The Corporate Social Responsibility Story

CSR promotes a vision of business accountability to a wide range of stakeholders. Key areas of concern are the environment, employees’ well-being, the community, and civil society. CSR is underpinned by the idea that corporations can no longer act as isolated economic entities. Traditional views about competitiveness, survival, and profitability are being swept away.?

DRIVERS PUSHING BUSINESS TOWARDS MORE CORPORATE SOCIAL RESPONSIBILITY / INVESTMENT?

1. The shrinking role of government. In the past, governments have relied on legislation and regulation to deliver social and environmental objectives in the business sector. Shrinking government resources, coupled with a distrust of regulations, has led to the exploration of voluntary and non-regulatory initiatives instead.?
2. Demands for greater disclosure. There is a growing demand for corporate disclosure from stakeholders, including customers, suppliers, employees, communities, investors, and activist organisations.?
3. Increased customer interest. There is evidence that the ethical conduct of companies exerts a growing influence on the purchasing decisions of customers. In a survey by Environics International, more than one in five consumers reported having either rewarded or punished companies based on their perceived social performance.?
4. Growing investor pressure. Investors are changing the way they assess companies’ performance, and are making decisions based on criteria that include ethical concerns.?
5. Competitive labour markets. Employees are increasingly looking beyond pay cheques and benefits, and seeking out employers whose philosophies and operating practices match their own principles. In order to hire and retain skilled employees, companies are being forced to improve working conditions.?
6. Supplier relations. As stakeholders are becoming increasingly interested in business affairs, many companies are taking steps to ensure that their partners conduct themselves in a socially responsible manner. Some are introducing codes of conduct for their suppliers, to ensure that other companies’ policies or practices do not tarnish their reputation.?

Nevertheless, many companies continue to overlook CSR in the supply chain - for example by importing and retailing timber that has been illegally harvested. While governments can impose embargos and penalties on offending companies, the organisations themselves can make a commitment to sustainability by being more discerning in their choice of suppliers. The concept of corporate social responsibility is now firmly rooted in the global business agenda. But in order to move from theory to concrete action, many obstacles need to be overcome. A key challenge facing business is the need for more reliable indicators of progress in the field of Corporate Social Investment, along with the dissemination of CSI strategies. Transparency and dialogue can help to make a business appear more trustworthy, and push up the standards of other organisations at the same time.

The Global Reporting Initiative is an international, multi-stakeholder effort to create a common framework for voluntary reporting of the economic, environmental, and social impact of organisation-level activity. Its mission is to improve the comparability and credibility of sustainability reporting worldwide. There is increasing recognition of the importance of public-private partnerships in CSR. Private enterprise is beginning to reach out to other members of civil society such as non-governmental organisations, the United Nations, and national and regional governments.

An example of such a partnership is the ‘Global Compact’.

Launched in 1999 by the United Nations, the Global Compact is a coalition of large businesses, trade unions, and environmental and human rights groups, brought together to share a dialogue on corporate social responsibility. The ‘Working with NGOs’ section offers some insights into the way businesses and lobby groups are working together for mutual benefit. Management training plays an important role in the implementation of CSR strategies, and there is a growing number of conferences and courses available on the subject. Organisations that provide such training include Global Responsibility, Business for Social Responsibility, and the Corporate Social Responsibility Forum.?

Extracted from The Responsible Citizen Magazine (December 2016)