It’s too easy to fake having an ethical brand


Opinion: The recent revelations around Grill’d highlight that the easiest path to developing an ‘ethical’ brand is marketing.

Grill’d is a ridiculous name for a restaurant. But the apostrophe that makes it so, a goofy anti-language decision that signifies sophistication, is kind of the perfect symbol for a company that gives its main product the oxymoronic label “healthy burgers”. 

Because, just quickly, Grill’d burgers are not healthy. They may be free of artificial colours, flavours and preservatives, but I’m pretty sure those aren’t people’s biggest health concerns when it comes to a burger. 

As a 2018 report from The New Daily detailed, the Simply Grill’d burger and its chips had fewer kilojoules and less salt per 100g than a Big Mac and fries, but the former served much larger portions. This resulted in McDonalds food having half the amount of salt in the chips and only 80 per cent of kilojoules in the burger. The article even quotes dietitian Dr Rosemary Stanton suggesting that “if you eat Grill’d foods, share with someone to avoid taking in more kilojoules.”

So yeah, healthy burgers. You might as well sell “weight-loss deep fried chicken”.

This isn’t the only part of Grill’d’s image that’s problematic (oh my goodness, will you just look at what that apostrophe made me do – Grill’d’s). 

HRM recently wrote about a series of investigative articles by the Sydney Morning Herald which revealed a startling number of disturbing accusations about a food service that at all points emphasises its virtue. 

The company says it “is committed to providing opportunities for Team Members to grow and progress in their careers.” But in the SMH report, the trainesheep it encourages staff to undertake is accused of being an elaborate way to keep wages down. Some team members called the government subsidised program a “scam” which cuts corners. An August 2018 survey mentioned in the article found that 92.4 percent of workers felt it was a “waste of time and had little educational value”.

And for a company that emphasises charitable giving, whether that’s through its bushfire appeal or its ‘local matters’ community giving initiative, it’s not a good look to also be accused of undermining franchise partners, poor food safety in one in 10 stores, and of having a co-founder forge liquor licence applications.

Now, this is hardly the first time a company with an ethical brand has been accused of bad behaviour. But that’s kind of the point. This is a broader phenomenon that is becoming starker by the year.

The business case for virtue

People want the companies they associate with to be ethical. It affects customer perception, customer loyalty, recruitment efforts and employee attachment. More than that, it’s fair to say that almost all organisational leaders would like to think of themselves as ethical. To meet this widespread desire, companies put some effort into seeming ethical. But too many fall short of being ethical. 

Indeed, there’s evidence that organisations favour compartmentalisation. Companies will be ethical in one area of their business while ignoring ethical considerations in another. 

The prominent example of this obviously took place around the Royal Banking Commission, where the huge gap between what the financial institutions were saying and what they were doing was revealed. HRM discussed this in an article on holding individuals accountable for toxic cultures:

“…the Commonwealth Bank’s 2014 report addresses employee engagement and inclusion, its initiatives designed to prevent financial crime and deliver financial wellbeing to Australians of all walks, and how the bank managed risks related to sustainability. 

Five years on, CBA’s bill for cleaning up its scandals and for compensating the customers it has wronged is over $2 billion and counting.”

One hand dirtying the other

Corporate Social Responsibility (CSR) captures an organisation’s efforts to do the right thing, to focus on more than just shareholder value, and seek to address the needs and desires of workers, the supply chain, the local community, the environment and society at large (some people capture this with the idea of a triple bottom line – profit, people, and environment).  

An interesting book on this topic is David Vogel’s The Market for Virtue. He delves into the compartmentalisation referred to above. Because companies that behave ethically in one area very often are lacking in another. He asks, “Is McDonald’s a responsible firm because it uses environmentally friendly packaging or an irresponsible one because it contributes to mass agricultural production?”

You could ask the same of Grill’d. Is it responsible because it supports local charities? Or, if the accusation is accurate, is it unethical for compelling the young workers in those communities into a wage suppressing traineeship that the workers think is a waste of time?  

Vogel compares CSR to advertising. Some businesses spend big on advertising, others do not. Sometimes it’s successful, and sometimes it isn’t. This is a useful framework for examining how companies approach ethical behaviour. 

Because very often CSR is just a strategy, one that can be deployed in key, discrete areas in order to achieve specific ends. Why wouldn’t they just use this strategy everywhere? Because, as Vogel writes, “Why should we expect investments in CSR to consistently create shareholder value when virtually no other business investments or strategies do so?”

Also worth mentioning, there is a logic we all understand that asks, “What’s the point of being an ethical business if it makes you go out of business?” 

Of course, it doesn’t take a philosopher to retort, “If you’re going to be unethical, please go out of business.” But the real world isn’t that cut and dry. 

We all compromise and do the best we can with what we’ve got. We all make excuses. Compartmentalisation is very human. We donate to a climate change not-for-profit to assuage our feeling that we’re overdoing it on power consumption. We eat a Grill’d burger today, but tomorrow it’s all salad.

A timely example. HRM published an article about the Great Place to Work list, on which cosmetics giant Mecca had secured a coveted top five spot. Exactly a week later, we published a story on how over 50 former and current members of its staff made damning complaints – including claims of nepotism, favouritism and racism.

What we didn’t do in the first story – and this is an example of us ignoring rigour in favour of expediency – is vet the top companies to see if they were worth lionising.

So what’s the answer? If I had a good one, I’d be a much better person. HRM has tried to figure out the answers when it comes to organisational culture. Unfortunately, all I can add to that story is that we all have to try and do better. Then again, our species is capable of great things – we made a healthy burger – so maybe that’s enough.

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Mark Wagner
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Mark Wagner

This has to be one of the best articles of the year for HRM. I was so happy to see the Banking RC cited, and those that follow court reports for know well that corporate entities are just not geared to be “ethical” it just does not exist in any objective form. CSR is utterly subjective and should be seen for what it is, simple marketing spin to appeal to emotion to persuade someone to enter into a commercial arrangement with one provider over another.

Ryan
Guest
Ryan

Corporate Social Responsibility has always been a web page on the corporate site with pictures of employees on one day a year packing food for homeless shelters. The other 364 days it’s profit profit profit. It’s hard to criticise CEOs for creating toxic cultures, however, as that’s what brings in the profit. If a potential CEO pitched to the board of directors that they could deliver 1% return ethically, but their peer promised 7% and the appearance of ethics, if you were on the board and legally responsible to shareholders what would you choose?

Karly
Guest
Karly

This also extends to ethical standards set in the beauty industry – any brand producing products in an amber coloured plastic bottle (Thank You, Sukin, Aesop to name a few) are contributing to our waste problem as these plastics although made from recycled material, can not be recycled in Australia and go directly to landfill. Any brands who also claim to be green and carbon neutral – buying this status needs to be called out!

FiM
Guest
FiM

I agree, a really well balanced and considered article. It’s a prickly issue for most organisations; genuinely ethical companies are rare (and perhaps are they indeed profitable?), and compartmentalising is commonplace for employees and consumers. Let’s remember White Ribbon and their work against DV whilst simultaneously courting SNAFU’s in ambassadors, fundraising and financial mismanagement). My awareness has been raised, thanks Girard Dorney

More on HRM

It’s too easy to fake having an ethical brand


Opinion: The recent revelations around Grill’d highlight that the easiest path to developing an ‘ethical’ brand is marketing.

Grill’d is a ridiculous name for a restaurant. But the apostrophe that makes it so, a goofy anti-language decision that signifies sophistication, is kind of the perfect symbol for a company that gives its main product the oxymoronic label “healthy burgers”. 

Because, just quickly, Grill’d burgers are not healthy. They may be free of artificial colours, flavours and preservatives, but I’m pretty sure those aren’t people’s biggest health concerns when it comes to a burger. 

As a 2018 report from The New Daily detailed, the Simply Grill’d burger and its chips had fewer kilojoules and less salt per 100g than a Big Mac and fries, but the former served much larger portions. This resulted in McDonalds food having half the amount of salt in the chips and only 80 per cent of kilojoules in the burger. The article even quotes dietitian Dr Rosemary Stanton suggesting that “if you eat Grill’d foods, share with someone to avoid taking in more kilojoules.”

So yeah, healthy burgers. You might as well sell “weight-loss deep fried chicken”.

This isn’t the only part of Grill’d’s image that’s problematic (oh my goodness, will you just look at what that apostrophe made me do – Grill’d’s). 

HRM recently wrote about a series of investigative articles by the Sydney Morning Herald which revealed a startling number of disturbing accusations about a food service that at all points emphasises its virtue. 

The company says it “is committed to providing opportunities for Team Members to grow and progress in their careers.” But in the SMH report, the trainesheep it encourages staff to undertake is accused of being an elaborate way to keep wages down. Some team members called the government subsidised program a “scam” which cuts corners. An August 2018 survey mentioned in the article found that 92.4 percent of workers felt it was a “waste of time and had little educational value”.

And for a company that emphasises charitable giving, whether that’s through its bushfire appeal or its ‘local matters’ community giving initiative, it’s not a good look to also be accused of undermining franchise partners, poor food safety in one in 10 stores, and of having a co-founder forge liquor licence applications.

Now, this is hardly the first time a company with an ethical brand has been accused of bad behaviour. But that’s kind of the point. This is a broader phenomenon that is becoming starker by the year.

The business case for virtue

People want the companies they associate with to be ethical. It affects customer perception, customer loyalty, recruitment efforts and employee attachment. More than that, it’s fair to say that almost all organisational leaders would like to think of themselves as ethical. To meet this widespread desire, companies put some effort into seeming ethical. But too many fall short of being ethical. 

Indeed, there’s evidence that organisations favour compartmentalisation. Companies will be ethical in one area of their business while ignoring ethical considerations in another. 

The prominent example of this obviously took place around the Royal Banking Commission, where the huge gap between what the financial institutions were saying and what they were doing was revealed. HRM discussed this in an article on holding individuals accountable for toxic cultures:

“…the Commonwealth Bank’s 2014 report addresses employee engagement and inclusion, its initiatives designed to prevent financial crime and deliver financial wellbeing to Australians of all walks, and how the bank managed risks related to sustainability. 

Five years on, CBA’s bill for cleaning up its scandals and for compensating the customers it has wronged is over $2 billion and counting.”

One hand dirtying the other

Corporate Social Responsibility (CSR) captures an organisation’s efforts to do the right thing, to focus on more than just shareholder value, and seek to address the needs and desires of workers, the supply chain, the local community, the environment and society at large (some people capture this with the idea of a triple bottom line – profit, people, and environment).  

An interesting book on this topic is David Vogel’s The Market for Virtue. He delves into the compartmentalisation referred to above. Because companies that behave ethically in one area very often are lacking in another. He asks, “Is McDonald’s a responsible firm because it uses environmentally friendly packaging or an irresponsible one because it contributes to mass agricultural production?”

You could ask the same of Grill’d. Is it responsible because it supports local charities? Or, if the accusation is accurate, is it unethical for compelling the young workers in those communities into a wage suppressing traineeship that the workers think is a waste of time?  

Vogel compares CSR to advertising. Some businesses spend big on advertising, others do not. Sometimes it’s successful, and sometimes it isn’t. This is a useful framework for examining how companies approach ethical behaviour. 

Because very often CSR is just a strategy, one that can be deployed in key, discrete areas in order to achieve specific ends. Why wouldn’t they just use this strategy everywhere? Because, as Vogel writes, “Why should we expect investments in CSR to consistently create shareholder value when virtually no other business investments or strategies do so?”

Also worth mentioning, there is a logic we all understand that asks, “What’s the point of being an ethical business if it makes you go out of business?” 

Of course, it doesn’t take a philosopher to retort, “If you’re going to be unethical, please go out of business.” But the real world isn’t that cut and dry. 

We all compromise and do the best we can with what we’ve got. We all make excuses. Compartmentalisation is very human. We donate to a climate change not-for-profit to assuage our feeling that we’re overdoing it on power consumption. We eat a Grill’d burger today, but tomorrow it’s all salad.

A timely example. HRM published an article about the Great Place to Work list, on which cosmetics giant Mecca had secured a coveted top five spot. Exactly a week later, we published a story on how over 50 former and current members of its staff made damning complaints – including claims of nepotism, favouritism and racism.

What we didn’t do in the first story – and this is an example of us ignoring rigour in favour of expediency – is vet the top companies to see if they were worth lionising.

So what’s the answer? If I had a good one, I’d be a much better person. HRM has tried to figure out the answers when it comes to organisational culture. Unfortunately, all I can add to that story is that we all have to try and do better. Then again, our species is capable of great things – we made a healthy burger – so maybe that’s enough.

4
Leave a reply

avatar
100000
  Subscribe to receive comments  
Notify me of
Mark Wagner
Guest
Mark Wagner

This has to be one of the best articles of the year for HRM. I was so happy to see the Banking RC cited, and those that follow court reports for know well that corporate entities are just not geared to be “ethical” it just does not exist in any objective form. CSR is utterly subjective and should be seen for what it is, simple marketing spin to appeal to emotion to persuade someone to enter into a commercial arrangement with one provider over another.

Ryan
Guest
Ryan

Corporate Social Responsibility has always been a web page on the corporate site with pictures of employees on one day a year packing food for homeless shelters. The other 364 days it’s profit profit profit. It’s hard to criticise CEOs for creating toxic cultures, however, as that’s what brings in the profit. If a potential CEO pitched to the board of directors that they could deliver 1% return ethically, but their peer promised 7% and the appearance of ethics, if you were on the board and legally responsible to shareholders what would you choose?

Karly
Guest
Karly

This also extends to ethical standards set in the beauty industry – any brand producing products in an amber coloured plastic bottle (Thank You, Sukin, Aesop to name a few) are contributing to our waste problem as these plastics although made from recycled material, can not be recycled in Australia and go directly to landfill. Any brands who also claim to be green and carbon neutral – buying this status needs to be called out!

FiM
Guest
FiM

I agree, a really well balanced and considered article. It’s a prickly issue for most organisations; genuinely ethical companies are rare (and perhaps are they indeed profitable?), and compartmentalising is commonplace for employees and consumers. Let’s remember White Ribbon and their work against DV whilst simultaneously courting SNAFU’s in ambassadors, fundraising and financial mismanagement). My awareness has been raised, thanks Girard Dorney

More on HRM