A Company Mantra: “Do the Right Thing”

linda rendle clorox ceo

As the chief executive officer and chairperson of The Clorox Company, Linda Rendle knows well that environmental, social and corporate governance (ESG) and diversity, equity and inclusion (DEI) have become controversial concepts in some business and political circles.

“I don’t view any of these topics as political,” Rendle told Dean Bill Boulding of Duke University’s Fuqua School of Business in a recent conversation in front of students. “I view them as just necessary to delivering good business. And I know they’ve been politicized, and I’m sad about that.”

Rendle says both ESG and DEI are so core to the business model of Clorox that they are discussed in detail in the company’s annual report.

“I just look at it as it’s business critical, and if it’s business critical and it’s ‘do the right thing,’ then it’s going to be right there on the annual report,” Rendle said. “It’s integrated. It’s not a hobby off the side.”

Rendle says general managers at Clorox are held accountable for their sustainability plans in the same way they are for innovation, cost savings and growth and profitability plans. Similarly, she says there is accountability throughout the organization for making sure the workplace is diverse and difference is valued.

“I think it comes down to the core of who we are at Clorox. Our number one principle, our number one value is ‘do the right thing’ without question,” Rendle said. “And to do the right thing is to look the facts in the face and deal with them. The facts are that we have climate change that we need to deal with. The facts are that inclusion delivers better business results. And those are the facts … so, we will deal with the facts and we will put out there a business strategy that includes all of those facts.”

Rendle says it’s also necessary to be transparent about how that business strategy succeeds in the long term, and not just focus on short-term profitability as success.

“We aspire to deliver the top-third shareholder return and do it in a way that integrates ESG. I think that’s the sustainable business model that actually gets you top-third TSR (total shareholder return) over time,” Rendle said. “Not every individual business choice we make is going to be profit positive, but in aggregate, the most value-creation that we can deliver is by putting those things together over time.”

Rendle says companies also build trust when they demonstrate they are citizens of the world and care about their communities, which she believes also builds brand loyalty.

“We have to have communities that are healthy. We have to have people that are thriving,” Rendle said. “And I think ultimately that’s the way that businesses create value over time … by having communities that then want to buy your products and have good jobs, and all of those things.”

 Editor’s note: You can read more about Linda Rendle’s leadership journey and philosophies in this story.