Alison Taylor is one of the world’s most compelling experts on business ethics. As a clinical professor at NYU Stern School of Business, she has spent decades advising large multinational corporations on sustainability issues, organizational culture and various forms of business-model risk.
In her new book, “Higher Ground,” Taylor emphasizes the challenges companies face in setting robust environmental and social priorities amidst a polarized political environment.
“What companies really need to do is to focus on the one to three issues that are core to their business model, core to how they make money, and that they actually have some ability to address. So, if you are a car company, that might be climate change; if you run a technology platform, that might be the social impact—the impact that your technology is having on society,” she explains.
Building a healthy organizational culture is another complex task Taylor discusses, particularly in an era where internal dynamics are often exposed to public scrutiny.
“If you’re not consciously paying attention to culture, it’s probably not going in the right direction. This is not something with a fixed point in time. It’s always been something very complicated because human beings are very complicated,” she says, “We can no longer treat leadership and no longer treat culture exercises as a matter of setting direction and designing incentives and thinking about structures. This is more a case of influencing across diffuse networks.”
When it comes to speaking out on contentious issues, Taylor advises caution and holistic thinking. She highlights the importance of a broad task force to evaluate the impact and potential consequences of speaking out.
“So, I think the first thing to say is you need to think about these questions holistically. It is not enough to have the communications team or the senior leadership team or the HR team or the ethics team deciding when a company shouldn’t speak up. What you really need is a broad task force where you can think: if we’re going to speak up, can we influence this issue?”
Taylor provides examples of business leaders taking a stand on big issues, such as Chobani, General Motors
GM
, and Unilever
UL
, illustrating how they have taken clear stances on issues central to their business strategies.
“I also would like to name Unilever because Unilever has been very heavily criticized in the press recently for dialing back on its ESG commitments. And I actually have the opposite perspective. I feel like Unilever was over committed on too many issues, too many vague long-term issues that couldn’t actually influence. And now it is focused much more closely on nature, livelihoods, plastic, and climate change, which are four issues core to its business, and they can actually have a significant positive impact,” she notes.
For building systems to check and balance leadership judgments, Taylor emphasizes the need for employee involvement in setting values and creating transparent ethics committees.
“What I would suggest that you do is get your employees involved in setting your values. I use the examples in the book from Dutch banks. ABN AMRO and Rabobank have ethics committees where any employee can bring a dilemma. Things are discussed in a very, very transparent way,” she explains.
For more insights, including perspectives of younger generations on corporate issues and how using frameworks like the UN Guiding Principles on Business and Human Rights can help navigate ethical dilemmas, watch the full interview with Allison Taylor on the Sustainable Finance Podcast:
Read more: The Sustainable Finance Podcast: Getting investors, companies and consumer involved
