Everyone can make a difference

Article from KPMG CSR newsletter – april 2008

Jan van den Herik and Gert van Essen do not get caught up in courtesies and formalities. They think Corporate Social Responsibility is too urgent for that. Enthusiasm and commitment go hand-in-hand. And KPMG can make money that way too.

Is that what you want, to set KPMG in motion by speaking boldly?
Jan: “It might be partly in my character, but I do communicate my passion with considerable enthusiasm. It’s also a necessity. KPMG is a collection of professionals who, above all, want to verify and explore the nuances of the relevant issues. That’s how we’ve made a name for ourselves. It is in our nature to progress step-by-step. However, CSR is more than simply verifying and ensuring a nuanced approach – it is also about vision, enthusiasm, empathy and action. If we want to be leaders on that level, and not play second fiddle while waiting for legislation and regulations, we’ll have to stick ournecks out. That suits a motivator, and that’s how I like to describe myself.”

Why is such motivation necessary? After Al Gore, everyone knows that it’s serious. All large companies are picking up on this, are they not?
Gert: “That’s true, it’s everywhere around us, worldwide. It’s a long way past being just hype. For example, numerous multinational companies – partly under pressure from stakeholders – have taken on Corporate Social Responsibility and Sustainable Development in a very dynamic manner. But you still see the same in both organisations and society: as citizens, people want to see action, but they show less initiative as consumers or as professionals. KPMG staff expect – in my experience, at any rate – KPMG to actively take on CSR, but many do not yet clearly see what their own role can be. ‘When I do my daily work, what does that have to do with CSR?’, they ask themselves.”

And what is your answer?
Jan: “It is a quest that begins with the individual. A way of thinking that we all have to develop, and it extends beyond how much paper you use or which car you choose. What we do within our tiny department is present issues and identify dilemmas. And I don’t see us as a department in the traditional sense, because that only means co-workers will say: ‘CSR, that’s the CSR department’s responsibility.’ I want to set a wider movement in motion. If I see relevant topics in society that do or should play a role within KPMG, then I ask questions within KPMG, and put the topics on the table. Obviously, these are not things that have a nice, tidy answer. For example, how do we deal with our top clients who expect us to sign off on their supplier code and subsequently want to audit us? What statement do we issue if we have to demonstrate in our proposals that we maintain socially responsible policies? Which practical examples do we present? How do we deal with suppliers or clients who violate human rights or contribute to environmental destruction on a grand scale? I don’t provide the answers, I get people thinking and hope to stimulate the efforts needed to bring our policy into line with our stakeholders’ expectations.”

But with the hope that solutions are found, am I correct?
Jan: “Of course. As soon as solutions are defined and implemented, we disappear into the background. There are still a lot of nuts left to crack in the coming years but, in my view, the CSR department will ultimately disappear from the scene because CSR will be secured in our existing business processes. [Laughing:] ‘Who was that Van den Herik again?’ As far as I’m concerned, the task will be completed when all KPMG staff are in a position to identify and work out the issues independently and take matters into their own hands.”

Can you give an example?
Jan: “During the planned liquidation of our pension fund, we will mainly be looking at financial parameters and, to a lesser degree, at the social context. Sustainable investing does not play an explicit role in transferring the pension fund elsewhere. The same is true with the purchase of the individual pension fund. In my opinion, however, that could and should have been taken into account. Reporting on our non-financial dealings is a similar area. An annual social responsibility report doesn’t exist yet, although numerous clients of ours already started down that path years ago. The motivation process could have happened from within corporate communications. I now see it as my task to take this further and ultimately see that it is secured in our regular annual reporting process. And there are many more similar topics. Just think of procurement policy: how do we ensure that our suppliers uphold standards in an international context in the areas of the environment and human rights, for example? As long as there aren’t any standards included in our procurement process, I will remain active as a motivator in that area as well. Once the standards are in place and are well maintained by our buyers and internal customers, CSR will disappear from the picture.” There are controversial issues too, of course.

Can you give an example of an issue you are currently facing?
Gert: “I think that it’s difficult to develop hard standards regarding client acceptance. Do we want to work for organisations which do business with companies linked to child labour? That’s a very complicated area. As a commercial service provider, we are part of a system, and at the same time, want to be able to influence it. Where do the possibilities lie and how do we determine the boundaries? We have to actively exchange ideas with each other about this.”

Is that a dilemma you will ever see the end of? Can you do any business at all without getting your hands a little dirty?
Gert: “Let’s be clear: every company wants to avoid a Brent Spar incident. No company wants a TV journalist on their doorstep with the question: “Why do you earn money doing the accounts for companies who use child labour?” At the same time, you can’t be holier than thou. It is a broad social problem which we can only resolve in cooperation with the business sector. Fortunately pressure from outside and from within the business sector is increasing. The Dow Jones Sustainability Index and the FTSE4Good Index are growing and flourishing; stakeholders are making increasing demands. Organisations such as Rabobank and Philips are known pioneers in this area and most organisations are starting to establish respectable standards in the sustainability arena. KPMG wants to actively contribute ideas and solutions. Just look at the initiatives in this newsletter. Look also at the opportunity that KPMG is offering Jan to act as Director of the Stichting Samenleving & Bedrijf – the national CSR business network. “We are doing an awful lot. On the other hand, of course we mustn’t lose sight of our commercial interests.”

But you can earn money from CSR too…
Gert: “Of course that’s important too. The CSR services fit into our business model very well. With our name and expertise, we are an ideal partner to perform audits and report on the CSR area. The question now is whether clients really want to pay for what they have committed to regarding social responsibility, such as detailed supply chain audits or comprehensive sustainability verification reports. We all have to be aware of the opportunities. And if we really take CSR seriously, we will include goals in the CSR area in our business planning, both commercially and with respect to our own actions. As far as I’m concerned, we’re definitely headed in that direction. In the long run, it can’t be the case that you are challenged as a manager and staff member to act in a socially responsible way, only to be evaluated solely on the commercial results.”

What do you ask of staff in this area?
Gert: “An awareness; a willingness to deal with issues actively and knowledgeably and to enter into a dialogue with each other. I prefer not to think too structurally in this area, I don’t want to present a polished policy to everyone. We simply have to tackle current issues. That’s why I’ve been firm on the new sustainable mobility scheme. In the foreseeable future, we’ll start analysing our values, together with newcomers joining our organisation.”

[He briefly looks into the clear blue sky.] “Ultimately, CSR has to touch you personally. There comes a time in your life when you think: life isn’t only about clients, profit, your profession, providing a service. We have more to offer to our environment than that – we as a company, we as individuals…”

Jan: “It starts with personal awareness. For me, it began during a long journey I undertook on my own across South America in the 1990s. In addition, you also have to become convinced that you really want to make a difference and you have to be ambitious. You also have to be bold and develop leadership skills so you are confident of bringing things up for discussion. Can KPMG staff do that? Of course they can. We are greatly appreciated for our professionalism, our involvement, our integrity and our character. Moreover, KPMG staff, by nature, are active outside of their work. In committees, sports clubs, social networks, you name it. Many staff members already devote their time to charitable causes. There are opportunities to let your voice be heard in all of these professional and private roles. Not in a pushy or moralistic way, of course, but rather clearly and constructively, based on personal involvement, enthusiasm and the courage to dream. I don’t think that you can say out of idleness, ‘that’s not my role as an auditor or advisor’, if you are concerned about distressing issues as a citizen. The world has changed drastically over the last few years. Many top decision makers are worried about the world of tomorrow. Why not use your advisory skills to make tricky issues debatable within companies and to reorganise them into opportunities and solutions. I don’t think it’s difficult, but you have to have the guts to take that first step. And above all, don’t forget that it’s very liberating to redefine your boundaries and broaden your horizons. Sometimes you hit a wall, that’s true. But that’s how you grow.”

Can you be more specific?
Gert: “When the opportunity presents itself, we all sit at a table somewhere. The talks take place within our organisation, but also with clients and in other environments. I notice in my environment that sustainable business is really alive. At the end of the day, we all have something to give, and that’s what you talk to each other about, there’s nothing extraordinary about that. It’s also an excellent way of spotting business opportunities which may be on the horizon for KPMG.”

Read the whole magazine here: