Today (18th February 2023) marks the 70th Anniversary of Corporate Social Responsibility (CSR), which was first introduced in 1953 by American economist Howard Bowen in his publication Social Responsibilities of the Businessman. CSR is generally understood to be a management approach that endeavours to achieve a balance between economic, environmental and social imperatives (“Triple-Bottom-Line- Approach”), while at the same time reaching the expectations of shareholders and stakeholders[1].
Over the last 70 years, CSR has gained traction, and is no longer just a voluntary tool for organisations to adopt, but has become a requirement driven by consumer behaviour. In 2019, a national survey found that 70% of consumers want to know what the brands they support are doing to address social and environmental issues, and 46% paid close attention to a brand’s social responsibility efforts when they buy a product.[2] In addition, another 2019 survey found that 25% of consumers had a “zero tolerance” policy toward companies that embrace questionable ethical practices, which risk them losing a significant number of potential customers. Equally, community organisations have also adopted CSR in their operating model, and consequently, have made the ‘C’ in CSR more inclusive than ever before[3].
Since consumer demand for sustainability has become the main driver to a greener, fairer, and smarter global economy, it is essential to follow some key principles and strategies to ensure high standards are met and to avoid falling short. Despite this, some businesses, which have faced increased consumer pressure, put CSR initiatives in place that have no real substance or value, and thus, offer minimal benefits to either business or society. In some instances, there are even discrepancies between their words and actions[4], which can lead to ‘greenwashing’. Therefore, to avoid such shortcomings here are some key principles[5] to help guide CSR activities and increase the chances of successful outcomes:
- Concentrating CSR efforts: Resources are limited for all organisations so the greatest opportunities will come from areas that the organisation significantly interacts with, and thus, can have the greatest impact on society.
- Building a deep understanding of the benefits: Once areas of opportunities are identified and selected, it is important to consider mutual value creation and the benefits for the organisation and wider society.
- Finding the right partners: Work with those that benefit from core operating activities and capabilities and who will benefit your organisation.
In addition, adherence to the following practices can help ensure that an organisation’s best practices are clearly communicated to their consumers:
- Making clear claims: Include details such as specific units of measurement (e.g., “70% organic cotton” rather than “made with organic cotton”) and specific certifications and verifiable endorsements from credible third-party eco-organisations.
- Using data: Support claims with current available data, only including data that can be verified and accessed via your website. If possible, include credible third-party certification from reputable sources.
- Providing comparability: When comparing your product’s sustainability to a competitor’s, make sure to compare the same product type to avoid misleading consumers.
- Institutionalising sustainable practices: Make sustainability part of your operating model, and include sustainable practices along your value chain. Have a clear communication plan – for example, when discussing strategy or goals, be specific about your targets and timelines – to ensure transparency and accountability and avoid misleading stakeholders.
Evidence shows the benefits of incorporating CSR into operating models are numerous. CSR drives innovation as it pushes organisations to find new and better solutions to, for example, reduce packaging; saves costs (whether it’s reducing use of energy or water); as well as driving consumer and employer engagement.[6] So, why not join the millions of organisations doing great work and start your own formal CSR journey today?
[1] Schoff, C. The Evolution of Corporate Social Responsibility, July 26,2021. Accessible at: https://www.ecolytics.io/blog/evolution-of-csr#:~:text=The%20term%20%E2%80%9CCorporate%20Social%20Responsibility,a%20tangible%20impact%20on%20society
[2] Consumers expect the brands they support to be socially responsible, Business Wire, October 2, 2019. Accessible at: https://www.businesswire.com/news/home/20191002005697/en/Consumers-Expect-the-Brands-they-Support-to-be-Socially-Responsible
[3] https://www.toroconsulting.co.uk/is-csr-just-for-corporates/
[4] Tracey Keys, et al. Making the most of corporate social responsibility, McKinsey Quarterly, December 1, 2009. Available at: https://www.mckinsey.com/featured-insights/leadership/making-the-most-of-corporate-social-responsibility
[5] Ibid
[6] Epstein-Reeves, J. Six Reasons Companies Should Embrace CSR, February 2021, Forbes. Accessible at: https://www.forbes.com/sites/csr/2012/02/21/six-reasons-companies-should-embrace-csr/?sh=3a0d2a963495
