In recent years, there is a growing trend of companies paying attention
to social and environmental impacts as a result of their business operations. Corporate
talks a lot about contributing to the society. Particularly in some blue-chip
organisations, Corporate Social Responsibility (CSR)/ Corporate Responsibility
(CR)/ Sustainability Divisions are set up. If you have aware, names of these
divisions have been shifted from CSR to CR or Sustainability. Are these concepts
the same? And why is there such a change?
Some people claim that CSR and CR/ Sustainability are interchangeable.
Theoretically speaking, however, they are contested concepts, which should
evolve across time and context.
CSR is viewed as part of the business roles of contributing its profits
to the community. It is defined by dual objectives- benefiting business and
society.
While climate change has becoming an overwhelming issue, our
interpretations have developed from a relatively narrowed social concern to a
wider notion of balancing economic, social and environmental development. The
CSR focus is far too narrow in the sustainable development led era.
By taking the ‘S’ out of CSR, CR embraces a holistic conception of sustainable
development- to meet the needs without compromising the needs of the future
generation. In business sense, CR means to meet the business objectives without
compromising the future social, economic and environmental needs. In other
words, corporate has the responsibility of maintaining sustainable development
by acting in a sustainable manner.
The transformation of departmental terms reflects practitioners’
awareness of the prevailing contextual shift. However, how can corporate make
full use of CR/ Sustainability? Is it an opportunity or a risk?
From a charity point of view, it is promising to see corporate waking up from the call and getting business beyond usual. We see CR/ Sustainability an opportunity for charity/non-profit organisations to build potential partnerships with corporate and accrue significant benefits to the society in sustainable manners.
Next, we will discuss more about the opportunities and challenges of
business-charity partnerships from a charity perspective. Please post a comment
of your initial thoughts!
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We received some very insightful comments from Thomas Loew (Institute 4 Sustainability) posted on Yahoo CSR Chicks Forum:
ReplyDeleteWe were researching on this question already some time ago, and came to the following conclusions:
a) CSR has got its roots in giving, spending, charity of Business, and the term came up in the United States . The European Union picked up CSR and gave it a different meaning. The Commission describes CSR in its Green Paper of 2001 as a concept, “Whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis”. The European Commission’s view of CSR encompasses all voluntary actions through which companies contribute to sustainable development in their CORE BUSINESS (see figure). So here's CSR is not charity but considering the interest of the employees, environmental protection, and further contributions to sustainable development within the core business. Still they are different interpretations of CSR, but to our opinion it makes most sense to agree to the understanding of the European Union. At least in continental Europe this is the case.
b) CR as Rafi.ki describes too, developped from leaving out the “S”. This developed because business did not like the misunderstanding that CSR is only on social issues. It is on both social and environmental issues. CR more and more includes compliance regarding economic issues especially anticorruption.
c) SR here within the process of developing the ISO standard the delegates voted to leave out the C for corporate, because they wanted to have a standard which is not only applicable for operations but also for other organisations for example public Administration.
So the first conclusion is if you understand CSR according to the European Union, then CR, and SR are the same.
So where's the difference between these three and sustainability?
ReplyDeleteWell, here we have to remember what is sustainable development. Sustainable development is a concept which has been developed not for business organisations but for national economies, whole continents or even the world. Sustainable development says that the national economy (the word) must not neglect one of the three sustainability dimensions, means the ecological, social, or economic dimension. If the bottom line in one of the dimensions is hurt, then the whole economy fails on the long-running. (Triple Bottom Line)
So what is sustainable management or sustainability management for a company? Sustainability management means that you try to contribute to sustainable development within the three sustainability dimensions. So management of the contribution to the environmental and to the social dimension, well and to the economic dimension. So he is the difference between CSR and sustainability management in theory:
a) CSR only looks at the VOLUNTRARY contributions of a company to sustainable development and
b) CSR only looks at the voluntary contributions to social and environmental dimension.
The difference to sustainability management is that sustainability management also includes the non- voluntary contributions, and also looks at the contributions to the economic dimension.
Well now look at the company. In practice they don't have two departments one for only the voluntary contributions to sustainable development in another one which is responsible for both. Second, we are well aware about what we want from business when we look at the social or the environmental dimension. But what do we want from companies regarding the contribution to the national economy? We do not know! Should they pay high taxes and invest less less taxes and invest more? Should they pay high wages - and as a consequence have lower earnings, and pay less taxes? Or is it better for the national economy when they pay high wages? And is the payment of wages and economic issue or a social issue if you look at sustainable development?
So the overall conclusion is: In theory there is a difference between sustainability management and CSR-Management. But not in practice.
For more information, please see
German Federal Ministry for the Environment (Ed.) (2006)
Corporate Social Responsibility: An Introduction from the Environmental Perspective,
Loew T, Ankele K, Braun S, Clausen J (2004)
Significance of the CSR Debate for Sustainability and the Requirements for Companies,
Download at: http://www.4sustainability.org/international/CSR-Publications.htm