Pandora's CSR Box: The Case for Banning CSR

I participated in a strategy session on CSR/sustainability this week and was left wondering if we CSR specialists are our own worst enemy. Would more progress be made if we banned CSR? Would we be better off if we never used the C-word again? What if we substituted “CSR” with “risk management” or “new business development”?

Let me explain what I mean. By having a CSR function, or department, or profession or career, we have created a neat little box for mainstream business to put CSR-related activities into - the CSR report, the ethics code, the supply chain audit. That has some advantages - there is a focal point, people to get things done - but at what cost?

The problem with boxes is that people often don’t think (or act) outside them. If environmental quality, or human rights, or health and safety, or stakeholder engagement is something that gets assigned to the CSR-box, there is a very real danger that everyone else feels they have been absolved of responsibility.

Not only that, the CSR-box mentality suggests that social, environmental and ethical challenges can be solved by thinkering at the edges of business, rather than reforming the core. If the current financial crisis teaches us anything, it is that we have to fundamentally change the way we do business. The current model is broken.

But what are the chances that business will change voluntarily? The answer is: extremely good! In fact, it is inevitable. That is because the issues we are dealing with - the breakdown of ecosystem services, the erosion of morality and the disintegration of social justice - are not marginal issues. They are business deal-breakers.

Put another way, the issues CSR is trying to tackle are business risks. If fish stocks collapse, or communities stay poor, or we have catastrophic climate change, or corruption is endemic - these undermine the ability for business to prosper. They undermine the enabling conditions for business - resource availability, political stability, and clear rules and ethics.

So when I say there is a case for banning CSR, I don’t mean stopping CSR-related efforts, or firing CSR professionals. I mean changing the language of CSR and raising the CSR game - to the level of strategic risk and opportunity. This is not about greenwash and moral high ground. This is about competitive survival and future markets.

Business will not (and should not) do CSR only because it is the right thing to do. Business should do CSR because it will go out of business if it doesn’t and it will be more successful if it does. And if it just calls that approach “good business sense” or “risk management” or “strategic investment”, rather than “CSR”, so much the better.

An Agenda for the Future of CSR (Part 2)

An idealistic-realistic approach calls us to engage in making CSR a catalyst for systemic change. Consequently a new agenda for CSR can emerge, with four essential tracks where coalitions need to be built.

Changing the baseline

The first track involves changing the baseline of markets, the driving force behind most business. This will involve coalitions of businesses, financiers, NGOs, governments, and others, aimed at changing the rules that govern the basics of capitalism, such as company law, currency flows, property rights, competition, tax management and executive accountability. Such work will be time-consuming and technical, and may seem too abstract and negative for some. But there are other crucial things to do.

Playing the Solos

The second track involves playing the solos within markets, by pioneering sustainable and just models of enterprise. Social entrepreneurs will help prefigure a new economy through creating businesses and projects that are inherently just and sustainable, including environmental technologies, co-operatives, and even sustainability stock markets. Their own success and their ability to takeover the mainstream economy will, however, depend partly on how well the first track is changing the baseline. Page 4 of 5 © Wayne Visser

To some people these first two tracks may seem too much like pontificating about macro economics, on the one hand, or following a fashion for eco-ethical enterprise on the other. They will focus instead on how people continue to be abused, poisoned, evicted, sacked and even killed, because of corporate interests and activities.

Singing the Chorus

Therefore the third track involves standing alongside and singing the chorus with those negatively affected by current market dynamics. Thus some will continue to work either with or against large companies to help specific groups of people improve their lot or seek redress – an area where much of the current effort on CSR and corporate accountability is located.

Maintaining the Beat

The fourth track involves maintaining the beat within the CSR profession, to keep its focus on a transformative agenda. This will require preventing it from becoming either solely client-directed and only interested in the goals of its paymasters, or protectionist and primarily interested in regulating access to services in this area. Instead, coalitions will form to help evolve a values-oriented profession, to maintain the heartbeat that is essential to a transformative movement.

Choosing Our Future?

The activities one chooses to engage in will depend on one’s particular skills, inclinations and circumstances. But for CSR to be part of the Rise and Shine scenario, a four-track agenda is essential, with the tracks harmonising to create a powerful music greater than the sum of its parts.

This means that people working in each of the four tracks will need to recognise the value of each and ensure their own work synergises with, rather than undermines, the other tracks. Unfortunately this is not always the case at the moment, as some people suggest their path is the only right one. We hope that developing and sharing a vision of how different activities could actually synergise towards creating systemic change will help that vision to become a reality.

Co-authored with Jem Bendell. Extracted from “The Corporate Responsibility Movement” (2009) by Bendell, Visser, et al.

Islamic and Cleantech markets: A CSR 2.0 tipping point?

I was fascinated to read a recent Time Magazine article on the growth of Islamic markets, which are reportedly already worth $1 trillion! The Halal food sector alone makes $632 billion annually, accounting for about 16% of the entire global food industry, acording to Halal Journal. The Islamic finance sector (which forbids the charging of interest) stands at $500 billion and is expected to grow to $4 trillion in five years, according to a 2008 report from Moody's Investors Service.

What is interesting about these and other Islamic markets (cosmetics, real estate, hotels and fashion) is that they have an ethical basis. According to Time, "citing the kosher and organic industries as successful examples of doing well by doing good, some entrepreneurs even see halal products moving into the mainstream and appealing to consumers looking for high-quality, ethical products." Mah Hussain-Gambles, founder of Saaf Pure Skincare which markets halal makeup, calls it "the next purity thing".

The other market area that is booming is the so-called clean-tech or green-tech sector. According to Clean Edge, $148 billion was invested in clean energy companies and projects in 2007, up 60% from 2006. Venture capital and private equity investment in clean energy companies was up 34% in 2007 to $9.8 billion, while finance via public markets was up more than 123%. Annual revenue for four benchmark clean technologies — solar photovoltaics, wind power, biofuels, and fuel cells - increased nearly 40% from $40 billion in 2005 to $55 billion in 2006. These are forecast to become a $226 billion market by 2016.

Add to this the vast sums being promised and poured into the so-called “green collar economy” as part of government financial stimulus packages around the world in 2009. Then add the emerging policies on climate change, such as the UK government's commitment to reduce carbon emissions of 80% by 2050, and we have something starting to feel like a brewing revolution. In fact, according the The State of Responsible Competitiveness 2007 report by AccountAbility, responsible markets in climate change, gender, human rights and anti-corruption will be worth at least US$750 billion by 2050.

Taken together, the green moon of Islamic markets and the green sun of cleantech may be just the tipping point we have been hoping for to turn CSR from a marginal, philanthropic activity into a connected, scaleable, responsive force of business for good. This is the real meaning of CSR 2.0 - the creation of a different way of doing business and an evolution of sustainability and responsibility to the level of markets, as opposed to old-style CSR applied at the individual manager or company level. Who knows, perhaps in the future, when we explain to our children how we narrowly escaped plunging into an overshoot and collapse catastrophe in our global social and ecological systems, we will use a simple tipping point formula:

Green Moon + Green Sun = Transformational Change.