Good, for NAU -- Part 2
Sustainable clothing maker NAU's financing experience confirms that lofty values can pose challenges to achieving the firm's business goals. To NAU's credit, they believe the triple bottom line business model actually enhances value. But, in an interview in Grist, NAU's Sustainability Officer Eric Brody acknowledged that NAU faced significant pushback to its documented commitment to sustainability. Brodi said, "People advance the view that the language [NAU's rules of corporate responsibility] suggested a greater degree of responsibility and therefore could lead to the company being devalued."
NAU initially rolled its code of corporate responsibility into its organizational documents. But as a result of challenges to raising capital, NAU eventually removed the code from these documents and adopted it as a stand alone set of principles. NAU's articles of incorporation do require that any amendment to its rules of corporate responsibility require approval of at least 75% of NAU's outstanding voting securities. No one knows yet whether or not these rules are binding on NAU or guidelines by which NAU chooses to operate.
Considering NAU's experience, I advise clients to consider carefully how the actions and positions it takes may affect its ability to raise capital and, ultimately, its ability to achieve or realize its business plan. A successful business has a much greater opportunity to impact society than an unsuccessful one.
