For many years I had very little or rather no understanding of what CSR actually is. I am sure I am not alone. Ask your family, friends or colleagues like I did and you will get answers like "saving the planet", and "planting trees" one even said "saving the whales". When I see CSR activities posted on our organisation's internal social network such as printing a paper card to provide information about how we save the environment it confirms my assumption that we haven't got a clue what CSR is and is more about doing things that sound good with no thought behind them so we can advertise it. Side note: have you ever wondered why CSR is placed in the Marketing Department? Just food for thought.
Why do businesses care about CSR? The sole purpose of a business is to make a profit right? Well, at least that is the conventional view and let's stay with this for now. CSR requires financial investment and common sense dictates that a £ taken away for such purpose a £ taken away from the shareholders. Why would anybody want to invest in a company which gives profit away? Here is the trick. This may be because they want to improve their image by associating themselves with a cause or to counter the claims of pressure groups, but there is always an underlying financial motive, so the company benefits. CSR sells, by appealing to customer's consciences and desires CSR helps companies to build loyalty and attract future investors and customers. Many corporate charity tie-ins gain company access to target markets and the involvement of the charity gives the company's message greater power. It is a genius money-making concept created under the umbrella of goodwill.
Businesses are very eager to continue their CSR activities and PR them but are fiercely opposed to be regulated by governments. Why? If doing so great why cannot this activity be legislated? Why would socially responsible companies have an issue with government regulation to tackle bad practices? That's because they do the least they can get away with for PR and eventually profit purposes. When Nike lost its court battle in 2002 for misleading public relations campaigns, Exxon Mobile, Microsoft and others were quick to contend that if every e-mail, press release website posting etc.. may be the basis for criminal and civil actions, corporation will find it difficult to promote their corporate activities, products and services.
To argue this further, it amazed me how corporations turned the debates towards almost privatisation during the G8 summit in 2005. BAA (British Airways) turned the debate from how to eradicate poverty in Africa to how corporations can benefit from the aid money invested in the continent. This comes as a little surprise since governments and businesses' attitude towards development comes from the ideology that poverty can be tackled by increasing economic growth and attracting foreign investment that will trickle down to the poorest, while the negative impacts of corporate activities can be controlled or conveniently ignored through a public commitment to CSR (this is also happening in the developed world).
CSR activities and programs are so wonderful and I feel so proud of what my organisation is doing. But when I think of the possible motive behind all those beautiful programs I feel let down! Some would say, who cares as long as we do good?
But hold on! Some argue that companies with a social conscience do society no good in the end as they enable governments to take the backseat on issues that clearly are the government's responsibility such as education, conservation, environment protection etc. This might be right but there is no guarantee that if CSR activities didn't take place the government would act on those issues. Furthermore, it is not realistic to expect governments to be able to legislate every single aspect of socially responsible behaviour not to mention that more legislation or regulation equals to slower and lower business growth. So no, we don't want that. What we want is responsible behaviour at all levels of society!
So what is missing here? Why is everybody focusing on profit rather than the good cause? First of all, I have a problem with the word corporate as it kind of excludes (as far as people understand corporate) SMEs which is 90% of total businesses worldwide. It also fails to put responsibility on individuals that make up organisations and households. Is a car owner aware of the carbon footprint of his/her car? Do we pay attention to the products we buy and where they are sourced? I could go on. So, the better name for me would be, 'Human Social Responsibility' as we are all responsible not only the corporations.
I believe that the missing link here is the common understanding of the environment that organisations operate in. Once we get that we will not only act as a responsible individual or organisation (here I use the organisation as it impacts everybody not only businesses) for the sake of PR exercise and profit but we will create organisational strategies to meet the 'triple bottom line' that focuses on economic prosperity, environmental quality and social justice.
Now, pay attention because if you get that you will have a very different view on your actions (unless of course, you don't care what is happening to others, the environment or everything else in the future including the organisation you are working for).
The world in which business takes place is comprised of three different but interconnected economies (1997, Hart). First is the Market Economy which includes both the developed and emerging economies. Approximately 1 billion people live in developed countries of the market economy and account for 75% of the world's energy and resource consumption and create the bulk of industrial toxic and consumer waste. To make it more interesting, the decisions of resource allocation, production, consumption, price levels and competition are made by them and of course, they seek their advantage.
The second economy is the Survival Economy which is a traditional village-based way of life in rural parts of developing countries such as India, China, the African continent etc. Around 3 billion people maintain themselves at the minimum level and meet their needs directly from nature. Now, think that the population is predicted to increase in the next 40 years and the majority of this will be in this economy. The rapid expansion of the Market Economy (the first economy) threatens the eco-system on which this economy depends. Rural populations will be driven into further poverty as they will be competing for the same scarce resources. You don't believe that they have the chance against large corporations or can afford to share their little food with our accelerated need to consume more and more, do you?
The third economy is Nature's Economy which consists of natural systems and resources that support the Market Economy and the Survival Economy (the two economies already mentioned). Here, do you now see the connections?????? We don't act responsibly because we want profit! We act responsibly because if we continue like that we won't even get the chance to think about profit!
The greatest threat to Sustainable Development is the decrease of the world's renewable resources such as soil, forest, and water fisheries, (80% of them are exploited already so no, we don't get to eat fish with a clear conscious) all of which already pushed beyond their limits by population growth and industrial development.
Coping with these global interdependencies or trying to positively influence them will require a change in the mindset of individuals and organisations to view these three economies as one, and to properly recognise that it is impossible to achieve sustainable economic growth in one of these interrelated economies without having a significant impact on the others.
After reading this, ask yourself the question, do I or does my organisation act responsibly in a way that simultaneously supports those three economies? I guess the answer will be no. That is why I say that CSR as it takes shape today are most of the time just PR nothing else. Of course, there are exceptions but I still would like to know what their motives are.