Contest ISO 26000:
What does social responsibility mean to you?

Facilitating socially responsible activity

by Susana and David Crowther

It is not very long ago that corporate social responsibility was a new concept and very few people knew what it was. Certainly it was new to businesses and only a very few made any attempt to practice any aspect of it – indeed it was regarded as an extra cost for businesses who needed to be persuaded that they should become involved. But things have changed very quickly. Now almost everyone has heard of the concept of CSR and almost every business has a policy and a strategy for implementing aspects of CSR because they understand that the business benefits are enormous. Although the ideas started in Europe and the USA the growth of the ideas had been rapid and it is now a well known concept for almost everywhere in the world.

Most people initially think that they know what CSR is and how to behave responsibly – and everyone claims to be able to recognise socially responsible or irresponsible behaviour without necessarily being able to define it. So there is general agreement that CSR is about a company’s concern for such things as community involvement, socially responsible products and processes, concern for the environment, concern about exploitation of people and socially responsible employee relations. According to the European Commission (EC) CSR is about undertaking voluntary activity which demonstrates a concern for stakeholders. But it is here that a firm runs into problems – how to balance up the conflicting needs and expectations of various stakeholder groups while still being concerned with shareholders; how to practice sustainability; how to report this activity to those interested; how to decide if one activity is more socially responsible that another. The situation is complex and conflicting.

A number of other things concerning CSR have started to feature prominently in popular consciousness. One of these which has become more pronounced is the issue of climate change and this has affected concern about CSR through a concern with the emission of greenhouse gases and particularly carbon dioxide. Nowadays it is quite common for people to know and discuss the size of their carbon footprint whereas even a few years ago people in general did not even know what a carbon footprint was. This concern affects all businesses whatever their size.

Another thing which has become prominent is a concern with the supply chain of business; in particular people are concerned with the exploitation of people in developing countries, especially the question of child labour but also such things as sweat shops. So no longer is it acceptable for a company to say that the conditions under which their suppliers operate is outside of their control and so they are not responsible. Customers have said that this is not acceptable and have called companies to account. And there have recently been a number of high profile retail companies which have admitted that they have had problems and have taken very public steps to change this. Interestingly the popularity of companies increases after they have admitted the problems and publicised what they will do to correct the situation, thereby showing both that honesty is the best practice and also that customers are reasonable. The evidence suggests that individual customers are understanding and that they do not expect perfection but do expect honesty and transparency. Moreover they also expect companies to make efforts to change their behaviour and to try to solve their CSR problems. Probably corruption and governance are also issues which are very important at the moment.

Companies themselves have also changed. No longer are they concerned with greenwashing – the pretence of socially responsible behaviour through artful reporting. Now companies are taking CSR much more seriously not just because they understand that it is a key to business success and can give them a strategic advantage, but also because people in those organisations care about social responsibility. So it would be reasonable to claim that the growing importance of CSR is being driven by individuals who care – but those individual are not just customers, they are also employees, managers, owners and investors of a company. So companies are partly reacting to external pressures and partly leading the development of responsible behaviour and reporting. So accountability – one of the central principles of CSR – much more recognised and is being responded to by increasing transparency – another of the principles of CSR.

Another concern is with sustainability and sustainable development and these are terms which have suddenly become so common as to be ubiquitous for business and for society. Now the debate is becoming concerned with durability – a stronger and more complete form of sustainability. Every organisation mentions sustainability and most claim to have developed sustainable practices. A lot of this is just rhetoric from people who do not want to face the difficult issues involved in addressing sustainability. There is a danger therefore that sustainability has taken over from CSR itself as a target for greenwashing. Nevertheless although the relationship between organisations and society has been subject to much debate, often of a critical nature, evidence continues to mount that the best companies make a positive impact upon their environment. Furthermore the evidence continues to mount that such socially responsible behaviour is good for business, not just in ethical terms but also in financial terms – in other words that corporate social responsibility is good for business as well as all its stakeholders – a truly win – win situation. Thus ethical behaviour and a concern for people and for the environment have been shown to have a positive correlation with corporate performance. Indeed evidence continues to mount concerning the benefit to business from socially responsible behaviour and, in the main, this benefit is no longer questioned by business managers.

These issues are truly global issues and must be addressed on a global basis as the world becomes increasingly globalised. But the world has become sufficiently global that two people from opposite sides of the world are able to discuss these issues, reach agreement and work together to address the issues. But what has been missing so far is a framework to identify socially responsible behaviour and to evaluate it in the context of organisational behaviour. And the ability to evaluate requires a reporting framework; this is where ISO 26000 becomes so important, as it provides that framework. As it becomes adopted around the world it will provide a basis for evaluating socially responsible activity and therefore a basis for facilitating and encouraging social responsibility.