CVS Agency Decision Signals A New Era In Partner Strategies: Values Vetting
CVS Takes The Next Step To Align Its Operations And Values
After pulling tobacco from its shelves in 2014, last week retailer CVS Health announced that it would not work with agencies who have tobacco or e-cigarette clients. Both decisions stem from the retailer’s desire to align operations with values. The effort is part of the Quit Big Tobacco campaign led by Vital Strategies, an organization dedicated to improving global health.
At Stake For CVS: Future Customers And Talent
The strategy has merit, even if a hit to short-term sales results. Survey data shows that 57% of consumers will boycott brands that don’t share their beliefs. And, as if the talent wars weren’t hard enough, employees are vocally vilifying employers whose policies don’t align with their values. Consider the example of the 2,500-person-strong petition pushback that led Google to disband its AI ethics committee. Enterprises seeking the best talent may start to face tough interviewee questions about their partners.
Not Just An Agency Problem: Guilt By Association
You might think this is an agency- or Silicon-Valley-only problem (and not without some schadenfreude). But it signals a trend for any company. In 2017, we predicted a “guilty-by-association phenomenon” in which companies would be called out based on the actions of the partners they associate with. If CVS is ready to apply values-based requirements to agencies, what’s to stop them from applying it to any partner, such as those that supply tech or raw materials. Or expand the requirement to other sin categories.
Drivers: Increased Transparency And Empowered Customers
What’s underpinning this trend? Mobile and social technologies enable content — false and true — to reach consumers at scale at unprecedented rates. Increasingly empowered consumers act on such information to craft an end state best for them — including aligning with their values. They don’t care about how companies usually do things; they vote with their wallets.
Next Step: Audit Your Clients’ And Partners’ Values
No doubt, the agencies on CVS’s current roster are nervous about CVS’s enforcement. Whether you are the buyer or supplier, don’t get caught off guard. Add partner/ecosystem risk to your total risk mitigation processes. B2B companies: Pull a client audit by value categories to gauge your risk potential. B2C companies: Stand up a cross-functional operational ethics committee to audit partnership. Both: Get a handle on your employee experience to find the link between their sense of purpose and their work, where important values may lie.