The role of charity in CSR

Following my last post on philanthrocapitalism, you may think that I am somehow anti-charity. Nothing can be further from the truth. Charity has an important role to play in society. There will always be those who are vulnerable or who are victims of injustice, who need and deserve the help of those of us who have been more fortunate.

I found out the other day (reading the Oxford  Book of 20th Century Words) that "Barnado" entered the English language as an adjective in 1904 (thanks to Rudyard Kipling - "all the time the beggar was a balmy Barnardo Orphan!"). What an amazing legacy of Dr Thomas John Barnado, who first founded Barnado homes in 1867.

In fact, supporting an orphanage was one of the first recorded instances of CSR-related charity, by Macy's in 1875 (as Archie Carroll tells in his excellent chapter on "A History of CSR" in The Oxford Handbook of CSR). I share Carroll's perspective on philanthropy, namely that it is just one part of CSR (along with economic, legal and ethical responsibilities in Carroll's CSR pyramid).

As I also show, however, philanthropy plays a different role in different countries and regions. In many developing countries (as I argue in a chaper in the same book), philanthropy tends to be the second-most important aspect of CSR (after economic contribution). But this is not ideal - it brings serious dilemmas and dangers.

One dilemma is that it casts companies in the role of governments - providing public services like education, healthcare and infrastructure. The problem is that business acts more like a monarchy than a democracy. Nobody voted them in and there are serious conflicts of interest when the beneficiaries are often dependent on the company for jobs.

Which is really the second major dilemma and danger - dependency. I saw this especially in Mozambique when I did some CSR work there a few years ago. The entire economy is geared towards foreign aid and donations. This leads to perverse policies (and sometimes questionable behaviours from charities themselves) that do not encourage independence or innovation.

Since charity will always be an important part of CSR, the real challenge is how to make sure that it "does what it says on the tin". Can we trust the organisations that act on our behalf? Today, I dropped off some spare clothes and books with Oxfam, which I think does a great job. But the issue of charity governance and accountability will certainly not go away.

The final point I would make is that charity is as much about the giver as the receiver. Giving makes us feel good. My research on what provides CSR managers with meaning in their work and life suggests that "making a difference" (which is the title of my CSR book on the subject) represents a deep pyschological motivation in humans that companies be aware of and tap into.

Eco-Cities; Does it Pay Off?

This is my first post since I've been invited to contribute this blog in last December. Hence, I wanted to share an interesting phonemenon in China these days, country where I work at, also the country where a lot of media thinks that is the next land of opportunity.

I've recently been contacted by one of the local media company that has been outsourced a job from a medium sized city to set up a showcase event to attract FDI (Foreign Direct Investment) to their city.

They obviously came to me since I had credible contacts at different country's chambers of commerce in China and my simple answer was "no" to them and I gave a reason that this is not my scope of business and that I cannot utilize my contacts for other reasons.

Then they came back to me few days later with a concept of "Eco-City" and justified my involvement as Environment is one of the issues that we do deal with. Now, I must confess that although we deal with it, it's done through our partners and also we usually take care of the overall marketing/communications side of it, rather than technical side, hence I did not see a correlation between the concept of "Eco-City" and my firm. However, it was an interesting topic in a long run and I decided to utilize the chance to learn. Afterall, if it turned out to be a good project, I can simply toss it on to our environmental consultacy partners.

They requested a proposal and an overall explanation/examples of eco-cities to show to the Gov leaders at that city. While I was working on the Proposal and different research on eco-cities, I found out that there were a lot in development, not only outside of China but also with-in China. Dongtan, in Shanghai was a big issue till the leader of the gov was jailed for corruption/ Sino-Singapore Tianjin Eco-City is becoming a big issue with an initial investment of 8billion RMB, and there were at least 3-4 others that were preparing themselves to be eco-cities.

Tonight, Since we take part in the environment consortium project of the German Chamber in Shanghai, I had a chance to attend a media appreciation dinner. Unlike other press conferences and media appreciation dinner, we decided to brainstorm and ask the reporters about "Green Industry" to understand their perception towards the industry and the German green technologies. Out of many interesting things we found out, there was a comment on the eco-city; that it will never pay off and that ROI is expected to be negative.

That got me thinking of the Eco-City project proposal. Perhaps the concept of the eco-city is unrealistic? No doubt that it will take years to break even and that it is a long-term project. So should this trend continue? Not to mention the current situation of the financial crisis? I am curious to find out other successful cases but all of them seem to not have clear answers. Perhaps we need to wait few years to find out. Currently, my thoughts are more supportive of reporters....

Philanthrocapitalism: A disaster idea that threatens CSR

Philanthrocapitalism is quite frankly the worst CSR-related idea I've come across in a long, long time. For those who aren't yet familiar with the term, it is the title of a book by Matthew Bishop and Michael Green, with high-powered endorsers like Bill Clinton and Bill Gates (hardly surprising given that both have reinvented themselves as uber-philanthropists).

Now first, let me confess that I have not read the book, nor do I ever intend to, unless someone holds an (ethically sourced, fairtrade) gun to my head. So I am reacting against the concept, rather than the content. Apart from the awful neologism, for me, the sub-title of the book - "how the rich can save the world" - says enough.

The idea that philanthropists can save the world is exactly the sort of backward thinking legacy that the CSR movement has been fighting to escape from over the past 20 years and more. Don't get me wrong, philanthropists do have a positive impact in the world (witness the progress made on diseases like Polio and river blindness) and we should be grateful for their generosity. 

But the idea that social justice, environmental sustainability, human rights and ethical transparency should be left to the whims of a few super-rich individuals is not only irresponsible, it is dangerous. They are not elected; hence there is no public mandate, nor any accountability mechanisms to control their actions. We should be looking to strengthen governance, not abdicating responsibility to profiteers.

Of more fundamental concern is that the very brand of capitalism that has made philanthropists wealthy is the root cause of many of the environmental, social and ethical impacts that CSR is trying to remedy. It is the same capitalism that breeds the income inequalities that allow philanthropists to have such preposterous wealth in the first place. It is the capitalism that has fuelled the culture of greed and excess that tipped us into a global recession. 

But that's a topic for another day. What about CSR? CSR should be about how you make your money, not whether you give it away once it's made. Companies and their leaders should be judged on who they trample on and what they destroy in the process of making money, not who they help once they've succeeded at all costs. Writing cheques is easy. Running a sustainable and responsible business is hard. 

Already the view that CSR equals philanthropy is in danger of taking hold in places like China. The last thing we need is to encourage this Stone-Age thinking. By all means, let us cheer on the philanthropists. But let us not for one moment think that this is CSR, nor that it makes these generous souls good role models for responsible business. If we want CSR to survive and thrive into the future, the idea of philanthrocapitalism must die a quick and painless death. If it doesn't, CSR will be dead and buried within the decade.

Online Speaker - Steven Lydenberg

Steve Lydenberg is the latest to confirm participation in CSR International's Online Dialogue series. Steve, for those don't know him or his work, is Chief Investment Officer of Domini Social Investments and Vice President of the Domini Funds. He has been active in social research since 1975.

Steve has written numerous publications on issues of corporate social responsibility. He is the author of Corporations and the Public Interest, co-author of Investing for Good, co-editor of The Social Investment Almanac and co-author of Rating America’s Corporate Conscience.

I look forward to welcoming him (and you!) to our virtual platform on 6 October.

For a full list of upcoming Online Dialogues, see 

http://www.csrinternational.org/csri_calendar.pdf

Summaries of 2008 Climate Research

CSR International Research Digest

CLIMATE CHANGE 2008

This digest is currently free to download and gives a sample of what will be available to CSR International members from March 2008.

CONTENTS

1.       Climate Change Regulation Survey (Global: Clifford Chance) (Jan 08)
2.       Climate Change Strategy Survey (Global: McKinsey) (Mar 08)
3.       Climate Change Strategy Ranking (Global: Ceres) (Apr 08)
4.       Climate Change Risks Survey (Global: KPMG) (May 08)
5.       Weather Risks Survey (US/Canada: Storm Exchange/Chicago Mercantile Exchange) (May 08)
6.       Supply Chain Carbon Disclosure Research (Global: Carbon Counts) (June 08)
7.       Green Marketing Report (UK/US/France/ Germany: The Climate Group/Lippincott) (June 08)
8.       Green Logistics Survey (Global: Transport Intelligence) (Sept 08)
9.       Climate Change and Branding Report (UK/US/China: The Climate Group) (Nov 08)
10.   ICT Industry Slow to Tackle Climate Change (Global: Gartner/WWF) (Nov 08)
11.   Climate Change and Job Market Sustainability (EU and US: Financial Times/Harris) (Nov 08)
 
Download: http://www.csrinternational.org/csri_digest_climate_2008.pdf

Regards

Wayne

POLL: CSR Leaders - Who is your top 10?

CSR International - with your help - is compiling a Top 100 list of CSR Leaders (including thought-leaders and leaders-in-practice). 

Taking into account your prior input and our own research, we have compiled a master list of potential CSR 100 Leaders. 

Now we need you to help us sort out who really deserves to be there. Simply click on the survey link below and select your Top 10 CSR Leaders (it should take 5 minutes or less!) and we will do the rest. 

The results will be displayed on the CSR International website in March, and will help to shape our upcoming CSR Leaders Webinar series. I look forward to discovering who the popular choices of the CSR community are!

http://www.surveymonkey.com/s.aspx?sm=FYrw73VzlRHkKwYd_2b73nVg_3d_3d

CSR International: Upcoming Events & Dates to Diarise

As we count down to the official launch of CSR International on 4 March, I thought I'd share with you some of the exciting events that are planned for the coming months. There are basically three kinds of events:

1. CSR Masterclasses - 1-day events in the fourth week of every month, usually on a Friday in London (except in April where we run 3 in a row). We will probably introduce these in an online webinar format for global participants starting in May.

2. CSR Thought-Leader Webinars - run online every Tuesday, alternating between 9 am and 4.30 pm UK-time slots (to ensure as much global participation as possible)

3. CSR Networking Meetings - evening events (6-8 pm) run on the first Wednesday of every month in London (we will add more organically as the CSR International City Hubs get established around the world)

To see the specific dates and who we have lined up for the Webinars (people like John Elkington and Stuart Hart), download the CSR International 2009 Calendar:

http://www.csrinternational.org/csri_calendar.pdf

Davos 2009: Quotable quotes

Montek Singh AHLUWALIA (Indian economist): Confidence grows as slowly as a coconut tree, and falls as fast as a coconut.

Kofi ANNAN (Former UN Secretary-General): The status quo cannot work.

Kofi ANNAN (Former UN Secretary-General): We need to ensure the poorest in the planet - who will be hardest hit by the financial crisis - are not forgotten.

Tony BLAIR (Former British Prime Minister): The free enterprise system has not failed; the financial system has failed.

Richard BRANSON (Founder of The Virgin Group):  In times of recession there are massive opportunities and fortunes to be made, so for new up and coming entrepreneurs, this is the time to go and start a business.

Gordon BROWN (British Prime Minister): The policy of doing nothing will allow this crisis to start a retreat from globalisation with huge implications for prosperity in every part of the world in the years to come.

David CAMERON (British Conservative Party Leader): It's time to place the market within a moral framework - even if that means standing up to companies who make life harder for parents and families.

David CAMERON (British Conservative Party Leader): The best chapters in our economic history are those that embrace the many, not the few.

Richard EDELMAN (CEO of Edelman): Business really has to work its way back. It has to re-earn the trust of its broad sets of constituents.

Richard EDELMAN (CEO of Edelman): I think we have moved from a shareholder society to a stakeholder society, and that has massive implications.

Bill GATES (Founder of Microsoft): Philanthropy is fun and fulfilling.

Bill GATES (Founder of Microsoft): The poor can't wait. Philanthropists needed to carry on being generous.

Rick GOINGS (CEO of Tupperware Brands Corp): The last thing to cut is your talent.

Stephen GREEN (chairman of HSBC): There are no magic wands and even crystal balls are in short supply.

Stephen GREEN (chairman of HSBC): Banks have clearly done things wrong. Some of the practices did not contribute, by any reasonable standards, to human welfare

Al GORE (Former US Vice-President) on finding a successor to the Kyoto Protocol at a Copenhagen climate summit in December: The new administration is very serious about this. We need an agreement this year, not next year or some other time.

Alex HEIDEGER (Member of the Davos Green Party): It's the same people who came last year and said the world economic situation is fine, and now we're in a financial crisis. Now it's the taxpayer who has to solve the whole problem.

Wen JIABAO (Chinese Premier) on the causes of the financial crisis: Inappropriate macro economic policies in some economies, characterised by [a] low savings rate and high consumption [and] failure of financial supervision and regulation to keep up with innovation which allowed financial derivatives to spread.

Vaclav KLAUS (Czech President whose country holds the EU Presidency): I don't think there is any global warming. I don't see the statistical data for that.

Christine LAGARDE (French Finance Minister): Social unrest and protectionism are the two major risks of the world economic crisis.

Doris LEUTHARD (Swiss Economy Minister): The opening up of markets is the best [thing] we can do to fight the crisis.

Hans-Rudolf MERZ (Swiss President): The notion of more of the same, must be replaced with more of something better.

Rupert MURDOCH (Chairman of News Corporation): Don't let's lose sight of what creates wealth. It is open markets, it is capitalism.

Raila ODINGA (Kenyan Prime Minister) on Mugabe’s regime in Zimbabwe: When over 3,000 people have already died of cholera, I think it is a tragedy that Africa cannot speak with one voice against this one regime.

Alessandro PROFUMO: (CEO of Unicredit): There is a real willingness to understand where we made mistakes and what we have to change in the future in order to improve our reputation on the one side, and the credibility of the whole industry on the other.

Kenneth ROGOFF (Harvard professor and former chief economist of the International Monetary Fund): Worrying about inflation now is like worrying about the measles when you might get the plague.

Nouriel ROUBINI (Economist who predicted the credit crunch): Capitalism is the worst system except for all those others that have been tried. (variation on a Churchill quote)

Desmond TUTU (South African Archbishop): We worshipped in the temple of cutthroat competition, and so some cooked the books, because the treasure is so great.

Desmond TUTU (South African Archbishop): We spend billions on banks when we know that a fraction of this money could save all the children in the world.