Corporate Social Responsibility (CSR) has long suffered from confusion of purpose and criticism of intention.
Over the years, CSR has been labelled little more than strategic philanthropy or, worse yet, “just public relations.” Yet, despite its misunderstood status, CSR initiatives are rapidly growing in number. Furthermore, the nature of these programs has transformed. No longer is ad-hoc programming that lacks connective tissue the norm. Increasingly, Corporate Social Responsibility programs reflect a core strategy that knits together an often-diverse range of a company’s philanthropic, cause-related, and stakeholder support initiatives.
A more thoughtful, strategic CSR paradigm has taken root. Corporate Social Responsibility now articulates a company’s business values while simultaneously addressing social, humanitarian, and environmental complexities. Consumers, employees, investors, and a range of stakeholders consider company values and practices in their decisions. “CSR is inherently organic, as companies both respond to societal expectations and define CSR in terms of their own organizational and social motives for philanthropic giving and civic engagement,” according to a Harvard Business School working paper authored by Kash Rangan, Lisa A. Chase, and Sohel Karim. Creation of “shared value” has come to govern CSR decisions so that value for shareholders is created while services for society are generated simultaneously.
According to a Yale Insights article, leaders in this new shared-value paradigm look to their business mission and values to inform CSR strategy. Patagonia Founder Yvon Chouinard believes “sustainability is the reason we’re in business. Our mission is to produce the best product, cause the least amount of harm, and use business to inspire and implement solutions to the environmental crisis.” From fair labor practices to supply chain decisions; from reusing materials to micro-grants and support, Patagonia has pioneered the next wave of CSR. Vice Chair of Business Innovations at General Electric, Beth Comstock, sees sustainability as part of the company’s DNA. “The ability to keep doing what we do is a core principle of sustainability.” GE devotes considerable R&D and marketing communications resources (“Ecomagination”) to clean technology innovation.
Opportunities to bring coherence to disparate Corporate Social Responsibility programs and practices remain unexplored for many organizations. Nor is this entirely a for-profit organizational issue. Foundations, NGOs, associations, academic institutions and others are evaluated on the basis of their CSR commitments. The ability to measure and report on the social, humanitarian, and environmental value of those programs in an authentic, credible manner is the vital link between CSR investment and realizing the value of that effort.