Self-proclaimed renegade Dame Anita Roddick’s Body Shop was one of the pioneers of corporate social responsibility.
Anita Roddick sees herself as an activist and renegade first and foremost, rather than a businesswoman. While today, her mainstay is indeed a mix of activism and philanthropy, her business credentials are pretty impeccable. She brought The Body Shop from one store sandwiched between two undertakers in Brighton (the company name raised a few eyebrows at the time – so no change there then) to a chain of more than 2,000 worldwide and then sold it in 2005 for in excess of £650m sterling.
Throughout her career, Roddick has campaigned tirelessly on ethical issues such as fair trade and sustainable development. Corporate social responsibility (CSR) was at the heart of her business philosophy. When we sit down to discuss CSR in a Dublin hotel, she has little time for the debates over the business case for CSR versus the society case – the latter argues that businesses are part of and mutually dependent on the well-being of society.
“I don’t think it’s a matter of either or,” she says. “There’s a certain tyranny in that. Successful businesses can and should act responsibly. We have proof of that through the Quakers, who ran incredibly good businesses – even on an international level – without lying, cheating or stealing money from the business. They had a sense of humanity in their dealings with suppliers, customers and the community. The alternative is what? Enron?”
She believes businesses are finding themselves in an era in which they have little choice but to behave responsibly. “Companies are now starting to be a little more wary, maybe not through a heartfelt belief that their responsibility is to run a business in an honourable way, but rather in terms of reputation management. You know that if you screw up, your brand is gone, and it’s very hard to come back from that.”
The vigilante consumer
She also points to the rise of a more educated, sophisticated marketplace. “Consumers are beginning to understand the stories behind how corporations work and are no longer just sympathetic with the product. They want to feel sympathy with the company and they want to know the story behind what they buy.”
Roddick refers to this as the rise of the ‘vigilante consumer’. “They’re educated and aware; they’re being informed by blogs and the internet. They don’t let themselves be enamoured by a company’s public relations (PR) and they are powerful. Look at Amit Srivastava, whom I met just last week. He’s a young Indian man living in California, who has taken up the issue about water being stolen from Indian peasant farmers to go into Coca-Cola. He has galvanised the southern state of Kerala and they’ve completely banned Coca-Cola, as have several university campuses in the US. Now, that’s powerful. Companies are going to have to sit up and listen to that.”
Another well-documented example of the power of the consumer is the whole Gap debacle several years back, she says. “It’s not only an example of how successful individuals and non-governmental organisations (NGOs) can be; it’s also a brilliant example of a company behaving intelligently. It had to take all that crap because it wasn’t diligent enough in its manufacturing. It just opened up all its factories, posted it on the web and said: ‘There you are. We have problems here’.
“Its transparency has given it the credibility of brand recognition and approval. If only companies could say: ‘Look, we’re going to screw up along the way, but come with us on the journey’. It’s like permission marketing. The consumer will give you the right to take it slowly if your efforts are transparent and honest.”
Role of the NGOs
Another significant development that gives Roddick great satisfaction is the rise in the profile and power of the NGO. “This new phenomenon amazes me – and the media aren’t touching it. Alongside the vigilante consumer you’ve got the rise of the NGOs that are gaining in influence all the time. When I was a kid there were probably five of them raising money for African villages. Today you’ve probably got 40 in Europe just raising awareness on environmental issues alone. They are setting the moral agenda now and they too are having success. One fax to Unilever by Greenpeace stopped it using genetically modified ingredients in its baby food. That’s powerful stuff!”
However, it’s not just about activist power. Roddick believes the NGOs have a strong role to play in informing business in their CSR policies. “The very progressive businesses don’t function without their knowledge. The likes of Amnesty did so much to inform me when I was running The Body Shop, because human rights, in my case, came before business. The depth of its knowledge is invaluable to any responsible business.
“Many of the NGOs are doing such a good job at getting the information out there that some of the big industries are forming their own NGOs to counter-balance it,” says Roddick, in what is likely to be an oblique reference to the Competitive Enterprise Institute (CEI) in the US, which is heavily funded by big players such as Exxon Mobil and Ford Motors. In May 2006, CEI released a controversial ad campaign including two television commercials arguing that global warming is not a problem. The commercials used the tag line ‘Carbon dioxide – they call it pollution; we call it life’. The ads recently featured in Al Gore’s film, An Inconvenient Truth.
Up and coming
Indeed in the next breath, Roddick is getting animated about what she sees as a new wave of young, socially conscious entrepreneurs. She name checks Jeff Skoll, co-founder of eBay, who sold up in 2001 and set up Participant Productions, the producers of An Inconvenient Truth, as well as other high-profile activist movies such as Good Night and Good Luck, Syriana and Fast Food Nation.
So is the business world transforming? “There definitely is a change in language, no doubt about that. The language of responsibility is there, but I fear it has been corralled by the management consultants. And I think the biggest change I’ve seen in the past two decades is the way economic values supersede every other human value – kindness, generosity, etc.
“There’s a fear in that, because if business is so centre stage then it’s got to have a moral agenda. I think there is a slight bubble of something exciting going on with the young successful entrepreneurs that now seem more open to being philanthropists. They’re not as closed to it as my generation probably was. They’re even saying ‘I don’t want to get big. I want to be a small giant, well established and well respected in my community’. They don’t necessarily subscribe to this notion that everybody has to project themselves into the stock market.”
Indeed, Roddick looks back with some bitterness at her Body Shop days on the stock market. “While you are on the treadmill of success and your profits are increasing and increasing, you’re fine, you’re left alone. It’s when the financial journalists come along and expect your profits to be higher every year that you’re in trouble. It’s a sort of terrorism – these statements that say you did £40m last year so this year you should do £80m.
“So we were fine while we were keeping the city happy with its projections of what profits would be. The minute we started trying to implement the big social actions (it wasn’t the campaigning or the anti-war stuff that worried them), they started to give us hell.”
It all started when Roddick and her team built a new model soap factory in one of the poorest areas in Glasgow. “Because I was so obsessed with the Quakers, we wanted to build a model factory, which had to have a day-care centre and all those things, and we put 25pc of the profits back into the community. We built a child development centre, an adventure playground and a drop-in centre for the elderly. It was my pride and joy.”
Roddick’s face soon drops. “When the financial journalists picked this up, they decided that what we were doing was stealing money from the shareholders! I guess it was the Milton Friedman concept.” Friedman famously held the view that ‘there is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits’.
“I remember having to stand up at a meeting with financial analysts and explain that my response to them was ‘up your bum’. This was what we were about and we were a profitable business, opening 150 stores every year. But the city doesn’t give you time to practise these social experiments. Assessment, reflection and thoughtfulness are not the modus operandi when you’re on the stock market. When you’re below their estimation of what your profit could be, the proverbial hits the fan and there’s nothing you can do about it.”
In fact, three times she tried to take the company private. “We’d go to the brink and then we’d just panic. I guess we didn’t trust the banks to stay with us.”
So what of the future of CSR in a globalised economy? “The really dark side of what’s happened to CSR is ‘greenwashing’ and it’s nothing but that,” Roddick claims energetically. “No matter how many global companies and global federations talk of CSR, if it gets in the way of profit, nothing moves.
“Until we have a corporate code of governance with corporate teeth to it – one that penalises human rights abuses and says this product is not going to be allowed into this country because there are human rights violations attached to it – and until we put in adequate and solid checks and balances, it’s going to be seen as greenwashing – part of the PR.”
So should we be looking at regulating CSR? “Regulate it?” she asks. “You bet we should. We regulate how many husbands we can have and what bloody side of the road we can drive on. We can regulate this. It’s not beyond our capabilities.”
I can’t let Roddick go without asking about the reaction to the sale of The Body Shop to cosmetics giant L’Oreal in March 2006 for more than £600m, of which she is estimated to have benefited to the tune of £130m. Roddick was pilloried at the time for going against all her own philosophies on responsibility. L’Oreal’s animal testing and corporate profile seemed to go against everything she had ever held dear.
“Look, if you put your head above the parapet in business and demand a different language and a different behaviour, you’re going to get shot down no matter what you do. If you act in a greedy, rapacious way, you’re left alone. So I was used to it. You just have to deal with it. Happily, most of the negative stuff was against me rather than the company.
“I love L’Oreal and I was very impressed with its approach. It’s ringfencing The Body Shop and does not intend to take its brand and move it somewhere else. It’s not going to put my products in its distribution. Mostly I love it for saying it wants to re-enchant the brand, because it needed it.”
Today Roddick works just a few days a year with The Body Shop, but she sees it as an opportunity to make a difference. “I like the idea of being a Trojan horse, of going to them and saying: ‘Look, my deal with you is how can you bring community trading ingredients harvested in the epicentre of struggle into your bevy of ingredients’. And they’re just gung-ho with that. So having the biggest cosmetic company in the world purchasing in a different and more humane way sounds like progress to me.”
Roddick had already begun to sell her shares in The Body Shop before the buy-out in order to fund her philanthropic foundation, so it was an opportunity to move full-time into what she loves.
“When I was running The Body Shop, if the truth be known it was a communications company for all the issues I cared about and thank God we had good products that kept us all going. But it was our politics of consciousness that gave us an edge where the competition didn’t want to go. They weren’t going to be putting their shops at Amnesty stations or picketing outside the Brazilian Embassy or Shell. That was our heartbeat. We were activists.
“Now my whole life is about turning what I was doing in The Body Shop – campaigning – into what I do now, which is campaigning full-time.” Today she is also in the business of strategic giving, with funds from her shares going into projects such as the new Amnesty buildings in the UK and Ireland – the reason for her visit to these shores.
“For me, it’s about making me feel alive. I cannot think of anything worse than sitting on a shed load of money and it just accumulating and accumulating – for what? When the alternative is that you’ve got this resource, this amazing ability to be generous. Most of us can’t because we don’t have the money to be. You get to look for extraordinary people doing extraordinary things, well below the radar. You think if you can make one person’s life a bit better, healthier or happier, you’re on the side of the angels.”
Pretty rewarding then? “Bloody right.”
Sadly, since this interview, Anita Roddick passed away in September 2007. RIP
This article first appeared in Irish Director magazine.