CSR and Social Responsibility Social Responsibility Ethical viewpoint

CSR and Social Responsibility

Social Responsibility � Ethical viewpoint that says every individual or organisation has an obligation to benefit society as a whole � Responsibility in the form of › Passively avoiding actions that could harm the environment › Actively take steps to benefit society

Corporate Social Responsibility Continuous commitment from a business to act ethically and contribute to economic development � Basic principals of CSR: � › Businesses accept responsibility for their impact on society / nature › Businesses act in a responsible manner › Relationship between businesses and community are effectively managed (remember the triple bottom line? )

Corporate Social Responsibility Pyramid Philanthropic Be a good citizen Ethical Do what is right and fair Legal Obey the law Economic Be profitable

CSR Benefits and Challenges #clarifytheconcept

Benefits to Business Increased awareness Meeting expectations of customers and suppliers Competitive Advantage Human Resources (recruitment & retention) Risk Management (future reputation) Brand Reputation Licence to Operate (Governments approval) Aligning with Good Corporate Governance (Kings Code) CEO & Board Interaction with projects

Challenges to Business How CSR fits into the purpose and nature of the business Motives for having CSR programmes Sincerity of CSR programmes in a business Triple bottom line

Benefits to Communities Charitable Contributions Employee Volunteer (Businesses support Programmes locals) (Encouraging employees) Corporate Involvement Product Safety & Quality

Challenges to Communities Profit driven focus (Not enough effort is put in CSR) Lack of enthusiasm and dedication (Community reliance) Motivation of projects (sceptical and question motives behind programmes)

Components of CSR

Corporate Social Responsibility Components CORPORATE Accountability , Transparency & Compliance with in the law to meet objectives GOVERNANCE CORPORATIVE Involvement in organizations that are run by a particular profession BUSINESS ETHICS Integration of core values into businesses policies, practices and procedures ETHICAL PRACTICE Derived from business ethics, it constitutes a businesses decision to apply ethical rules within the company WORKPLACE & Ensures a good work-life balance and ensure employees are attracted to stay with the business LABOUR for a longer period RELATIONS

Corporate Social Responsibility Components INVESTMENT PRACTICES Companies are encouraged to invest in CSR objectives EMPLOYMENT Equal opportunity and diversity in the workplace all indicate the health of a good CSR practice EQUITY SUPPLY CHAIN Correct use of strategic position to influence the entire supply chain to implement CSR practices CUSTOMERS Not only concerned with cost & quality, but an increasing importance to produce green products/services ENVIRONMENT CSR requires businesses to go beyond the minimum requirements to protect the environment

Corporate Social Investment

Corporate Social Investment Projects that are not part of the normal business activities � They are designed and aimed to benefit the community � The original aim was philanthropic but later moved towards improving the reputation of the business How to implement CSI? � Invest a % of profits in a community project � Give money to school , charities etc. � Uplift staff members through training or offering bursaries to employees children � Hands-on projects within the community � Involvement in sport development �

Corporate Social Investment Sustainability Stakeholder Engagement Enlightened self-interest Responsible Business Practice CSR Triple Bottom Line

Corporate Social Investment Five main elements of responsible business practice? 1. Environmental 2. Community / social 3. Workplace Practices 4. Marketplace and Business Conduct 5. Ethical Governance

CSI Challenges � Conflict of purpose › Businesses must make a profit and anything else businesses do is a waste of time � Perceived actual benefit to the community › Businesses seem to benefit more � Consumerism cynicism › Consumers are not easily convinced that businesses even care about them or the environment � Reversible benefits of CSR › Economic conditions help CSI ( good = happy CSI , Bad = you get the idea )

CSI Benefits � The broad categories that recognise businesses benefits to business that exercise responsible business practice: › Reputation management & competitive advantage › Strengthened social approval to operate › Employee satisfaction › Risk management › Access to capital › Financial performance › Minimised environmental impacts › Long-term perspectives

Legislative Requirements � Employment Equity Act � Skills Development Act � Black Economic Empowerment