CSR is about focusing on the little things

It seems odd that when corporations show their commitment to society through CSR they get the most out of doing something about the little things. Companies that are successful looks at what they do well and tries to figures out how this impact communities that they are active in, in ways they could not imagine if they did not have the tools provided though CSR.

When reviewing the many definitions of CSR that is out there it gives little or no clue how actually to conduct social responsibility. It would seem that if one just followed conventional wisdom it would be hard if not impossible to satisfy even the simplest requirements given by all these different classifications.

“The Social Responsibility refers to the obligations of businessmen to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society.” Bowen, 1953 in Social Responsibilities of the Businessman, which commonly regarded as the first milestone in modern CSR research and practice.

Another more modern definition have been issued by the International Standards Organisation (ISO) through their guidance on social responsibility “Responsibility of an organization for the impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that contributes to sustainable development, including health and the welfare of society; takes into account the expectations of stakeholders; is in compliance with applicable law and consistent with international norms of behaviour; and is integrated throughout the organization and practiced in its relationships.”

Both of these very fine definitions give little or no clue to what companies should actually do to both successful in terms of profit, development and continued competitive advantage, and at the same time being in tune with societies moral compass.

But some companies have actually done quite well trying to combine their CSR with their core business. Just to give a few examples.

Danish Novo Nordisk has committed themselves to the task of “Changing diabetes” and have successfully introduced new products like Victoza inline with their core mission statement

The Swedish fashion company, H&M have under the statement “Conscious” has with worked to create sustainable fashion through a comprehensive CSR system that reduce risks in their supply chain.

Vivendi, the French telecom company, have initiated a program that promotes the safe use of the Internet to youth.

All of these initiatives are small when it comes to the efforts that the company needs to put into them because it is embedded in the “what we do” part of their business, but even so that have a huge impact on their outreach to the communities they are active in.

So even though it would seem that these successful companies are focusing on the “little things” they do represent a significant societal impact exactly for that reason.

It is the secondary effect that is central

When working with CSR we like to believe that there is a cause effect relationship between the activities that we engage in and the results we can measure. But we often overlook that it is the secondary results that represent our greatest achievements.

Most organisations look at the direct effects of communication technology like CSR systems and efforts to introduce sustainable technologies with a communication component. There is no doubt that there persist other perspectives on how organisations can achieve sustainable business development but in all cases is the communication part central. To illustrate one can look at CSR as part of the branding strategy of companies that in order to boost their image advocate their products as green or sustainable. This I will characterise as a 1st order communication strategy like a cause-effect system of meaning.

 

We can look at communication technology like CSR as “what management wants”. This can be decentralisation into global teams, working from home systems or technologies that enable projects to work cross boarders. The common denominator for these communication technologies is that they enable people to process more data more efficiently or/and with greater ease. However it is often the side effects or secondary effects of the introduction of a CSR systems approach that have the greatest impact on business development, an effect that is often ignored or underestimated in the original prospect. So what management wants is often not what management really gets because the secondary effects outweigh the first order ones.

So what does management need to look out for when implementing a new technology, like CSR. First of all one should not underestimate the effect of cultural changes. Organisations cant implement a new technology without assuming that people will do their tasks differently meaning that they will use or at least relate to the introduction of this new process that is presented. They do not have to embrace CSR but the presence of systems that coerce employees to relate to something than them selves will force a cultural change no mater what. One could say that CSR questions the status quo forcing employees to ask themselves; “who are we as and organisation and how do we interact with people outside”.

Another effect closely related to cultural change is the raise of new types of conflicts. When people question their own ethics they will natural also question the ethics of their fellow employees. This give raise to conflicts that relate to our understanding of the consequences of how we interact and do business with customers or other stakeholders. Are we really doing good? Or are we only doing well? Just look at the banking sector that for a long time did not ask these fundamental questions, but almost exclusively used CSR as a means create a image of “goodness”. But when the ethics were questioned an internal conflict erupted questioning the very fabric of what the business was all about which was mainly grounded in CSR or Ethical framework of understanding.

Lesson is that when starting on the path of CSR it is not only that directly related effects of the system that one needs to take into account of, but also the changes that comes with thinking differently about the organisation. If you ask the organisational members to think (and I mean really think) about the consequences of their actions one should take this into account when embracing a technology. CSR asks employees to think and react to consequences of the actions. So be prepared to embrace rather their input rather than only thinking of CSR as a way create a better image of the organisation to outside stakeholders.

 

CSR and Development Corporation meets

Can development and CSR really meet or are they at odds no matter what you do? I have met many people from the development world who are really aggressive towards CSR and just about everything it stands for. And while I will be the first to admit that CSR is far from a perfect approach for business towards its social responsibilities it is just about the best guess out there on how its done.

So why all this hostility and aggressiveness towards business having a social responsibility, is it not what we all want that business take on more of the social burden that governments cant handle by their own?

Here are some common denominators on what people in development think is wrong with CSR.

  1. It is a branding and communication exercise that has nothing to do with social responsibility.

Well it is true that a lot of companies are actively communicating their CSR activities and that for some of the major companies CSR has become part of the image that we have of the company. For one I think the Abraham Lincoln (attributed) quote “You can fool all the people some of the time and some of the people all the time but you cannot fool all the people all the time” rings true. All communication people know that you can’t lie forever and the same goes for corporate communication. If there were no hint of truth to in the brand it would at some point be exposed as a fake.

  1. It is only exercised to reduce the risk of bad PR.

There is a strong risk element in CSR because it is the only business approach that has some success in confronting social risk. Actually risk management have been one of the primary “business cases” for CSR. But risk is not limited to PR alone it can be many different things that has nothing to do with creating a good or bad image of the organisation. Proper risk management take a holistic approach to the organisation and so does CSR. With this approach on gets an insight into operations of the state, which under normal circumstances would be left out or marginalised.

  1. It is seen as a neoliberal project that is out to exploit the developing world

There seem to be the perception that business somehow has feelings that guide them to do evil. But as far as I know there is no evidence that companies in themselves are either good or evil, they are as far as I know just companies working in a market. But with the market there are structures and mechanisms that can be harmful. The companies might or might not be aware that their actions have a counterproductive result or even harm people who are in contact with its operations. CSR is an effort to confront some of theses impacts in a constructive and systematic way rather than tackling them one by one as they arise.

  1. It will be gone in three years.

The same thing was said three years ago and CSR is still around. In the years I have been involved in CSR there have been shifts in focus from reporting, to communication to governance. At some point either one have been the prevailing issues that have been talked about. I’m convinced that CSR will be around for many years to come because it works from the basic principle that organisations have a responsibility towards its stakeholders. This basic premise have been true always and that we call it CSR is more a construction of the time we live in rather than a shift in basic assumptions about business and society.

I hope and think that CSR professionals and development people can meet on common ground and that the two have something to learn from each other. But there is a strong need to confront some of the stereotypical assumptions about how business operates and how development people think.

Research and education gets a central position within EU CSR policy

The Earth flag is not an official flag, since ...

Earth flag

While I do have some criticism of the new EU CSR policy there are some points were I think progress have been made. And within the field of education and research there are clear signs that lessons have been learned.

“The further development of CSR requires new skills as well as changes in values and behaviour. Member States can play an important role by encouraging education establishments to integrate CSR, sustainable development and responsible citizenship into relevant education curricula, including at secondary school and university level. European business schools are encouraged to sign the UN Principles for Responsible Management Education.”

I think this quote from the policy shows that CSR have hit the mainstream vein and that it should be taken serious not only by business but also by the institutions that teach our future leaders that there is such thing as ethics and morals.

Especially London School of Economics have been accused of having a lax relationship in terms of teaching their students what is right and what is wrong. Actually to such extend that business schools had to apologize for alleged harm that students had done in the wake of the first financial crisis. So this step is definitely a step in the right direction in terms of trying to integrate moral thinking into the curriculum.

Another subject is that EU will support research and the further development of the field of research.

“High quality academic research supports the development of business practice and public policy in the field of CSR. Further research should build on the results of projects financed under the 6th and 7th EU Framework Programmes. The Commission will explore opportunities for financing further research and innovation on CSR, and supporting CSR principles and guidelines in research funded still under the 7th Framework Programme, as well as under its successor, Horizon 2020, and in building the European Research Area.”

While there are no independent money to be found it is a strong signal to send that they will continue the funding beyond the 7th framework, which will end in 2011. So all in all not all is bad with the EU CSR policy there are beacons of light out there. At least as long as they don’t give the money to prove the concept of Shared value I will be a happy camper.

Integrated Market Communication as a CSR communication strategy

In the introduction of the CSR training that I’m involved in with the CSR gender group I start out with asking the participants which definition of CSR they subscribe to. The answers normally vary a great deal depending on the audience but for the majority people would like to be told what and how CSR is to be formulated. These are the four definitions we present:

 “The Social Responsibility refers to the obligations of businessmen to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society.”

“The Social Responsibility of business is to tame the dragon, that is, to turn a social problem into economic, opportunities and economic benefit, into productive capacity, into human competence, into well-paid jobs, and into wealth.”

Corporate Social Responsibility is a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis.”

“Responsibility of an organization for the impacts of its decisions and activities on society and the environment, through transparent and ethical behaviour that contributes to sustainable development, including health and the welfare of society; takes into account the expectations of stakeholders; is in compliance with applicable law and consistent with international norms of behaviour; and is integrated throughout the organization and practiced in its relationships.”

However, I believe that is a misunderstanding to tell people what definition they should subscribe to. Rather it should be negotiated between the organisation and its key stakeholders on a continues basis. CSR is not a management system and will never become such a system simply because it is based on the principle that “Any group or individual who can affect or is affected by the achievement of the organization’s purpose and objectives”(Freeman, 1984) have a stake in how the organization develop.

What organizations can do is to become effective in their efforts to identify, categories and negotiate with the stakeholder on what activities that it should engage in. Such a framework can be found using a integrated marketing (IMC) approach enabling organizations to communicate effectively with multiple stakeholders and at the same time indentifying less salient groups which might have a interest or is affected by the organizations activities.

IMC can be described as a process which involves the management and organization of all stakeholders in the analysis, planning, implementation and control of all marketing communication contacts, media, messages and promotional tools focused at selected target audiences in such a way as to derive the greatest enhancement and coherence of marketing communication effort in achieving predetermined product and marketing communication objectives.

An IMC approach will in my mind be the most effective framework a given organization can adopt if it wants to be regarded as social responsible player and keep some influence in relation to its identity, culture and image.

Novo Nordisk on year of continues growth

For all SRI interested investors it is good to see that some of the leaders within CSR have had a tremendous year. I just pulled the numbers for the company and the growth pattern is amazing with almost a full year of continues and sustainable growth.

Novo Nordisk is a leader within business driven CSR and is looked upon as a engine for other companies trying to integrate a sustainable approach in their business model.