Many people share the belief that big business is focused solely on making money with little or no regard for the consequences of how they do it. They consider major corporates to be uncaring giants that will do whatever it takes to protect their profits irrespective of the price that someone else or the environment might have to pay. In some cases they may be right. The Union Carbide disaster in Bhopal and the more recent BP oil spill in the Gulf of Mexico are both instances when the drive for profits seem to have outweighed all other considerations.

But not all businesses focus on profit alone. Richard Reed, a co-founder of the highly successful Innocent Drinks company, believes in the concept of corporate social responsibility and puts his belief into practice by ensuring that his business runs ethically and gives something back to society.

Corporate social responsibility, a term that came into common usage as far back as the 1960s, essentially means that a business has a self-regulatory mechanism to ensure that it complies not only with the spirit of the law but also with international norms and ethical standards. Proponents of the concept claim that it facilitates better profits in the long term Critics, however, argue that it distracts businesses from their economic role. Neither seems to be right. With a number of contradictory studies on the matter confusing the issue, in 2001 Abagail McWilliams of the University of Illinois and Donald Siegal of the University of Nottingham, co-authored a study that showed that corporate social responsibility has a neutral effect on financial outcomes.

Richard Reed, however, claims that it has contributed to the success of Innocent Drinks. In fact, it could be said that his company was founded on the concept. Innocent Drinks had its beginnings in 1999 when Reed, along with fellow Cambridge University graduates Adam Balon and Jon Wright, got together to produce smoothie drinks from real fruit. They sold their drinks at a London music festival and asked their customers to put their empty bottles into one of two bins – one if they were in favour of the three men quitting their jobs to continue making the drinks, and the other if they were against the idea.

With  the ‘yes’ bin full and only three ‘no’ votes, Reed and friends left their jobs and embarked on their new business. Lucky enough to secure a £250,000 investment from American businessman Maurice Pinto, they began to produce and market their product and the Innocent Drinks story was born.

According to Reed, the company’s success is due to hard work, good decisions and good fortune, combined with a product that is better than the competition’s. But Reed also believes in values and attributes around 5% of the success to the appeal to some customers of its commitment to corporate social responsibility. He adds that his company has a great relationship with its business partners and is an enlightened employer, offering staff excellent benefits.

His company also has a policy of leaving things better than it found them. It only uses natural, ethically sourced ingredients and is committed to giving at least 10% of its profits to charity, most of this going to the Innocent Foundation, which funds rural development projects in countries where Innocent sources its fruit.

Reed clearly lives up to his beliefs and has a message for other business about corporate social responsibility. He says that their products or services really should support the concept not just do it to make themselves more marketable. It has to be real, not just a brand construct.

David Seymour is a business journalist who focuses on CSR and the environmental impact of modern business.

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