What is Corporate Social Irresponsibility? Simply put, it’s the practice of not being socially responsible as a corporation. What is social responsibility? Although heavily debated, it’s something that 71% of adults in the US believe corporations are not doing, or at least not doing well, according to a recent study by Harris Interactive. Why is it important? If it leads to even a one point change on Fortune Magazine’s “Americas Most Admired Companies”, it can translate into 107M of additional value for your corporation. Furthermore, the portfolios of the most admired companies show cumulative returns of 126% while those of the least admired show cumulative returns of only 80%. Furthermore, a good CSR program can make any company more competitive.
So what is it? Simply speaking, it’s the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of that of the local community and society at large. It’s responsible production, socially responsible labour relations, community involvement, environmental cognizance, and sustainability. It’s about a commitment to do things right.
What is right? That’s up for debate. The specifics will depend on local regulations, industry standards, your shareholders, and your corporate values, but at a high level, you can pretty much count on needing good labour, health and safety, environment, and community conduct codes.
But it’s not just as easy as raising wages, reducing greenhouse emissions, or opening a day care. For example: One company reduces its emissions of greenhouse gases. One increases its spending on recycling. Another provides free child-care facilities for its workers. Another raises the wages of its lowest-paid workers. All of these things cost money: suppose, for the sake of argument, that all four have reduced profit by the same amount. Which company has done most to protect the environment? Which has done most to advance social progress? Overall, how far has each company improved its triple bottom line? Bearing in mind the cost, can you even say that any of them have done so? (The World According to CSR, The Economist, January 2005)
It requires a strategy – and that requires a good process to develop one, a process that is described in the new wiki-paper over on the eSourcing wiki:
Corporate Social Responsibility: A Sustainable Solution. It’s complete with over a dozen in-depth references, so check it out!