Lecture 10: Relations: Managing corporate responsibility strategies and stakeholder relations

Question 1

Corporate citizenship

Answer 1

The portfolio of activities that organizations undertake to fulfil perceived duties as members of society

The contribution a company makes to society through its core business activities, its social investment and philanthropy programs and its engagement with public policy

Pro bono activities, corporate volunteerism, charitable contributions, support for community education, environmental programs

A company needs to behave in ways that promote and build trust between it and the community, and that provide it with legitimacy to operate in that community. Legitimacy refers to some kind of social acceptance resulting from the adherence of a company to regulations but also to community norms and expectations

Question 2

Corporate Social Responsibility CSR

Answer 2

The continuing commitment by business to contribute to economic development while improving the quality of life of the workforce and their families as well as of the community and society at large

Largely a moral contract - being expected to meet the social and environmental expectations of stakeholders as a good corporate citizen

Question 3

Triple bottom line (John Elkington)

Answer 3

People, planet and profits

CSR can be broken into activities that include social (people) and ecological (planet) initiatives alongside te generation of profits and healthy financial accounts (profit)

People: social and labour issues inside and outside the organization, including employee support, gender and ethnic balance of workforce, health and safety codes

Planet: responsibility to integrate environmental care into its business operations, such as reduction of harmful waste and residues

Profit: conventional bottom-line of manufacturing and selling products to generate financial returns for the organization and its shareholders

Question 4

Communicating about CSR

Answer 4

Tends to be based on a model of strategic persuasion rather than “democratic” communication or “dialogue”

Question 5

Integrated reporting

Answer 5

More companies are choosing to integrate their CSR reporting with their financial reports to make sure they show a triple bottom line and not just a financial one - integrating activities

Question 6

Greenwashing

Answer 6

The gap between the rhetoric and implementation of CSR

Involves companies declaring and framing themselves as promoting environmentally friendly policies whereas in reality, the actual implementation is out of step with the rethoric

Putting too much spin on their CSR might achieve the opposite effect

Question 7

Communication strategies for CSR (three strategies)

Answer 7

1. Informational strategy: not necessarily persuasive intent, but companies aim to inform the public as objectively as possible about its CSR activities - e.g. social reports, magazines, figures
2. Stakeholder Response Strategy: there stakeholders are asked for feedback on CSR activities or more generally in response to organizational decisions and actions - ie. Two-way symmetrical communication, but since the company makes the decisions, it might still be pretty one sided
3. Stakeholder Involvement Strategy: stakeholders have a say in the CSR commitments of a company with the company trying to meet/exceed expectations of their stakeholder groups on social and environmental issues

Question 8

Guidelines to successfully report CSR

Answer 8

1. Set clear objectives - setting social and environmental objectives annually and then systematically reporting on the results
2. Set progressive objectives: brings new aspirations and standards to bear upon business operations instead of regurgiating of exisiting practices that may be seen as socially or environmentally viable
3. Involve stakeholders: include issues that are relevant to stakeholders and are linked to clear benchmarks and standards (at the industry and policy levels)
4. Report transparently: honest, transparent and full-scale self-assessment instead of polishing performance data
5. Be accountable: performance data is assessed and verified by credible auditors

Question 9

Three CSR program elements (Ronald Speed)

Answer 9

1. Philanthropy: charitable donations, contributions to local community causes or charities - minor involvement in community affairs, but strong symbolic signal that the company cares about the community
2. Volunteers: employee volunteering programs, where they can work on local causes or public programs as ambassadors for the company and enhancing its reputation
3. Partnerships: higher level of commitment and community involvement, as they partner with community agencies or form alliances with other organizations to address public or community issues