Why should a company have a thorough corporate social responsibility (CSR) program? CB: It is part of our corporate responsibility (CR) policy to be clear and accountable when it comes to our impact on people and the environment. Engagement is an essential element of being a responsible business. Both the company and stakeholders should benefit.
JC: We really believe there are long-term benefits to being more responsible. When Vodafone Turkey was acquired about 12 months ago, we weren’t the highest bidders; because our CR program was taken into account by the Turkish government, however, we won the contract.
BvB: Increasingly, investors are looking for unconventional drivers that aren’t yet priced into the market. A poor CR program can have an effect on reputation. Socially responsible investment (SRI) ratings create a certain leverage and can exert influence. For example, when Wal-Mart was excluded from a Norwegian pension fund because of its poor record on labor and human rights, the issue was reported in the press and subsequently had some impact on the company’s reputation.
How can you put your message across to the investor community?
CB: Broad, company-wide engagement might be appropriate in some cases, but sometimes it fails to reach the right people and to address certain issues in appropriate detail. To be effective in helping us to understand and respond to stakeholder concerns, engagement needs to be considered and operate at the right level.
For example, when we wish to get our message out to our institutional investors, we target key shareholders that have a clear SRI focus. It is also a continuous process, so these areas are constantly under review.
JC: We think it’s really important to try to speak our investors’ language. We also set up meetings and go to roadshows alongside the investor relations team. We typically meet 12-15 investors per year and go through the CR report with them. In the US, we have also had SRI analysts at our meetings who have provided us with good feedback.
BvB: It’s crucial to tailor your communications.
IR and sustainable development (SD) executives should get together to communicate the CR message. Companies have to use existing mechanisms such as roadshows and one-on-one meetings. For written communications, the one-size-fits-all approach doesn’t work. Analysts will not dig into a 100-page or 200-page report to get information. Can you give our readers any practical advice?
CB: Vodafone’s CR team and IR function meet with 20 of our largest investors on a one-to-one basis once a year, after the release of the CR report in June. Our group CR team works with local operating companies and group operational functions to develop policies on CR issues. Additional group resources are dedicated to key issues, such as radio frequency fields and health, social products and enterprise, and content standards. For example, we have an electric and magnetic fields board and committees on content standards, privacy and social investment.
