Sustainable management Metropolia, Business Ethics IP week 6 CSR and Sustainable Development

Can CSR deliver SD? To what extent does CSR deliver Sustainable Development? John Elkington Author of ‘Cannibals With Forks’, 1998 Inventor of Triple Bottom Line "Is it progress if a cannibal uses a fork?" Triple Bottom Line = People, Planet, Profit

CSR delivers SD? World Economic Forum 2006 annual summit: “Get ready for radical disruption of markets, societies and ecosystems” Visited by 735 CEO’s CSR: It is about capacity to thrive and survive in a very different operating environment According to business itself (WEF)

Corporate Social Responsibility Responsibility towards: Consumers Employees Environment Business partners (chain responsibility) Lecture of today

CSR: Responsibility towards: Consumers (John F. Kennedy, 1962) The right to be safe The right to be informed The right to choose freely The right to be heard Employees (ILO standards, 175 member states) Freedom of association Elimination of all forms of forced/compulsory labour Abolition of child labour Elimination of discrimination (in employment and occupation) Consumers: Speech of John F. Kennedy to the U.S. Congress 1962, later called The Consumer Bill of Rights. ILO. (2009, June 12). Rules of the Game: a brief introduction to International Labour Standards (Revised edition 2009). Publication, . Retrieved December 29, 2009, from http://www.ilo.org/global/What_we_do/Publications/lang--en/docName--WCMS_108393/index.htm

CSR: Responsibility towards: Environment: Environmental legislation Direct regulation (strict + sanctions) Indirect regulations (pay according to pollution) Market corrections Consumers ‘vote with their wallets’ Corporate self-direction Individual self regulation Collective self regulation (FSC, MSC) Environmental convenants Direct regulation does not stimulate business to go beyond standards Indirect regulations promotes more innovation Environmental covenant is a voluntary yet binding agreement between the government and industry Goodstein, E. S. (2007). Economics and the Environment (5th ed.). Wiley.

Chain responsibility Upstream: You are (partly) responsible for behavior of your suppliers, or at least you support continuation of behavior. E. g. produced by child labor Downstream: You are (partly) responsible for behavior of your customer, or at least you facilitate behavior. E.g. waste disposal of your product

Expectations of society Chain Responsibility Expectations of society supplier producer wholesaler retailer consumer

Transparency in CSR As part of disclosure policy Comparable and in addition to annual reporting Use Key Performance Indicators (KPI’s) in Social and Environmental matters Invite 3rd parties to check and benchmark Responsive to issues, ongoing discussions, and honesty about progress.

Stages of CSR Stage 1 Elementary Stage 2 Engaged Stage 3 Innovative Integrated Stage 5 Transforming Citizenship concept Jobs; profits; taxes Philanthropy; environment protection Stakeholder management Sustainability/Triple Bottom Line Change the game Strategic Intent Legal compliance Maintain license to operate Make business case Integration of value and values Create new markets/social change Leadership Minimal Supportive On top of the issues Ahead of the curve Visionary Issues Management Defensive Reactive Responsive Proactive Defines the issues Stakeholder Relationships Unilateral Interactive Mutual influence Alliances and Partnerships Multi organizational Transparency Enough to protect flanks Public relations Public reporting Assurance Full disclosure

Assignment 5 Find a company listed in Fortune Global 500 (2012), with a recent (2011-12) CSR report. Check for Global Reporting Initiative CSR reports the site Corporateregister.com

Assignment 5 Quality of CSR Check the CSR report on quality Since how long do they report (and yearly)? What kind of GRI standard/level? Is it 3rd party audited/checked? Do they make use of (universal) standards? Like ISO, Fair Trade, labels, LEED, etc. What kind of framework for CSR is used? (Global Compact, Agenda 21, Earth Charter, etc.) Are there other quality markers you can think of?

Assignment 5; CSR strategy In what stage is your CSR company? Check for the 6 factors at which stage the company is. Give overall conclusion.