Corporate Responsibility Index - Australia
1 September 2004 at 1:09 pm
Who are the corporate social responsibility leaders in Australia today? How is corporate social responsibility (CSR) measured to ensure that business meets society’s ethical, legal, commercial and public expectations?
All will be revealed when the inaugural results of the Corporate Responsibility Index in Australia are published on Saturday 28 August.
Responding to the need for a credible index that allows companies to accurately benchmark social corporate responsibility practices with those of their peers, St James Ethics Centre has joined forces with The Sydney Morning Herald, The Age and Ernst & Young to introduce the Corporate Responsibility Index to Australia.
Twenty-six pioneering Australian companies have signed up for the CRI, introduced for the first time in Australia since it was established two years ago by 80 leading businesses working with UK charity Business in the Community (BITC).
The CRI results rank companies according to their impact on society and the environment. Performance is based on a company’s impact across its operations, products and services and through its relationships with stakeholders, including employees, suppliers, shareholders and communities.
The CRI is a voluntary, self-assessment survey. Using a web-based assessment tool, it sets up a process that compares the systems and performances of different companies in and across sectors. Its main focus areas are strategy, integration, management practice, performance and impact and assurance.
Companies that come in at the top are taken to have the following characteristics:
-they have incorporated the rhetoric of their corporate values and commitments into the way the organisation is managed;
-they can actually measure and report how this works in practice;
-and they are taking action to reduce any negative impacts of their products and services and maximise their positive qualities.
The CRI acts as a business management tool by evaluating CSR across all areas of company activity whilst also providing a practical framework for improving and communicating performance. Its methodology can identify whether business is conducting corporate responsibility activity in a systematic and integrated way and indicate where improvements should be made.
Dr Simon Longstaff, Executive Director of St James Ethics Centre, says that much can be learned from the UK experience in the lead up to the publication of the first round of Australian results.
Dr. Longstaff says the development, application and refinement of this Index in the UK provides a good indication of the complexities around accurately measuring CSR. Many companies articulate visionary and progressive organisational philosophies, but such messages need to be reinforced by strategies that transform them into practical action across the whole business.
The last round of UK results revealed good news: most participating companies integrate corporate responsibility issues across their businesses and continue to build it within risk evaluation processes. On the down side, an area identified for improvement is the internal communication of Policies and Codes of Practice. Most companies have these in place, but many do not provide training to ensure that they are understood and adhered to by staff.
Dr Longstaff says the Index is the next stage in the evolution of measuring corporate social responsibility in Australia.
He says it’s crucial that we have an accurate methodology for tracking performance in CSR. A major disincentive for Australian businesses in engaging in CSR is the complexity surrounding measurement of returns from investment in this area.
Results published in The Sydney Morning Herald and The Age on 28 August will reveal Australia’s CSR leaders.
Close analysis of results will take place during the Fifth National Business Leaders Forum on Sustainable Development, in Melbourne on 2-3 September 2004.
Chaired by, Julia Cleverdon, CVO, CBE, CEO of Business in the Community, a session entitled Business Strategy for Innovation will use the inaugural results of Australian Index to identify innovations in the application of CSR by Australian companies and areas in which there is room for improvement. This session will also feature presentations from:
-John Dow, Managing Director, Newmont Australia
-The Hon John Thwaites, MP, Deputy Premier Victoria
-John Cox, Former CEO Stanbroke Pastoral Company
– Mike Hawker, CEO, IAG.
Further details about the Fifth National Business Leaders Forum on Sustainable Development at www.corporate-responsibility.com.au/participate/events.asp