CSR vs Responsible Business
We get asked a lot about the difference between Corporate Social Responsibility (CSR) and Responsible Business.
In our view Responsible Business goes beyond standard CSR. The very definition of CSR is that it is a form of corporate self-regulation whereby an organisation adheres to basic compliance and engages in actions that appear to further social good beyond the interests of the organisation and that are required by law.
Responsible Business however is grounded in the concept of a sustainable business, that being the actions and governance the organisation takes, and has in place, that mitigate the actual and potential risks to it achieving its long and short term strategic objectives. An organisation’s commitment to operating its business responsibly and in a sustainable way should not just support its business strategy, but is fundamental to its successful delivery.
The only way to achieve an effective Responsible Business model is to embed it in all aspects of the way an organisation works and its culture. This is achieved by creating four key elements:
- Responsible Business strategy
- Responsible Business framework
- Stakeholder Engagement programme
- Measurement and accreditation
The Responsible Business strategy takes the overall business strategy and focuses not on what is delivered by the organisation, but how it is delivered. It defines how the culture of the organisation takes a responsible approach to its operations to drive long-term sustainable performance and not just short-term financial and operational results.
The Responsible Business framework is “how” an organisation delivers its Responsible Business strategy and how all audiences benefit from it, creating clarity around “who we are” and “what we believe”. Getting this right is key to create value and add a unifying proposition to the organisation.
Without the link between the strategy and the framework, the exercise is more of a “social and environmental responsibility” box-ticking exercise rather than a true Responsible Business one.
The framework should tie directly with the strategic business model (see example of Integrated Business Model from IIRC below) and demonstrate how each component of that model considers and reinforces the commitment to a responsible business. It defines the elements covered and measured by responsible business from the macro – things that impact us, but we can only effect (such as the environment and society) through to the micro – things that impact us that we control (employees and operations).
Communicating the Responsible Business strategy and framework is critical to its success. This is done by creating the Responsible Business story. This is an opportunity to explain the benefits of taking a responsible approach to business and how the organisation’s values will influence its long term sustainable growth. This is also an opportunity to demonstrate proof points of current responsible operations/ activities and the aspirations of the organisation.
The story will build a culture of responsible business by:
- Demonstrating the benefits and value to the organisation and all its stakeholders
- Creating a consistent message for all audiences
- Increasing value by building pride and commitment through shared values
- Establishing the communication style, behaviours and activity
The programme communicates to all stakeholders the organisation’s commitment to responsible business and explains what the benefits are moving forward. It will contain the framework, governance, targets and, over time, measurement and case studies.
The programme would consist of direct to audience communications such as a section on the corporate website, the organisations intranet, responsible business reporting, video content, traditional and social media engagement, employee engagement and responsible initiatives, customer communications, awards, rewards and recognition.
The Responsible Business framework facilitates the opportunity of integrated reporting by linking together responsible business and the strategic business model. This allows the organisation to demonstrate and report on responsible business in each key element fundamental to the business.
To make fundamental long-term changes to the culture of any organisation requires a commitment to organisational development. To ingrain the responsible business framework into the culture of the business it is not only how an organisation behaves, but also how it does business. This is achieved through the development of:
- Talent Management and succession planning – use existing or create talent management programmes to promote key representatives of responsible business behaviours and ensure a dependable ongoing business
- Education and Training – add to existing or create education and training materials that help employees support the responsible business strategy of the organisation
- Performance management – develop the existing review and management process to implement the responsible business framework, to let people be rewarded for BOTH what they do (their goals) and how they do it (responsible business)
Policies and Systems
- Develop key policies and procedures to support responsible business. The primary aim is to ensure that the policies and systems reflect the values and behaviours
Measurement and accreditation
- There are two primary ways to report on the progress being made with a responsible business strategy, the first is to provide real life examples of the strategy in action and its benefits through ongoing communications, and the second is through measurement and reporting using an internationally recognised framework
- Depending on the aims and objectives of the strategy there are many different indexes and accreditations. As an internally recognised standard we recommend using the Global Reporting Index (GRI) G4 framework as it is a harmonization of other important global frameworks. It helps organisation’s focus their sights on setting goals, measuring performance and managing change in order to implement better practices
There are many different ways that the GRI G4 framework can be applied and sector/ organisational-specific issues defined by the responsible business strategy also need to be considered, but it forms a solid foundation for ongoing measurement and external accreditation
If you’d like to find out more about our approach to Responsible Business and how it could benefit your business, get in touch!