2. Connect with the external regulatory environment for market and non-market strategies and through the value chain in your own way. There were some interesting case studies including those from Guinness, Ben & Jerry, Tylenol, Union Carbide, GE Honeywell, Dannone, SwissRe, BMW, Nestle, Cadbury and Apple
3. Structurally synchronise and strategically elevate your connection with the external environment. He advocated the creation of a CEEO – a Chief External Engagement Officer

There was the inevitable matrix which summarised the different types of external engagement architecture with axes of political orientation and social responsibility (from sceptic, to dealmaker, to concerned to ambidextrous). And another in terms of whether the CEO, political and legal affairs (PLA), CSR or a CEEO takes the lead in the organisation. Professor Lawton admitted that the findings were not new but that the topic was either ignored, misunderstood or badly implemented in many organisations.

There was a presentation by Dr Virginia Acha, director of regulatory affairs of AmGen (manufacturer of biologic medical products) who gave an insight into how it all works in practice. There were some interesting questions about the impact on reputation, superficial marketing and branding programmes and social activism (“doing well by doing good”).

While I can’t see this having much of an impact on professional firms (although some have strong Pro Bono and CSR programmes) at the moment it did occur to me that this would be further impetus to the growing importance of the in-house lawyer or general counsel where the political and regulatory brief often sits.