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When What Matters Most is NOT Your Bottom Line

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It is hard to disagree that good ethics is good business. What many organizations struggle with is how to support ethical behavior, communicate the values of good ethics within and outside of the company's walls, and deal swiftly and justly with unethical misconduct.

An important part of developing an ethically sound company is stewardship. Some call it corporate social responsibility. Basically, stewardship can be defined as "what you do once you say that you believe in your mission statement, code of conduct/ethics, and core values."

The greatest example of stewardship in today's marketplace is Patagonia, the outdoor specialty apparel and gear maker. Ethisphere™ magazine ranked Patagonia among the top ethical companies for apparel in 2007. The story is quite fascinating, but what is most exciting is how Yvon Chouinard, the founder, melded a natural partnership between ethics and business success.

Chouinard's driving force has always been his passion for the earth. He began mountain climbing in the 1950s and developed a natural appreciation for the environment and its beauty. This appreciation propelled him to use his passion for the betterment of the environment. From early on, honing the blacksmith skills he had picked up from his father, Chouinard made pitons (steel spikes drilled into rock to aid in climbing) that he sold for $1.50 a piece out of his car and lived on those proceeds for months while he spent his summers climbing.

1. Your Actions Must Support What You Say!

It was not until 1970 that Chouinard discovered that his equipment company (Chouinard Equipment) was becoming an "environmental villain" with the repeated use of pitons that were hammered into well-known routes up several mountains. He realized that his pitons were destroying the thing he most loved — the rock in the mountains. These pitons were the mainstay of Chouinard Equipment's business, and with mountain climbing growing more popular, Chouinard was extremely concerned. During a routine climb, Chouinard and a business associate decided to phase out of the piton business when they saw firsthand the damaged rock that their pitons had caused. They did not think twice about this decision.

One of their core beliefs was "strive to do no harm," and when they realized a product of theirs was hurting the earth, they immediately decided to stop selling it. They found alternative material to serve the same purpose without causing such damage. Their actions served as an example of the first core value of stewardship.

2. It's Not About You! Be Others-Centered.

Chouinard states that he never set out to be a businessman. He did not dream of building a multimillion-dollar company. He wanted to enjoy and appreciate the environment and help others to do that. He yearned to share his passion with others who held similar passions.

What is your passion? What do you dream of? How can you help others? The second core value of stewardship is being focused on helping others. Life will go on even when you are gone.

What is your company doing today to leave a lasting legacy for tomorrow — to better the world around us? Maybe it's respecting the environment. Maybe it's developing your employees' skills to help them be the best they can be. Maybe it's making a product or service that will relieve pain or end suffering. What is your company focusing on — making money or sincerely helping others? (And these do not have to be mutually exclusive!)

Patagonia longs to leave a legacy full of ethically and environmentally responsible people that use their passions to sustain natural resources and take care of the earth. Its core values led it to found the organization One Percent for the Planet. Chouinard knows that when he passes away, the world will go on. In fact, he knows that the degradation of the environment, the burning of the ozone, and the elimination of endangered species will linger long after he is gone. However, to leave a lasting legacy, he has partnered with 574 other organizations (as of June 8, 2007) to "donate at least 1% of our net revenues to efforts that protect and restore our natural environment."

Patagonia is not thinking about itself. Yes, it is a business, and yes, it must make money to donate anything. However, its passion lies at the forefront of its legacy. Chouinard and his associates' business is not about them. It is about preserving the environment and using their resources to influence others to do the same. It is about making products to help their customers live out their passions.

3. Is It the Right Thing for the Customer?

To be a good corporate steward, ask yourself two questions:
  • Is this in line with the company's objectives?
  • Will this decision result in the right thing for the customer?
If the answer is "no" to either question, don't do it. Referring to your company's objectives or code of ethics is comparable to referring to the rules for playing a game. You must be certain that employees (the players of the game) know the rules (the code of ethics/conduct) before they begin to play (work for your company).

The first question should be fairly simple to answer if you know, and empower all employees to know, the company's objectives and code of ethics. The second question may take a little work to answer. Who determines what is right? What Patagonia has done is defined the company's objectives and then compared who their customers are and what is in the best interest of their customers.

Patagonia created a checklist of quality measures for its designers to consider. All products had to be functional, multifunctional, and durable and had to fit the company's core customers. The designers then started with the functionality of the product, asking questions like "Where is this product going to be used — in a hot or cold climate? Should it keep moisture out, or does it also need to breathe?" Then they found the materials to accomplish that function. They sought to make one piece of clothing with two uses (multifunctional), a jacket that wicks away moisture but also allows for a full range of arm movement. The goal of their products' durability is that after a long lifespan, all of the parts of the product should wear out around the same time, which to Patagonia is a sign of high quality.

Patagonia builds its products and services with its customers in mind, and it sincerely concentrates a lot of energy on its core customers — their desires and their wants. In return, it is a multimillion-dollar company sustaining profitability for the long haul.

You can hardly consider a company ethical if it is not a good steward. How does your organization show its care for others? Focus on how you can be more of a steward, be it for the environment, specific charities or causes, or the development of your people, both professionally and personally. Strive to model the behavior you expect based on the values you profess. If you do this and do it continually, you can then brace yourself for great success.

About the Author

Frank Bucaro is an author, speaker, and consultant who specializes in the benefits of ethics for business growth and personal success. Using a distinctive blend of humor and enthusiasm, Frank works to integrate ethical standards with solid business practices. His clients range from Fortune 500 companies to associations to small businesses. Frank's latest book, Trust Me! Insights into Ethical Leadership, highlights the unique role of ethics in leadership today. For more information about his speaking and consulting, please visit or call 800-784-4476.

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