Guide to Giving
MEDIA, JOBS & RESOURCES FOR THE COMMON GOOD
NEWS  |  Corporate Engagement, General, Good Business, Leadership, Research

Time to Replace CSR?


Wednesday, 6th April 2016 at 8:10 pm
Xavier Smerdon, Journalist
Corporate Social Responsibility “focuses more on boosting employee morale than addressing the way a company engages with society’s concerns” and should be replaced with a new model of engagement, according to a leading English businessman.

Wednesday, 6th April 2016
at 8:10 pm
Xavier Smerdon, Journalist


1 Comments


FREE SOCIAL
SECTOR NEWS

 Print
Time to Replace CSR?
Wednesday, 6th April 2016 at 8:10 pm

Corporate Social Responsibility “focuses more on boosting employee morale than addressing the way a company engages with society’s concerns” and should be replaced with a new model of engagement, according to a leading English businessman.

John Browne, a former chief executive of BP, has co-written a book in which he interviewed more than 70 business leaders on their perceptions of CSR.

In an article for the Harvard Business Review, he said that many of the business leaders view CSR commercially relevant.

“One big problem is CSR departments lack the participation of big-spending commercial functions and the input of managers on the ground who better understand the local context,” Browne said.

“Their programs focus on limiting the downside of reputational damage, not on the commercial upside of better stakeholder engagement. This means CSR initiatives tend to be short-lived, dependent as they are on the whims of senior executives rather than the value they deliver.”

In CSR’s place Browne proposed a new model of engagement, which he called “connected leadership”.

“It is not an academic hypothesis; it is built on the collective wisdom of interviews with business, government, and third-sector leaders, as well as my own experience,” he said.

Browne laid out the four tenants of connected leadership that he said could help revolutionise the way companies engage with society.

The first was for businesses to map their world.

“This tenet calls on companies to be rigorous in analysing macroeconomic environments, public attitudes, and the company’s own behavior in order to identify, early on, the challenges it might face and the ways this might affect profitability,” he said.

Browne points to Shell as an example of a company effectively mapping its world by identifying 10 major drivers of change and assessing the respective value at a stake for the company and society.

“It measures the impact of these drivers across three horizons: the near-term financial impact, the long-term financial impact, and the impact on reputation,” he said.

“If companies can successfully apply this level of analysis, it will help them understand their stakeholders, calculate the value of external relationships, and help them tackle the second tenet of connected leadership.”

The second tenant Browne sets out is for companies to define and communicate their contribution to society.

“Purpose is the litmus test of sustainability in business,” he said.

“Companies that want to be around for decades to come must ensure that society is at the heart of everything they do.”

He said Unilever’s Sustainable Living Plan was a good example of this.

“It aims to double the size of the business while helping one billion people improve their health and wellbeing, halving the company’s environmental footprint, and enhancing suppliers’ livelihoods,” he said.

“These are not philanthropic ambitions. Each goal is tied to Unilever’s core business activity. Improving hygiene habits halves the number of people who die from disease and increases sales of its soap products; reducing carbon emissions and water usage cuts costs and limits the company’s exposure to water-scarcity.”

His third tenant is to apply world-class management.

“Successfully embedding societal concerns deeply within business operations, as Unilever has done, requires a new approach to management at every level of the company from the boardroom to the shop floor,” he said.

“Companies need the right people with the skills and experience to incorporate external considerations into their decision making.

“However, there are only a handful of companies that do this proficiently. Less than a quarter of business executives interviewed by McKinsey reported having the management resources, talent and processes to engage with stakeholders effectively.”

Browne’s final tenant was to engage radically, ie engaging on someone else’s terms rather than a businesses’ own terms.

Browne said evidence showed that a company’s ability to engage successfully with stakeholders was worth over 20 per cent in superior stock performance over the course of a decade.

“Finding solutions to today’s greatest, global, social problems – from smoking to climate change to obesity – will rely on the resources and innovation of business,” Browne said.

“The winning companies of the future will be those that successfully redefine their purpose and deploy their best teams in pursuit of these great social and environmental challenges.”


Xavier Smerdon  |  Journalist |  @XavierSmerdon

Xavier Smerdon is a journalist specialising in the Not for Profit sector. He writes breaking and investigative news articles.

Guide to Giving

FEATURED SUPPLIERS


HLB Mann Judd is a specialist Accounting and Advisory firm t...

HLB Mann Judd

Yes we’re lawyers, but we do a lot more....

Moores

NGO Recruitment is Australia’s not-for-profit sector recru...

NGO Recruitment

Brennan IT helps not-for-profit (NFP) organisations drive gr...

Brennan IT

More Suppliers

Tags : CSR, England,

Get more stories like this

FREE SOCIAL
SECTOR NEWS

YOU MAY ALSO LIKE

Thinkers Look to Melbourne to Grow SA Purpose Economy

Wendy Williams

Thursday, 21st September 2017 at 4:44 pm

AICD Announces NFP Scholarships Across Australia

Luke Michael

Wednesday, 20th September 2017 at 12:10 pm

Australian Organisations Score in the Top 10 Per Cent of B Corps Globally

Luke Michael

Monday, 18th September 2017 at 5:03 pm

POPULAR

Moves to Stop Volunteering at Overseas Orphanages

Luke Michael

Wednesday, 13th September 2017 at 1:54 pm

Future Uncertain for Disability Organisations Following Funding Cuts

Wendy Williams

Tuesday, 19th September 2017 at 8:29 am

Majority of NFPs Are Not Believed to be Well-Run, According to New Survey

Luke Michael

Tuesday, 12th September 2017 at 4:14 pm

More Australians Are Giving Time Not Money

Wendy Williams

Monday, 11th September 2017 at 5:07 pm

One Comment

  • David Turnbull says:

    If this is true, then companies and leaders are failing. Furthermore, this article would seem to assume that what it says is rife. Perhaps, but lets see whats going wrong first before we think of another hook on which CEOs etc can hang their leadership credentials

Write a Reply or Comment

Your email address will not be published. Required fields are marked *


Guide to Giving
pba inverse logo
Subscribe Twitter Facebook

Get the social sector's most essential news coverage. Delivered free to your inbox every Tuesday and Thursday morning.

You have Successfully Subscribed!