By Kjartan Sigurdsson, writing from Stormsalen in Horsens, Denmark
It is interesting to examine how organisations develop and implement a corporate social responsibility (CSR) strategy, especially if CSR is regarded as a value proposition at the core of the business model and executed to grow the business in a sustainable way.
There are some basic elements that may affect sustainability strategies in companies. One initiative is a CSR strategy, a strategy that is widely used when organisations want to find a way to label, for example, their concern for the environment, how they treat their employees and society as a whole. This interest in finding ways to label their social responsibility may include issuing social reports as part of the annual report, providing information on the company website or through different kinds of media and social media.
One of the important expected benefits to be gained from CSR is the transformation of firm’s business model to take into account the environment, employees and society. This is likely to lead to new business developments and a new mind set.
A successful CSR strategy is one that first and foremost appreciates people (employees) because it is the people in a firm that nurture and take care of the firm. The shared vision and the dynamic environment that can grow within a firm stem from open communication and appreciation, i.e. open-mindedness and understanding that the people are the most important asset. This important asset, the people, is most likely to affect the whole business and to create guiding principles that foster innovation, actuate entrepreneurship, differentiation and competitive advantage. Having said that, transforming the business model into new way of thinking and doing serves to create superior and unique value, which is costly to imitate, and can help neutralise threats from competitors.
However, it is important to understand that behind the new value proposition the CSR strategy is likely to affect the growth of the company and its competitive position. An important aspect is how a company communicates its commitment to social responsibility. If a company decides to communicate its CSR strategy this should be done in a transparent fashion; a CSR strategy can be made transparent on a firm’s website, in a firm’s annual report, social media or wherever it can be communicated in line with the commitments promised in the written contract codified in the CSR strategy. Therefore, the social responsibility report is communicated and transparent, somewhere where all stakeholders can access it.
It is important to pay attention to the development of a CSR strategy. One of the most important features of CSR is that it is not rooted in laws and regulations in most countries. CSR is an initiative that gives a company freedom to develop something unique and extraordinary, that is the social responsibility of the company that goes further in its approach to the environment, employees and society. Furthermore, a business model that includes a CSR component has the potential to transform the identity of a company as one that supports its employees, nurtures innovative ideas and the entrepreneur within. Moreover, CSR becomes a strategy created by the company that goes beyond laws and regulations.
Finally it is important to be aware that there is no single definition of CSR and, in my opinion, it should stay like that. Thus, CSR should be free of barriers, flexible and not become rooted into legalisation.