How Reliable is Corporate Social Responsibility?

By Lorna Taylor

Pressure is increasing on large organisations to demonstrate their commitment to sustainability across the three pillars of economic performance, social equity and environmental protection. There are many good stories of CSR in practice, but many others are undermining the principles of CSR.

Think back 15 years. The organic and fair-trade industries were small niche markets for dedicated sustainability enthusiasts. Nowadays they are found in every major supermarket with a huge following.

However, along with this boom in sustainability and CSR came ‘greenwash’ - “disinformation disseminated by an organisation, so as to present an environmentally responsible public image.” The term greenwash may now be outdated but the problem remains; it encompasses not just misleading environmental claims but also ethical and social ones.

Time and again we hear how large organisations that have caused social or environmental damage rapidly take up new CSR initiatives to counteract the bad press and encourage perceptions of ‘good’ corporate citizenship. But CSR should not be a cover up, or a PR tool; it should be embedded in the organisation at every level. Corporate actions need to match CSR claims.

Christian Aid in 2004 named and shamed large organisations involved in greenwash, revealing CSR projects that were misleadingly marketed as ‘the right thing’, when in fact they were not feasible; unsuccessful or detrimental to local communities. Commenting on Shell in the oil producing region of the Niger Delta, their report states, “The region is now a veritable graveyard of projects, including water systems that do not work, health centres that have never opened and schools where no lesson has been taught.”

CSR should be about companies outlining their social and environmental goals and committing to follow through. However, there is very little independent regulation to monitor such commitments. Should governments control companies’ efforts through increased legislation, or in the true spirit of CSR, should organisations be regulating themselves? Unfortunately, whilst self-regulation may be preferable, it does not always occur. Corporate statements of CSR no longer guarantee good practice.

Greenwash is not always deliberate; laziness and ignorance are common causes. CSR, or sustainability, is a difficult term to define and definitions tend to be vague due to its broad nature. Stakeholders have adapted and moulded the CSR concept to work for them; but ulterior motives have also resulted in confusion, greenwashing and the compromise of long-term sustainability goals.

Despite some progress, governmental regulation and political action is required to rebuild faith in the concept and monitor CSR delivery. Sustainability in its current form is not sustainable. CSR needs to evolve, becoming more accountable and embedded in core societal changes in order to provide truly sustainable benefits for society.

Accountability is the key to addressing the issue of greenwashing and ensuring that CSR is sustainable. Corporate Social Responsibility has to grow into Corporate Social Accountability, measuring the impact of actions, not just what actions have been taken.

References

Christian Aid, 2004. Behind The Mask: The real face of Corporate Social Responsibility

Jim MacNeill, 2007. Our Common Future: Advance or Retreat? Sustainable Development: A New Urgency. Geneva: EcoLomics International.

John Drexhage and Deborah Murphy, 2010. Sustainable Development: From Brundtland to Rio 2012, International Institute for Sustainable Development (IISD)

Futerra Sustainability Communications, 2008. The Greenwash Guide

Sustainable development Innovation Briefs, Issue 1, February 2007, “CSR and Developing Countries: what scope for government action?”

Cracking the CSR Codes Puzzle

By Dr Wayne Visser

Part 5 of 13 in Wayne Visser's Age of Responsibility Blog Series for 3BL Media.

Looking back, we can see that the 1990s were the decade of CSR codes – not only EMAS, ISO 14001 and SA 8000, but also the Forest Steward Council (FSC) and Marine Stewardship Council (MSC) Certification Schemes, Green Globe Standard (tourism sector), Corruption Perceptions Index, Fairtrade Standard, Ethical Trading Initiative, Dow Jones Sustainability Index and OHSAS 18001 (health & safety), to mention just a few. But all that was just a warm up act when we look at the last 10 years, when we have seen codes proliferate in virtually every area of sustainability and responsibility and all major industry sectors. So much so that in the A to Z of Corporate Social Responsibility, we included over 100 such codes, guidelines and standards – and that was just a selection of what it out there. To illustrate the point, here is a sample of what has been thrust onto corporate agendas since the year 2000:

The Carbon Disclosure Project; Global Alliance for Vaccines and Immunisation; GRI Sustainability Reporting Guidelines; Kimberley Process (to stop trade in conflict diamonds); Mining and Minerals for Sustainable Development (MMSD) Project; UN Global Compact; UN Millennium Development Goals; Voluntary Principles on Human Rights; FTSE4Good Index; Global Business Coalition on HIV/AIDS; Global Fund to Fight AIDS, Tuberculosis and Malaria; Business Principles for Countering Bribery; Publish What Pay Campaign; Johannesburg Declaration on Sustainable Development; London Principles (finance sector); AA 1000 Assurance Standard; Equator Principles (finance sector); Extractive Industries Transparency Initiative (EITI); Roundtable on Sustainable Palm Oil; Global Corruption Barometer; UN Convention Against Corruption; UNEP Finance Initiative; UN Norms on Business and Human Rights; World Bank Extractive Industries Review; AA 1000 Standard for Stakeholder Engagement; EU Greenhouse Gas Emissions Trading Scheme; Millennium Ecosystem Assessment; ISO 14064 Standard on Greenhouse Gas Accounting and Verification; Stern Review on the Economics of Climate Change; Bribe Payers’ Index; UN Principles for Responsible Investment; ClimateWise Principles (insurance sector); UNEP Declaration on Climate Change; UN Principles for Responsible Management Education (PRME); Bali, Poznan and Copenhagen Communiqués (climate change) ... and many, many more.

No wonder companies are suffering from code fatigue and audit exhaustion. It is the supreme paradox of the Age of Management – companies are pressured to standardise their efforts on sustainability and responsibility, while stakeholders and critics (myself included) remain unconvinced that this approach identifies or addresses the root causes of the problems we face. Many of the institutional failures over the past 20 years have, I would argue, been systemic failures of culture, rather than bureaucratic failures of management; they have more to do with a prevailing set of values than a particular set of procedures.

The latest in this code-mania is ISO 26000 on Social Responsibility. I have suggested before that ISO 26000 is like a teddy bear – something cute and fluffy, which may help companies sleep better at night, but nothing like the grizzly bear that we really need to shake business out of their CSR complacency. Of course, it is unfair of me to make so light of a five-year international process of negotiation involving over 90 countries, which managed to reach some measure of agreement on such tricky issues as human rights and fair operating practices. But I really do believe that, as a non-certifiable guidance standard that promotes a strategic approach to CSR (rather than a transformative CSR 2.0 agenda), ISO 26000 may prove to be more of a damp squib than a big bang.

Having said that, I must give ISO 26000 its due – as a foundation document that encapsulates the international consensus on social responsibility, it is to be applauded and recommended. Its greatest achievement – and what I expect may prove to be its most enduring legacy – is the way in which it broadens the scope of CSR, first beyond big corporates to any organisation, and second beyond an exclusive focus on philanthropic community development to incorporate six other core subjects, namely organisational governance, human rights, labour rights, the environment, fair operating practices and consumer issues.

Besides this, countries like Denmark are ignoring ISO’s strong declaration against ISO 26000 certification schemes and have begun developing their own certifiable national standard, DS 26000. I expect consultants will also increasingly offer ISO 26000 compliance auditing services, irrespective of whether these are sanctioned by ISO. The fact is that business, governments and civil society alike want standards on social responsibility with ‘teeth’. A decade of weak standards without sanction, like the UN Global Compact and AA 1000, as compared with tougher certification schemes like SA 8000 and the Forest Stewardship Council, have taught us where real value lies.

I believe that the codes-based approach, which I call Strategic CSR in an Age of Management, fails on three counts. First, the incremental approach of CSR, while replete with evidence of micro-scale, gradual improvements, has completely and utterly failed to make any impact on the massive sustainability crises that we face, many of which are getting worse at a pace that far outstrips any futile CSR-led attempts at amelioration.

Second, CSR is, at best, a peripheral function in most companies. There may be a CSR manager, a CSR department even, a CSR report and a public commitment to any number of CSR codes and standards. But these do little to change the underlying growth-and-consumption model that fuels environmental degradation and social disruption.

Third, the ‘inconvenient truth’ is that CSR sometimes pays, in specific circumstances, but more often, it is still uneconomic. Of course there are low-hanging fruit – like eco-efficiencies around waste and energy – but most of the hard-core CSR changes that are needed require strategic change and massive investment, which the markets don’t support.

So where does this leave us? I have argued so far that the Ages of Greed, Philanthropy, Marketing and Management have brought us to a point of crisis in CSR. Specifically, CSR is failing to turn around our most serious global problems – the very issues it purports to be concerned with – and may even be distracting us from the real issue, which is business’s role causal role in the social and environmental crises we face. In the rest of this blog series, I will explore what a different approach – CSR 2.0 – may look like.

About the author

Dr Wayne Visser is Founder and Director of the think-tank CSR International and consultancy Kaleidoscope Futures Ltd. He is the author of thirteen books, including The Age of Responsibility: CSR 2.0 and the New DNA of Business (2011), The World Guide to CSR (2010) and The A to Z of Corporate Social Responsibility (2010). He is the author of over 180 publications (chapters, articles, etc.) and has delivered more than 170 professional speeches on in over 50 countries in the last 20 years. In addition, Wayne is Senior Associate at the University of Cambridge Programme for Sustainability Leadership, Visiting Professor of Sustainability at Magna Carta College, Oxford, and Adjunct Professor of CSR at Warwick Business School, UK.

Tracing Corporate Social Investment (CSI) Milestones in South Africa

By Greer Blizzard

2012 marks the eighteenth year of democracy for the ‘new’ South Africa – a country still navigating its way through the unique political, economic and social turmoil of its birth, while accepting the shortcomings inherent in its colonial and apartheid past.

Corporate Social Investment (CSI), a far more widely used and accepted term in the South African context, has been around for many years. As a broad concept it was introduced in 1972, when Meyer Feldberg called on local business leaders to support the communities that surrounded their operations and from where they drew the majority of their workforce.

Since then, this dynamic landscape has seen many challenges, yet continues to grow as cooperation between government, NGOs, the private-sector and individuals moves from confrontation to collaboration and responsibility – albeit a slow and far from perfect process.

In 1992, in an effort to support corporate South Africa, the Institute of Directors approached Professor Mervyn E. King to create a corporate governance solution for business. This resulted in the establishment of the King Committee on Corporate Governance, which in 1994 launched the first King Report that marked the institutionalisation of corporate governance in South Africa.

In 2002 the King II Report was published, which included a far-reaching section on integrated sustainability reporting, setting out specific reporting, accounting and auditing guidelines for non-financial matters. Although voluntary at the time, the Johannesburg Securities Exchange requested that listed companies comply with the King II Report recommendations, or explain their level of non-compliance. This subtle pressure was seen as a turning point in the formal life of CSI.

These shifts in the corporate world paralleled changes in the newly elected democratic government, with the intention of bridging the traditional economic gap between black and white South Africans. The first move saw the launch of the Reconstruction and Development Programme (RDP) in 1994, followed by many transformations in an evolving effort to create a supportive, stable and economically profitable environment.

In 1996 the RDP was replaced with the Growth, Employment and Redistribution (GEAR) macro-economic policy and further in 2000 by the Black Economic Empowerment (BEE) commission, chaired by former politician and new leading black businessman Cyril Ramaphosa, which released a report highlighting the need to establish guidelines to ensure greater black participation in the economic future of the country.

This in turn led to a revised Broad-Based Black Economic Empowerment (B-BBEE) Strategy, a precursor to the B-BBEE Act 53 of 2003. The period November 2005 to February 2007, saw three sets of B-BBEE Codes of Good Practice published, each setting various frameworks for the practical implementation of the B-BBEE Act, including a score-card system which supports the implementation of the following seven pillars:

1. Equity Ownership
2. Management
3. Employment Equity
4. Skills Development
5. Preferential Procurement
6. Enterprise Development
7. Residual Element/Corporate Social Investment

As a result of these two key legislative frameworks, the concept and application of Corporate Social Investment in South Africa, has become very closely aligned to the advancement of ‘black’ (African, Coloured and Indian) people and their more formal participation in the economy.

In 2014 when South Africa celebrates its 20th year of democracy, it will undoubtedly acknowledge the huge undertakings achieved and will most certainly highlight the steps going forward, as many more (listed) companies engage with Corporate Social Investment - not just as a ‘marketing add-on’, but as a fully integrated business strategy, giving it respected time on Board agendas.

Changing the World - One Leader at a Time

By Dr Wayne Visser

Quest for CSR 2.0 Series No.12

We face a crisis of leadership. Our global challenges loom large and clear, but we seem to lack leaders who can make change happen at a scale and speed that match the size and urgency of the problems we face. In an attempt to understand this leadership impasse, I’ve done some research with the University of Cambridge’s Programme for Sustainability Leadership on how change happens. In this blog, I’ll briefly outline some of our conclusions.

Let’s start with what kind of change we’re talking about. Jim Collins, author of Good to Great, observes that companies that went from being ‘good to great’ did not rely on revolutions, dramatic change programs or wrenching restructurings. ‘Rather, the process resembled relentlessly pushing a giant flywheel in one direction, turn upon turn, building momentum until a point of breakthrough, and beyond.’

So we’re talking about catalyzing and scaling up change. And for this change to be successful, leaders need to foster and entrench new values, culture, incentives, rules and resources. In Accenture and the UN Global Compact’s 2010 survey, 54 percent of CEOs felt that a cultural tipping point on sustainability is only a decade away—and 80 percent believe it will occur within 15 years, so perhaps we are nearing a moment of infectious change. Meanwhile, at the organizational level, leaders must catalyze change for sustainability through a suite of actions, including innovation, empowerment, accountability, closed-loop practices and collaboration.

We found that effective sustainability leaders are good at promoting creativity in business models, technology, products and services that address social and environmental challenges. Sustainability leaders also implement structures and processes for good governance, transparency and stakeholder engagement.

Accountability does not have to be all about structures and controls however. Collins believes great leaders foster a culture of discipline, saying “When you have disciplined people, you don’t need hierarchy. When you have disciplined thought, you don’t need bureaucracy. When you have disciplined action, you don’t need excessive controls.” According to Jeffrey Immelt, CEO of G.E., “Enron and 9/11 marked the end of an era of individual freedom and the beginning of personal responsibility. You lead today by building teams and placing others first. It’s not about you.”

The best sustainability leaders adopt principles of cradle-to-cradle production, internalizing externalities and extending these principles to the supply chain. Sustainability leaders also build formal cross-sector partnerships, as well as innovative and inclusive collaborative processes such as social networking (Web 2.0). Betty Sue Flowers, co-author of Presence, poses the challenge as a question, saying, “We know a lot about heroic action because that’s in the past of leadership. But how do you have leadership in groups across boundaries, multi-nationally?”

At the people level, leaders catalyze change for sustainability by providing a compelling vision, encouraging long term thinking, making strategic investments and promoting intergenerational equity. Immelt says “every leader needs to clearly explain the top three things the organization is working on. If you can’t, then you’re not leading well.”

Ray Anderson, the late CEO of Interface, saw this as a process of inclusion, saying, “For Interface, sustainability is broader than before: sustainability reaches out to embrace people, processes, products, place, the planet and profits—we now know that none can long be afforded allegiance at the expense of the others.”

Sustainability leaders have to deep knowledge and skills and provide opportunities and resources for appropriate action. This embraces Robert Greenleaf’s notion of servant leadership. He explains that “It begins with the natural feeling that one wants to serve. Then conscious choice brings one to aspire to lead. The best test is: do those served grow as persons; do they, while being served, become healthier, wiser, freer, more autonomous, more likely themselves to become servants?”

Transformational sustainability leaders also focus on creating a culture and structure that provides peer support and encouragement and recognizes achievement. Immelt says, “Today, it’s employment at will. Nobody’s here who doesn’t want to be here. So it’s critical to understand people, to always be fair, and to want the best in them.”

In the end, I believe the best leaders are effective storytellers. And they realize that we need a new collective story. As I wrote in Beyond Reasonable Greed, “each time the world changes – when civilizations rise and fall, when new scientific theories challenge our understanding of the universe, when technological innovation reinvents our lifestyle, when political revolution breaks down the old structures of society, or when a global crisis threatens to destroy our planet – humanity is forced to let go of some of its most cherished beliefs in order to create a new mythology to guide its collective psyche.”

We are at just such a fulcrum of change, and the beliefs we need to challenge and modify are many. Maybe it is our belief in the beneficence of the “invisible hand” of the market. Or our belief that a global political deal is all we need to solve the climate crisis. Or that that business has the power to act unilaterally in bringing about a more sustainable and responsible future.

If my experience of living through the political changes in South Africa has taught me anything, it is that change is systemic. It happens because of millions of small actions by millions of people all over the world, some coordinated, some diffuse. Yes, change also happens because of bold leadership, but it always needs an enabling environment, a society or an organization that is ready to change.

Change is something organic. It is worth remembering that the largest living thing in the world is a honey mushroom in Oregon – an interconnected fungus measuring 3.5 miles across. It is said to be 2,400 years old and takes up 2,200 acres (1,665 football fields), with the small mushrooms visible above ground representing only a tiny proportion of its real girth and substance. I think change is something like that too: spread out, interconnected, growing where the ground is most fertile ground and often invisible.

Source

Welcome to this international dialogue, Quest for CSR 2.0, with Dr Wayne Visser, pioneering author, academic and social entrepreneur. The dialogue, hosted by CSRwire Talkback, is based on his groundbreaking book, The Age of Responsibility: CSR 2.0 and the New DNA of Business. For the next several weeks, Dr Visser will summarize the main points and key lessons of each chapter of his book, exploring why CSR 1.0 has failed, the 5 Ages and Stages of CSR, the 5 Principles of CSR 2.0 and how to make change happen. Readers will be invited to share their views on each posting. This exciting new series is co-published by CSRwire and CSR International.

Original link on CSRwire

Myths About CSR in Developing Countries

By Wayne Visser

Part of the Quest for CSR 2.0 series.

Are concepts and models of corporate social responsibility (CSR) developed in the West appropriate for developing countries?

I decided to first tackle this question by setting out what I believe to be Seven Popular Myths about CSR in developing countries. Most of these myths exist as a result of the feeding frenzy that inevitably occurs every time the media has hunted down and sunk its teeth into one or other juicy story of corporate exploitation. They, however, become sustainable because they are spread by whole legions of largely well-intentioned people who have vested interests in promoting their particular brand of the truth about CSR.

The Seven Myths:

1. Economic growth is not compatible with CSR.
2. Multinationals are the biggest CSR sinners.
3. Multinationals are the biggest CSR saviours.
4. Developing countries are anti-multinational.
5. Developed countries lead on CSR.
6. Codes can ensure CSR in developing countries.
7. CSR is the same the world over.

Let’s look at these myths each briefly in turn.

Myth 1: Economic growth is not compatible with CSR: What the Index for Sustainable Economic Welfare and Genuine Progress Index show is that GDP growth and quality of life move in parallel until social and environmental costs begin to outweigh economic benefits. According to this ‘threshold hypothesis’ – coined by Chilean barefoot economist, Manfred Max-Neef – most developing countries have yet to reach this divergence threshold. For them, economic growth and the expansion of business activities is still one of the most effective ways to achieve improved social development, while environmental impacts are increasingly being tackled through leapfrog clean technologies.

Myth 2: Multinationals are the biggest CSR sinners: On the ground in most countries, multinationals are generally powerful forces for good, through their investment in local economies, creation of jobs, upgrading of infrastructure, provision of basic services and involvement in community development and environmental conservation. There are always exceptions, of course, and these should be named and shamed. But they shouldn’t overshadow the overall positive role of big companies in developing countries. The cumulative social and environmental impacts of smaller companies, which operate below the radar of the media and out of reach of the arm of the law, are typically far larger than that of the high profile multinationals.

Myth 3: Multinationals are the biggest CSR saviours: Not only do large companies have limited influence over government policy, but most multinationals, despite large capital investments, provide only a minuscule proportion of the total employment in developing countries. The real potential saviours are small, medium and micro enterprises (SMMEs), including social enterprises, which are labour intensive and better placed to affect local economic development. If the social and environmental impacts of these SMMEs can be improved, the knock on benefits will be proportionally much greater than anything that multinationals could achieve on their own. This is why the work CSR for SMEs by Anahuac University in Mexico and Forum Empresa in Latin America is so encouraging and important.

Myth 4: Developing countries are anti-multinational: Developing countries are often caught in a no-man’s land of under-development in a competitive, monetized, global economy, and the sooner they can modernise and integrate, the better for them. Most often, developing country communities welcome multinationals and their CSR initiatives. This is not the same as saying the developing world should repeat the past mistakes of the developed countries, such as highly polluting industrialisation, nor that multinationals should not be required to be responsible and held accountable. But we should not deny developing countries the dignity of choice, whether it be Unilever products or Coca Cola, both of which have made significant progress on CSR in recent years.

Myth 5: Developed countries lead on CSR: There are countless examples of how developing countries are proving themselves highly adept at delivering the so-called triple bottom line of sustainability, namely balanced and integrated social, economic and environmental benefits. It is actually not surprising, since in developing countries, these three spheres are seldom separable – economic development almost inevitably results in social upliftment and environmental improvement, and vice versa. Whether it is South Africa’s King Code, which encourages integrated sustainability reporting, or A Little World, which uses mobile phone and biometric scanners to bring micro-banking services to the poor in India, a lot of the innovation in CSR is taking place in developing countries.

Myth 6: Codes can ensure CSR in developing countries: The past few years have seen a mushrooming of corporate responsibility codes, standards and guidelines, which developing countries are keen to adopt, if only to satisfy their Western partners. This standardisation trend is both inevitable and necessary in a globalising world—which is desperately searching for an alternative to command-and-control style business regulation in order to satisfy the governance and accountability void which still exists. But this codification tends to measure CSR activities, rather than CSR impacts on the ground. Developing countries need to move rapidly through this Strategic CSR approach in an Age of Management to a more transformative CSR approach in an Age of Responsibility.

Myth 7: CSR is the same the world over: One of the biggest fallacies is that, in a globalised world, CSR can somehow conform to a unitary model. Of course, we need universal principles, like the Global Compact, and perhaps even process frameworks, like ISO 14001. But standardised performance metrics, like those of the Global Reporting Initiative and the numerous sustainability funds and indexes, start to tread on shaky ground. The tendency is for developed country priorities – such as energy and climate change – to receive emphasis and for northern NGO agendas to dominate.

The antitdote to these CSR myths for developing countries is glocality – one of the five principles of CSR 2.0. The term ‘glocal’ – a portmanteau of global and local – is said to come from the Japanese worddochakuka, which simply means global localisation. Or more simply, ‘think global, act local’. The question is, do we see glocality in action, or do we just see corporations in developing countries mimicking the practices of the West?

Source

Welcome to this international dialogue, Quest for CSR 2.0, with Dr Wayne Visser, pioneering author, academic and social entrepreneur. The dialogue, hosted by CSRwire Talkback, is based on his groundbreaking book, The Age of Responsibility: CSR 2.0 and the New DNA of Business. For the next several weeks, Dr Visser will summarize the main points and key lessons of each chapter of his book, exploring why CSR 1.0 has failed, the 5 Ages and Stages of CSR, the 5 Principles of CSR 2.0 and how to make change happen. Readers will be invited to share their views on each posting. This exciting new series is co-published by CSRwire and CSR International.

Original link on CSRwire

Can We Break the Spell of CSR Curses?

By Dr. Wayne Visser

Quest for CSR 2.0 Series No.5

Looking back, we can see that the 1990s were the decade of CSR codes and standards – from EMAS and ISO 14001 to SA 8000 and the Global Reporting Initiative. But these were just a warm up act compared to the last 10 years, when we have seen codes proliferate in virtually every area of sustainability and responsibility and all major industry sectors. So much so that in the A to Z of Corporate Social Responsibility, we included over 100 such codes, guidelines and standards – and that was just a selection of what it out there.

This spawning of CSR codes and standards is typical of Strategic CSR, emerging from the Age of Management. At its heart, this is the drive to relate CSR activities to the company’s core business (like Coca-Cola's focus on water management) by turning these into formal management systems, with cycles of CSR policy development, goal and target setting, programme implementation, auditing and reporting. All good and well, but where does this leave us?

My belief is that Strategic CSR – like its predecessors Defensive, Charitable and Promotional CSR - has brought us to a point of crisis. Specifically, all these approaches are failing to turn around our most serious global problems – the very issues CSR purports to be concerned with – and may even be distracting us from the real issue, which is business’s role causal role in the social and environmental crises we face. This failure is due to what I have called the three Curses of CSR 1.0, namely that it is incremental, peripheral and uneconomic. Let’s look at these briefly in turn.

Curse 1: Incremental CSR

One of the great revolutions of the 1970s was total quality management, conceived by American statistician W. Edwards Deming and perfected by the Japanese before being exported around the world as ISO 9001. At the very core of Deming’s TQM model and the ISO standard is continual improvement, a principle that has now become ubiquitous in all management system approaches to performance. It is no surprise, therefore, that the most popular environmental management standard, ISO 14001, is built on the same principle.

There is nothing wrong with continuous improvement per se. On the contrary, it has brought safety and reliability to the very products and services that we associate with modern quality of life. But when we use it as the primary approach to tackling our social, environmental and ethical challenges, it fails on two critical counts: speed and scale. The incremental approach to CSR, while replete with evidence of micro-scale, gradual improvements, has completely and utterly failed to make any impact on the massive sustainability crises that we face, many of which are getting worse at a pace that far outstrips any futile CSR-led attempts at amelioration.

Curse 2: Peripheral CSR

Ask any CSR manager what their greatest frustration is and they will tell you: lack of top management commitment. Translated, this means that CSR is, at best, a peripheral function in most companies. There may be a CSR manager, a CSR department even, a CSR report and a public commitment to any number of CSR codes and standards. But these do little to mask the underlying truth that shareholder-driven capitalism is rampant and its obsession with short-term financial measures of progress is contradictory in almost every way to the long-term, stakeholder approach needed for high-impact CSR.

So what we are left with is an approach to CSR which allows each company to set their own voluntary objectives and targets, which appear responsible, but lack the scale and urgency needed to reverse our social and environmental crises. CSR remains peripheral in another sense as well, because it is only a handful of big-branded companies that find themselves in the CSR spotlight. What about the millions of small and medium sized enterprises. By and large, CSR passes them by, despite their collectively bigger impacts.

Curse 3: Uneconomic CSR

Which brings us to Curse 3. If there was ever a monotonously repetitive, stuck record in CSR debates, it is the one about the so-called ‘business case’ for CSR. That is because CSR managers and consultants, and even the occasional saintly CEO, are desperate to find compelling evidence that ‘doing good is good for business’, i.e. CSR pays. The lack of corroborative research seems to be no impediment for these desperados endlessly incanting the motto of the business case, as if it were an entirely self-evident fact.

The rather more ‘inconvenient truth’ is that CSR sometimes pays, in specific circumstances, but more often does not. Of course there are low-hanging fruit – like eco-efficiencies around waste and energy – but these only go so far. Most of the hard-core CSR changes that are needed to reverse the misery of poverty and the sixth mass extinction of species currently underway require strategic change and massive investment. They may very well be lucrative in the long term, economically rational over a generation or two, but we have already established that the financial markets don’t work like that; at least, not yet.

The way I see it, that leaves us with three options for taking CSR forward, which I like to think of as the Parrot, Ostrich and Phoenix scenarios.

The Way of Parrot is to tell it like it is: recognise the limitations of CSR and admit to its primary role as a business tactic for reputation management. The Way of the Ostrich is the status quo: pretend that CSR is working and that more of the same will be enough. The Way of the Phoenix is the transformative agenda: reconceptualise CSR as a radical or revolutionary concept that challenges the intransigent business and economic model and offers genuine solutions to our global challenges. The Way of the Phoenix is what I call Systemic CSR, or Transformative CSR, or CSR 2.0, and is what we are just starting to see rising from the ashes of the previous ages, as we enter a new Age of Responsibility. This rather more positive agenda is what I will explore for the remainder of this blog series.

Source

Welcome to this international dialogue, Quest for CSR 2.0, with Dr Wayne Visser, pioneering author, academic and social entrepreneur. The dialogue, hosted by CSRwire Talkback, is based on his groundbreaking book, The Age of Responsibility: CSR 2.0 and the New DNA of Business. For the next several weeks, Dr Visser will summarize the main points and key lessons of each chapter of his book, exploring why CSR 1.0 has failed, the 5 Ages and Stages of CSR, the 5 Principles of CSR 2.0 and how to make change happen. Readers will be invited to share their views on each posting. This exciting new series is co-published by CSRwire and CSR International.

Original link on CSRwire