In late 2008, when the big banks were failing and unemployment was soaring, the thought struck us:
The most important way companies can help the poor, and in so doing support social sustainability, is through their own employment practices.
For the past decade many, if not most, of our grants had been in the realm of training and workforce development, including two exciting, large-scale efforts in the implementation of worker training and career ladders: Jobs to Careers and the National Fund for Workforce Solutions.
But in the midst of the economic chaos that accompanied the Great Recession, we realized there was a crucial aspect to workforce development that none of our grants - or anyone's grants - was really addressing - namely, the strategic needs of employers. Simply put, few companies can or even should institute higher wages or career ladders for their lower-wage employees out of charity. Every business must ultimately answer for its own financial bottom line. Thus, in order for a one person's dead-end job to be turned into a life-affirming economic opportunity, there must be an economic incentive for the firm to make that change. The question was: can businesses make money by providing a pathway out of poverty for their employees?
We knew of two entrepreneurs that had devised solutions to just that question: Al Fuller of Integrated Packaging Corporation and Louise Woerner of Home Care of Rochester (both of whom have served on the Hitachi Foundation's Board of Directors). Their two companies had achieved strategic advantage by offering better than average wages or employee stock options, and exceptional training for their workers. In return, they capitalized on extraordinary productivity, high retention, and terrific employee morale, in industries where such conditions are unusual. In other words, by creating genuine opportunities for employees to move up the economic ladder, they secured a sustainable competitive advantage through increased productivity, revenues from new market segments and improved quality of product or service.
Knowing these two companies existed encouraged the Foundation to seek out others. We asked: how could we find more companies like them? How many are there, and in which sectors? Most importantly, if we could discover the factors that made these companies successful while empowering their employees, could we then help similar firms do the same things?
The Pioneer Employers Initiative is The Hitachi Foundation’s effort to answer those questions.
Here is our approach. We’re doing this industry by industry, sector by sector, region by region. For each subsector, we find a grantee organization with deep knowledge and a host of local, regional, and national connections. Usually these organizations are involved in developing improved standards of productivity for their industry and sector, but they also must have a strong focus on improving working conditions. Our grantees then find the Pioneer Employers in their sectors, and develop case studies about them that distill the practices and policies which make them successful. Finally, they then turn to the employers within their networks, as the primary audience for the lessons learned in these studies.
You can see a complete listing of our Pioneer Employer case studies here.