The Social Business

Social innovation, Danone style

I spent a fascinating couple of days this week at a Social Innovation Lab, hosted by Danone in Paris.

The Lab is an annual event for Danone staff to get together, with NGO partners (and this time with a handful of bloggers – including me and Mike Chitty from the UK) to talk about how Danone can be more socially innovative.

You may or may not know a lot about Danone. The extent of my knowledge about them was that they sell bottled water (not my favourite product) and lots of yoghurts, many of which supposedly help to make you healthy. You might, particularly if you’re into social business and read my blog, know about their alliance with Grameen in Bangladesh, selling nutrient-rich yoghurts, via self-employed women, who get support and finance from Grameen. And you’ll almost certainly remember their mmm…. Danone advertising.

Given what you may or may not know, you may be surprised to hear that their mission is this:

To bring health through food to as many people as possible.

I think that’s a great mission. Simple, understandable, and ambitious. And the Lab was partly about that ambition – how can Danone be socially innovative – at a bigger scale – and faster – than they are now?

It was genuinely fascinating and inspiring to see such a massive business where people where genuinely committed to how their business could have a social impact. This wasn’t some CSR nonesense, and there were no presentations from bosses who’ve just been on a course and who understood that “doing good” is the right thing to do.

Leadership came from the very top. On the Monday evening there was a Q & A with the CEO, Franck Riboud. He talked a lot about how for a business to be innovative, it needs to have humility in its business culture, and not assume that it has all the answers. This was true in the Q&A too – twice he said he didn’t have an answer to a question. Somehow I can’t imagine that happening in your average multinational, where the all-powerful CEO dominates – and influences the business’s culture.

I’m sure they’re not perfect, and I accept that we saw them at their best, but the two days opened my eyes to how powerful it can be when a successful, profitable big business puts social impact and innovation at the heart of what they do. Take, for example, the bonus system they have introduced for senior staff. One third of the bonus relates to personal goals. One third to Danone’s financial performance. And one third is related to social goals – including 22% linked to the achievement of ambitious CO2 reduction targets (30% across the business by 2012). This focuses minds.

Similarly, it was so refreshing to hear a big business talking comfortably and credibly about co-creation. Again, with the starting point of “We don’t have all the answers, let’s try to team up with people with whom we may find the answers”. That’s why so many NGOs – most of whom were partners of Danone in projects across the world – were there at the Lab too. This co-creation isn’t without its problems – one common issue related to the different pace (and speed of decision making) in some of the NGO’s in comparison with Danone. But the commitment is there to try to work things out.

I came away with lots of questions. Some about Danone – particularly around the long-term sustainability of bottled water sales in countries where the water is safe to drink (I understand the arguments in countries without safe drinking water).

But more of the questions related to the work that I do. Many of us get excited about social enterprise, and many people think that we need different ownership models – and that privately owned, shareholder driven businesses can never really help us to change the world for the better. But did Danone give me a glimpse of what a world could look like where big businesses went beyond CSR and put social impact at the heart of what they do? And should I be thinking how to work with other businesses to help them to do the same?

That’s partly why we’ve set up Social Business Brokers – which has an explicit aim to work with any business that is interested in having a social impact – not just social enterprises. As a social enterprise sector, might we need a similar shift in emphasis? Or are we going to keep telling people that we have all the answers? Are you listening Big Society people?

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3 Comments

  1. Business with a social objective isn’t entirely new Rob. In fact it was one of the early roots of social enterprise and took the idea of reforming capitalism as its starting point.

    It’s been a working model in the UK for 6 years.

    http://www.p-ced.com/1/about/

    After its founder was excluded as a UK visitor and our appeal for help to Baroness Thornton of the SEC was unanswered we took it to Ukraine and did it anyway delivering their government a ‘Marshall Plan’ strategy paper in October 2006. A plan which included a proposal for a social investment fund.

    With those recommendations which have been applied so far in childcare reform, Ukraine has increased its domestic adoption by 40% yet floundered on their pledge to create 400 rehab centres for disabled children, Hence our petition to raise awareness.

    http://www.change.org/petitions/view/the_abandoned_children_of_ukraine

    David Cameron’s kinder capitalism derives from our script and we want him to demonstrate that he means it, by supporting those who are already walking the talk.

  2. I should also mention that on Linkedin there’s been a group discussing ‘Social Business and For Benefit corporations’ for the last couple of years.

    Jeff

  3. I’m glad to read your feedback on the Lab. Just like you and many other bloggers, I was impressed by the transparency and humility. Basically, Danone’s message was “We don’t have the solutions, but we are experimenting, and we welcome your remarks”. Compared to classic corporate (bullshit) communication, it’s refreshing!

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