The Top Small Company Workplaces take very different approaches to social responsibility. Is one approach preferable?
Lehman: I prefer to create a culture where community service and volunteerism is encouraged but not prescriptive. At Fel-Pro, we had a United Way campaign. But we also had an employee-administered Better Neighborhood Fund that awarded grants to worthy programs in employees' communities. In addition to the grants, on Fel-Pro Volunteer Day, employees could choose from a menu of projects involving the recipients of those grants. The message to employees was, We care about the place you live.
The Neighborhood Fund was another example of enlightened self-interest. When our workers brought charitable contributions into their neighborhoods, they became heroes there, and they bragged about where they worked. It further cemented their relationship with us.
Chouinard: We give employees two weeks' paid time to volunteer at the environmental organization of their choice. I also co-founded 1% for the Planet, an alliance of 1,300 companies that give 1 percent of their sales to environmental causes. It is surprising how small these companies are. The most philanthropic people are often the poorest -- the people who give 10 percent of their annual income to the church. But certainly it is good for business. Recently I was talking to some of the largest companies in the group. And we agreed that during the recession, we're having the two best years we've had.
Is environmental responsibility something all companies must commit to, the same way they presumably commit to ethical financial behavior?
Chouinard: We look at that 1 percent of sales as a cost of doing business. We make outdoor products, so it's to our benefit that there be some nature left. We have more responsibility than your average taxpayer. But anytime you find a process that makes your business greener, you are way ahead.
When I talk to business students, I say, "Imagine you have one of the best companies to work for in America. You give great benefits. You do everything possible for working mothers. And your product is the best of its kind in the world. But you're making land mines." You have to think about these things. Business leaders can't afford to lead an unexamined life.
Lehman: We see in the applications to Winning Workplaces that green has become way more prominent. Along the lines Yvon was talking about, at Fel-Pro the biggest risk was asbestos, which had been a primary raw material in our industry. We reengineered our product line and eliminated it before anybody told us we had to. Then we went to our original equipment customers and said we've got products that work equally well and don't have asbestos.
What should company leaders pay more attention to in order to maximize the quality of the work experience?
Lehman: Open, two-way communication. Open-book management, for example. Employees want to do a good job. But they need to know what is going on and how they fit in. Frequent, open communication -- including financial information -- equips people to do their best. Every good organization has a culture of shared risks and rewards. You also need shared information.
Chouinard: I agree. Openness creates trust. Our employees know we reinvest profits back into the company, so we remain debt free. They know what we give to environmental causes. It's part of an overall message where there is no hierarchy and everything is very honest and equal. At Patagonia, we don't have special parking spaces for the executives. When my wife and I go down to the cafeteria, we pay for our food just like everyone else. To do anything else sends the wrong message.
Lehman: Companies with an executive dining room are robbing themselves of an opportunity. We always ate in the cafeteria. We would sit down with different people and learn what was going on in their departments. Do you know the show Undercover Boss? The leader of a company goes undercover among his frontline workers and learns what their jobs are really like. That is ridiculous. No good leader could go incognito. Even in a 100,000-person organization, you can use technology to be seen and heard by employees -- and to see them and hear them. If you are a good leader, then your people know you.
If you were starting a company today, what would you do to create the best possible workplace?
Lehman: I would run it with the same values we had at Fel-Pro. I would instill in my new company a long-term outlook. I would remember the golden rule, every day. I would create an atmosphere where the business was a family. I would try to be the best employer in the markets in which I found myself.
Chouinard: I couldn't state it better than that. But I would add one thing. I would search out older women as employees. Ones that have already raised families and are looking for something to do. These people have lived with a budget. They are aggressive. They are honest. You can't find better employees. They are one of the most underused resources in America.
Winning Workplaces is Inc.'s partner for the Top Small Company Workplaces report. The Evanston, Illinois-based nonprofit helps small and midsize businesses create better work environments. Learn more by visiting their website www.winningworkplaces.org/
