Maala Conference 2008: Is Israeli Business Ready to Take Some Responsibility?

Will the financial crisis make corporations more responsible? What will make business move beyond philanthropy to true sustainability? What are the responsibilities of government, business and civil society in an era when business dominates society?

These were some of the topics discussed last week at the 2008 Maala — Business for Social Responsibility Conference, held at the Tel Aviv Hilton.

A crowd of 600 members of Israel's corporate world spent the day discussing the merits of community involvement and progressive environmental policies, and, of course, how a more responsible business approach affects the bottom line. Speakers included major CEO's, the Minister of Welfare and Jerry Greenfield, cofounder of Ben & Jerry's.Financial Crisis at the Door

A corporation is like a child — it functions best when it is absolutely clear what is expected of it. But when those expectations are confused, unenforced and inconsistent, a child will get in trouble.
-Intel Israel Representative

The conference marked the 10 year anniversary of the founding of Maala, a corporate citizenship organization based on US-based Business for Social Responsibility. Maala Founder and CEO Talia Aharoni opened the conference by noting that awareness of corporate social responsibility in Israel has come a long way in the past ten years, and is now an integral part of the way local companies approach their business. However, she added:

The challenges are going to be even greater with the background of the financial crisis and we will have to be more creative and even more adventurous in addressing the burning social and environmental issues like poverty, water scarcity, climate change and minorities — issues that can't be put aside or wait until the economic recession is over.

Concern over the financial crisis pervaded the event, with some wondering aloud if the credit crunch would end the blossoming of the green economy that has taken place recently. In response, Tzipi Iser Itzik, Executive Director of the Israel Union for Environmental Defense, a prominent environmental organization, presented the green economy as the solution to both the economic and ecological crises. "I have asked investors," she said, "and they told me that are not intending to invest less in green business," adding that Barack Obama was proposing to invest billions in greener infrastructure in the US.

Redefining the Bottom Line

Iser Itzik went on to tell the story of a local factory that for years refused to clean up its emissions. After years of attempts to convince the factory to install a filter on its smokestack, the factory's CEO suddenly requested a permit to install the filter. What had made him finally see the light? As it turns out, one day the CEO's kid came home from school upset that the other kids at school had told him that his dad was killing people by polluting the air.


Jerry Greenfield of Ben & Jerry's.

A fresh and unusual perspective was provided by Ben & Jerry's cofounder Jerry Greenfield, who began his presentation by passing out tiny ice cream cartons to everyone in the audience. After recounting some of the history of the company ("Ben and I were the two slowest, fattest kids of the track in 7th grade"), Greenfield addressed the crowd with brutal honesty:

Business is the most powerful force in our society today, more than religion or governments. This is a relatively new phenomenon Business has incredible influence on our society — through giving campaign contributions, lobbying for legislation, ownership of the media, employing citizens as workers and selling to them as consumers. And all of it is done in the narrow interest of business, which is to make money.

The difference between a business-led society and a society led by religion or government, Greenfield said, is that business is generally not concerned with its impact on society. "Business students are still taught that the only legitimate purpose of business is to maximize profit. We wouldn't tolerate that from any other major entity in society, but it's okay for business."

Ben & Jerry's moved beyond this paradigm, Greenfield told the conference, by redefining its bottom line to include social goals, and today issues reports on its social accomplishments right next to its financial reports. "At Ben & Jerry's there is a spiritual aspect to business. As we help others, we can't help but be helped in return," he added.

Green is Good for Business

At an unusual panel discussion, which brought together representatives of business, government and civil society, one thing that everyone seemed to agree on was that green (or at least the appearance of green) is good for business. Business reps discussed their attempts to move beyond compliance with regulation, and become responsible members of the larger community, while government reps detailed their plans to encourage green tech. As one speaker put it, "Ten years ago, this was the territory of a small group of tree huggers. Today it is mainstream."

Despite the near-unanimous agreement that green makes green, it was evident that other forms of environmental awareness had yet to fully penetrate the Israeli business scene. Companies of all kinds gave out an endless supply of voluminous booklets and free products, wrapped in generous amounts of packing that without exception ended up in the dumpster. Nor was there evidence of any attempt to donate or compost leftover food from the event's extravagant buffets.

Dr. Lia Ettinger of the Heschel Center for Environmental Learning and Leadership summed up the panel discussion by recognizing the business world's progress toward environmental responsibility. However, she noted:

Business activity is growing all the time, and it's not enough to just reduce its externalities a bit. This crisis needs new, outside the box thinking. Industry has to reinvent itself. The financial crisis was caused by a systemic failure, and the ecological crisis is the same. We have a small window of opportunity to radically reinvent ourselves. We must move the tax burden onto the biggest polluters, stop subsidizing unsustainable activities and invest in the environment and society to avoid recession. That's the kind of thinking that is needed, and I invite you all to adopt it.

Photos by Daniel Cherrin.

Tags: Corporate Responsibility | Israel | Technology | Tel Aviv

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