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The Five Driving Forces of CSR: Can You Name a Sixth?

Leslie Back | Friday May 6th, 2011 | 4 Comments

I take little credit for the intelligence of this post. Indeed, I give all that might be due to Werther & Chandler’s 2011 text, Strategic Corporate Social Responsibility: Stakeholders in a Global Environment, as well as to my Green Mountain College MBA Triple-Bottom-Line Management Course, in progress. Through these studies, the five below drivers have been articulated as those most germane to the promotion of CSR, but I ask you, my favorite TriplePundit readers, are there others? Have motivating factors been missed? What else has brought us here, to this CSR “Tipping Point”?

The Five Driving Forces of CSR:

  1. Increased Affluence: CSR becomes more relevant as economies grow and stabilize. Therefore, the greatest attention to CSR is found in developed countries. Stable work and security provide the luxury of choice and socially responsible activism. No such luxury exists when basic needs are in question.
  2. Ecological Sustainability: Perhaps the most obvious and most talked about of the drivers, concerns over pollution, waste, natural resource depletion, climate change and the like continue to fuel the CSR discussion and heighten expectations for proactive corporate action. After all, it is in the best interest of firms to protect for the sustainable future the long-term availability of the resources on which they depend.
  3. Globalization: Globalization has had considerable impacts. First, the increased wealth and power of multinational corporations has led to questions on the decreased authority of the nation-state, especially in developing areas. Further, cultural differences have added to the complexity of CSR as expectations of acceptable behavior vary regionally. With increased power comes increased responsibility and globalization has fueled the need to filter all strategic decisions through a CSR lens to ensure optimal outcomes for diverse stakeholders.
  4. Free Flow of Information: Yes, blame the bloggers, but through the Internet and other electronic mediums the flow of information has shifted back to the stakeholders, especially in the case of three important groups: consumers, NGOs and the general media. Easily accessible and affordable communication technologies have permanently changed the game and only truly authentic and transparent companies will profit in the long term.
  5. The Power of the Brand: Brands are today the focal point of corporate success and much of the health of the brand depends on public perception of the corporation. In other words, reputation is key and honest CSR is a way to protect that reputation and therefore the brand.

As reported by the aforementioned text, Malcolm Gladwell referred to the tipping point as the point of critical mass after which an idea spreads widely and becomes generally accepted and broadly implemented. I argue that CSR has reached such a tipping point, pushed there by the five above factors. I further argue that CSR will become more mainstream and more part and parcel of everyday business strategy. These five forces have brought us here and will continue to promote and develop trends towards greater social responsibility on the part of firms. But, are there others? Factors that have not here been considered that have or will prompt this continued CSR evolution?

 

 


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  • http://www.linkedin.com/in/ianedwards Ian Edwards

    Sure, there are other drivers of CSR. Along with those you mention — or perhaps, refinements:

    Threat of regulation: Many companies are managing long-term risk by stepping up compliance issues related to sustainability — either current or expected regulations.

    Supply chain pressures: WalMart, Ikea, P&G, Timberland and other large companies are forcing sustainability and CSR initiatives on vendors through various sustainability indices and codes of conduct.

    Opportunity to innovate: Sustainability and CSR are effective catalysts for refreshing products and service and inventing new business opportunities.

    Cost containment: Lots of evidence that CSR and sustainability strategies help to refine business processes, cut costs and improve margins. This is a compelling point when selling the concept up to a conservative C-level executive team.

    Cause marketing: You mention the brand-boosting powers of CSR. A key pillar of CSR is strategic philanthropy — supporting and engaging a cause or causes that are compatible with the company’s core values. Many companies do this without having a CSR platform. For those companies, it’s an easy step up to a fuller CSR commitment.

  • sanjay s. devkar

    As film makers we hv developed entertaining content with the objective of re-establishing the most important factor, the “Civil society”

    The notion is to embrace all the members of the society that together form the civil body, i.e. homes, schools-colleges, employees, shareholders, corporate-houses under one roof.

    The film project shall be a CSR to the masses, aiming to transforming them from people to minds.

    Kindly call on us for more details.

    Dhanyawaad,
    Sanjay Devkar
    CSR advocate

  • http://twitter.com/CatherineChongC Catherine Chong

    Shareholders stipulation. Shareholders finally realise that adopting CSR could mitigate organisational risks. After all, when negative event happens, shareholders suffers. ( Remember how BP’s shares halved within days?)

    As we saw early this year, 24 institutional investors (US$1.6 trillion in assets under management) representing led by Aviva Investors have written to 30 of the world’s largest stock exchanges urging them to address inadequate sustainability reporting by companies. Last week, Ernst & Young “Shareholders press boards on social and environmental risks” report concluded that more than 50% of shareholders’ proposals in 2011 will focus on ESG issues.

  • http://www.britesprite.co.uk Chris Milton

    How about the human face?

    Like many progressive concepts, CSR is wrapped up with concepts of justice, but while economic justice is sometimes mentioned social justice (ironically) rarely is.

    So a sixth driver surely has to be how an increasingly educated consumer is demanding greater economic and social justice from corporations.

    And no, I don’t mean philanthropy!