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Corporate Social

Responsibility
CSR Strategy
Prof.dr. Nikolay A. Dentchev

Examples of CSR strategies


Toyota: https://www.youtube.com/watch?v
=O6tXq6YF8SQ
Umicore:
http://www.umicore.com/en/vision/history
/#
background
Close the Gap:
Video

The
Business
Model of
CSR

CSR in
The
Business
Model

Market for Virtue (Vogel, 05)


Old school doing good
vs.
Doing good and doing well

BUSINESS RATIONALE

Improved stakeholder relations


Confidence, motivation,
satisfaction, and loyalty.

Enhancement of intangibles
Reputation, social capital and
trust.

Business model improvement


Innovativeness, knowledge of
the value chain, efficiency and
effectiveness.

Cost savings
Asset damage, energy use,
production.

Improved risk management


Differentiation
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CSR Risks
Organizational
Diluting managerial attention
Non-productive spending
Bad strategy implementation
Stretching the organizational coalition
Relational
Legitimacy destruction
Issue ownership
Poor risk communication

CSR Risks
DILUTING MANAGERIAL ATTENTION
Network coordinator of Trivisi
To embrace the principles of CSR implies that firms
not only acknowledge and embrace economic and
financial values, but also social, societal, and
environmental values. What really matters is that one
at least acknowledges all stakeholders that operate in
and around the firm () But the primary reason of
being in a business is to turn a profit. The real danger
of CSR is that one loses sight of the commercial
strategy. It is perfectly conceivable that an
enthusiastic firm begins to orient itself primarily to
the pursuit of social and ecological goals, even if
economical aspects are its primary purpose.

Diluting Managerila
Attention
How do CSR activities entrich the
dynamic capabilities of a business?
What do we learn from stakeholders?
How does this improve our agility?

CSR Risks
NON-PRODUCTIVE SPENDING
Project manager working for one of companys contractors
[] a subcontractor of ours [] never wants to work
for this company again. A truck driver lost his footing on
a piece of surface that had somehow gotten a little
slippery. The guy did not even fall, but a safety inspector
caught a glance of him rubbing his leg afterwards.
Incredible, but the guy was then urged to report to the
first-aid worker on duty at that plant, and was
subsequently taken to the doctor at a small industry
town some 15 miles away of the plant. And afterwards
they still ran him trough an entire mill of formalities;
simply an entire day lost for nothing. []

Non Productive Spending

Clinical
Fiscal
Political
Strategic

=> criteria, dixit Meyer, 1884

CSR Risks
BAD STRATEGY IMPLEMENTATION
A Business Development Manager
Yes, we indeed introduced safety improvements for
employees and there was quite some resistance. They
thought that those measures were not necessary.
Besides, they perceived that wearing that equipment
could have a negative image to customers. We have
some work to do on the employee perception.

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Bad Strategy
Implementation
Intervention tactics create
perceived need for CSR
Participation tactics involve
stakeholders.
Persuasion tactics expert opinions.
Implementation by edict use of
authority.

CSR Risks
STRETCHING THE ORGANIZATIONAL COALITION
Executive Vice President of Operational Excellence
Some stakeholders expect perfect performance, no
emissions, or even that we quit our business as to leave no
ecological footprint at all. Well, let me tell you that it is
extremely hard to have a conversation with that last group of
stakeholders. Some stakeholders take up the position that
everything we tell is a lie. They will always say: you tell us
one thing, and then do another, and that offers dim
possibilities for a constructive conversation. []

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Stretching the Organisational


Coalition
Get inspired by stakeholders
Be aware of conflicting requests
DO NOT GIVE UP MANAGEMENT
RESPONSIBILITY

CSR Risks
LEGITIMACY DESTRUCTION
Logistics manager:

Another recent example concerns one of our truck


drivers, who got into a situation where a car was
driving straight toward him on his side of the road.
So the driver had to divert, and he himself crashed.
In the newspapers the whole thing was reported as
yet another accident in the petrochemical
industry, whereas the driver essentially did a good
thing by not hitting the other car.

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Legitimacy Destruction
KPI
Independent audits

CSR Risks
ISSUE OWNERSHIP
A member of a corporate plants Neighborhood Council.
A: [] We find it unacceptable when the company says: that
factory is no longer ours, the responsibility for it is out of our
hands. That gives us a sneaky feeling.

Q: Why does that give you a sneaky feeling?

A: Well, of course those plants will still have to meet the prevailing
environmental legislations. But if they [the company] say that
the factory is no longer theirs, we worry about whether all
provisions will still be met. Are they [the new owners] as good or
as bad as the company, is what we then ask ourselves. []

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Issue Ownership
Stakeholder dialogues expose
stakeholders to conflicting,
unreasonable demands
Industry platforms
Round tables

CSR Risks
POOR RISK COMMUNICATION
An environmental technologists
[] Flaring and noise are affecting neighbors, as they
always become frightened. Therefore it is important to
communicate in advance when you expect to flare, so
that they do not have to worry. And the neighbors can
also contribute to the improvement of your
communication performance, by saying what they think
of it.

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Poor risk communication


Rationale vs. Emotions
Rational: crisis scenarios, risk
assessment
Emotional: empathy to fears,
concerns

Mitigation Strategies
GENERIC PRINCIPLES
1. Consistency
2. Centrality
3. Specificity
4. Visibility
5. Accountability
6. Productivity

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