Corporate Social Responsibility – a perspective

As the weather is still so cold, I was thinking about lloydmasters projects in sunnier locations such Brazil where we helped the United Nations run a series of stakeholder dialogues focused on sustainable development and Corporate Social Responsibility (CSR).

In the UN, as in other client companies we often see much hand wringing and confusion on the vexing question of sustainability and CSR and and what to do about it.The subject can appear daunting as there is much ‘expert opinion’ and a cottage industry of ‘triple-bottom-line’ reporting endless conferences and seminars searching for the definitive ‘business case’ for CSR can also prevent clarity.

So, lets get back to basics.

When we talk about CSR, all we are really talking about is leadership and due diligence. By leadership, we mean adopting a more thoughtful, businesslike and having an understanding ambitious approach to ethical, social and environmental issues – and of the commercial opportunities arising from tackling them. Due diligence means managing the risks arising from evolving expectations in society, the values of the demand-side of the economy, requirements of law, industry standards as well as professional and codes of practice.

So, what is the 'business case'? Putting aside for one moment moral philosophy, we know that issues that are of significant interest to customers, employees, suppliers and to general society will also be of concern to shareholders. We also know that public and consumer trust are essential for a sustainable business; but more often we operate in a low trust environment and in an increasingly transparent and connected world.

In short we are constantly under scrutiny. The business case is therefore quite simple; companies showing leadership and exercising due diligence will do well and be rewarded. Those that don't, will tend to suffer in terms of brand devaluation and will eventually have to change or could go out of business.

So, what should you do?

• Don't let the tail wag the dog! Don't let ‘reporting’ be the driver. Understand what societal issues are out there, what values are driving them, explore, and understand what they mean for the ongoing success of your business
• Show leadership by acknowledging issues relevant to your business and discuss these with relevant stakeholder groups to gain insights, identify boundaries and discover win-win business opportunities. Understand what due diligence means for these issues and put in place appropriate risk management processes
• Translate these opportunities into the ‘day-to-day’ job. Set targets and measure performance taking care that things are done in a joined-up fashion and that performance is cast in win-win terms. For the business this means impact on brand equity, license to operate, customer and supplier relationships, staff motivation, carbon risk, market share, etc. For society, this means impact on the environmental, social, ethical and economic issues that you have acknowledged as something relevant to your business
• Decide what you need to communicate, and to who, and put in place appropriate communications, feedback mechanisms, partnerships and performance reporting procedures