Eveline Lubbers on 14 Jul 2000 17:25:42 -0000

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<nettime> global businesses fighting back on the Internet

June 26, 2000

Six Degrees of Co-optation

As activists use the Internet to pressure global businesses, their
adversaries are fighting back  with openness. 

By Steffan Heuer

Naomi Klein spends her days making giant corporations look bad, so she
hardly expected to get a fan letter from the people who spend their days
making the same companies look good. 

A pair of brand managers for the British manufacturing giant Unilever,
nonetheless, found Klein's anticorporate bestseller, No Logo, fascinating,
and they wondered if she would join them at a luncheon to discuss how the
company might improve its image. It's important, they wrote, to hear and
understand different perspectives. "Is this your worst nightmare e-mail
come true?" they asked. 

In a way, it is. The 29-year-old Canadian activist has spent the past five
years researching a book that argues that brand-obsessed companies like
Nike, Shell and Unilever are increasingly vulnerable to a new breed of
activist:  Internet-savvy hackers and journalists who use the Web's
ubiquity and speed to hit the companies where it hurts the most: their
image. Real-time distribution of data about pollution, widely distributed
photos of sweatshops, rapidly organized protests  all were made possible
for activists by the advent of the Internet. 

But now, even as activists turn the marketing guns against the big
corporations, the corporations are in turn co-opting the activist's
information and turning it into yet another branding play. Klein declined
to help Unilever ("I don't feel like I have anything to say to individual
companies") but the company is nonetheless watching  and learning fast. 

It's a sometimes edgy dance between activists and their corporate nemeses. 
Activists mount sophisticated campaigns against corporate exploitation,
commercialization, pollution and other assorted sins. Meanwhile, managers
in dire need of consumer feedback click through to see where their
businesses are most exposed and what they can do on their Web sites to
counteract it. 

This dance is becoming increasingly cooperative as companies around the
world discover that it pays to display a social conscience and brag about
it in real time. David Wheeler, who helped pioneer such efforts as the
director of environmental and social policy at The Body Shop International
(BOS) and now teaches at Toronto's York University, says transparency and
accountability add value to a company by helping build trust and loyalty,
not only with customers, but also with employees, suppliers and the public
at large. 

The Internet, he says, has accelerated this process by letting more and
more companies engage the public through what he calls "cybernetic
sustainability reporting"  Web-based reports that are up-to-the-minute
and interactive. Shell, for example, after being stung by controversies
surrounding the Brent Spa platform in the North Sea and its investments in
Nigeria, now discusses "issues and dilemmas" on its site and provides
forums for feedback. The forums are somewhat sparsely populated, though,
and comments range from the heartfelt "This company continues to persecute
the people of Nigeria. Why?" to the more basic "I want you greedy bastards
to do something about the high GAS prices." 

Surveys show, nonetheless, that more companies are attempting to open up,
no matter how awkwardly. The British outfit SustainAbility last year
surveyed 150 corporate Web sites on behalf of the United Nations and found
that more than half included some kind of environmental communication,
though less than 10 percent discussed social issues online. "Our hunch is
this will grow significantly," the authors concluded. 

Not surprisingly, there are geographical differences. U.S. pharmaceutical
behemoth Monsanto (MTC) , freshly merged with Pharmacia & Upjohn (PNU)
into Pharmacia, praises its achievements in the area of "food, health,
hope" on its domestic site without delving right away into controversies
over genetically engineered food. Its British site starts with the
statement: "Food biotechnology is a matter of opinions. Monsanto believes
you should hear them all" and goes on to include links to critics such as
Greenpeace and Friends of the Earth. 

American companies are dragging their heels because of liability issues
their European counterparts don't face, says Wheeler. "They will switch on
to this as soon as they see it as a source of value. Then the floodgates
will open." 

The wave of the future, Wheeler predicts, will be one-to-one corporate
communications. Information will be tailored and streamed to specific
stakeholder groups, such as current employees, job seekers, consumers or
nonprofits. Why should a dot-com without any stake in East Asian mining or
"Frankenfood" care about all this? Because the new economy transcends the
focus on products and profits, says brand-basher Klein. "Dot-coms are pure
brand, their IPOs the ultimate victory in branding. If you're pop culture
and built on image alone, it's easier to be attacked." No wonder these
companies are rushing to tether themselves to the earth. 

Positive values can be a distinguishing mark in cyberspace. Just ask David
B.  Wheeler (no relation to Toronto's David Wheeler), CEO of Chicago
startup Myvalues.com. This fall he plans to launch a Web-based
international clearinghouse for companies, consumers and governments
committed to ethical business practices. 

While value-based advertising is common offline, it hasn't taken hold in
cyberspace, where steep discounting is the primary sales pitch. Wheeler
aims to change that. "On the Net right now," Wheeler says, "consumers are
given only one choice: price. We believe they are more sophisticated and
want to make choices on things a lot deeper than price." 

His plan is to build communities based on certified companies. Member
firms will be screened for a seal of approval and ranked against their
competitors. If a VP of purchasing cares about the rain forest and
workers' rights, he'll be able to find suppliers that do, too  right from
his browser. 

"It's not a protest site for beating up companies," Wheeler explains.
"It's a carrot, not a stick." 

A bottom line based on such intangibles will most likely require a new
breed of manager. And that's exactly what's being hatched at business
schools around the country. When students at UC Berkeley's Haas School of
Business organized a business-plan competition for socially conscious
enterprises this spring, 66 entrants submitted proposals  nearly half of
them Net-related. 

"It indicates a trend," says Sara Olsen, one of the co-organizers. 
"Sustainability relates strongly to the Internet, how we think and learn
about the externalities of capitalism. Businesses can be more profitable
by being green. It will be perfectly normal in a few years." 

Several of the plans have already secured funding. 

Judith Samuelson from the Aspen Institute in New York has been tracking
whether and how hundreds of MBA programs teach transparency and corporate
responsibility in the Internet age. She sees some encouraging signs,
though acceptance of the concept is still marginal. She agrees, however,
that the Internet has been critical in forcing enterprises to change their
behavior. "Companies now experience economic and reputational effects [of
protests and boycotts] literally overnight." 

That's fine by Klein. As far as she's concerned, companies could stand to
do a lot more than open a dialogue with her. "The Internet has changed a
lot for activists and brought a lot of skeletons out of the closet," she
says. "We're able to embarrass companies now, but it's not a truth serum." 

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