As we focus on the “triangle” of reputation, relationship, and responsive rectitude, we get a clear picture of the conditions and strategic presentation of organizations engaged proactively in the CSR movement. We have much to learn from scholarly literature. And, we can gain insights from heavily engaged organizations. There is a growing commitment to not view profit as being at odds with CSR. In fact, if we focus on doing the right thing and thinking about sustainable business activities as sustainable environment and markets, we come close to finding our directions on this crucial theme.
One of the assumptions used by advocates for corporate social responsibility is that organizations with better reputations enjoy competitive advantage over those with lower or inadequate reputations. Or, this theme might be fashioned as advocates of reputation management champion it: One of the advantages of achieving and being perceived to have achieved corporate responsibility is a stronger and therefore more rewardable reputation. This stronger reputation can lead to profits and defend the organization in times of crisis and during public policy issue battles.
Is this theme a chicken or the egg question? Does reputation result from the ability of each organization to know, aspire to meet, and ability to satisfy higher standards of CSR? Will those standards depend also and perhaps more so on what each key public expects? If the organization believes it deserves a favorable reputation, how does it communicate in ways that take full advantage of that claim? Thus, can one public or market believe a business has a reputation based on high CSR policies and operations whereas another might believe it falls short? Also, if the organization’s reputation is manufactured to seem more responsible than it actually is in its policies and operations can that discovery lead to crisis? Can a “good reputation” be manufactured and sustained despite organizational policies and actions that are contrary to the reputational claims?
Concern over reputation, ethics, and strategic management is a timeless topic. One of the major sources of this discussion, from a strategic management perspective, is the work of R. Edward Freeman (1984; 1988) who popularized the concept of stakeholder identification and participation as being central to strategic management. This work is two decades old, but relevant to today’s discussion. Management theorists such as Freeman, as have many authors about public relations and issues management, pinned post WWII controversies as the connective tissue for interest in strategic management, stakeholder participation, and CSR.
The basic idea of corporate social responsibility is simple. Firms are social entities, and so they should play a role in the social issues of the day. They should take seriously their “obligations to society” and actively try to fulfill them. (Freeman & Gilbert, 1988, p. 89)
Rejecting the thinking of Milton Friedman as narrow and acknowledging concerns voiced by CEO’s working operate in a new opinion environment, Freeman and Gilbert (1988) offered several axioms of strategic management, including this one:
Effective strategy will be formulated and implemented if and only if each player successfully puts himself or herself in the place of other players and endeavors to see the situation from the others’ perceptions. (p. 91).
Simply stated, authors such as these can’t imagine a means for creating the strategically viable organization imagined by Milton Friedman, such as a business, without sensitivity to sound social principles and business practices implied in the serious engagement with stakeholders over standards of corporate social responsibility.
As we continue our discussion of CSR, we can find at least three competing themes or challenges and no universally accepted definition. One of the themes of effective CSR focuses on the positive associations that result from its strategic philanthropy as it is known to key publics and markets. A second theme features management choices that can be judged to reflect and meet or exceed stakeholder expectations for an organization to be regarded as socially responsible, for its commitment to sustainability or environmental impact, for instance. Third, emphasis on the “social” in corporate social responsibility can all on businesses, for instance, to end social problems such as poverty. Another point of discussion can result as CSR is viewed as resulting from management decision making and operational excellence as opposed to being a communication challenge: How well the organization communicates with and relates to its stakeholders.
Drawing these themes together, but not concurring that all actually count for the assessment of CSR performance. It seems that we can conceptualize a triangle that consists of three R’s: Reputation, Relationship – especially that which is mutually beneficial, and Responsive Rectitude. Broadly applied, these terms constitute focal topics for discussing and measuring CSR performance.
Duhe (2009) explored one way to look at the relation between reputation and CSR. Social responsibility, together with management quality and financial soundness, is conceptualized as an essential attribute of reputation, which is found in that study to have a positive relation with firm financial performance.
In its recent report “What’s the ROI from Citizenship Activities?,” the Reputation Institute http://www.reputationinstitute.com/ made the following observation relevant to measuring CSR:
The need to use a credible measure: CSR professionals have the opportunity to take the initiative to integrate the importance of trust across the business. A way to do this is to understand that citizenship activities build trust – and improve reputation – with stakeholders from across the business. At Reputation Institute we measure reputation as fundamentally being a level of trust, admiration, good feeling and overall esteem that stakeholders have towards a company. We know citizenship activities are a key driver of this trust and a company’s reputation.
This approach does not fully address the reservation of CSR critics such as Robert Reich who argue that CSR claims, especially self-laudatory statements by corporations, are masked efforts to seem good as a strategy for reducing criticism. Reduced criticism might lead to decreased regulation, legislation, and even litigation that would raise standards of CSR performance. One can note many instances, even self-serving awards, where businesses and other organizations congratulate themselves for achieving what they allege to be CSR. Is this solid management practice or facile market positioning?
During 2009, the CSR part of EKP invited business/management strategy recommendations, standards definitions, performance measures and qualities of trustworthy messages that can create stakeholder confidence that businesses and other organizations know and are willing and able to meet appropriate CSR standards.
To that end, we raise some questions:
1. Do we assume that efforts to meet CSR are on a continual upward trajectory, or do they plateau?
2. How and in what way are CSR standards specific to industries, non-profits, and government agencies?
3. Do standards require independent, third party endorsement and verification?
4. Do platitudes obfuscate standards and their achievement while deflecting criticism?
5. Is doing well by doing good a hollow or guiding theme in constructive efforts to achieve, measure, and report success with CSR?
Reputation is a two edged sword, and central to two themes that drive CSR discussions and best practices.
• Can and therefore does a “good” reputation mask a reality that once revealed leads stakeholders to conclude that either the organization or industry does not in fact set and meet laudable standards of CSR as either alleged or assumed?
• The banking industry, as revealed by the 2009 economic turmoil, may have helped create and enact standards of operation that benefited companies and executives while eventually harming individuals and the general taxpayer. Was the industry scrupulous in setting and maintaining standards of operation that protected stakeholders or did it merely assume risks which once manifested into crisis were unmanageable without government intervention? Some critics have argued that executives especially, and for a while the companies, benefited from taking and creating risks which they could not manage once strains opened in their operations.
• Toy companies, some more and others less or not at all, sold or at least attempted to sell products that contain lead or other harmful substances. Even though they knew that their brand equity was on the line ultimately, some tried to shift the blame to manufacturers. The public actually does not care who created the problem, but who should not have allowed the problem to occur. Thus, if a toy company assumes responsibility for the safety of products as part of its reputation, does it not also take on the burden of testing or having independent testing to assure that harmful products do not get into the hands of customers?
• Do industries and individual companies work to create reputations that presume that they serve one interest, even though it is or might be operating at the expense of another interest? Coal mining companies have engaged in unsafe mining practices and environmentally harmful practices as a rationale for keeping the cost of an end product, such as electricity, “as low as possible.” Such companies’ reputations feature only part of the whole standard by which the reputation might be judged. They feature one part on the proposition that it overweighs, and even masks, other aspects of their activities, business planning choices. And, they craft their reputation to present themselves as serving a high interest, such a cost maintenance.
2009 is a year of particular interest; the problems with the USA economy, and the ripples it caused around the world, have at times revealed seams in the fabric of corporate responsibility worth examining. Labor costs are often attributed as the reason companies are not competitive. Less likely to be explored are unwise management decisions or the extraordinary salaries and bonuses of executives even at a time when their companies are failing or not generating rewardable profits.
Some companies and industries are pressing CSR themes in this period of economic transition, others are continuing to define, refine, and proclaim their standards. They have continued or made advances in measuring corporate responsibility.
Agencies and Associations that Establish and Monitor CSR
Through efforts by government and as well as voluntary or sponsored associations, standards get set and implemented. Some of these standards offer leverage for profitability, especially if competition revolves around certain standards.
Energy and housing themes in 2009 brought renewed interest in green building. This theme allowed claims and advances by architects, engineers, builders, manufacturers, software companies, and community designers/developers.
Websites, such as CSRwire (http://www.csrwire.com), provided access for discussion and advice on a range of topics. Accessed on April 13, 2009, it included the following:
Where Green Building Professionals Go to Compare Notes
LEEDLoop is the #1 community and resource for Green Building Experts in all fields. This is the place where people can bring their experiences, questions, successes, and failures. It also allows the opportunity to get specific answers to LEED questions. LEEDLOOP is your day-to-day resource for solving problems, venting about lousy websites, and networking globally within the green building community. Your page on LEEDLoop is customized by you and gives the community a little bit of understanding of what you bring to the table.
Of related interest is this comment posted at CSRwire:
Just because you are a LEED-AP does not mean that you now see everything from the USGBC clearly- in fact, sometimes it highlights the grey areas in the Reference Guide and information provided by a manufacturer.
Example: a (local) flooring company that salvages wood from mills and other historic buildings in the area, ships it to China, makes a thin veneer of the wood and glues it to a substrate, and ships it back to the small local town. The distributer of the company is claiming that the material is Regional and Recycled. What was once Regional as defined by LEED-NC v2.2 is no longer regional.
Through dialogue, topics get featured attention. Discussion occurs. Transparency at least seems to increase. And progress, as well as reputation management, can become more systematic and thoroughly vetted by such sites.
Increasingly, the Web is becoming both a vehicle for championing standards and debating them. The Web also allows a cost effective means for watchdogs to report on organizations that more or less meet them. One watchdog site is SourceWatch (http://www.sourcewatch.org/index.php?title=Corporate_Social_Responsibility), which defines itself as “A Project of the Center for Media and Democracy.” It made a variety of statements worth considering (as accessed on April 13, 2009):
Corporate social responsibility (CSR) is commonly described by its promoters as aligning a company’s activities with the social, economic and environmental expectations of its “stakeholders.” It has become a multi-billion dollar public relations specialty in the business world.
As the discussion continued, cases were offered as evidence for the following proposition:
With the growing popularity of CSR in the last few years, especially in Europe and more recently in the U.S., a number of major PR firms have responded by establishing specialist CSR practice groups within their companies.
As evidence that substance does not sustain claims, the site offered the following observation:
In a review of the role of PR firms in corporate social responsibility programs, Lisa Roner wrote in Ethical Corporation that “many early efforts to communicate on corporate responsibility have been high on production value and low on substance.”
Connecting the topic of CSR and Regulation, as others have done, the site observed:
CSR is often used to promote voluntary corporate initiatives, as an alternative to additional or existing mandatory regulations. The International Chamber of Commerce has aggressively promoted a standards-free concept of “corporate responsibility” that enables companies to proclaim their “responsibility” without necessitating companies to meet minimum standards.
Accordingly, many non-governmental organizations are suspicious of the CSR “movement” as corporate PR or regulation-dodging.” The burgeoning industry known as corporate social responsibility – or CSR … is now seen as a vital tool in promoting and improving the public image of some of the world’s largest companies and corporations,” Christian Aid stated, in its report scrutinizing the record of several major companies. “The image of multinational companies working hard to make the world a better place is often just that – an image … What’s needed are new laws to make businesses responsible for protecting human rights and the environment wherever they work,” Christian Aid argued.
Conclusion: Reputation is a key link in the CSR chain (or CSR is a key link in the reputation chain). However, the chain is no stronger than the weakest link’s ability to withstand critics’ scrutiny. One can conclude that making a case for having achieved CSR standards, or demanding that some frustrate the achievement of others, can be perilous in public discourse and reputation management.
• Don’t make claims that cannot be proved.
• Understand that every claim of CSR performance that is made in the public record is subject to review. It will be examined, analyzed, and compared against each and other organizations’ performance and policy.
• Realize that just making claims that one standard frustrates another standard is not justification alone for a lower standards.
• Don’t make claims or set standards for reputation value alone if they cannot or will not be met.
• Recognize that touting CSR claims, perhaps as part of reputation management, can be augmented when reviewed thoroughly by third-parties, especially non-governmental organizations and government agencies. Realize, however, that such review is not surefire protection. History is replete with cases where irresponsible industries either created or tailored governmental organizations to serve as loyal watchdogs. They have worked to discredit reputable agencies that are in fact public interest watchdogs, and reasoned that the standards were incorrect or ruinous. Moreover, industries have created (and this is a perilous public relations practice) trade associations and front groups (note the two are not inherently the same) to “manage CSR standards and measure compliance.”
NGO’s, Activists, Non-profits, and Other Sources of CSR Influence
In addition to monitoring scholarly articles for advances in academic understanding of the nature and impact (positive or negative, marketplace and public policy) of CSR, we are interested in how it plays out. In this section, we offer, without commentary, examples of organizations whose primary mission is to advance and promote standards of CSR in the public interest.
One of the realities of CSR is that is not the presumed responsibility of business alone. It is also not the product of single voices, but of multiple voices posing questions, challenges, and standards. It results from debates over values and policies, as well as the generation of fact which is analyzed to the interest of society. Its measures and well as means for implementation result from community engaged in risk management.
Even if not specifically stated, most discussants of CSR believe or assume that interest in that discipline has a common root in the activism that arose in the 1950s, 1960s, and matured in the 1970s and 1980s in the USA. To some extent, similar forces were either more or less important in Europe given its varied political economies and history of responsible business practices. The full impact of the global trend has yet to reach deeply and profoundly into Asia, but it will.
As in all matters, no universal response occurred to changing CSR expectations. Some industries either created or polished and readapted existing trade associations. Trade associations are an old business model, and can be constructive to shaping industry standards and working for compliance. They can also speak with a single voice on matters of regulation, legislation, and even adjudication. A full assessment of them, especially by industry, cannot be provided here because of limited space. Generalizations about their positive or negative role on CSR performance are messy and overly broad, but suffice it to say, positives and negatives have resulted, but the collective voice and compliance measures offer solid potential for more good than harm.
Government agencies have been created to foster and implement standards of corporate responsibility. On that matter, the Populist and Progressive responses to the industrial revolution in the USA, what has been characterized as the invention of mass production and mass consumptions, focused on higher standards and argued for various governmental regulatory agencies and standards to implement assure those standards. For instance, competition, pure/sanitary food, helpful rather than harmful drugs, and labor practices are among the several themes that were translated into regulation more than a century ago. Note that many of those concerns and calls for higher standards, with nuances and fundamental changes and challenges, continue today.
Positions on such policy positions and means for their implementation have become hallmarks for differentiating Republicans and Democrats, as well as swinging the Independent vote. What once were local challenges, became state, national, and today international or global challenges. Even passing notice reveals that standards and missions of such agencies, pressed to and fro by activists and trade associations often create changing standards. As well, those who believe in the potency of regulation have to acknowledge that every standard and agency can be changed and even co-opted. As well, industries know the advantage of regulation, and some companies have even used regulatory approval as rationale for defense against product liability lawsuits.
A variety of watchdog organizations, loosely typed as trade associations and NGOs, have developed. One of these is Underwriters Laboratory (UL) (http://www.ul.com/). In its “about us” statement, UL proclaims:
Underwriters Laboratories® is an independent product safety certification organization that has been testing products and writing standards for safety for more than a century. UL evaluates more than 19,000 types of products, components, materials and systems annually with 21 billion UL Marks appearing on 72,000 manufacturers’ products each year. UL’s worldwide family of companies and network of service providers includes 62 laboratory, testing and certification facilities serving customers in 99 countries.
Reflecting on its role in more detail, and noting its impact, it presents the following details:
Our mission: working for a safer world since 1894
• To promote safe living and working environments by the application of safety science and hazard-based safety engineering
• To support the production and use of products which are physically and environmentally safe and to apply our efforts to prevent or reduce loss of life and property
• To advance safety science through research and investigation
• To concentrate our efforts and resources on public safety in those areas where we can make valuable contributions
• To work with integrity and a focus on quality to enhance the trust conveyed by our certification marks
• To charge fair prices that allow us to meet our obligations, sustain our growth, and invest in safety science and education
• To invest in our people and encourage our people to invest in themselves
• To be a good example of corporate citizenship and social responsibility
UL’s global conformity work in 2008
• 20 billion UL Marks appeared on products
• 72,302 manufacturers produced UL certified products
• 93,762 product evaluations were conducted by UL
• 579,684 Follow-Up Services inspection visits were conducted by UL
• 19,535 types of products were evaluated by UL
• 117 UL inspection centers in service
• 98 countries with UL customers
• 447 million consumers were reached by UL with safety messages in Asia, Europe and North America
• 1,362 current Standards for Safety published by the UL family of companies (1,063 for UL; 299 for ULC)
• 64 laboratory, testing and certification facilities in the UL family of companies
• 6,808 employees in the UL family of companies ready to serve UL customers
Worth noting as one of its mission statements is this: “To be a good example of corporate citizenship and social responsibility.” UL uses sound science, independent judgment, collaborative development of standards, and reputation management to advance the cause of consumer safety.
Taking more of an activist position, another organization whose role is worth noting, is the Union of Concerned Scientists: Citizens and Scientists for Environmental Solutions (Accessed June 1, 2009). Its “about us” statement implied standards and commitment to CSR (http://www.ucsusa.org):
The Union of Concerned Scientists is the leading science-based nonprofit working for a healthy environment and a safer world. UCS combines independent scientific research and citizen action to develop innovative, practical solutions and to secure responsible changes in government policy, corporate practices, and consumer choices.
Defining itself as actively engaged in collaboration to bring sound science to bear on public and private sector theme, the organization makes this claim:
In an increasingly complex and technical world, rigorous and objective research and analysis is essential to devise innovative and effective solutions for cleaner air, energy and transportation, to ensure food is produced in a safe and sustainable manner, and to build a future free from the threats of global warming and nuclear war.
Advocating its commitment to collaboration and alliances, this organization works to draw on a vast array of intellectual and policy resources to engage in “thoughtful action based on the best available science [that] can help safeguard our future and the future of our planet.” In 2009, the Union worried under the topic of “Scientific Integrity”:
Political interference in federal government science is weakening our nation’s ability to respond to the complex challenges we face. Because policy makers depend on impartial research to make informed decisions, we are mobilizing scientists and citizens alike to push for reforms that will enable our leaders to fully protect our health, safety, and environment.
In its “about us” statement, the Union observed:
What began as a collaboration between students and faculty members at the Massachusetts Institute of Technology in 1969 is now an alliance of more than 250,000 citizens and scientists. UCS members are people from all walks of life: parents and businesspeople, biologists and physicists, teachers and students. Our achievements over the decades show that thoughtful action based on the best available science can help safeguard our future and the future of our planet.
A Federal agency, the Consumer Product Safety Commission (CPSC) (http://www.cpsc.gov) analyzes products (including toys) to assess whether and assure that they are safe. They state their mission this way:
The U.S. Consumer Product Safety Commission is charged with protecting the public from unreasonable risks of serious injury or death from thousands of types of consumer products under the agency’s jurisdiction. The CPSC is committed to protecting consumers and families from products that pose a fire, electrical, chemical, or mechanical hazard or can injure children. The CPSC’s work to ensure the safety of consumer products – such as toys, cribs, power tools, cigarette lighters, and household chemicals – contributed significantly to the 30 percent decline in the rate of deaths and injuries associated with consumer products over the past 30 years.
As well as testing and monitoring, they work to set standards and create legislation and regulation to that end. They work to assure that the standards created are met by having sufficient and properly trained monitors. They also implore the general public to report incidents of what might be a failure of product safety.
Better Business Bureau (BBB) (http://www.bbb.org) sets, applies, and reports standards of CSR for businesses and non-profits, philanthropic organizations. In conjunction with the leaders of business and the non-profit/philanthropy worlds, BBB has created standards, in large part to protect other organizations, customers, and individual donors from organizations that seem to be better than they are.
Chambers of Commerce The various layers of the chamber of commerce seek to provide information, advice, and government access to consumers and businesses seeking to improve the private sector operations and marketplace conditions. Chamber of Commerce.com (http://www.uschamber.com) offered the following statement on June 1, 2009:
Welcome to Chamber Of Commerce.com, your gateway to a world of resources. Our goal is to help keep you informed as a savvy and knowledgeable consumer.
Our web site contains information for consumers regarding what to look for to avoid being a victim of fraud, how to avoid problems and make better buying decisions.
If you do run into a problem, we provide you the information necessary to resolve and or report your issue to your areas Chamber of Commerce or Better Business Bureau.
We also provide valuable tools for current and future business owners who are looking to be the best and to keep informed what you need to help your business run smoothly.”
When searched on June 1, 2009, The US Chamber of Commerce (http://www.chamberofcommerce.com) provided no single accessible statement on corporate social responsibility. Its programs, however, implied the organization’s sense of CSR for an efficient marketplace. Among other positions, it believes it needs to serve the following functions through its Business Civic Leadership Center (BCLC):
BCLC’s mission is to advance the positive role of business in society. BCLC works with leaders from business, government, and non-governmental organizations to address and act on shared goals.”
Energy: The purpose of the U.S. Chamber Institute for 21st Century Energy is to unify energy stakeholders and policymakers behind a common strategy to ensure that America’s supply of fuel and power is adequate, stable, and affordable, while protecting national security, and improving the environment.
Infrastructure: The Chamber will put money, people, research, programs, and strong political action around a sustained, long-term campaign to rebuild the economic platform of our nation. We will employ every resource at our disposal-our policy expertise, our lobbying clout, our grassroots capabilities, and our communications channels.
Given its mission to foster an effective system of production and provide a functional and responsible marketplace, the Chamber embraces many stances which can be interpreted as balancing the interests of production and consumption. Quality of worklife as well as that of the general citizenry is central to the organization’s mission at all of its levels.
Business for Social Responsibility (http://www.bsr.org) positions itself this way in its “About BSR” statement:
BSR works with its global network of more than 250 member companies to develop sustainable business strategies and solutions through consulting, research, and cross-sector collaboration.
It claims to deliver “independent, leading-edge research and initiatives that help you stay ahead of the curve.”
Corporate Responsibility Officer Association (CROA) (http://www.thecro.com/ accessed June 26, 2009) commits itself to “sustainability in the era of responsibility. One of its themes is “Short term thinking is the enemy of responsible corporate behavior.” It expands on this theme:
The resonance of this message has brought together the leading practitioners of corporate responsibility to create a dynamic organization to define and build the responsible business of the future. Our association is the leading independent forum which provides an equal voice to all aspects of corporate responsibility; Governance Risk & Compliance (GRC), Corporate Social Responsibility (CSR), Sustainability, and Philanthropy.
It mission is as follows:
The Corporate Responsibility Officers Association seeks to:
* Clearly define the role of the Corporate Responsibility Officer as it evolves and matures
* Strengthen the community of practice across all Corporate Responsibility disciplines
* Establish professional development and certification programs that contribute to establishing the profession of the Corporate Responsibility Officer
* Assemble, publish, promote, and maintain best practices for use by the community of members
* Establish methods for verifying and accrediting use and compliance with the established standards and practices of the Corporate Responsibility Officers Association
The list of organizations engaged on the topic of organizational performance is vast. In this review, we make no attempt to capture the totality of such a list or the essence of what all believe to be the standards and value (private sector and public sector) value of CSR. Our purpose is to suggest that standards/measures, market impact, government responsibility as well as that of NGO’s, and the private sector are in constant change. Whether the dialogue leads in a direction to merely protect private sector interests from critics is one matter. Another is whether out of these many collaborative and competing voices we get, sensitive to various political economies, a better sense of what CSR is, how it affects communities through business activities, and whether interests are served beyond those of individual companies.
CSR is necessarily a matter under constant development. It is the product of many voices engaged in varying degrees of heated debate over standards, policies, implementation, and a sense of the good for the total community. The advocacy and counter advocacy can be harmonious and collaborative, or patronizing and hostile.
As professional communicators, partners in strategic management, and stewards of the public interest, public relations has a constructive CSR role to play. By example, the role has not always been constructive. One of the primary determinants of the quality of that role is the interest being championed and the extent to which the substance of claims is transparently offered, vetted, and able to withstand the battles of statement and counterstatement. Can such efforts make society more fully functioning to serve many rather than narrow interests?
Cases: CSR and Communication in Action
The following statements of CSR by a few companies are offered without comment as indicating the sorts of content, tactic and topic discussion that are being placed online by companies. These cases are offered as illustrations for consideration as guides based on CSR principles and challenges discussed in the EKP. Worth noting is not only the situationally relevant differences of approach, theme, and apparent purpose, but also the terms used by each organization to express its views on CSR, In addition to statements by companies, the Web abounds in comments by supporters and critics of the concept and its implementation, as well as enticing statements by consultants seeking work and think tanks working for sponsors. National/international public relations firms also place statements on CSR counseling.
One primary theme runs through the statements. It features the rights and responsibilities to operate profitably in a manner that meets or exceeds the standards of its stakeholders. This is the right to operate. It addresses the responsibility of such operation. Discussions of standards as well as reports (and marketing claims) constitute the rationale and strategic choice of messages and positioning of organizations for their reputation, based on relationships, through responsive rectitude.
The following organizations were accessed on June 2, 2009 through a Google search using corporate social responsibility as the key search term. No effort was made to comprehensively search for and present all organizations’ stances on this topic. The following are part of a thoughtful dialogue shared not as a statement of our judgment or critical assessment but as an opportunity to listen to the dialogue on this topic by bellwether organizations. These organizations have for themselves resolved issues that some academics continue to contest, such as whether CSR is profitable, responsible to shareholders, and more than hype or spin. Full CSR and other non-financial reports are a vital part of the communication efforts of companies such as the following.
Starbucks: http://www.starbucks.com/aboutus/csr.asp “Our commitment to being a responsible company includes our efforts to be open and honest about the successes and challenges we face. Each year since 2001, our reports on our corporate social responsibility efforts — which we now call global responsibility — have told the story of our journey and progress related to Starbucks social, environmental and economic impacts in the communities where we do business.”
Sun Microsystems: http:// http://www.sun.com “Throughout Sun’s history, we’ve implemented programs and practices that reflect our long-held values and address our corporate responsibility. We’re committed to meeting the needs of not only our stakeholders — our customers, employees, investors, and partners — but of the global community as well.”
Eco Responsibility
“Sun leads the industry in offering a portfolio of eco responsible products and services that deliver powerful, sustainable, energy-efficient computing solutions that don’t compromise on capacity and security. Our Eco Responsibility Initiative also focuses on how we run our business, and includes efforts to shrink our carbon emissions, develop an alternative-energy strategy, and otherwise reduce the environmental impact of our operations.”
Business Practices
“At Sun, we strive to bring corporate responsibility to every aspect of our business. We’ve institutionalized strong principles of corporate governance. We support open source initiatives that increase access to technology. And we work diligently to ensure the privacy and security of our customers. We’re committed to managing a responsible and diverse supply chain that’s consistent with our high standards for environmental and business practices.”
Forbes.Com: Is Corporate Social Responsibility Responsible? asked Forbes.com which then answered, “Not if companies spend shareholder assets on unprofitable causes.” (http://www.forbes.com/2008/10/16/corporate-social-responsibility-corprespons08-lead-cx_mn_de_tw_1016csr_land.html)
StatoilHydro Norway: http://www.statoilhydro.com/ addresses the balance of environment and society. Centered on sustainability, their non-financial statements feature environment, safety, society, and health and working environment. On the topic of “ethics,” StatoilHydro makes the following statement based on its values commitment as the core of its management system. Its positioning acknowledges the interests and opinions of its stakeholders:
Our ability to create value depends on maintaining high ethical standards, and we are determined to be known for these.
We regard ethics as an integral part of our business activities, and act within the law and well within our own ethical principles.
We require high ethical standards of everyone who acts on our behalf and will maintain an open dialogue on ethical issues, both in-house and externally. We also expect our business partners to have ethical standards compatible with our own.
Our code of ethical conduct describes the requirements which apply to our business practices.
Together with our values statement, it constitutes the basis and framework for the values-based performance culture we want to develop.
As part of its sustainability commitment, it vows: “Emissions of greenhouse gases and environmental pollutants are among the biggest challenges of our times. We are helping to overcome these problems by developing new technology and making effective use of natural resources.”
Sony Corporation (http://www.sony.net/) reasoned that CSR is the foundation of innovation, or innovation is the instrument for achieving CSR: “True to our DNA, Sony continues to address the challenge of realizing new potential through creative technologies, products and services and a spirit of innovation that focuses on contributing to society. The challenge is achieved under the partnership with diverse stakeholders.” It connects CSR and its rationale for Corporate Governance:
Sony is committed to strong corporate governance.
As a part of this effort, Sony adopted a “Company with Committees” corporate governance system under the Japanese Company Law. In addition to complying with the requirements of laws and regulations, Sony has introduced its own system to help improve the soundness and transparency of its governance by strengthening the separation of the Directors’ function from that of management and advancing the proper functioning of the statutory committees. Under Sony’s system, the Board of Directors defines the respective areas for which each of the Corporate Executive Officers is responsible and delegates to them decision-making authority to manage the business, thereby promoting the prompt and efficient management of the Sony Group.
It voices its commitment to the communities where it operates and to their sustainability, which benefits from its social philanthropy:
Sony undertakes a wide variety of social contribution activities to help address the needs of communities in regions around the world where Sony conducts business.” It supports activities and policies that advance environmental sustainability:
Sony acknowledges that our businesses have an impact on the environment; we aim to provide more environmentally friendly products and services to our customers by using our superior technology and innovation to reduce harmful effects on the environment.
Timberland Corporation: http://www.timberland.com/csrreport relies on its CSR standards and discourse relationships to set, implement, measure, and report its commitment to CSR as part of its reputation management.
Starting in 2008, Timberland will be reporting on key CSR performance indicators on a quarterly basis. We believe this represents an evolution in our CSR reporting process from static data presentation to dynamic information exchange; from corporate statement to stakeholder engagement; and from delayed annual reports to quarterly updates. In addition, this level of disclosure and reporting will provide invaluable feedback loops to help us achieve the bold goals set forth in our long term CSR strategy.
It asked and answered this question:
Where can you find our updated quarterly metrics? Timberland has partnered with JustMeans, a social media platform, to provide a forum for our stakeholder to discuss our material impacts as an apparel and footwear manufacturer. This Web platform utilizes the power of social networking to connect our stakeholder in a focused discussion around Timberland’s performance in global human rights, environmental stewardship, community engagement and more. We invite you to participate in this new initiative.
[See JustMeans (http://www.justmeans.org/) which is a site dedicated to giving organizations a centralized place in which to talk about the good work they are doing as a company, with other companies and organizations, and the people who matter to that end.]
Timberland’s CSR principles grow from this philosophy:
Timberland’s commitment to corporate social responsibility (CSR) is grounded in the values that define our community: humanity, humility, integrity and excellence. For over 30 years, “community” has been synonymous with the ethic of service—the desire to share our strength for the common good. Our approach to building and sustaining strong communities includes civic engagement, environmental stewardship and global human rights.” This statement serves as a platform for four areas of standards and policies: Energy, products, workplaces, and service.
Gap Incorporated’s (http://www.gapinc.com/public/SocialResponsibility/socialres.shtml) CSR program focuses on improving factory conditions, caring for the environment, investing in communities, and supporting its employees. It says it is dedicated to CSR principles in all it does and says: “At Gap Inc., we believe we should go beyond the basics of ethical business practices and embrace our responsibility to people and to the planet. We believe this brings sustained, collective value to our shareholders, our employees, our customers and society.”
IBM (http://www.ibm.com/gbs/csrstudy) monitors others’ commitment and refines as well as restates its own.
Today, more than ever, organizations are focused on environmental and social responsibility as a strategic objective. Our survey of senior executives worldwide shows that 60 percent believe that corporate social responsibility (CSR) has increased in importance over the past year. Only 6 percent say it’s a lower priority. To be sustainable, businesses are now embracing a relatively new objective: optimizing their operations to improve environmental and social outcomes in a manner that maximizes overall performance. As a result, executives face entirely new decisions and must manage an intricate new set of trade-offs. This new objective calls for new information, which many organizations are still missing, by a wide margin. Outperforming organizations, by contrast, have proved to be far better at collecting relevant and timely information from across their ecosystems, including their customers. These organizations and leaders in CSR point to a path forward – developing new sources of information and new levels of insight for meeting strategic sustainability objectives.
Positions such as this, and a theme in other statements, suggests that the theme of sustainability has or is achieving a foundational role in discussions of CSR policy, principle, implementation, measurement, and reporting.
AT&T (http://www.att.com) features diversity as one of its major CSR principles:
At AT&T, we recognize the importance of diversity and we value it. At the cornerstone of our diversity policy is respect for the broad spectrum of diversity that exists within our workforce and our customer base. It is our goal to strengthen and partner with our diverse business communities by contributing to their overall economic growth and to the expansion of our markets.
Our Supplier Diversity organization has the opportunity to positively affect both our company and the communities in which we do business. We are dedicated to utilizing proactive business strategies that mirror our diverse customer base while offering our suppliers access to procurement opportunities if they exist.
We want to develop mutually beneficial business relationships with Minority/Women and Disabled Veteran-Owned Business Enterprises (M/W and DVBEs) by utilizing these firms as primary contractors and as subcontractors. We will also encourage our primary contractors to use M/W/DVBEs as subcontractors to further reinforce our commitment.
This stance translates into the following policy:
It is the policy and practice of AT&T to promote and increase business opportunities for Minority, Women and Disabled Veteran Business Enterprises (M/W/ and DVBEs) to ensure that they receive their fair market share of AT&T’s total expenditures for products and services. In establishing this policy, AT&T is recognizing its commitment to the communities in which it serves and the marketplace in which it conducts business.
Strengthening the diverse business community economically contributes to the overall economic growth and expansion of our markets. Therefore, it is our objective to offer M/W/DVBEs equal access to purchasing opportunities. In addition, it is AT&T’s goal to assist in developing and growing such businesses.
The Supplier Diversity Initiative is intended not only to build awareness of the social responsibility of AT&T and its employees to provide opportunities for M/W/DVBEs, but also to further the business strategy by directly affecting the bottom line.
This policy is being adopted, not as a response to outside regulatory agencies or mandatory requirements, but as an effort to strengthen ties with the communities in which AT&T does business.
It relies on the following certification agencies to help implement and assess the organization’s accomplishments toward diversity.
“AT&T recognizes the following certifying agencies:
* National Minority Supplier Development Council
* Women’s Business Enterprise National Council
* Association for Service Disabled Veterans
* Government Agencies (Federal, State, City or County)”
Marathon Oil Corporation (http://www.marathon.com/Social_Responsibility/) addressed one of the themes central to the CSR aspect of the EKP:
Social Responsibility: Commerce. Conscience. Compassion.
Once considered mutually exclusive, these three ideas have converged in a powerful global concept—Corporate Social Responsibility (CSR). Marathon, as a responsible corporate citizen, seeks opportunities to strengthen the communities and countries in which it has the privilege to operate, through sustainable practices and initiatives.
In practice, CSR involves assessing all the potential ways that the Company’s actions and operations may impact others. It means looking beyond our office walls and outside our operational fence lines to consider how our decisions affect a broad range of individuals, groups and organizations. Referred to as stakeholders, these affected interests include local communities, non-governmental organizations, investors, employees, customers, suppliers, host governments and regulatory agencies.
Marathon’s approach to social responsibility is rooted in Living Our Values, a touchstone philosophy for the entire Company. These core values, which encompass longstanding commitments to health and safety, environmental stewardship, honesty and integrity, corporate citizenship and high performance form the foundation for the comprehensive approach that shapes the way we choose to do business.
Its CSR philosophy stresses another theme in this project: accountability to others and an alignment of interests.
Marathon’s commitment to Corporate Social Responsibility (CSR) means being accountable for our actions to a broad range of stakeholders—investors, employees, customers, suppliers, communities, business partners, host governments and others who have a stake in how our company conducts itself. Marathon has long-established core values associated with health and safety, environmental stewardship, honesty and integrity, corporate citizenship, and a high performance team. We recognize the importance of both financial and non-financial performance in our efforts to maintain long-term, sustainable performance for the Company. We put our policies into practice everyday as we manage our business to promote sustainable social, environmental and economic benefits to all stakeholders wherever Marathon operates.
Toward these ends, its program is multidimensional and integrated into management decision making, operations, and community engagement: Stakeholder engagement, environmental stewardship, CSR reporting, community development, capacity building, education and training, human rights, rule of law, and transparency. The centerpiece is a code of business conduct resting on core values.
Ringling Bros. Circus (http://www.elephantcenter.com/nursery.aspx), develops and enacts policy in response to criticism by activists such as People for the Ethical Treatment of Animals. “Ringling Bros. Center for Elephant Conservation is home to the most successful Asian elephant breeding program in the Western Hemisphere.” An extensive part of the brand equity of the organization, under the vigilant eye of animal rights activists, is devoted to the care, retirement, research, maintenance, and breeding of elephants as part of its responsibility to animals as such and to sustainable species.
This very short list of companies which announce their commitment to CSR, state or imply the standards it opts to implement, and reports its progress is an important part of the trend to combine and balance Reputation, Responsibility/Rectitude, and Relationship. These topics variously appear in research finding as noted in the next section.
Other Trends in Research
We identify the following trends in CSR research that were not covered extensively in the 2008 version of the CSR statement in the Essential Knowledge Project. They include: stakeholder engagement, internet presentation of CSR, and the connection between public relations and CSR.
Stakeholder engagement. Since CSR research and practice uses stakeholder theory as an important theoretical framework, exploration on stakeholder engagement is essential in the process of pursuing CSR efforts.
Acknowledging the critical role of CSR reporting in engaging with multiple stakeholders, Golob and Bartlett (2007) examined cross-cultural issues in CSR reporting by comparing this issue in two countries, Australia and Slovenia. They found a need to increase reporting incentives in both countries and to connect and compare hem to global reporting requirements.
O’Connor, Shumate, and Meister (2008) recognized the importance of giving primacy to the “voice, interpretations, and response to CSR” of an organization’s target publics and examined how a major stakeholder group, active moms, define CSR. They identified five key themes in the active moms’ perceptions of authentic CSR.
Internet presentation of CSR efforts. Given the growing prominence of the internet, many companies and other organizations rely on the it as a key channel for conveying messages and engaging in dialogues about CSR. However, research over time has revealed a lack of sufficient use of the internet in this area. Few corporations used websites effectively to monitor public opinion on issues or advocate policy positions (Esrock & Leichty, 1998). This has not improved significantly with the passage of time and the growing sophistication in technology. Even in the year of 2007, companies did not take full advantage of the interactivity of the internet, a key feature that may engage stakeholders better. Rather, most organizations only used “expositive” or unidirectional resources on the internet (Capriotti & Moreno, 2007).
Perhaps because of the reason above, internet publics or netizens generally have a negative evaluation of CSR stories online (Cho & Hong, 2009). Readers are especially cynical toward simplistic CSR efforts such as monetary donation immediately after a crisis. They found that such a remedial type of philanthropic donation was considered as insufficient.
Public relations practitioners and CSR. Public relations practitioners are found to have five different roles regarding an organization’s CSR activities (Kim & Reber, 2008): significant management role (to strongly advise clients or advocate to management on behalf of CSR issues); philanthropic role (central in promoting human welfare such as making decisions about charitable giving, volunteering, etc.); value-driven role (based on ethical standards, mission, or the values of the organization, or serving as a corporate role model); communication role (to communicate externally the CSR activities); and no role (public relations had no role in CSR).
In addition, public relations professionalism was found to positively correlate to the practitioners’ attitudes towards CSR (Kim & Reber, 2009). Kim and Reber (2009) also explored demographic features of public relations practitioners and found that women and older practitioners tend to have more positive attitudes towards CSR.
Conclusions:
An issues management approach to organizational success features the four pillars of strategic business planning and management, issue monitoring, corporate social responsibility, and strategic engagement in multiple voice dialogues. A strategic management approach to CSR reasons that it entails effective awareness of, analysis of, and engagement with stakeholders both as a matter of pragmatics and ethics. Standards of CSR are central, not incidental to the quality of stakeholder relationships. It is more than “mere” reputational claims. It is a thoroughly grounded way of operating so that its reputation can reflect its understanding of and commitment to responsibility/rectitude and high quality relationship management.
References
Capriotti, P., & Moreno, A. (2007). Corporate citizenship and public relations: The importance and interactivity of social responsibility issues on corporate websites. Public Relations Review, 33, 84-91.
Cho, S., & Hong, Y. (2009). Netizens’ evaluations of corporate social responsibility: Content analysis of CSR news stories and online readers’ comments. Public Relations Review, 35, 147-149.
Duhe, S. C. (2009). Good management, sound finances, and social responsibility: Two decades of U.S. corporate insider perspectives on reputation and the bottom line. Public Relations Review, 35, 77-78.
Esrock, S. L. & Leichty, G. B. (1998). Social responsibility and corporate web pages: Self-presentation or agenda-setting? Public Relations Review, 24, 305-319.
Freeman, R. E. (1984). Strategic management: A stakeholder approach. Boston: Pitman.
Freeman, R. E. & Gilbert, D. R., Jr. (1988). Corporate strategy and the search for ethics. Englewood Cliffs, NJ: Prentice-Hall.
Golob, U., & Bartlett, J. L. (2007). Communicating about corporate social responsibility: A comparative study of CSR reporting in Australia and Slovenia. Public Relations Review, 33, 1-9.
Kim, S-Y., & Reber, B. H. (2008). Public relations’ place in corporate social responsibility: Practitioners define their role. Public Relations Review, 34, 337-342.
Kim, S-Y., & Reber, B. (2009). How public relations professionalism influences corporate social responsibility: A survey of practitioners. Journalism and Mass Communication Quarterly, 86, 157-174.
O’Connor, A., Shumate, M., & Meister, M. (2008). Walk the line: Active moms define corporate social responsibility. Public Relations Review, 34, 343-350.
