Promoting Corporate Citizenship by Crowdsourcing Market Power

The sluggish pace of our economic recovery is certainly not holding some back. Enter the social entrepreneur: a passionate and dedicated group of leaders armed with an understanding of the imperative for better business practices and a willingness to take risk. “Social entrepreneurs” are key change agents for societies, creating new solutions to problems and implementing them across sectors and industries.

Mohammad Yunnus is perhaps the most famous current social entrepreneur. As a recipient of the 2006 Nobel Peace Prize, Yunnus began offering microloans to impoverished people in Bangladesh in 1976, thereby empowering them to become economically self-sufficient and proving the microcredit model that has now been replicated around the world.

More recent movements of social entrepreneurship seek to harness the power of social media and technology to push for new ways of interacting and serving markets of the world.

Stéphane de Messières, for example, serves as Executive Director of Citizens Market, an innovative nonprofit organization now based in DC. The mission of Citizens Market is to empower consumers with tools to shop their values. They use the market power of consumers to build the business case for corporate social responsibility. The idea is to use a team of volunteers to develop a crowdsourced website for responsible shopping, where user-generated information about corporate social and environmental behavior is reviewed by peers and organized into simple scores. Consumers then view these company scores while they shop, by scanning product barcodes with their mobile phone camera or using a widget to view scores while browsing online.

A key strength of the approach used by Citizens Market is the application of the Global Reporting Initiative’s (GRI) indicators for assessment. The current efforts existing for addressing the impacts of corporate activities vis-a-vis social and environmental rights have been numerous and uncoordinated, although in recent years they are making efforts to collaborate. First, the UN Global Compact seeks to align businesses operations and strategies with ten universally accepted principles in the areas of human rights, labor, environment and anti-corruption. Next, Realizing Rights articulates another set of concerns focusing on decent work, the right to health, women’s leadership, corporate responsibility and climate justice. Lastly, the GRI provides tools to assist companies in their human rights reporting, including in helping companies begin the process of identifying human rights. These are relevant issues in their operations and to assist in translating these into meaningful and effective reporting. The ultimate aim of such reporting is to create a robust system of human rights due diligence, defined as the ongoing processes which a company carries out to ensure it is aware of which human rights operations may affect, and the steps taken to anticipate, prevent or mitigate any negative impacts.

Citizens Market’s decision to rely on the GRI for its indicators recognizes the inherent strength of this system as well as the importance of standardization in tools that are used for assessing corporate performance. What is innovative about Citizens Market approach to using the GRI indicators is that it is powered by crowdsourcing. Thus, instead of relying on corporate disclosures, Citizens Market brings monitoring and reporting to the ultimate end-user themselves. A recent review of the retailer Abercrombie & Fitch, for example, highlighted issues of transparency in their financial disclosures. The contributor wrote:

In its March/April 2010 issue, Corporate Responsibility Magazine put Abercrombie & Fitch on its “Black List,” a distinction earned by companies that provide virtually no information related to environmental impact, human rights, corporate governance, or labor relations. However, after that issue was published A&F started increasing its transparency by launching an “AF Cares” website (so they get points for responding to criticism). It looks like a good start, but to my eyes the website needs more substance- for example, they claim to use “third party auditors to regularly audit the factories in our supply chain” to ensure compliance with labor standards, but don’t seem to provide the results of such audits. I’ll revise my opinion upward if they continue to increase their transparency.

In our continued quest for better corporate performance along social, environmental and human rights measures, we often forget our power as consumers. The Citizens Market approach empowers us to shape corporate practices through our purchasing power. By being conscious of where and what our shopping dollars are rewarding, we can ensure that the right respect for human, environmental and social rights is evidenced by our corporations

Citizens Market recently announced a new public face for their organization: Fosfo, derived from the Greek for “light”. They use this term to describe their crowdsourced review model as lots of bits of light that collectively illuminate and transform corporate behavior. An accurate description that conveys the power of the platform built by Stéphane de Messières and his team.

Click to watch the Citizens Market Youtube Video

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