CSR and Social Media – Part 1

By Wayne Visser

In my previous blog on CSR and WikiLeaks, I suggested that social media may be a new platform for social activism. There are some, like Tipping Point author Malcolm Gladwell, who are sceptical. In his article for The New Yorker, subtitled “Why the revolution will not be Tweeted”, he argues that “the drawbacks of networks scarcely matter if the network isn’t interested in systemic change—if it just wants to frighten or humiliate or make a splash—or if it doesn’t need to think strategically. But if you’re taking on a powerful and organized establishment you have to be a hierarchy.”

WikiLeaks is just one face of a broader movement of the explosion of social media as a new platform for communication, stakeholder engagement and transparency. We now have companies like GoodGuide providing sustainability ratings for over 60,000 products in the U.S., all accessible at the point of purchase simply by using a free iPhone barcode scanning application. We have JustMeans providing a social networking platform that allows self-declared stakeholders to “follow” a company through the site, providing not only access to their published CSR information, but also providing a conduit for feedback. Justmeans and CRD Analytics have also launched an innovative platform to provide companies with the capability to verify the accuracy and completeness of their ESG Data Set. And we have a new company, OpenEyeWorld, which provides a “crowdsourcing” tool for companies to consult with sustainability experts from around the world.

However, like any new tool, social media is still a double edged sword for companies trying to turn it their advantage in the sphere of corporate citizenship. An already classic case is that of Greenpeace’s anti-Kit-Kat chocolate campaign, which went viral in March 2010 across the social media networks like Facebook and Twitter. The 60 second Greenpeace video, which was at the heart of their campaign, shows a bored office worker biting into a Kit-Kat, and as he does so, it turns into the finger of an orang-utan and ‘crunch!’ the blood spills down his chin and over his clean white shirt. One estimate by Scott Douglas on Prezi calculated that within 4 days the Greenpeace report and shock-video may have reached half a million people through social media like Twitter and Facebook. This viral effect was seemingly boosted by Nestle’s attempt on its Facebook page to censor comments made by its critics (including activists who had changed their Facebook profile pictures to a defamed logo of Nestle, which said ‘Killer’ instead).

The fact that Nestle took swift action by dropping the accused Indonesian supplier and that their hands are effective tied by a lack of available sustainable palm oil did little to quell the angry reactions of online activists. Greenpeace later called off the campaign, which Nestle Executive Vice President for Operations, Jose Lopez, says was achieved “by putting on the table a very technical view of the issues we are talking about. We’ve demonstrated that we have a logic, a path and a process that drives continuous improvement into topics of high concern, which in this case is deforestation” (Courtice, 2010). Nestle’s successful resolution, however, does not take away the fact that social media is a tricky area for companies to master.

References

Courtice, P. (2010). Interview of Jose Lopez by Polly Courtice, Director of the Cambridge Programme for Sustainability Leadership, 17 June 2010.

—

Note: This blog is partly based on research and writing done for the forthcoming edition of the Journal of Corporate Citizenship.

Part 3 - Foreword by Jeffrey Hollender for “The Age of Responsibility”

Though much has changed in the last 25 years, one thing hasn’t: business is still the only force with the reach and resources to do what needs to be done as quickly and efficiently as possible.

After watching America’s political process devolve in recent years into what is essentially an oversized argument punctuated by self-serving bursts of alarming obstructionism, it’s clear that government is not the answer. Real leadership in Washington and other political capitals has long since been replaced by fearful strategic triangulation that replaces big ideas and bold action with anemic incremental change.

Nor are NGOs an effective alternative. There are too many of them too narrowly focused and too often at odds with each other. Even when added up, the non-profit world simply hasn’t the authority, influence, or financial base to engineer change on a mass scale.

That leaves business as the only force in today’s world that’s got it all: a universal presence, an ability to get things done quickly and on as little as a CEO’s say-so, and the economic clout required to engineer widespread systemic change with remarkable speed. Business is our best and indeed last hope, and it’s time to put that hope to the test.

As this book wisely notes, change is no longer a matter of choice. Our present trajectory tells us it’s coming whether we want it to or not. The only question is what form this change is going to take. If the corporate community fails to adopt and embrace meaningful CR, those changes will be grim indeed, and the world that will emerge may very possibly be too environmentally degraded and socially unstable for business to survive at all.

Business needs CR as much as the world itself does. This book is how we get to that better future. The journey starts with Visser’s critical dissection of the role that business has played in the development of the many challenges we face and the first-generation failures of the CR movement to prevent them. It’s as key an instructive moment as the movement has ever had, and we will do well to heed the important lessons this analysis brings to the table.

Yet it’s when Visser looks at where we go from here that the book you are holding offers its biggest payoff. Upon seeing that the first iteration of CR was not enough, we could easily be left wondering what to do next. Having once given it our all, what’s left to give? In Visser’s view, the answer is plenty, and I agree. Rather than be frustrated by our previous lack of meaningful success, this roadmap to a more sane and just future offers ideas to get excited about. Visser’s vision of what a new brand of CR could and should look like and his exploration of the kind of businesses it would breed is the medicine the movement has been seeking. It’s at once a way out and way forward. We would be foolish in the extreme not to take it to heart and put it to work.

Over twenty years ago, a handful of individuals at a ragged assortment of companies tried to start a revolution. You’re holding the book that can finish it. Take what it knows and use this wisdom to set your own business on the path to a better and more profitable place. Whether you’re a CEO in a corner office or a worker on the line, read it, learn it, and spread its gospel as far and wide as you can. The hour may be late and the clock loudly ticking, but the story of responsible business is not over yet. There’s still room for a happy ending. And the time has come for us to write it for ourselves.

--

Jeffrey Hollender is former CEO and co-founder of Seventh Generation, and co-author of The Responsibility Revolution

How to Order

• Direct from the publisher's website - available 18 February 2011
• From Amazon (UK) - available 18 February 2011
• From Amazon (USA) - available 19 April 2011

Part 2 - Foreword by Jeffrey Hollender for “The Age of Responsibility”

So what happened?

The short answer is not enough. As the CR movement spread to the corporate mainstream, it lost its focus. What started as a relatively simple set of goals to protect the environment and human rights degenerated into a philanthropic free-for-all in which causes proliferated and an ever-expanding array of do-good choices and options presented itself to business management teams who were already on confusing ground. Corporate executives who saw the need for CR failed to adequately help their staffs translate their vision into action, and public expectations about what was truly important were misunderstood or not understood at all. The resulting disconnect between what was needed and what actually got done neutered too many promising efforts.

At the same time, countless companies did what companies do: They created an office or a department to deal with CR and told it to grow CR initiatives. But this compartmentalized approach had the effect of decoupling innumerable CR agendas from their company’s actually daily workings and left programs trapped “inside the box” where nothing meaningful could happen.

In other cases, companies simply co-opted CR for their own purposes. This “greenwashing” was all about hype and appearance rather than honesty and action, and too many firms simply sought CR window dressing to help them look better in an increasingly informed world. They released fancy reports with pretty pictures. They had their CEOs photographed at CR conferences and summits. They purchased smaller more legitimately responsible companies for their halo effect and little more. But very rarely did they walk their talk.

Ironically, forces like these resulted in the one thing that CR supporters and naysayers can agree on: Corporate responsibility in its present incarnation has been an enormous disappointment at best. It has not lifted people out of poverty. It has not protected the environment. It has not boosted community wellbeing. It has been too little, too late and at most has succeeded in getting some companies to aspire to simply do less damage than they did before. Instead of changing the world, CR merely evolved into a baseline requirement in every company’s license to operate. Where it succeeded, it only managed to slow the rate of decay, which is hardly enough to do much more than maintain the status quo.

This, say CR’s detractors, is proof that the movement’s fundamental ideal—that a business can remake itself so as to create an overwhelming net benefit for society and the environment in addition to its own bottom line—is not a valid model for moving forward and tackling the extremely big issues we now need to address.

But that’s wrong, and in this book, Wayne Visser shows us not only why but where we go from here. CR remains a valid approach ripe with promise and possibility. Yet as Visser quite importantly notes, this reaffirmation is dependent on the emergence of a new form of CR that takes a far more holistic view of its work and seeks not to affect piecemeal change but to engineer a series of systemic corrections that wisely recognize that since all our problems are connected our solutions must be, too. The job of CR advocates is to pull these new values into every last corner of the world’s companies in order to impact each process and decision, and deliver a return on purpose as well as a return on investment.

--

Jeffrey Hollender is former CEO and co-founder of Seventh Generation, and co-author of The Responsibility Revolution

How to Order

• Direct from the publisher's website - available 18 February 2011
• From Amazon (UK) - available 18 February 2011
• From Amazon (USA) - available 19 April 2011

Part 1 - Foreword by Jeffrey Hollender for “The Age of Responsibility”

Seeing Farther, Going Further

In the beginning, responsible businesses were going to save the world. I remember because I was there. It was the late 1980s, and a new brand of socially and environmentally benevolent companies were emerging on the corporate landscape. The Body Shop, Ben & Jerry’s, Patagonia, and my own company, Seventh Generation, to name just a few, were out not only to make money but to fundamentally change the way things worked doing it.

Driven by equal parts societal need and personal desire, and an ethos carried on patchouli smoke from the late 1960s, these companies were founded by entrepreneurs who confronted the regressive bent of the Reagan era with a determination to create a different operating model for the business community. This new paradigm would reconcile the historic conflict between corporate profits and cultural progress by selling products and services whose creation took every possible precaution to safeguard the environment and respect the rights and dignity of the people responsible for bringing them to market.

Those were heady days. We thought we could save the world and earn a living doing it. The idea seemed obvious and its execution relatively straightforward. And though the things

were

we were doing had largely never been tried, every time one of them worked, the possibilities appeared even more endless than before. By the time of the big 20^th anniversary of Earth Day in 1990, it was clear that corporate responsibility was a concept whose time had come. People the world over were eager for an evolutionary change from business-as-usual and the harm it was causing, and we were sure that it was only matter of time before the rest of the corporate world beat a path to our doorstep

Indeed, the business community did come knocking. Flash forward two decades, and it’s rare to find a company of any appreciable size that doesn’t offer a corporate responsibility (CR) report or tout some kind of progressive initiative. There are CR officers sitting in executive suites around the world and conferences on the subject well attended by Fortune 500 companies. Touchy-feely ad campaigns and self congratulatory press conferences abound. And some days it seems like nearly every product label has something to say about the change the goods within are helping to create.

Yet by virtually every measure, the world is in worse shape than it’s ever been. Our atmosphere is overburdened with dangerous levels of greenhouse gases. Our planet’s biodiversity and its ecosystems are under siege. Growing numbers of people are living in increasing poverty. Deadly toxins pollute our land and our bodies, yet health care remains a distant dream for far too many. We’re running out of water. We’re running out of natural resources. And we’re running out of time.

--

Jeffrey Hollender is former CEO and co-founder of Seventh Generation, and co-author of The Responsibility Revolution

The Age of Responsibility Launches in the UK

By Wayne Visser

My book launched in the UK yesterday. If anyone wants to request a review copy, email me on wayne@csrinternational.org.

Back cover text

Business is doing more than ever before to tackle issues like climate change, poverty, human rights and corruption. So why are things are getting worse, not better? Why are environmental and social trends still headed in the wrong direction?

Wayne Visser argues that traditional approaches have failed, leaving business stuck in the Ages of Greed, Philanthropy, Marketing and Management. Using Web 2.0 as a metaphor, he shows how business needs to radically transform if we are to ever reach a true Age of Responsibility. The required systemic approach is dubbed CSR 2.0 and characterised by five key principles: creativity, scalability, responsiveness, glocality and circularity.

Citing more than 300 cases to illustrate ‘the good, the bad and the ugly’ of corporate sustainability and responsibility, the book describes how the new DNA of business is fast being decoded in the areas of value creation, good governance, societal contribution and environmental integrity.

Having set out a compelling vision of the future, The Age of Responsibility describes how to get there by exploring change at the societal, organisational and individual level. Readers are left not only informed, but also inspired to make a difference.

This book is the most challenging and exciting account of the future of business that you’re likely to read all year.

Book details

• Title: The Age of Responsibility: CSR 2.0 and the New DNA of Business
• Author: Wayne Visser
• Publisher: John Wiley & Sons
• ISBN: 978-0-470-68857-1
• Hardcover, 408 pages
• February 2011

About the Author

Wayne Visser is Founder and Director of the think-tank CSR International and the author/editor of twelve books, including nine on the role of business in society. In addition, he is a Senior Associate at the University of Cambridge Programme for Sustainability Leadership, Professor of Sustainability at Magna Carta College, Oxford, and Adjunct Professor in CSR at the La Trobe Graduate School of Management in Australia.

How to Order

Direct from the publisher’s website – available 18 February 2011

From Amazon (UK) – available 18 February 2011

From Amazon (USA) – available 19 April 2011

Alberta Tar Sands (Guest Blog)

Guest blog by Dr. John Blewitt

The tar sands development in Alberta, Canada, is highly controversial and clearly very destructive of the environment. Boreal forest land is being clearcut in order to apply an industrial process that will extract bitumen from oil and so make countless millions of dollars for the oil companies, offer useful tax revenue to the Canadian authorities and satisfy our relentlessly consumerist society with what it needs to sustain its unsustainable ways of living and working – oil. The social, economic and political consequences of the industrial processes being operated are clearly evident in two recent films: Dirty Oil directed by Leslie Iwerks and Petroplis directed by Peter Mettler from Greenpeace Canada. Both films have been made available on DVD by Dogwoof.

At issue in both of these excellent if disturbing films is the nature of the dominant economic system (capitalism) which requires constant growth to survive and the willingness or otherwise of governments and corporations to act in a socially and ecologically responsible manner. There are huge question marks here that are not adequately answered by the coverage the tar sands development generally gets in the mainstream media. The really big ones are about the nature of the corporate and capitalist systems remain largely unasked although a great deal of indisputable evidence about the adverse ecological, social, economic, social and health effects of the development has been presented by Greenpeace Canada and indeed in the two movies mentioned above.

In looking at these films, particularly Petropolis, it seems to me if it is possible for capitalism to be green it, and for that matter all of us, must abandon its addiction to oil. There are renewable technologies available. We dont have to produce and consume so much. It doesn’t make us happier or healthier. So why do it? Why can’t we stop? If we don’t then it is quite likely that ecological destruction, climate change and so on will, to continue the narcotics metaphor, force us to go ‘cold turkey’. Perhaps it would be better for us to go into cultural and economic rehab now before that other possibility becomes an inevitability.

About the blogger

John Blewitt is Director of Lifelong Learning at Aston University (United Kingdom). He is responsible for leading the Lifelong Learning Network Consortium in Sustainable Communities, Urban Regeneration and Environmental Technologies and is co-leader of the MSc Social Responsibility and Sustainability. He is a member of the IUCN Commission on Communication and Education. Recent books include: Understanding Sustainable Development (Earthscan, 2008), and Media, Ecology and Conservation (Green Books, 2010).

Source

http://www.greenconduct.com

The Age of Philanthropy: The Wheels of Wealth

By Wayne Visser

The Rockefeller story is a

good one to introduce the Age of Philanthropy, not only because of John D. Rockefeller’s iconic status as a tycoon and philanthropist, but also because his life and views on charity embody much of the philanthropic attitudes that still prevail today in business. At the heart

of the Age – and its chief agent, Charitable CSR – is the notion of giving back to society. Rather interestingly, this presupposes that you have taken something away in the first place. Charitable CSR embodies the principle of sharing the fruits of success, irrespective of the path taken to achieve that success. It is the idea of post-wealth generosity, of making lots of money first and then dedicating oneself to the task of how best to distribute those riches, by way of leaving a legacy.

Of course, the ideals of charity and philanthropy pre-date Rockefeller. Like greed, charity is probably as old as humanity itself. And right from the beginning, there is an element of enlightened self-interest. For example, in the Hindu religious text, the Rig Veda (1,500–900 BC), we are told: ‘If it is expected of every rich man to satisfy the poor implorer, let the rich person have a distant vision (for a rich man of today may not remain rich tomorrow). Remember that riches revolve from one man to another, as revolve the wheels of a chariot.’ Similarly, in the Upanishads, another of the Hindu scriptures, it states: ‘Like in a well, the more you fetch, the more water oozes. The more you give the more you get. This generosity is mandatory to every individual. Hurry to promise or pledge to help.’

Turning to the Far East, Confucius (551–479 BC) said: ‘When wealth is centralized, the people are dispersed. When wealth is distributed, the people are brought together.’ Hence, ‘a man of humanity is one who, in seeking to establish himself, finds a foothold for others and who, desiring attainment for himself, helps others to attain’. When asked, ‘Is there one word which may serve as a rule of practice for all one’s life?’ he replied, ‘Is not reciprocity such a word? What you do not want done to yourself, do not do to others.’

This so-called Golden Rule, which we find in all the world’s major religions, has come to represent the very essence of charity. In fact, the word charity derives from the Latin caritas, which means preciousness, dearness, or high price. In Christian theology, caritas became the standard Latin translation for the Greek word agape, meaning an unlimited loving kindness to all others. Hence, in St Paul’s Letter to the Corinthians, we read, in the King James Version of the Bible, of ‘faith, hope and charity’. Of course, it is not only giving that is important, but also the nature of giving. There is a Jewish proverb that says: ‘What you give for the cause of charity in health is gold; what you give in sickness is silver; what you give after death is lead.’

Islam also has a strong tradition of charity. Zakat, or alms-giving for the purposes of alleviating poverty and helping those less fortunate, is one of the Five Pillars of Islam. The practice is generally in the form of an annual tithe or tax of 2.5% of an individual’s wealth (although the percentage can vary by country and tradition), including money made through business, savings and income. The zak_at must also be above an agreed minimum (called nisab), which is said to be around $2,640 or the equivalent in any other currency. As important as the collection of zakat is in a community, its fair distribution among the needy is even more important. Another form of charitable action by Muslims is sadaqah, which literally means ‘righteousness’ and refers to the voluntary giving of alms or charity. These ancient traditions are considered to be a personal responsibility for all Muslims, practised out of love for humanity, to ease the economic hardship of others and eliminate inequality.

There are numerous other religious and cultural variations on the theme. Philanthropy in Latin America typically revolves around asistencialismo, which is charitable giving for poverty alleviation. In Eastern Europe, Bulgarian communities have, over the years, raised donations to build churches, schools and cultural centres called chitalishta. In India, Gandhi’s trusteeship concept has been adapted and applied to welfare acts. In Mexico, the Raramori, who still live in the mountains of the state of Chihuahua, use the expression korima, which means ‘to share’ resources in times of stress. In Southern Africa, ubuntu is the practice of humanism based on the collectivist notion that ‘I am a person through other people’. And so on, all around the world.

---
This is an extract from Chapter 3 of The Age of Responsibility: CSR 2.0 and the New DNA of Business. For more information and ongoing updates, follow the The Age of Responsibility Blog

Copyright 2010 Wayne Visser

Deborah Leipziger on "The Age of Responsibility"

The Age of Responsibility will change the way you think about CSR, allowing you to discard myths and to work towards a systemic view of CSR. Wayne Visser holds up a mirror to the CSR community and to business and society itself, providing a brilliant lens with which to see our past and envision a new future. Visser projects a new type of CSR he terms "CSR 2.0". The Age of Responsibility is a call to arms: inspiring, engaging and visionary.

- Deborah Leipziger, author of The Corporate Responsibility Code Book and SA8000: The Definitive Guide to the New Social Standard

Video: Roberto Salazar on CSR and Stakeholder Dialogue in Ecuador

Roberto Salazar is CEO of Hexagon Consultores. In this interview with Dr Wayne Visser, Director of CSR International, he talks about the state of CSR and the role of stakeholder dialogue in Ecuador. The interview took place in the cloud forest reserve in Mindo at Septimo Paraiso on 2 October 2010.

Brad Googins on "The Age of Responsibility"

High marks for Wayne Visser who brings us a book that both challenges the conventional state of CSR in very fresh and bold fashion, and offers a provocative new vision of CSR 2.0.

What is most energizing about this book is that it provides a well documented historical and analytical framework on the progression of CSR over the past century. But in analyzing the current state of CSR, it recognizes that despite amazing achievements and progress, CSR has to leap frog into a new world, one that recognizes the new DNA of business, and one that calls for a CSR 2.0 that goes far beyond the models that currently exist.

The new Principles of CSR 2.0 that Visser puts at the heart of this book provide the business community and the CSR world a new path for incorporating the complexity of the social and environmental issues that confront today’s corporation, a CSR that can serve as a more transformative force for economic and social sustainability.

What a refreshing and creative read! There are few books that can cut to the chase and provide a thoughtful analysis of the current state of CSR while at the same time opening up a vision for tomorrow. This is a contribution to the CSR world that is long overdue and most welcome.

- Brad Googins, Associate Professor in Organisation Studies at the Carroll School of Management, and former Director of the Boston College Center for Corporate Citizenship

---
The Age of Responsibility: CSR 2.0 and the New DNA of Business, by Wayne Visser is available from Amazon.co.uk, Amazon.com and other leading book retailers (ISBN-10: 0470688572, ISBN-13: 978-0470688571).

The False Promise of Ethical Consumerism: Why "Green" Products Obstruct CSR 2.0

Guest Blog by Katheryn Rivas

As Corporate Social Responsibility, with all its divergent meanings and applications, burgeons into a more common practice, companies have traditionally taken up the call of CSR in part from the growing pressure of investors and consumers who are now more "ethically aware". In other words, consumers, who have become more educated about the ways in which unrestrained global capitalism affects the environment, demand that the companies who produce their products do so in a more responsible manner. Of course, this is all well and good, as corporations must be responsive to their investors. Simply put, it's good business. After all, the customer is always right.

In the past decade we've seen an enormous proliferation of products that are touted as "green". While there is no one standard, regulated definition of green or eco-friendly, it's a label that is taken to mean a number of things. The product may be "fair trade certified", meaning it meets agreed-upon standards for ethically responsible labor practices, or it may have not been tested on animals, or maybe it contains no chemical additives, and so on.

Corporate Social Responsibility, as noted in Wayne Visser’s new book, The Age of Responsibility, must occur on a much more systemic level. This is how a real impact is made. Not by churning out "eco-friendly" products and marketing the heck out of them. Of course, CSR requires communication between each business and its respective investors and customers. And rendering transparent a business’s internal processes and how they effect our social and environmental worlds is a central component of CSR. But turning this communication (which has the potential to be substantive, co-creating dialogue between businesses and their customers) into a marketing gimmick essential cheapens and mocks the goals that drive our cause.

If a difference is really to be made, let’s stop treating investors and consumers as passive children. Let’s stop trying to convince them that they are really involving themselves in solutions to the world’s problems by consuming products, no matter how ethically the product is made. A business products should be marketed and purchased because they provide real value to the person who consumes them. No matter how well-intentioned, inserting this too facile message that "if you buy our product, you buy into the workings of a better, more just world" only serves to confuse the aims of CSR.

As Visser has noted, ultimately, the purpose of business is to serve society. Making a positive contribution to society is the essence of CSR 2.0--not just a marginal afterthought." If this is true, if the purpose of business is truly to serve society, then marketing social and environmental initiatives vis a vis products is a hypocrisy of the highest order. The Age of Marketing is over. It’s time for CSR to step up its game and move beyond green washing.

About the author

This guest contribution was submitted by Katheryn Rivas, who specializes in writing about online universities. Questions and comments can be sent to: katherynrivas87@gmail.com.

The Age of Greed

By Wayne Visser

In my view, the Age of Greed began when the first financial derivatives were traded on the Chicago Mercantile Exchange in 1972 and peaked when Lehman’s collapse in 2008. It was a time when ‘greed is good’ and ‘bigger is better’ were the dual-mottos that seemed to underpin the American Dream. The invisible hand of the market went unquestioned. Incentives – like Wall Street profits and traders’ bonuses – were perverse, leading not only to unbelievable wealth in the hands of a few speculators, but ultimately to global financial catastrophe.

The word ‘greed’ – from the old English grædig – has etymological roots that relate to ‘hunger’ and ‘eagerness’. This is similar to the older word, avarice, coming from Old French and Latin (avere), meaning ‘to crave or long for’. Those are characteristics that Larry had in spades. The Greek word for greed – philargyros, literally ‘money-loving’ – also has a familiar ring in the Lehman's story. The trouble is that capitalism in general, and the American Dream in particular, has tended to interpret this as a healthy trait. Traders at Lehman Brothers didn’t believe he was being unethical, or doing anything wrong. They were playing the game – extremely well – and being rewarded handsomely.

Perhaps we would do well to revive the German root of the word for greed (habsüchtig), which means ‘to have a sickness or disease’, for greed acts like a cancer in society, an essentially healthy cell in the body, which becomes selfish and ultimately destroys its host. The enabling environment is as important as the greedy cell itself. After all, as I argued in my book, Beyond Reasonable Greed, a certain measure of selfishness is natural, but it needs to be moderated by norms, rules and cultural taboos that keep its destructive tendencies in check.

It is worth reminding ourselves what the consequences of those destructive tendencies can mean in the lives of millions of ordinary people. The financial cost of cleaning up after the global financial crisis – which ultimately gets translated into a tax burden on the public – was estimated by the IMF in August 2009 at £7.1 trillion, enough to finance a £1,779 handout for every man, woman and child on the planet. The gargantuan sum includes capital injections pumped into banks in order to prevent them from collapse, the cost of soaking up so-called toxic assets, guarantees over debt and liquidity support from central banks.

And then there is the human cost of unemployment. In January 2010, the International Labour Organisation released figures showing that global unemployment rate for 2009 was 6.6%, which translates into 212 million people, an increase of almost 34 million over the number of unemployed in 2007. In the US alone over 100,000 businesses filed for bankruptcy in 2008 and 2009. At the same time, the World Bank estimates that the financial crisis will left an additional 50 million people in extreme poverty in 2009 and some 64 million in 2010 relative to a no-crisis scenario, principally in sub-Saharan Africa and Eastern and South-Eastern Asia.

The Age of Greed was not something ‘out there’. It was not the preserve of a few rogue traders. We were all caught up in its web. It is in fact a multi-level phenomenon, incorporating executive greed, banking greed, financial market greed, corporate greed and ultimately the greed embedded in the capitalist system. These different facets of greed are each explored in turn in the sections to follow ...

---

This is an extract from Chapter 2 of The Age of Responsibility: CSR 2.0 and the New DNA of Business

For more information and ongoing updates, follow the The Age of Responsibility Blog

Copyright 2010 Wayne Visser

CSR in South Africa (Guest Blog)

Guest Blog by Mervyn E. King

In the broadest sense, CSR refers to the role of business in society. It entails how business is governed and how it contributes to a just and sustainable society.

In South Africa, the concept and rationale of CSR are strongly informed by the King Code on Corporate Governance. Now in its third edition, the King Report was the first report on corporate governance that embraced the concepts of stakeholder engagement, ethics and environmental management and actively encouraged an inclusive approach to these issues.

Through the King Report, confidence is placed in the entrenchment of African values into corporate governance, of which ubuntu (African humanism) is the most evident. The notion of ubuntu resonates with the reciprocal nature of CSR in South Africa, making it a dominant culture driver of CSR.

Priority issues include:

• HIV and AIDS - South African is currently at the epicenter of the AIDS pandemic and the disease is affecting all aspects of South African society. Prevalence rates have increased from 0.7% among 15 – 49 year olds in 1990 to 18% at the end of 2007.
• Skills development and job creation - South Africa's unemployment rate is around 24% and unemployment remains the country’s greatest economic challenge. Job creation and skills are consequently a major national development objective to address poverty and develop the economy.
• Energy - Energy issues are high on the political agenda ever since the January 2008 energy crisis and subsequent blackouts, during which more than 20% of South Africa’s electricity-generating capacity was out of commission. Plans to address the power supply crisis are summarised in a policy document issued by the Department of Minerals and Energy.

Among the most interesting trends is that the latest version of the King Code (King III) strongly argues in favour of external assurance of sustainability reports becoming a mandatory requirement.

National legislation significantly informs the nature of CSR as the government has legislated several social issues in management and in the workplace since the democratic dispensation in 1994. Nonetheless, implementation and enforcement are challenging, even to the extent that compliance in some instances is treated as “an issue of business voluntarism”.

The following case studies illustrate different approaches to CSR in South Africa:

• Pick ‘n Pay - CSR practices are perceived as informal, unsystematic or even “whimsical”, as they are directed by the paternalistic “whim of the company chief executive or chair”.
• AngloGold Ashanti - CSR is based on systematic decision-making guided by institutional policies. Operationally, CSR is approached as a professional area that requires good management. The mining company, AngloGold Ashanti, epitomises this type of CSR which, although not new, is significantly influenced by mandatory guidelines such as the Mining Charter and other codes aimed at standardisation and accountability.
• BHP Billiton (SA) - This company aims at integrating CSR into all business strategies and processes. BHP Billiton (SA) is emerging as a leader and innovator in institutionalising CSR.

A review of the 17 accredited MBA programmes in SA revealed that CSR is minimally integrated into core course curricula (Hamann et al 2006).

Source

Based on extracts from the chapter on South African by Mervyn E. King (Chairman of the King Committee on Corporate Governance in South Africa and of the Global Reporting Initiative) and Derick de Jongh (Director of the Centre for Responsible Leadership, University of Pretoria), in The World Guide to CSR (Greenleaf, 2010).