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Public Management Program

 

25th Anniversary

Business with a Heart Session

Moderator
Kirk Hanson, Director of the Sloan Program, Stanford Graduate School of Business

Panelists
Daniel Grossman, Co-Founder and President, Wild Planet Toys
Nancy Katz, Executive Director, Students for Responsible Business
Michael Kieschnick, President and Chief Operating Officer, Working Assets

Questions

Q. Talk about current business–business and social missions.

A. from Michael Kieschnick:
For the business mission: be a good phone company. For the social mission, be a company for social change. Tools to change: Donations to peace, justice, the environment, human rights; Political activity–two per month, and advertise in phone bills.

A. from Daniel Grossman:
For the business mission: create a great brand for 4-10 years with a healthy value. For the social mission: make the change in conservative individuals. Avoid gender stereotypes and promote non-violence.

Q. Are they representative of business school students?

A. from Nancy Katz:
Most Socially Responsible Business (SRB) students want to be where Danny and Michael are, but… They want to: pay off their loans, live well, AND do good. I often play interpreter between the business and nonprofit worlds. Most people agree that business should do good without compromising profit.

Q. Social entrepreneurship now seems more nonprofit oriented, are you different from this? (i.e. Do you want the money? Why not at a nonprofit?): Social entrepreneurship now seems more nonprofit oriented, are you different from this? (i.e. Do you want the money? Why not at a nonprofit?)

A. from Daniel Grossman:
If here now, nonprofit. I won't be in the private sector forever, but if I've done it right in the private sector, it's great for change.

A. from Michael Kieschnick:
I won't be at Working Assets forever. I feel rich and cringe. I left Palo Alto because of all the money here; it's hard to escape. It's hard to live here and not be infected by money. I started a nonprofit and find the difference interesting. The private sector moves faster. I expect to run a fast nonprofit.

A. from Daniel Grossman:
Money. Social Venture Network: lots of people there want to make big money, then be free to do what they want. I disagree with that, I believe in voluntary simplicity. Wild Planet gives me money, but it won't have the impact I envisioned or would like.

Q. Is this more than a niche appeal?

A. from Michael Kieschnick:
There are certain beliefs of the company, and I don't know how many people agree with the Working Assets progressive agenda. We have 300,000 customers–and yes, they're a niche. Our customers are hopeful optimists.

Q. Would Working Assets exist without a social mission?

A. from Michael Kieschnick:
I wanted to build a practical machine. This was the way we saw to do it.

A. from Daniel Grossman:
Our goal was to succeed at a large level (i.e. Kmart). Our mission is not put out as boldly as is Working Asset's. The employees know the social mission and many reenergize it.

Q. Are MBA's motivated by guilt?

A. from Nancy Katz:
There's no guilt. NP'ers are here to bring skills to that world. The difference between today's MBA's and SVN's older generation. Today, it's more practical. Business is the way to do it. MBA's ask, "who is really committed to this?" Not just small companies, but support those in large companies. Consumer habits are heard. Examples: recyclable packaging, animal testing.

Q. MBA's debate nonprofit versus for profit. Would they have been able to do it in a nonprofit and succeeded as well?

A. from Daniel Grossman:
That's a tough question to answer. It would look so different. I doubt it.

A. from Michael Kieschnick:
Working Assets would now be turned into a nonprofit. But I don't think it could have gotten started as one. There's no way to get the money to start. Regulations might have made it hard.

Q. What has the political lobby done for gun control?

A. from Michael Kieschnick:
Handgun control. Calls and letters on the Brady Bill. Involved in every note on guns. 9,000 customers in 24 hours called the Senate about gun control.

Q. Are you panelists exemplary?

A. from Daniel Grossman:
For me, the impact is on the people right around us. Social assessment is now based on SVN's criteria. This starts a dialogue internally about "social shortcomings" of the company.

A. from Michael Kieschnick:
Working Assets is exemplary in many respects. But our impact is outside. There's a lot of work to be done for social change. Our big struggle is in the work. We don't lead balanced lives.

Q. There's no one formula for what social responsibility is. The expectations are infinite for these businesses.

A. from Nancy Katz:
Companies find the label hard. There is a spectrum and companies choose where they fall. Companies are not perfect.

A. from Daniel Grossman:
Our assessment tried to keep the focus on. We ask about the hierarchy of values.

Q. The socially responsible label is a tough one. How do you draw the line?

A. from Daniel Grossman:
Each person decides for him/herself, using his or her own criteria. It's too complex for a bipolar definition. Should have values, state them, and assess.

Q. How do you focus on responsibility and consistency?

A. from Nancy Katz:
Nonprofits have a great mission, but behind the scenes it can be tough. They strive to live the mission–it's incredibly hard. You try for integrity. Balance is something we work on.

Q. Is there such a thing as a morally neutral business?

A. from Michael Kieschnick:
No one is ever neutral. Most businesses' net impact falls on a scale. They make moral choices everyday.

A. from Daniel Grossman:
A lot more voices need to be involved. Dayton Hudson does a lot, but they're not at the table.

Q. What are the differences between bringing values in at start up versus later?

A. from Michael Kieschnick:
It's getting harder every year to hire people who share your values. Running the business is so tough. So we have outside speakers, recipients of donations, etc. come in.

A. from Daniel Grossman:
It becomes less explicit later, but it's always a backdrop. The values are internalized.

Q. Is there a market for developing metrics for companies?

A. from Kirk Hanson:
It's growing. Each "group" (environment, labor, etc.) sets up criteria for audits in Europe. The US looks more individual per company.

Q. Has Wild Planet tested being more explicit?

A. from Daniel Grossman:
They tried it early on and it was very negative. People did not want preaching. Up to this point, there have been more toys geared toward boys. There's a new line this fall geared towards girls.

Q. How far can business go in being effective?

A. from Daniel Grossman:
Look at what EDF did by working with McDonald's. Small changes can have a huge impact.

Q. Should the Working Assets model go everywhere?

A. from Michael Kieschnick:
We thought we'd be copied and we're disappointed.

A. from Nancy Katz:
Social activists are so powerful.

A. from Michael Kieschnick:
Business has a legitimacy that has grown–it's the most effective platform. Sad but true.

Q. What is your next venture? Where do you want to be in five years?

A. from Daniel Grossman:
I want to be closer to kids and social action, who knows exactly where.

A. from Michael Kieschnick:
Next, we want to go after the media since it's so corruptive. Working Assets just bought a radio station. Later, maybe I'll teach–it's lots of fun.

A. from Nancy Katz:
The PMP got her here. Five years with SRB. What next?