CSR
How Can ISO 14001 Benefit My Business?
May 16, 2012 | 
Author Environmental Issues are now of paramount consideration by company directors, owners and employees worldwide.
Since the 14001 Environmental management system includes everyone in the organization and all areas of the organization that affect the environment, it can improve an organization’s environmental performance in many ways. This improved performance comes at a cost to the organization, a cost which can be recovered by aggressively seeking benefits.
Some of those benefits are as follows:
All environmental policies and procedures are now in the same format
All documents are now more accessible to employees so compliance has improved
Regularly scheduled EMS reviews are ensuring both legal and ethical obligations are met in a timely fashion.
Increased Profits
The quantity of materials and energy required for manufacturing a product may be reduced, thereby reducing the cost of the product, material handling costs, and waste disposal costs.
An EMS can help reduce incidents of pollution and the associated expense of recovery.
Recycling manufacturing waste and unused inputs could increase revenues. Recycling need not be within the same facility, but with another one that can use the waste as input to their production.
Employee health and safety can be improved, thereby improving productivity, decreasing sick days, and reducing insurable risk.
Insurance claims may be reduced, thus reducing the costs of coverage and settlements.
This is just a sample of the benefits available to business; the list of benefits and potential benefits is considerably larger.
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Tags: Benefits, Business, carbon reduction, Change, Climate, Corporate, CSR, EMS, Enterprise, Environment, ENVIRONMENTAL, environmental management system, Global, Green, Greenhouse, ISO 14001, Management, Money, Social, Social Responsibility, Solutions | 
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DOES LEADERSHIP MAKE FOR BETTER CSR?
It’s unusual to read something balanced and practical about CSR. Activists want business to carry the wrap for everything. Apologists limit it to immediate operating activities and what the law requires. True, the primary responsibility is to sell sound products that people want, employ and reward fairly and act honesty and responsibly. But, the authors of a recent HBR article offer an insightful approach to the boundary issue of what is and isn’t a company’s responsibility? They make this erstwhile no-man’s land a fertile ground for corporate creative thinking and commercial good sense.
The authors point out that in the 1980s, notwithstanding sound evidence including their own, companies in the tobacco industry were still fighting the link between smoking and cancer. In contrast, over the last decade, the packaged food and restaurant industries have undertaken programs to remove trans fats – entirely at their own initiative. The authors speak of Kraft, Nabisco and Nestle “internalising externalities” – those “impacts that a business has on its broader milieu.” For example, adverse effects on consumers’ health or the local environment.
The authors offer us a politically fair-minded way of thinking about this – encompassing the need for action without going overboard. They give their argument urgency by highlighting the ever increasing level of public monitoring of social impacts through government programs and the huge increase in social networking, search techniques and other activities, which find and spread information (and anger) amongst concerned citizens (and potential litigants).
The authors make distinctions as to how a company should act. Taking ownership where there’s direct causality – as the food companies did. Taking action where there’s some link and you have problem-solving capability as Wal-Mart has done with its buying power to improve product disclosures. Or, taking interest if you see distant ripple effects and can identify others with capability – as Shell has done in supporting research on heat and fuel efficiency for cookers used in poor countries.
Here are some questions to consider. What are the externalities of my business: both close-in and further out. What changes to our thinking and/or business model are needed – and what’s the cost? Who should lead this and develop the plan? What should be our new benchmarks and how will we monitor them? How are we to communicate the program – both internally and externally?
It’s tough and confusing stuff. But the authors offer a sensible view and a helpful framework. My action suggestions may help you find an approach that’s commercial and practical. All better, as the authors put it, than engaging in “an incoherent mishmash of charitable giving, CSR programs, and “going green” initiatives.” Better to act proactively and strategically today than wait to be pushed into a war of tactical skirmishes (and court cases) that will damage your people, your brand and your business.
What Makes a Home a Green Home?
What Makes a Home a Green House?
One of the hottest topics today is about being environmentally friendly. There are many ways to become environmentally friendly about the home including water preservation and energy reduction. This not only helps with a positive action by reducing your impact on the environment, but will also save you money!
Lets take a look at what makes a home environmentally friendly.
Reduced Energy Use
Energy comes in many forms such as electricity, natural gas, oil, etc. The creation or use of this energy results in greenhouse gas emissions that affect our planet in a negative way.
Methods of Reducing Energy Usage
Insulation, One of the best things that you can do to make a green home is to ensure that the walls, windows, attic, and floors are all well insulated and draft free. The majority of the energy used in a home goes towards heating the house. Insulation will prevent the air temperature from escaping the home and save you money on your utilities.
Energy Star Appliances When one of your appliances has reached it’s end of life, or when you are building a new home, consider installing an appliance that meets energy star requirements. This will ensure that it will use over 30 percent less electricity or fuel than a typical appliance of that type.
Other options include advanced mechanical Systems On demand tankless water heaters, geothermal HVAC equipment, and even solar power is a great way to reduce the amount of energy that is wasted to run the plumbing, heat and air, and electrical systems in the home. While they can have a higher upfront cost than a typical unit of its kind, tax incentives from the government can offset a good deal of the extra cost and allow you to make the money back within a few years time.
Reduced Water Use
Water is another essential resource that can be preserved in our day to day use around the house.
Low Flow Fixtures Many low flow shower heads and toilets developed a bad reputation in the past because they could not live up to their less efficient counterparts. Fortunately, todays better engineered models and aerators allow you to experience the luxury and ease of use that you prefer, while additionally using a significantly lower amount of water.
Efficient Clothes Washers Many of the newer front loading clothes washers use as little as half of the water of a typical top loading washer. For families who are constantly putting in a new load of dirty clothes, this can lead to a significant savings in cost and water usage over time.
Use Rain Water For Irrigation For those who want to really cut down on water usage, storage tanks that collect rain water during a storm for latter use to water the garden and lawn can save thousands of gallons over the span of a summer.
These are just a few of the many ideas out there that will help ensure that your home is green. Environmentally friendly decisions in the home can lead to wallet friendly results over time and allow for the satisfaction of knowing you are reducing your negative impact on the planet.
At Be Seen Go Green, we offer solutions for a variety of Environmental issues. Please click on the following link to contact us.
Posted in Carbon accounting, carbon emissions, Carbon footprint, carbon reduction, Climate Change, CO2, computer recycling, CRC, CSR, Edinburgh Recycle, Edinburgh WEEE, eee, Energy, Environmental accounting, Food Recycling, Food Waste, Footprint, ghg emissions, glasgow eee, glasgow recycling, Glasgow waste, Green IT, landfill, Packaging Waste, Recycle Edinburgh, Recycle UK, recycling, UK Recycle, UK WEEE, Uncategorized, Waste management, weee, WEEE Edinburgh, WEEE UK, wheelie bin | Tags: Change, computer recycling, eco house, edinburgh green home, Edinburgh Recycling, Efficiency, electrical waste recycling, Emissions, Energy, Environment, ENVIRONMENTAL, Footprint, Glasgow green home, glasgow recycling, Global, Going, going green, Green, green home, green house, Greenhouse, Home, House, London green home, Makes, Management, Money, Power, Responsibility, warming | No Comments »
Importance Of Csr And Business Ethics
1. Importance of CSR and Business Ethics
Corporate Social Responsibility (CSR) and business ethics have grown considerably in developed and developing countries over the past decades. The CSR and Business Ethics are concerned about the caring the human beings and its society. Because of this, CSR has emerged as an unavoidable concerned to the leaders of every nations. Still efficiency could not be gained as targeted.
The growing importance of business ethics and CSR in recent years has helped in “promoting the human rights in China” and it can be important to raise the interest “awareness on corporate, labour, social and environmental practices” as per Backgrounder (2008). This is the reason why the Communist Party enacted the Labour contract Law in 2008 in order to provide minimum protections to workers.
Development of human rights, labour standards, environment and anti-corruption is essential elements in business as stated in the “10 Principles in Business Activities” by the UN Secretary-General Kofi Annan at the World Economic Forum on January 31, 1999.
Corporate Social Responsibility along with business ethics plays significant roles in the success and failure of the business. CSR plays an important role in forecasting and decisions making. Kitzmueller (2008) focus on the CSR as an essential building block of the firm’s strategy. The study further added that the investors based their investment decisions not only on financial but also on social and environmental performance criteria. The importance of CRS is gradually rising day by day and general people are more aware on this issue.
2. Political Perspective of CSR
The need of CSR is rising from the past decades. The people who share the power at top level are gradually taking the issue of CSR in their interest. Each and every responsible people including stakeholders, government are taking the various issues of corporate social responsibilities in a serious way. Political and business people are doing it for their own interest and prospects.
According to UN (2007), “The concept of Corporate Social Responsibility (CSR) aims both to examine the role of business in society and to maximize the positive social outcomes of business activities.” The study further made analysis on the why developing country governments should be interested in CSR. The study made analysis on two reasons for low income countries to engage for Corporate Social Responsibility (CSR). They are “defensive and proactive justifications which are not mutually exclusive”. Defensive justification is more related to minimizing the adverse effect of CSR on local communities, environments and markets. The study further deals on the example of Vietnamese garment and footwear industries on increasing national competitiveness through improved CSR practice. Vietnamese Chamber of Commerce and Industries (VCCI) provide the CSR support trainings on CSR skills and practices as a result the company is able to receive the Corporate Social Responsibility Award 2006. The study gave more focus on the importance of government to provide CSR training to its companies to increase its competitiveness because the foreign investors basically bring the expertise knowledge with them from the abroad. It is necessary for the local companies to compete them.
United Nations Industrial Development Organization (UNIDO) has been working in the field of CSR especially for developing countries. The organization is contributing to make the individual and cluster companies of developing countries to compete with foreign multinational companies in the field of CSR. UNIDO (2006) says, “CSR has frequently been misleadingly equated simply with ‘corporate philanthropy’ and ‘charitable giving’, which in turn are often separate from their core business and without an underlying strategic plan behind it”
There are many cases where that the CSR has failed in recent days. Despite of positive views, there are alternative views that show CSR policies have no real impact on society and people. The political systems and business man are just bringing the new issues to highlight themselves and coming to the media and among the people. The study of Gill (2007) made criticism on CSR as “ill defined”. The study focused on the lack of validity for measuring the CSR. The studies of Doane (2005, cited Gill 2007) view CSR by stating the “political complexities”. The study further states CSR as a “myth” and argues on the corporate moral obligations and licence given to operate the business by the political parties. This shows that the CSR can harm the societies by creating the competition among the business houses. This leads to negative effect on society and corporate governance due to the lack of transparency on “corporate decisions, social activities and policies” as per Crane and Matten (2007).
3. Debates on Corporate Social Responsibilities
CSR holds many issues of debates. Different organizations and environmental rating agencies are keeping more records and track on the issues that the organizations and political parties are making. Most debates are more concerned about the transparency policy of the organizations. CSR has become a tool for defending the competitors.
On the other hand, government is no more proactive like in the past. The study of Ascoli (2009) explains that the government involvement is increased when a global economic crisis took place. The study focused on sign of more “good governance” in CSR practices.
In the words of Ascoli (2009), “Government led CSR promotion faces several challenges” The study states that the effort for promoting CSR for the companies as a volunteering action do not guarantee proper implementation.
It is hard to match the interest between the general public and private organization as the CSR the managers have to focus on attaining a balance between the stakeholders and strategic planning. It is sometimes debated by the organization that the private sector should purely involve in profit maximization and government should only think about the social and environmental issues.
United Nations Industrial Development Organization (UNIDO) has been working in the field of CSR especially for developing countries. The organization is contributing to make the individual and cluster companies of developing countries to compete with foreign multinational companies in the field of CSR. UNIDO (2006) says, “CSR has frequently been misleadingly equated simply with ‘corporate philanthropy’ and ‘charitable giving’, which in turn are often separate from their core business and without an underlying strategic plan behind it”
4. The Responses of Companies to CSR
The ample of studies and research works on CSR show that the companies and politicians are positive towards the CSR. They are forced to adopt the policies of CSR for defensive reason in order to be secured in the market. CSR clearly impacts our corporations, society, and educational organizations. It provides a powerful driver for continual efficiency across the national boundaries.
Each and every activity that the organization does can have the ripple effect. The company should take account of such effects and work for the mutual benefits of the two parties. The Figure 1 shows the detail analysis of Ripple Effect as suggested by Marsden and Andriof (1998, cited Zappla 2003).
The Coca-Cola Company claims that they are concerned about the business ethics and CSR. The company has published the 2006 reports stating that the water use ratio has been decreased than the previous years. The company has given more focus on the environmental issues by stating the use of waste water after proper treatment. The company is also proud to announce the refillable packaging system. For this it has already opened the recycling plant in Austria. During the economic crisis, usually firm are ready to help the people and communities on growth and welfare in the sake of creating future customers. Coca-Cola companies is doing this for creating the values for stakeholders and societies by bring new concept like “Going Green”.
Governmental organizations are increasingly focusing their attention on Corporate Social Responsibility (CSR) practices. According to Maloni (2006), “CSR continues to evolve in practice, and its reach now often extends to supply chain partners including suppliers, customers, and logistics providers.” The study gave the example of failure of CSR adopted NIKE regarding the “sweatshop labor issues and its overseas suppliers.”
5. Conclusion
CSR, due to social activities, much attention is given. It enables political and business people to acquire the targeted result quickly. It has become the tool for future prospects of different groups that facilitates receiving the fame in near future.
In underdeveloped and developed countries the growth of CSR has been widespread in recent times. Despite of the controversies, the political elite of the world are continuingly raising the issue of CSR stating the important implications for economic activities although they fail themselves. They are selling the policies for popularity. A study by Hertz (2001 cited Crane and Matten 2007) and Smith (1990 cited Crane and Matten 1997 ) argued that there is more power in individual choice as a consumer than in their choice in the ballot box and consumption choices are for “purchase votes” in the public control of corporations.
Online Corporate Social Responsibility – The Latest Trend
Corporate social responsibility has moved from being a buzz word in management books to an important aspect of business activities. The concept of CSR is vague for many; however, it generally refers to the connection of business decision making with ethical values. Even though the modern society rests on the pillars of governance and ethics, the distinction between social role and business motive of an organization cannot be denied.
Publishing CSR reports can have tremendous benefits for any company as this affect its reputation and branding in a positive manner. Advancement in technology has led to the popularity of online corporate social responsibility reporting. With the Internet becoming an interactive platform for communication, online CSR reports can help business organizations expand their reach. Many companies are focusing on the maintenance of a significant profile on the Internet. The need to update latest information for the stakeholders and sharing good work initiatives with a wider audience has become order of the day.
The concept of using the Internet to share corporate social responsibility reports and programs has gained tremendous popularity in the last few years. Companies are cashing in on the scope and access of the latest technology despite being active through their community based projects. A section of their website is especially dedicated to CSR reports for the interest of far reaching audiences. BITC (Business in the Community) is one such company that has been taking advantage of online resources for the implementation of its corporate social responsibility programs.
Companies need to keep analyzing the sustainability section of their website on a regular basis. They need to keep a track of how many visitors browsed through the CSR report in a month. In case the figure is low, they need to come up strategies to make the report accessible to readers who might find the report interesting but are not visiting the website. It also helps to figure out who reads the sustainability report. This might help the companies generate better reports and also include a feedback mechanism to start a dialogue.
Responsibility of the Corporate
What ever one does for the good cause of the society it needed to look back and monitor the situation, weather it is actually fulfilling the intention or it is just lying on the papers. As a person who has given thought a shape for upliftment of the society and oneself, it is our up most duty to keep checking the same, in terms of progress of the desired changes if needed.
For the same purpose there was a visit of Mr. Bill Gates the founder and Chairman of Microsoft Corporation and Bill Gates Foundation in India very recently. Bill Gates foundation is actively involved in various activities related to upliftment of the society across the world and provides funds and the assistance to remote corner places of India too. He Visited city called Amethi in the state of Uttarpardesh. Amethi is very popular place in India as the political representatives of Amethi, mostly belongs to Gandhi family for the past many decades and the Gandhi families are the pillars of Indian politics in India. As the largest political party of the country, and they are the one who have carried Indian tradition legacy for past many years and will continue in future too.
Indian National Congress is most respected political party in India, as the congress party is known to many peoples in the developed countries of the world. The principles of the party’s are totally different from the others like BJP, Janata Dal or the communist party (In India). The National Congress Party of India takes complete responsibility of upliftment the society and its related concerns. As the leader of the reputed member of the political organization and traditional experienced person, Mr.Rahul Gandhi was with Mr. Bill Gates through out the Amethi tour. He was doing the best as a leader to support another leader from the corporate world to provide all the necessary assistance to help the corporate visitor and show him the gesture of Indian tradition heritage.
The heat and the dust of Uttarpardesh at the present climate in the month of May one can imagine as how Mr. Bill Gate have manage the tour, as he is not Asian ethics by birth or the experience of this type of climate. Respecting to the corporate leader and social responsible person it was Mr.Rahul Gandhi’s duty to give the traditional value, simultaneously to be present with him to the Amethi.
It was his gesture that he manages to take out time from his busy schedule and traveled with Mr. Bill Gates and provided the required necessary assistance. He even did the language translation for Mr. Bill Gate as the local people were asking the questions in Hindi or their native language.
We need to learn from our leaders of such, as how improve our behavior and our responsibility towards the society. The Best Part is to learn as, how to implement and manage such things, despite heaving busy schedule.
As a responsible person one shouldn’t leave the things after kickoff, but we need to keep monitoring the developments on time to time. It is not possible to do the same on a daily basis by the people who are attached with the corporate world, because their responsibilities are diverted in many directions, but it can be manageable to access the situation and further directions.
Corporate Responsibility: The Answer to the UK Job Crisis
As the G8 summit in Italy draws to an end it is apparent that the top issues discussed, remains to be the three biggest issues around the world: the current economy, global warming and world hunger.
Their final draft statement seen by Reuters, addresses these different issues and their solution to it.
“We are committed to increase investments in short, medium and long-term agriculture development that directly benefits the poorest and makes best use of international institutions,” the statement said.
While the richest countries in the world debate these issues, big corporate companies around the world have been trying for years to improve them in some way or the other.
Corporate Responsibility (CR), formerly known as Corporate Social Responsibility (CSR) has been placing big multinational companies under extraordinary stress to honour and support the triple bottom line of people, planet and profit.
According to the UK Government’s Corporate Responsibility Report, CR makes business sense.
“Good business leaders recognise that Corporate Responsibility makes good business sense – it attracts the best talent, earns the trust of customers and the community and acts as a powerful investment for long-term sustainability,” said Ian Pearson, Minister of State Department for Business, Enterprise and Regulatory Reform.
While countries around the world battle with one or all three issues as well as new concerns manifested from them, one of the biggest problems the UK is currently facing is the growing unemployment rate.
According the Office of National Statistics, the UK had a staggering two million people out of a jobs at the end of 2008 and in the last three months the unemployment rate rose from 6.5 pc to 7.1pc.
Corporate Responsibility takes on a new and more intense role when it demands job creation and skill training during the current economic climate.
Tesco’s plans to expand a store in Barton-Upon-Humber leading to the creation of 50 new jobs in the area, is an example of the kind of CR the UK job market needs.
Residents of Barton-Upon-Humber has responded positively towards their plans and corporate affairs manager, Nick Gellatly said that although recruiting will only start in next year, people from the area have already enquired about it.
“Nearer to the time, we will talk to the Job Centre Plus and set up a Local Employment Partnership to make sure that local people have the best possible chance of getting a job and people who have been unemployed have the best chance of getting a job,” he said.
Another example of this is with Sainsbury’s new store in north Essex where 23 new jobs were created.
The store in Halstead’s High Street was previously a Somerfield store and through the Sainsbury buy-over 70 jobs were safeguarded as well.
“We’re proud of our new store but the best part is meeting the local community. Everyone’s so friendly and we’re looking forward to making a positive difference,” commented Andy Deacon, Store manager.
Companies show their participation through endeavours like these, with on-going charity support or with projects like Vodafone’s Lifetracks programme.
The Lifetracks programme focuses on the youth of the UK, empowering 16-25-year-olds with the knowledge to make informed choices about work, study and training.
The programme involves engagement teams, workshops, help lines, a website and volunteers.
Vodafone’s aim with this programme is to assist 720,000 UK youngsters over a three year period and help 70pc of them into employment, education or training.
Vodafone has also created 3600 jobs in Berkshire at their Newbury HQ and spent £12m on products and services from West Berkshire’s local suppliers.
While the economic climate is currently a daily issue it does not mean that the environmental climate should take the back-seat until the economy settles down.
Natural disasters like floods and earth quakes are a direct result of global warming and will only increase economic turmoil if not pro-actively dealt with.
“This week the G8 nations came to an historic consensus towards concrete goals to reduce carbon emissions,” said US president, Barack Obama.
“Developed nations will reduce their emissions by 80 percent and we will work with all nations to cut global emissions in half. This ambitious efforts is consistent with limiting global warming to no more than two degrees Celsius. Developed countries, like my own, have a historic responsibility to take the lead,” he said.
The good news is that while our big corporate institutions need to focus their CR on job creation, this is not the only focus for some.
Coca-Cola who employ 4500 people in England, Scotland and Wales do their bit for the environment through ensuring that all of their UK manufacturing sites adhere to the highest environmental standards, by being ISO14001 certified.
The largest listed water company in the UK, United Utilities, who maintain water, wastewater, electricity and gas, are trying to improve the environment through their numerous projects.
They are currently involved with a project that turns biogas from sewage treatment into fuel for vehicles.
Another of their projects saved £6.7m through producing methane gas from sewage sludge in order to provide heat and electricity to run sewage systems.
Big corporate companies earn billions each year and to some extend certain global issues, like for example global warming, is as a result of pollution from billions of factories around the world.
That is why big companies owe it to the world to put money back into improving the economy, environment and social issues.
Hopefully the UK will see more CR projects, charity support and most importantly job creation within the next several months as companies start to see the importance of Corporate Responsibility in combating unemployment.
With the prospect of companies in the UK doing their part, citizens around the country can also assist with embarking on their own responsibility projects.
Through making accountable environment-friendly choices, by supporting charities and if at all possible creating a job opportunity for someone who desperately needs one, we can all put an effort into improving an aspect of everyday life.
Sustainability Reporting
Sustainability ReportingSustainable development implies development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs.
Role of Business in Sustainable Development
The business and industry sector has a significant role in promoting sustainable development.
Business must make money; and staying in business and prospering is a fundamental value of any for-profit enterprise. At the same time, business is required to take into account the interests of all stakeholders that include customers, employees, investors, vendors, government and the society.
The late 1990s and early 2000s were turbulent periods for the global investment community, with vast amount of shareholder wealth being created and destroyed. Both the institutional and retail investors have learnt some painful lessons, re-examined their assumptions about what constitute tangible and intangible value, and broadened their scope to consider characteristics that could lead to long term financial success.
One area of corporate performance that has begun to capture the attention of investment professionals is sustainable development:a set of responsibilities that contributes directly to an organisation’s risk management profile and is sometimes also linked with corporate responsibility.
There is considerable evidence that sustainable development contributes to shareholder value in a variety of ways-not only through tangible contribution such as risk reduction and profitability improvement, but also through intangible asset creation such as brand equity, human capital, etc. Operating business by pursuing the sustainable development path strengthens an organisation’s intangible assets in a number of ways that in turn leads to tangible shareholder value creation.
It is now globally recognised that following sustainable development path makes good business sense. This entails various approaches. For example, eco-efficiency is based on a common sense proposition that reduces waste and inefficiency in production processes, saves money and protects the environment at the same time. Life Cycle Analysis (LCA) offers a framework for understanding material flaws and potential impacts involved with providing services or products in a closed loop. Sometimes referred to as cradle to cradle or cradle to grave, LCA looks at an enterprise in terms of input, throughput and output. This helps to identify inefficiencies that drain profit and produce waste including pollutants.
Many of these approaches: e.g. eco-efficiency, LCA, full cost accounting, industrial ecology, systems based pollution prevention, etc. are new to the business world. Businesses keen to benefit from transition to sustainable development path therefore need to prepare themselves and have a longer time horizon and a broader set of goals than traditional companies.
Realisation and recognition of the significane of sustainable developm
ent approach usually starts from the top management. However, best intentions are meaningless if these are only lodged in the minds of a few individuals. Values of sustainable development has to permeate throughout the organisation. Changing a company’s culture and outlook requires a contribution from everyone starting from the chief executive officer and permeating through senior, middle, junior management and staff and all working as a team.
To make this change happen towards sustainable development approach, it is important to:
Prepare a mission statement Form in-house waste reduction and pollution prevention teams Inform employees about economic, environmental and social trends Maintain regular communication lines Have commitment for community development efforts Be committed to honest and accessible public relations Measure and report on progress and performance Prepare annual sustainability reportCorporate Social Responsibility
 Drivers pushing business towards CSR:
Shrinking Role of Government. Demands for Greater Disclosure Increased Customer Interest Growing Investor Pressure Competitive Labour Markets Supplier RelationsBusiness must make money; and staying in business and prospering is a fundamental value of any for-profit enterprise. Companies therefore owe responsibility to their shareholders for improving profitability and enhancing shareholder value. At the same time, companies are required to take into account the interests of all their stakeholders that include customers, employees, investors, vendors, government and the society.
It is in this context that Corporate Social Responsibility (CSR) assumes a significant role. CSR is underpinned by the idea that companies can no longer act as isolated economic entities in detachment from broader society. Traditional views about competitiveness, survival and profitability are undergoing a paradigm shift.
Sixteen principles of Business Charter for Sustainable Development prepared by ICC.
Corporate Priority Integrated Management Process of Improvement Employee Education Prior Assessment Products and Services Customer Advice Facilities and Operations Research Precautionary Approach Contractors and Suppliers Emergency Preparedness Transfer of Technology Contributing to the Common Effort Openness to Concerns Compliance and ReportingSustainability Reporting
As a result of the global upsurge of interest in sustainable development, sustainability reporting system has emerged. Sustainability Reporting means reporting on the economic, environmental and social aspects of organisational performance (also known as triple bottom line). It may be clarified that the term sustainability does not mean that a company is sustainable or that it will continue in existence for any specified period of time. On the other hand, sustainability reporting is designed to provide information on a company’s environmental, social and economic performance and impacts and the initiatives for improving performance in these areas. The World Business Council for Sustainable Development (WBCSB), a coalition of about 175 international companies united by a shared commitment to sustainable development, defines sustainability report as public reports by companies to provide internal and external stakeholders with a picture of corporate position on activities on economic, environmental and social dimensions.
In view of the objectives of sustainability reporting and the audience it targets, the GRI Guidelines provide eleven principles for reporting grouped in four clusters. These are:
Cluster 1: Framework of the Report
Transparency Inclusiveness Auditability Cluster 2 : Decision on What Information to Report Completeness Relevance Sustainability ContextCluster 3 : Quality and Reliability of Reported Information
Accuracy Neutrality ComparabilityCluster 4 : Accessibility of Reported Information
Clarity Timeliness
Contents of an Ideal Sustainability Report as per GRI Guidelines
1.CEO StatementA statement of the CEO or equivalent senior management person describing key elements of the report. It is suggested that the CEO’s statement should include:
highlights of the report content and commitment to targets; commitment of the company’s leadership to economic, environmental and social goals; statement of successes and failures; performance against benchmarks; the company’s approach to stakeholder engagement major challenges in integrating responsibilities for financial performance with those for economic, environmental and social performance and the implications for future business strategy. 2. Profile of the Reporting Company
An overview of the reporting company and the scope of the report to provide a context for understanding and evaluating information in subsequent sections.
This section of the report should include:
organisation profile scope of the report profile of the report3.Executive Summary and Key Indicators
A succient overview of the report
4.Vision and Strategy
Provide the vision of the reporting company for the future and discussion on how that vision integrates economic, environmental and social performance.
It should especially address:
what are the main issues for the company relating to the major themes of sustainable development? how are stakeholders included in identifying these issues? for each issue, which stakeholders are most affected by the company? how are these issues reflected in the company’s values and integrated into itsbusiness strategies?
what are the company’s objectives and actions on these issues?5.Policies, Organisation and Management Systems
An overview of the governance structure and the management systems that are in place to implement the vision. Central to this section of the report is a discussion of stakeholder engagement.
6. Performance
Performance should be addressed across social, economic and environmental areas of impact and activity as well as on an integrated/cross-cutting basis, if possible
7. GRI Content Index
A table identifying location of each element of the report content by section and indicator.
Relationship Between Sustainability and Financial Reporting.
Sustainability reporting communicates a wide range of subject matter about environmental, social and economic impacts arising from a company’s activities, products and services. Economic impacts include but are not limited to financial performance in meeting the expectations of investors and lenders. On the other hand, financial reporting communicates about a company’s performance in creating value for investors and its accountability for monetary resources invested in it. Sustainability reporting and financial reporting both communicate about risks and intangibles, but do so in ways that are different and partially complementary.
Sustainability Reporting has the potential to provide critical information for business analysis that is normally absent from financial reports. These information facilitate financial reports with forward-looking information that could enhance the report users understanding of such key value drivers as human capital formation in the company, corporate governance, management of environmental risks and liabilities and the capacity to innovate. It provides insight to support business analysis and has relevance within the framework of traditional financial reports.
By consistently measuring sustainability performance, companies could strengthen both their internal business practices and their external communication. The succeeding paragraphs briefly outline how the advantages of sustainability reporting could strengthen translating sustainability information into the language of financial analysis.
Increased process efficiency is an example of a proven sustainability strategy for decreasing cost and improving profitability. Opportunities to reduce costs or create revenues through increased yield and sale of waste streams exist throughout the value chain of a business and could offer significant benefits.
Cost analysis could be greatly enhanced by a holistic approach to assessing risks and uncertainty, which have strong links to environmental and social concerns.
Sustainability initiatives and strategies also provide opportunities for product differentiation a key component of competitive advantage. Companies could reposition their products and services as part of their attempt to reduce their environmental or social impacts. In the process, this would help differentiating their products and services in a manner that would enhance their competitive position.
Other intangible assets such as intellectual capital, ability to innovate, investment in research and development and networks and alliances are integral to analysing a company’s financial prospects. These assets are influenced by the company’s commitment to training, skill development, employee relations and employee turnover a foci of social performance indicators in sustainability reporting.
Innovative partnership with stakeholders around environmental or social aspects of products or markets could lead to product differentiation and brand enhancement.
In other words, ample opportunity exists to translate sustainability information into a form that speaks to the needs of the financial analysts. Sustainability reporting offers real value to those whose business is to assess the current financial health of companies and anticipate future performance. At present, the content of sustainability reports tend to appear in forms and units that are not readily convertible into financial terms; but rapid advances in areas such as environmental management accounting, valuation of intangible assets and value reporting promise to make sustainability information useful to the financial community.
Sustainability Assurance
Companies value the overall contribution that assurance makes to the sustainability reporting process. Organisations in the forefront of sustainability reporting assurance also recognise the key role that they have in ensuring the credibility and usefulness of information flows within the organisation, especially from non-traditional and non-commercial sources.
Currently, there are only two recognised professional standards for carrying out sustainability reporting assurance. These are: 1000 assurance standard developed by the Institute for Social and Ethical Accountability; and ISAE 3000 provided by the International Audit and Assurance Standard Board which is a part of the International Federation of Accountants. ISO2600 is about to be launched as the international standard for CSR
Trends in Sustainability Reporting
Sustainability reporting has become a common practice in a number of countries like
the USA, Europe, Japan and Australia. Sustainability reporting is yet at an emerging stage in Asia, Latin, America, Africa and Russia.
Though sustainability reporting is not mandatory in India, a small but a sizeable number of both subsidiaries of multinational and local companies are preparing sustainability reports mostly based on GRI guidelines. However, majority of these companies are focused on community initiatives rather than governance risk and disclosure.
With globalisation, Indian companies are increasingly realising that they have much to lose by not following sustainability reporting norms. Indian companies now see sustainability reporting as central to corporate social responsibility with passive philanthropy no longer a sufficient response to rising expectations.
Conclusion
The goal of sustainable development requires that the businesses take responsibility for their social, environmental and economic impacts. Sustainable development can provide business with an opportunity to innovate and a means to grow at each level and step of business operation. Making the right choices within a company, whether it is newly exposed to the concept of sustainable development or is already advancing its sustainability agenda, contributes to the company’s long term success.
It is a matter of making the right choices and setting the right priorities. This underlies the need for a positive mind set towards sustainable development. Wider the spread of sustainability, greater the chances of its success. In order to attain this, rising awareness and hence education, is key.
Corporate Social Responsibility in Textile Industry
The concept of social responsibility is a fairly recent one in the business world. Awareness about the social responsibility of business organizations is rapidly on the rise and firms are also accepting this concept. The textile industry is no exception. Textile producing and trading firms are also realizing their responsibility towards the society and the environment. This article aims at analyzing the concept of social responsibility and the common ways in which textile firms try to fulfill it.
What is social responsibility?
Social responsibility is “an organization’s obligation to maximize its positive impact and minimize its negative impact on the societyâ€. In other words, it is “the concept that businesses should be actively concerned with the welfare of the society at largeâ€.
The concept of social responsibility is applicable to individuals and governments as well as organizations. The social responsibility of an organization is referred to as ‘corporate social responsibility’.
Social responsibility can be broadly divided into two parts: human responsibility and environmental responsibility.
Human responsibility refers to the responsibility of the organization towards the various parties associated with it, which are known as ‘stakeholders’ in business parlance. These parties include employees, shareholders, the government, customers, investors, suppliers, competitors and the society at large.
Environmental responsibility refers to the organization’s responsibility towards environment protection.
The concept of social responsibility holds that an organization should work in a manner in which the interests of the stakeholders are protected or, at the very least, they are not adversely affected. It holds that the organization should work in an ethical manner and work in the best interests of the various parties associated with it.
The realm of social responsibility extends beyond the legal responsibilities of an organization. It is voluntarily fulfilled by the organization.
The concept of corporate social responsibility has been criticized by certain experts, who believe that it is a cynical and selfish idea. They are of the opinion that corporates undertake projects for social welfare only because of the increase in reputation that they would get due to them.
Social responsibility in the textile industry
Like the firms in other industries, textiles firms are also realizing their responsibility towards the various parties associated with them and the environment. However, the ways by which different organizations choose to fulfill their social responsibility might be different.
The ways in which a textile firm can fulfill its responsibility towards various parties are similar to those of firms in other industries, as is evident from the points mentioned below:
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Gordon Gekko: No Longer A Big-Business Hero
Socrates once said “Virtue does not come from wealth, but wealth, and every other good thing which men have, comes from virtue.”
In the 1987 movie Wall Street, Gordon Gekko’s character famously said “Greed is Good”
In 2010, you would be excused for thinking the corporate world is likely to have more in common with Gordon Gekko, than a 400 BC philosopher.
But the continuing strength and focus on Corporate Social responsibility (CSR), by businesses across the globe, seems to indicate our modern age may just be on the path to a more virtuous one.
CSR is the notion that decision-making in corporations can and should take into account the impact of their actions on communities and the environment.
It’s been around for several decades, and is also referred to often as the triple bottom line; people, planet, profits or more recently as Corporate Sustainability.
Whatever you call it, it has not really been until now that I’ve started to get the feeling CSR is finally going main-stream.
Businesses of all sizes are now making key investment & supplier decisions with an eye-out for the “ethical street-cred” of the action.
The cynics amongst us may think this is more about trying to manage corporate reputations in a highly inter-connected and wired world, than any genuine motivation to make the world a better place.
As an article in CCNMoney recently noted : “in a world where disgruntled employees and unhappy customers can trash you globally in the time it takes to dash off a nasty blog…, it’s becoming much harder to manage reputation…”
CSR is taking hold because it works on many levels.
First,employees. It’s easier to advocate for your company if you trust them, and its even easier if you are actually proud of them because of specific policies, programs or actions they take which contribute positively to society.
Happy employees work hard, stay with the company, advocate and innovate.
Second, customers. Businesses that damage the environment or the communities around them may loose customers. Conversely, those that take a more holistic approach can attract customers. Just look at the Ben & Jerry’s Ice Cream story. The two-man, “hippy” ice cream business started in 1977 with strong values about the environment and the community. It sold in 2000 to Unilever for around $US 326m with thousands of existing customers all over the world.
Third, money. Let’s be crass. Being ethical pays. If the Ben & Jerry’s story didn’t prove it, take the example of Marks & Spencer, the UK retailer. In 2007, M&S pledged over 200 million pounds over 5 years to their “Plan A…. because there is no Plan B” CSR strategy.
By 2009, M&S reported that the energy and waste cost savings alone had already made the plan cash positive. Importantly, according to research by the Reputation Institute, Plan A had also made M&S the most reputable brand in the UK.
So if happy, retained employees, new customers and cost-savings sounds like something you might be interested in, CSR might just be your thing.