Trust me, I'm a philanthropist

Michael Young examines the idea of placing society at the heart of a company.

As a sociologist who has started some 50 non-profit institutions, from the Consumers Association to the Open University, I did not expect to find this book from the Future Foundation as relevant to non-profit companies as to the profit-based companies for which it is primarily written.

It is a trenchant reply to Naomi Klein's No Logo , which stirred up such a storm in company boardrooms. Klein's view is that brands represent a huge portion of the value of a company. So firms are switching from producing products to marketing aspirations, images and lifestyles. In this Barbie world for relatively grown-up people, the image-makers (the same brand more or less as the spin doctors who do not practise in the National Health Service, where there is a shortage of unspun doctors) have integrated their brands so fully into our lives that they cocoon us all (apart from conscientious objectors) into a "brandscape".

In the worldwide case of Klein vs Willmott, the latter puts the case for the defence. He is not the QC for every brand - not for Marlboro or whisky matured in an ex-sherry barrel - but for a new kind of brand that he calls a "citizen brand". A company ready to take on the responsibilities of a corporate citizen has many of the duties of an ordinary citizen, amplified. The world is full of artificial persons, growing even faster in an artificial demography than in human demography: companies, governments, non-profit organisations that torture the language of "I" and "we" to create collective images that look more like puppets than human beings.

"We at Goldman Sachs deplore our excessive executive salaries." They do not say this kind of thing, even though it is the fact of the matter; but they could if they chose, and many other bodies do make a brave effort to give their artificial persons social consciences. BP, an oil company, pushes its business to one side by claiming to be "beyond petroleum". If investors believed this, it would be catastrophic for BP. There is no real money, yet, in wind or tidal generators.

What then is a citizen brand? At its most general it means placing society at the heart of a company. An active interest has to be taken in employees, customers, investors and suppliers. In addition, it entails showing the same interest in local and wider communities and societies and demonstrating that the company takes these issues seriously. Some companies focus on their workers and their families, others on the problems - such as poverty, health and education - that many third-world countries face.

It goes much deeper than making donations to charities. The image-makers need to be born-again philanthropists with a keen eye for all the good relating to their business that can properly be supported. The ethic is that what's good for General Motors (or any other firm) is good for America or Britain or the Czechs who now have Skoda to sound off about.

A citizen brand - representing the favourable way in which a company is regarded - needs the best skills of the best marketing men to guard and enhance it at every opportunity. Coca-Cola had a contamination problem at its Belgian bottling plant and played it down: "Where the hell is Belgium?" The new chairman and chief executive, Douglas Daft, belied his name by urging employees to "think local, act local" and "lead as model citizens". Barclays Bank got into a quandary by closing branches galore in poor districts while running an advertising campaign that emphasised its size and international credentials. According to a report leaked to The Sunday Times , Barclays was seen as having a "culture of greed". The image-maker had to go work in earnest. However burnished your citizen brand, constant polishing is needed to keep it that way and constant vigilance to spot the whistleblowers who will otherwise remove the shine.

The rise of citizen brands is, like so much else, traced by Willmott to that late 20th-century revolutionary figure, Margaret Thatcher, who set out to handbag the state. Labour's welfare state, which had engaged the support of every Conservative government up to hers, suddenly became vulnerable. With her in Downing Street, Willmott believes, citizens and workers who would have been protected by safety nets found themselves in queer street. If the culture of the state that had provided the safety net was in decline, who was to fill the void? Business, which had been under a cloud for so long, began to be seen in a new light under the beneficial guardianship of the market.

As one business leader interviewed by the Future Foundation admitted:

"Businesses were definitely expected to do more in the Thatcher years in a general sense; business success was seen as the answer to everything. But a lot of corporate social activity in the 1980s was a sham." What started as sham by no means always ended as a sham. John Banham, then director general of the Confederation of British Industry, spoke up for corporate responsibility: "It is a chilling prospect, as any visitor to the South Bronx or parts of Lambeth will confirm. An increasingly affluent majority will live uneasily with an increasingly deprived, resentful and repressed minority who will not be able to use the ballot box to secure a redistribution of wealth to their advantage." Business, it was argued, had to take up a new stance. As a new post-Conservative era got into its stride, a double bottom line began to be talked about: on the one hand profits, on the other successes in social and environmental awareness and activity.

Willmott's book has suffered the fate of a thousand books that have been caught out by later events. For example, Marks and Spencer comes well at the top of a league table for honesty and openness. BT comes out well too. Its own statement is quoted: "BT's' continued success depends on the skills and resources of our people, the loyalty of our customers and the health and profits of the communities of which we are part. Successful companies need successful communities." Willmott offers no comment.

Still, he makes a powerful case and one that is increasingly listened to and acted on at the top of the building where the top people pursue their crafts. With this book, the Future Foundation has established itself as the body to go to if you are not satisfied with your citizen brand. Maybe the foundation will even establish a registry of citizen brands, with strict conditions for entry and for continuance year by year.

Lord Young is at the Institute of Community Studies.