Has CSR Really Had its Day?
Has CSR Really Had its Day?
It’s been five years since Michael Porter and Mark Kramer published their seminal article in the Harvard Business Review introducing the concept of ‘created shared value’, thereby sparking one of the most contentious questions in sustainability: Is corporate social responsibility dead?
Next month this great debate continues when Mark Kramer goes head to head with John Elkington, originator of the ‘triple bottom line’ and a long-time advocate of corporate social responsibility. This is the latest in Barclays' series of global debates – you’ll be able to tune in live - which bring together leading figures with diverse perspectives to deliberate some of the biggest and most provocative CSR and Sustainability challenges facing organisations
So why is corporate social responsibility (CSR) on the critical list and what makes this debate so widely anticipated?
In their original article, Porter and Kramer argued that CSR was a “bolt on” to business strategy, nothing more than a reputational exercise. The alternative they suggested was the notion of ‘creating shared value’ (CSV)- linking business strategy to societal needs, creating competitive advantage and achieving large-scale social and environmental benefit.
As Kramer explains: “Rather than forcing a trade-off between making money and doing good, shared value encourages business innovations that increase profits by contributing to social progress.”
In the years since, CSV has been gaining acceptance as a way of doing business. It has been adopted by some of the world’s leading corporations including the likes of Nestle, GE, IKEA, Coca-Cola, Novartis and Unilever, all of whom feature in Fortune’s Change the World list published last month. The list shines a light on 50 companies that have made significant progress in addressing major social problems as a part of their core business strategy.
“These companies have increased incomes and access to medicines for millions of the world’s poor, reduced countless tons of carbon emissions, and pioneered new ways of doing business that overcome entrenched social problems, all for the sake of improving their bottom lines,” says Kramer.
CSR on the other hand has faced a tougher time. Late last year Peter Bakker, speaking for the World Business Council for Sustainable Business, declared that the agenda for 2015 would be defined by “the death of CSR” – check out Michael Townsend's look at CSR and what comes next here - while in his new book Connect published this month, former chief executive of BP Lord Browne called on corporations to sack their CSR departments whose role he deems divorced from the mainstream of business.
All of this might suggest that CSR is reaching the end of the road, but not everyone believes so.
Advocates of CSR say it is constantly evolving and that its impact in the boardroom is growing, with increasing attention from investors looking for sustainable returns. As a leading innovator in delivering sustainable commercial and societal outcomes through CSR, Elkington has strongly defended the concept and gone further by questioning whether CSV is yet more incrementalism, unable to deliver real sustainability.
In a recent post examining Fortune’s Change the World list, Elkington recognises the efforts that those companies listed have made in helping the boards and C-suites of a growing number of companies to navigate their way through the emerging demands for responsibility, accountability and, ultimately, sustainability. But he highlights there are still challenges that must be faced “if we want to get on-course for the sort of breakthrough change now to create shared value not only for today’s economic actors but also for tomorrow’s.”
So have reports of the death of CSR been greatly exaggerated? Plenty of organisations are currently wrestling with the challenge of how to measure and set targets to tackle their own impacts and put in place a strategy for delivering these, while at the same time transforming their businesses and moving the practice of CSR. Tune in on the 8 October to listen to the panellists and decide for yourself.
The debate will take place between 5:30pm-8:00pm on 8 October. Register to watch the debate online here.