CSR - Luxury or Neccessity?

ISO 26000, from the International Organisation for Standardisation (ISO), covers voluntary guidance on social responsibility. It is intended to be a worldwide standard and is aimed at both public and private organisations. It will inform participating organisations how to operate in a socially responsible way, and will be a distillation of international experience of what social responsibility means in practice.

The standard is being developed to be consistent with other relevant declarations and conventions from the United Nations and the International Labour Organisation (ILO). The standard will cover terms and definitions; social responsibility principles; core guidance on social responsibility; and guidance on implementation. The standard has been in development since 2003/4 and is expected to be published by Autumn 2010.

Responding to this agenda encourages triple bottom line thinking: financial, environmental and social responsibility, otherwise known as profit, planet & people, but it is a known fact that a company’s green and social credentials have a significant impact to the traditional bottom line, as well as creating competitive advantage. But ‘green-washing/do-gooding’ the brand over night is not enough. Today’s consumers demand transparency and commitment if a brand is to warrant their trust, emotional investment and uptake. In a UK survey ‘Sustainable Life Media’ conducted by YouGov for The Carbon Trust Standard, it was discovered that one in seven UK consumers (14%) have decided not to buy from a company with a poor reputation for environmental responsibility. One in four boycott ethically challenged companies. Equally confusion and lack of trust over a company’s ethical or environmental claims will also act as a turn off.

Indeed today’s consumers are now discerning ‘prosumers’ who are territorial about which brands they expose themselves too. They are resourceful and have a wide range of informational and networking tools at their disposal, with which to analyse and document their world. They recognise that there are social and environmental implications to the purchases they make and that they need to consume without compromising the quality of life of current and future generations, or burdening the environment in the process. They therefore have an automatic expectation for brands to take issues like the impact of globalisation and the increasing pressure on limited natural resources seriously, by driving or at the very least, influencing change.

By a brand switching from a passive role to active, sincere and sustained engagement that connects with its consumer on things that they care about, it can deliver a service way beyond the product. This increases overall value, credibility, and differentiation, and engenders consumer loyalty. The brands that master this marriage between business ethics and non-economic social and environmental values will be better placed to ride out the recession and poised to capture sizeable market share when it ends.