1. Business Responsibility and Sustainability Dr Eshani Beddewela Week 04

2. Session Outline Explain what a strategic approach to CSR is, and why it is necessary Set out the key components of a CSR strategy Outline a 7 step process for developing CSR strategy Develop an understanding of the factors that need to be taken into account when developing CSR strategy in a global context

3. Strategic CSR (1) Developing a distinct CSR strategy: –Set goals for CSR strategy: Identify key areas where the organization wants to achieve progress, setting specific targets and measuring progress. –Design CSR strategy: Work out how the firm can get from its current position to a desired future state. –Implement CSR strategy: Do similar things as usual but with CSR added on (e.g. adding social criteria to supplier evaluation tools) or do things differently from the start (e.g. practicing stakeholder engagement). –Assess the outcomes of CSR strategy: CSR auditing and reporting are the key tools that help companies to assess their social performance and communicate it to internal / external audiences.

4. How Do We Build Corporate Social Strategy? By Bryan Husted and David Bruce Allen Crane, A., Matten, D., & Spencer, L. (Eds.). (2014). Corporate Social Responsibility: Readings and cases in a global context (2nd ed.). London: Routledge - Chapter 10 (pages 443 – 451)

5. Husted and Allen’s 7-step model of CSR strategy development Analyse social issue opportunities, competitive environment, and non-market stakeholders Analyse firm resources and capabilities for capitalising on opportunitiesEvaluate firm identity in terms of social needs and opportunities Determine the means and cost of acquiring any necessary resources and capabilities Create a plan integrating issues, stakeholders, identity, resources, competitive environment, and expected outcomes Implement the plan Measure and evaluate performance

6. 1.Analyse social-issue opportunities and stakeholders Identify social opportunities which create value to the firm Look for opportunities in the market environment which can be used to create competitive advantages for the firm –E.g. ‘Body shop’ realised a competitive advantage by adopting a ‘social’ aspect to its corporate strategy - natural cosmetics which are ethically produced! Look for opportunities to collaborate with stakeholders (specially those who are against the company’s actions)

7. 2.Analyse company resources and capabilities Check where the company is capable of innovation - as a ‘social strategy’ may require companies to produce ‘new’ and ‘different’ products/ services! Develop the companies social networks by developing strong links with its stakeholders (i.e. stakeholder integration)

8. 3.Evaluate the company’s identity in relation to CSR Corporate Values Corporate Identity Corporate Identity CSR strategy –Goals and objectives –Beliefs and Values

9. 4.Acquire resources and capabilities which the firm lacks Make or buy or ally (create alliances) decisions related to CSR –Make – do it yourself –Buy / Ally – out-sourced (collaborate with NGOs and other allies)

10. 5.Create a plan integrating issues, stakeholders, identity, resources and expected outcomes Long-TermParticipative approach to stakeholders Invest in Organisational Values and Resources

11. 6.Implement the plan

12. 7.Measure and evaluate performance Strategic CSR Financial Performance Social Performance Profit EPS Trust Reputation Values Corporate Identity Social contribution Sustainability

13. Global Considerations for CSR Strategy Culture Societal and stakeholder concerns differ from country to country Home norms impose CSR strategy (universalist approach) or adapt CSR strategy to host country (relativist approach)? Regulatory Environment Laws and regulations are key component of CSR Development of enforceable legal framework for social responsibility has grown since 1970s.

14. Global Considerations for CSR Strategy Non-Governmental Organisations (NGOs) Local, regional and international level Ideas-based (e.g. human rights, sustainability) or identity- based (e.g. indigenous, gender). Global Standards Institutional pressure – designed for voluntary corporate self- regulation E.g. United Nations (UN) Declaration on Human Rights, International Standards Organisation (ISO) 14000 and 14031.

15. Global Considerations for CSR Strategy UNGC (United Nations Global Compact) The UN Global Compact is a strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption. By doing so, business, as a primary driver of globalization, can help ensure that markets, commerce, technology and finance advance in ways that benefit economies and societies everywhere.ten universally accepted principleshuman rightslabourenvironmentanti-corruption

16. Global Considerations for CSR Strategy The Global Reporting Initiative (GRI) The Global Reporting Initiative (GRI) is a leading organization in the sustainability field. GRI promotes the use of sustainability reporting as a way for organizations to become more sustainable and contribute to sustainable development

17. Global Considerations for CSR Strategy World Business Council for Sustainable Development (WBCSD)World Business Council for Sustainable Development (WBCSD) The WBCSD is unique because its output is developed and road tested by its members. Its comprehensive work program enables it to cover all aspects of sustainable development in business. To deal effectively with all issues the work program is divided into focus areas, sector projects, systems solutions and capacity building.

18. References Crane, A., Matten, D., & Spencer, L. (Eds.). (2014). Corporate Social Responsibility: Readings and cases in a global context (2nd ed.). London: Routledge. Chapter 10 (pages 443 – 451)