Marketing and Profiting From An Ethics Edge Presented by CalgaryJune 5, 2015 David Nitkin President, EthicScan Canada

Questions 1.What do we mean by upmanship? 2.Is it moral or ethical to market an ethics edge? 3.What does superior or responsible CSR performance look like? 4.How can we embed and enhance ethical choices, decisions and outcomes?

The Meaning of Upmanship (1) 1.Do one better 2.The art or practice of outdoing or keeping one jump ahead of a friend or competitor 3.Continuous improvement 4.Aim your decisions higher on the minimize harm, do no harm, do good triangle

The Meaning of Upmanship (2) Striving to do better Realizing more stakeholder expectations Building upon experience of others Addressing social needs Transformative nature of “we are wrong” Decisions higher up the goals hierarchy

HIERARCHY OF GOALS DO GOOD DO NO HARM MINIMIZE HARM

Thesis Canadian business people have not realized their potential as an agent of change – Community investment – Role model employment equity – Redefine socially acceptable forms of “trust- based” economic globalization – Intellectual capital – Lack responsible Canadian governance model

The Ethicality of Marketing Ethics Yes – its right to market an ethics edge No it’s not ValuesEveryone does itNot all organizations are ethical or equal Morality (Public reaction) You will be rewarded by the public You can be harshly judged by the public or certain stakeholders Share price30-60% of valuation is reputation: Apple, Coca Cola Share prices typically increase with layoffs Sustainability footprint Measure and market an ethics edge Scientific knowledge-based certainty is questioned

Quantifying Superior CSR Performance (1) Return on investment Shared values Stakeholder engagement A respected employer of choice Corporate reputation Cultivation of “gold collar” workers

Quantifying Superior CSR Performance (2) There are some who find answers in a particular framework (GC, Future Fit, GRI) Others look for support and standards without assessment or benchmarking CSR standards change over time (society, science, politics, footprint, expectations) One size cannot fit all circumstances

Assessing and Quantifying Superior Performance (1) Green Blue Grey Brown Organizational Ethic SustainableEmpowermentProfitable short and long term Short term PartneringEngagementCommunity investment PhilanthropyIsolation; charity of owner Standard setting Eco-consciousResults based management ManagementDominant family or shareholder Management style Outside inTop down and bottom up Inside in isolation Top down hierarchical

Assessing and Quantifying Superior Performance (2) Green Blue Grey Brown Performance approach GRI G4Global compactAccounting standard Audit standard Ethics regimenWhistle blower protection OmbudsmanHarassment policies Code of ethics Progressive practices SabbaticalSame sex benefits Emergency family days Compassionate leave AuditInternal and external Disclose executive compensation GAAPInternal audit

Higher Thinking To Up Your Performance Don’t strive to keep all stakeholders happy Sharing values isn’t the same as shared values Transparency, honesty and accountability can find expression in all organizations Be wary of one size (reporting standard, performance metric) fitting all companies Do the right thing even if it’s for the wrong reasons

Conclusion Clarify and realize the full potential of your corporate responsibility competency Upmanship is acceptable in all circumstances or rainbow colours Upmanship is its own reward