Building authentic relationships through social responsibility

NRF 2021 – Chapter 1: Executives from The Home Depot and Ulta Beauty on creating a movement for positive change
Peter Johnston
NRF Contributor

Stephanie Wissink, managing director for consumer research at Jefferies, moderated a fast-paced panel discussion on social responsibility at NRF 2021: Retail’s Big Show – Chapter 1. Joining her were Kendra Clarke, vice president for data science and product development at sparks & honey; Ron Jarvis, chief sustainability officer with The Home Depot; and Dave Kimbell, president of Ulta Beauty.

In setting up the discussion, Wissink noted that being socially responsible is no longer a point of distinction. It’s what stakeholders — customers, employees and capital investors — expect. But what does meeting that expectation involve? Is social responsibility a response? An agenda? A strategy? Or is it simply a necessity?

“It’s a necessity,” Kimbell said, “and it has to be built into the core of the company. It’s driven by consumers making choices about who they want to align with, and from that you build a strategy.”

Diversity and inclusion

Learn how other retailers are addressing social responsibility here.

The Home Depot’s Jarvis agreed, noting the visibility and importance of social responsibility and sustainability have increased enormously. “We have thousands of suppliers pitching their products to us,” he said. “A couple of decades ago, one out of about 30 would mention these issues. Today, almost everybody who comes in either opens or closes their presentation with sustainability.”

It affects everything …

Turning to Clarke, Wissink asked how data and analytics should be included in a social responsibility plan. The answer was that leadership should think about these issues as broadly as possible. The assumption, she said in essence, is that social responsibility is a cost center, to be controlled by the appropriate metrics. The reality? Not so much.

“It affects your revenue,” Clarke said. “It affects everything. We make a change, and we expect it to show up in business results.”

And how, asked Wissink, do we remain agile in the midst of change? How do we build agility into the social responsibility framework?

We look at where ideas come from, Jarvis responded: In his estimation, 80 to 90 percent from the bottom — suppliers, employees — and 10 to 20 percent from corporate leadership. The key to agility, he suggested, lies in understanding your own assumptions.

“We have a saying: Know business, no surprises,” he said. “If you know what your impacts are, and you know the issues you need to address, you’re agile.”

Following up on this thought, Jarvis said, “Time is critical. If it’s a social responsibility problem, we need to be working on it. Your goal should be to have zero issues pop and surprise you. Stay ahead of the curve.”

… and everybody

Who needs to be at the table to make this happen?

“If the whole company isn’t fully connected to it,” Kimbell said, “we — the leadership team — haven’t done our job. And if we only listen to ourselves, we’re probably not going to get it right.”

Echoing this thought, Clarke noted that in many ways, the leadership team may be the least well-informed participants. “Once you become a leader,” she said, “you will never know again how it feels to be on the front lines. We can make strategy in a room, but we can’t make it happen in a room — so make sure the people who will be the most affected have a voice.”

The risk of doing nothing

Noting that there are risks in taking on social responsibility issues, Wissink asked the panel about inaction. Is that also a risk?

“It depends,” said Clarke. “If it’s a small issue, maybe not. If it’s a huge issue, the risk of not responding to it is also huge. If the world has moved in a certain direction, and you haven’t, you’ll see a kind of slow erosion of what was once a strong base. Action can be a risk, but it can also cement your connection with a certain audience.”

“Inaction,” Kimbell said, “is the biggest risk. You can’t act on everything, but you can’t ignore the world as it changes.”

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