This article was written by Alex Steffen in October 2007. We're republishing it here as part of our month-long editorial retrospective.
There was a time, not all that long ago, when a company's responsibilities stopped at the office door.
Those days are over. As connectivity increases and activists grow more savvy about forcing transparency in the sourcing of goods (think, for instance, of the blood diamonds campaign or the use of cell phones to reveal the origins of food), William Gibson's prophetic remarks on accountability ring more true every day:
"It is becoming unprecedentedly difficult for anyone, anyone at all, to keep a secret. In the age of the leak and the blog, of evidence extraction and link discovery, truths will either out or be outed, later if not sooner. This is something I would bring to the attention of every diplomat, politician and corporate leader: the future, eventually, will find you out. The future... will have its way with you. In the end, you will be seen to have done that which you did."
The practical manifestation of this trend is that everything matters. Where once a company was held accountable for what it did, it is increasingly held accountable for that which it caused to happen. As the consulting outfit SustainAbility puts it in their report The Changing Landscape of Liability, "boundaries of accountability will progressively expand through the value chain and through the whole life-cycle of a product's development, production, use and disposal."
A company's suppliers matter. Those suppliers' subcontractors matter. The labor standards of everyone who had any part in making the product matter. The materials in the product matter. The energy used to make it matters. The manufacturing process itself matters, as does the producer's plan for the disposal of the product when it's over. Indeed, as far a corporate reputations are concerned, accountability is becoming a vast web of entanglements in the actions of others, some of whom the leaders of that corporation might be hard-pressed to name.
This is something new, and powerful. We already have an increasingly effective global NGO movement aimed at forcing whole classes of businesses into compliance with certification systems (think FSC timber, fair trade coffee, etc.). In his excellent book Branded!: How the 'certification revolution' is transforming global capitalism, Michael Conroy notes that a whole array of industries are now coming into compliance with third-party accountability systems that certify whether or not that company's actions meet basic environmental and social standards. It's not just coffee and chocolate anymore, but also mining, banking, apparel, chemicals and so on. If you're in business, you can be sure that someone, somewhere has a certification system with your name on it.
But in this new phase, it is not enough simply to stop being evil. As Marks & Spencer executive Ed Williams said, "consumers increasingly want to be sure that the companies they deal with reflect their values, can be trusted to behave responsibly, are who they say they are and are the kind of organization they like to be associated with." In simpler terms, companies are finding themselves held responsible for the whole backstory of their products.
A product's backstory, you'll remember, is everything that happened to get the object or service to us, everything that will happen behind the scenes while we use it, and everything that will happen after it leaves our lives. The backstory tells us who we’re being when we make a choice.
Good companies are getting better at telling the backstories of the things they make. Other companies -- the ones who can’t figure out how to tell their backstories, or whose backstories are shameful -- are sailing into the storm. Indeed, how companies tell their backstories is the critical business communication challenge of the next decade. We're entering an era of holistic accountability and backstory management.
So far, attempts at creating tools for telling backstories have been mostly unsuccessful.
One reason for this is complexity: the backstories of even simple products often link together a staggering array of people, places and things.
Another difficulty in backstory communication has been the lack of clear targets. Effectively revealing your backstory conveys explicit goals about the kind of company you're trying to be, and it is still difficult to know what the gold standard is for any particular product or service: What does a sustainable shoe look like? How does a responsible masonry supply chain operate?
There are some practices smart companies should definitely avoid. Lying is obviously at the top of the list, but not much farther down the list is trying obscure negatives by emphasizing the positive -- even when this doesn't devolve into outright greenwashing, it risks being seen as such. But neither will vague goals help much.
Vague goals are dangerous because they're clueless. Consumers and investors both want effectiveness, and at a time when cluelessness about sustainability equals liability, to display muddle-headed thinking is to send a message that you are not entirely worthy of their trust.
A well-intentioned example of flawed goal-setting is the site Actics, which means to help individual and institutional members turn values into action, but which assigns no absolute value to the goals towards which the action aims, thus making the whole site rather wishy-washy. For instance, the most popular action on the site is "Have an interest in and concern for ideas, opinions, practices, etc., foreign to one's own; a liberal, undogmatic viewpoint." To say that this leaves some wiggle room for irresponsible behavior would be an understatement.
In contrast, the path to really managing your backstory runs through big visions, hard targets and open admission of shortcomings. Shoe manufacturers should work to envision a boldly responsible shoe, one which not only incorporates their ambitions about the future of footwear, but also encompasses the cutting-edge standards in ethical behavior: a shoe, say, that has a one-planet ecological footprint and meets the highest possible labor standards. That company should share the vision of that shoe with every one of its customers.
And then it take the hardest step of all: admit the degree to which its current shoes fall short of that mark, and explain the steps it's taking to bring its shoes closer to the gold standard. This has three benefits: the first is that achieving the gold standard is a competitive advantage in and of itself, reducing liability and often raising the bottom line in the process. The second is that companies which reveal their shortcomings and an understanding of what those shortcomings matter earn an astronomical amount of market trust. They may even win over ethical consumers who wouldn't normally support the product but want to help the company in its efforts. When all is transparent, nobody can accuse the company of greenwashing. The third is perhaps less tangible, but I believe no less real because of it: the people in that company will be making shoes they can be proud of.
It's hard to do work you can be proud of these days. We live in an ethically compromised global economy, and almost every aspect of our lives is compromised as a result. But by acknowledging the gaps between practice and aspiration, and setting concrete plans for bridging those gaps, we lift a good part of that burden. Our shoes (or laptops or meals) may not be perfect, but we are pushing in a realistic way towards shoes and laptops and meals that will one day meet our ideals, and that, in and of itself, is something to take pride in.
I've said before that in these times optimism is a political act. Intelligent thinking about backstory management shows us something more: when doing business during a global crisis, idealism can be a practical act.
From Corporate Responsibility to Backstory Management is part of our month long retrospective leading up to our anniversary on October 1. For the next four weeks, we'll celebrate five years of solutions-based, forward-thinking and innovative journalism by publishing the best of the Worldchanging archives.