Companies at the cutting edge of corporate responsibility are weaving their citizenship efforts into the strategic heart of the business.
In the decade or so since the phrase "corporate social responsibility" first began to make its way into the mainstream corporate lexicon, the concept has gained widespread support and acceptance in the business world. In fact, the formal adoption of CSR policies has become so widespread that, among larger companies at least, it is almost universal. Adam Greene, vice president for labor affairs and corporate responsibility at the United States Council for International Business ( USCIB ), a business promotion group that counts most of the biggest US companies among its members, believes the majority of large companies feel like they are responsible corporate citizens. "For the most part, most US companies have got the CSR policies and systems in place," he says. "That's not to say nothing will ever go wrong, but they're covered in terms of the main issues they're trying to track."
There is no doubt that the corporate world is mostly aware of-if not entirely convinced about-the importance of social responsibility. But while the vast majority of the biggest companies may have CSR policies or departments in place, their effectiveness and strategic influence within the business is often questionable. Part of the problem is that CSR, even now, is far too rarely considered a strategically important element of a business. Laura Herman, a managing director at CSR consultant FSG Social Impact Advisors, says that in a surprisingly large number of companies the CSR department still does not have direct access to the top-level decision makers. "It's a challenge getting top leadership to embrace CSR," she says. "It's still seen as taking a risk-although really it's a risk not to embrace it."
According to Herman, many senior executives still have only a rudimentary understanding of the purpose and promise of CSR. "Unfortunately, the CSR function is often not a function that speaks directly to the C-suite," she says. "The people in these departments may have great business or strategic ideas, but the people at the top may not be open to hearing them because they don't perceive the CSR function as generating business ideas."
Often it is only after a company ends up on the sharp end of a consumer or pressure group campaign that its leaders recognize the strategic importance of corporate citizenship. As a result, many of the leaders in the CSR field are those companies that have been most badly mauled by NGO (non-governmental organization) or consumer-led campaigns against them in the past. "Nothing focuses the mind like having a bunch of campaigners camped outside your head office," says Eric Biel, managing director for corporate responsibility at global public relations firm Burson-Marsteller. It is no surprise, then, that some of the organizations most vilified over the years by human rights and environmental campaigners-companies such as Wal-Mart and Nike-have become enthusiastic cheerleaders for CSR.
Biel says companies that have "had their feet held to the fire" are extremely likely to continue building on their CSR efforts even after the pressure is off. "Once companies put in the programs and commit the resources-not just on human rights but sustainability-as long as they can tie it to their core business objectives and it's something that can be demonstrated to be good for the bottom line, I don't think there is any going back," he says. "In fact, a lot of those companies bring some of their critics inside the tent." US clothing retailer Gap, for example, gives critics space in the company's sustainability report to discuss the company's progress, while Wal-Mart has brought activists into its head office to help guide its environmental policies, Biel adds.
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Corporate Social Responsibility - NASDAQ.com
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