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CSR in the UK Nanotechnology Industry: Attitudes and Prospects

CSR in the UK Nanotechnology Industry: Attitudes and Prospects

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Published by Chris Groves
This paper aims to provide a clearer understanding of the role which corporate social responsibility (CSR) currently plays in influencing the activities of companies involved in the nanotechnologies industry in the UK, and how CSR may contribute to building the material and social sustainability of the industry as part of a regime of adaptive and anticipatory governance. The paper employs a conceptual framework in which a model of continuous improvement and a classification of “modes” of CSR (“do no harm”, “positive social force”) are used to evaluate the extent to which nanotechnology companies report on their impact management activities (based on an online survey of 78 companies), and to interpret attitudes towards CSR (drawing on 15 semi-structured interviews with company representatives). It is argued that the general level of CSR reporting is low, although companies themselves often demonstrate awareness of the requirements of a “do no harm” model of CSR. It is suggested that, if CSR is to be positioned as contributing to an adaptive and anticipatory governance framework for nanotechnology in the UK, serious shortcomings and obstacles need to be addressed in order to move closer to the “positive social force” mode of CSR
This paper aims to provide a clearer understanding of the role which corporate social responsibility (CSR) currently plays in influencing the activities of companies involved in the nanotechnologies industry in the UK, and how CSR may contribute to building the material and social sustainability of the industry as part of a regime of adaptive and anticipatory governance. The paper employs a conceptual framework in which a model of continuous improvement and a classification of “modes” of CSR (“do no harm”, “positive social force”) are used to evaluate the extent to which nanotechnology companies report on their impact management activities (based on an online survey of 78 companies), and to interpret attitudes towards CSR (drawing on 15 semi-structured interviews with company representatives). It is argued that the general level of CSR reporting is low, although companies themselves often demonstrate awareness of the requirements of a “do no harm” model of CSR. It is suggested that, if CSR is to be positioned as contributing to an adaptive and anticipatory governance framework for nanotechnology in the UK, serious shortcomings and obstacles need to be addressed in order to move closer to the “positive social force” mode of CSR

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Published by: Chris Groves on Mar 22, 2010
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Is There Room at the Bottom for CSR?Corporate Social Responsibilityand Nanotechnology in the UK
Chris GrovesLori Frater Robert Lee Elen Stokes
ABSTRACT. Nanotechnologies are enabling technolo-gies which rely on the manipulation of matter on the scaleof billionths of a metre. It has been argued that scientificuncertainties surrounding nanotechnologies and theinability of regulatory agencies to keep up with industrydevelopments mean that voluntary regulation will play apart in the development of nanotechnologies. Thedevelopment of technological applications based onnanoscale science is now increasingly seen as a potentialtest case for new models of regulation based on future-oriented responsibility, lifecycle risk management, andupstream public engagement. This article outlines find-ings from a project undertaken in 2008–2009 for the UKGovernment’s Department of Environment, Food andRural Affairs (DEFRA) by BRASS at Cardiff University,involving an in-depth survey both of current corporatesocial responsibility (CSR) reporting in the UK nano-technologies industry, and of attitudes to particulastakeholder issues within the industry. The article analysesthe results to give an account of the nature of corporatesocial performance (CSP) within the industry, together with the particular model of CSR operating therein (‘dono harm’ versus ‘positive social force’). It is argued thatthe nature of emerging technologies requires businesses toadopt particular visions of CSR in order to addressstakeholder issues, and that the nanotechnologies industrypresents specific obstacles and opportunities in this regard.KEY WORDS: nanotechnology, CSR, CSP, stake-holder engagement, uncertainty, risk, innovation
Introduction
Corporate social responsibility (CSR), as a com-mitment on the part of companies to deal with thewider social impacts of their activities, is oftenargued to have the potential to contribute both tothe environmental and social sustainability of busi-ness. Where the businesses in question are involvedin emerging technologies, the role of such com-mitments in both anticipating and managing suchimpacts may be particularly important.Nanoscale science and technology (NST) isincreasinglythoughtofasprovidingahostofenablingtechnologies (Rip,2006) which may lead to radicaland even revolutionary innovations across a host of industrialsectors(fromhealthcarethroughelectronicsto sustainable energy) in the near or further future(see,e.g.Berube,2006).Muchattentionhasthereforebeen paid to the potential ethical, legal and socialimpacts of NST. Comparatively little work hasbeen done, however, on the extent of efforts withinthe industry to extend efforts in corporate socialperformance (CSP) to address emerging concernssurrounding the specific characteristics of nanotech-nologies. There remain significant knowledge gaps,for example, about the possible negative health andenvironmentaleffectsofnanomaterials, mainlyduetothe potential for nano-engineered substances tomanifestpropertieswhicharenotsharedbytheirbulkequivalents (Uskokovic,2007). Properties such asenhanced reactivity, for which nanomaterials may beprized, may also lead to negative consequences incases of accidental release and exposure.The extent to which NST companies are con-cerned with CSP has not been left entirely un-examined by researchers. There have been a number of surveys on environmental, health and safety(EHS) practices in companies, including some dataon life cycle issues such as how often guidance givenby manufacturers to customers on how to dispose of nanomaterials waste safely (Australian NationalNanotechnology Strategic Taskforce (ANNST),
 Journal of Business Ethics (2011) 101:525–552
Ó
Springer 2011DOI 10.1007/s10551-010-0731-7
 
2005; Conti et al.,2008; Gamo and Kishimoto, 2006). In addition, some research has been done inthe EU on the extent of formal practices of riskassessment and management amongst NST compa-nies which occupy various positions in the supplychain (Helland et al.,2008), and the contribution of nanomanufacturing to life cycle risk issues (Meyer et al.,2008). No study has been performed to date,however, which combines an in-depth examinationof how far CSR in this emerging sector is com-municated, with an equally in-depth exploration of how companies themselves see the role of CSR intheir industry. We provide an account of just such astudy, undertaken in the UK in 2008–2009.
Conceptual background
CSR may be variously defined in terms of specificobligations or other ethical expectations. In general,though, it represents companies as social entitieswhose behaviour should legitimately be expected tomeet certain wider obligations, rather than as privateentities with a sole duty, that of maximising profitsfor their shareholders. It follows from this under-standing that, as a company can have a range of negative and positive impacts on society through itsprofit-seeking activities, it therefore has certainobligations to contribute to the management of impacts, wherever they levy external costs or harmson others.Companies, considered as legal entities, are part of civil society alongside various other kinds of organi-sations and institutions, together with individualcitizens. They can thus be thought of as possessingresponsibilities that fall into four categories of ‘issue’:economic, legal, ethical and discretionary (Carroll,1979). Economic responsibilities include being effi-cient and profitable, and providing goods whichcustomers need. Legal responsibilities comprise com-pliance with applicable laws and statutes (including‘issues’suchasaccounting,environmentalprotection,employee health and safety, consumer protection andso on), whereas ethical responsibilities imply ‘beyondcompliance’ measures that exceed what is required bystatute (e.g. anticipate risks, protect human rights, actsustainably and so on), and discretionary responsibil-ities imply philanthropic activities, community sup-port and involvement and so on.The relationships from which these responsibili-ties derive can be conceptualised in various ways. Toa great extent, how this is done will depend on
ontological 
assumptions about the constitution of society whether, for example, one should be amethodological individualist or collectivist aboutsocial reality, or assume that societies are based onconsensus or conflict (and whether these basic socialrelations are single or multiple overarching or overlapping consensus/es and fundamental or dis-tributed antagonisms). Some have noted that theseassumptions tend to privilege a reductive and indi-vidualistic sociological perspective in which com-panies are conceptualised as individual actorsseparate from society, and who need therefore tobe somehow reconnected with it (Buchholz andRosenthal,2005).Perhaps the most influential framework fothinking about the relationships between compa-nies and the rest of society is stakeholder theory(Donaldson and Preston,1995). This aims tounderstand the concrete
interdependence 
of businessand society, as opposed to positing a fundamentaltension between them (Porter and Kramer,2006,p. 83). Stakeholder theory proposes that CSRcannot be understood simply in terms of broadesocial
issues
and the response of business to them, butrather in terms of specific issues that concern thecompany’s
stakeholders
, these being groups and indi-viduals who are either affected by the company’sactivities or who can, through their own activities,affect the company’s activities, often by restricting its‘license to operate’. The differing degrees of inter-dependence between businesses and other govern-mental and civil society groups can be conceptualisedwith the aid of a distinction between primary andsecondary stakeholders, i.e. those without whomthe company cannot exist and those who are affectedby or influence the company’s behaviour, butare notpositionedin thiskind of relationshipwith thecompany(Clarkson,1995,pp.106–107).Regulators,customers, peer companies, employees, local com-munities, non-governmental organisations (NGOs),civil society organisations (CSOs) or ‘the public’ atlarge can fit into either category, depending on thenature of an individual business’ activities.In addition, there is the question of CSP, or howcompanies actually
enact 
social responsibility. Ananalysis of responsibilities needs to be coupled to an526
Chris Groves et al.
 
analysis of responsiveness (Wartick and Cochran,1985), or the processes by which companies attemptto fulfil their responsibilities and communicate their efforts to stakeholders. Performance may be catego-risedonthebasisofitsstrategicfoundationandwhatisaccomplished. Proactively making CSR part of acompany’s activities is clearly distinct from takinglimited defensive measures in response to a scandal(Porter and Kramer,2006, p. 84). This can be doneusing the kind of characterisation given in TableI.Measuring performance brings its own difficulties,with non-financial performance metrics being aninfluential way of aligning managerial incentives withlonger-term social value but also often being them-selves of questionable value and quality (Chatterji andLevine,2006, pp. 31–33). Further, the importance of reporting must be especially emphasised (e.g. GlobalReporting International,2006). Without an ade-quate reporting – and auditing – strategy, the legiti-macy of any approach to continuous improvement isimpossible to establish.As this management goal is an ideal, one mightlook to how continuous improvement in pursuing itshould be conceptualised. Thinking normativelyabout how such a process might work, we may as-sume it is necessary to establish a dynamic andmutually reinforcing relationship between differentforms of commitment, which might be divided intothree classes.For example, the
values
expressed in a code of conduct might be linked to specific
policies
presentedon a company website or in a shareholder report.Specific quantitative or qualitative indicators canthen be translated into performance goals and thecompany’s activities audited by an external agency,with the results being included in an annual report.These reports might then lead to pressure from theboard, shareholders or other stakeholders for thecompany to change its policies and/or higher-levelcommitments in order to better guide performanceimprovements.Aside from a processual understanding of howperformance is to be subjected to continuousimprovement, the question of what substantive CSRis in play needs to be answered. The ability to makeaccepting and anticipating responsibilities part of astrategic approach to CSR (Hockerts et al.,2008,p. 8) and thus positively increasing the social value of a company’s activities produces a different vision of CSR than simply seeking to mitigate harm (Porter and Kramer,2006). As the recent EU-fundedRESPONSE study of firms’ attitudes to CSR hasshown, two main CSR orientations can be isolated – on the one hand, towards minimisation of risks bothto the business and to the society across the spectrumof a company’s activities – ‘do no harm’ – and, onthe other, towards adding positive social value to thecompany’s business activities the company as‘positive social force’ (see Figure1).Businesses with proactive CSR engage in mana-gerial practices like environmental assessment andstakeholder management (Wood,1991) that tend toanticipate and reduce potential sources of businessrisk, such as potential governmental regulation, la-bour unrest or environmental damage (Orlitzsky andBenjamin,2001). On the other hand, where busi-nesses are engaged in innovation, particularly inemerging technologies, there may be scope for thebusiness to enhance social value beyond the provisionof useful products, such as contributing more widelyto sustainable innovation and development (Car-penter and White,2004) or by adopting businessparadigms like ‘socially responsible design’ (Davey,2005).Once a theoretical framework is in place thatencompasses both performance-related and sub-
TABLE IThe reactive–defensive–accommodative–proactive (RDAP) scale [reproduced from Clarkson (1995, p. 109)Rating Posture or strategy Performance1.
eactive Deny responsibility Doing less than required2.
efensive Admit responsibility but ght it Doing the least that is required3.
A
ccommodative Accept responsibility Doing all that is required4.
roactive Anticipate responsibility Doing more than is required
527
Is There Room at the Bottom for CSR?

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