CORPORATE SUSTAINABILITY AND ITS

RELATIONSHIP WITH CORPORATE

SOCIAL RESPONSIBILITY

PRESENTED BY: RIDHIKA JAIN, SHWETA,

KANAV RANA, KARAN GAUR, UJJWAL TIWARI
WHAT IS CORPORATE SUSTAINABILITY?

 This idea was born from the concept of sustainable development, which is growth and development that
meets the current needs of today without compromising any natural resources that future generations
depend on.
 We can define corporate sustainability as the strategy whereby a business delivers its goods and services
in a manner that is both environmentally sustainable and supports its economic growth. Corporate
sustainability prioritises long-term growth through sustainable methods as opposed to focussing on
short-term financial gains.
 By implementing a corporate sustainability strategy, your business should be committing to using
natural resources responsibly, investing for the long-term wellbeing of the planet and ensuring that all
people involved in your business process are treated fairly.
 IMPORTANCE OF CORPORATE
SUSTAINABILITY
 The core importance of corporate sustainability lies in bringing companies and
industries more in touch with the standards of sustainable development.
 Also, it is imperative to construct a rough roadmap for a rejuvenated, greener,
and cleaner planet when it comes to global warming and climate change.
 Today, in the age of hyper-awareness about social issues and environmental
health, corporate sustainability has proven to be an integral tool to convince
customers about the intent and priorities of the organization.
 To put it simply, corporate sustainability matters as it enables companies to
grow, adapt and rethink with the demands and needs of an evolving society and
planet.
THREE PILLARS OF CORPORATE
SUSTAINABILITY
 The three pillars of a corporate sustainability strategy are: the environmental,
the socially responsible, and the economic. They are referred to as pillars
because, together, they support sustainable goals.
 These three pillars are also informally referred to as people, planet, purpose,
and profits.
 People refers to being aware of the impact of operations and products on
employees, customers, and a community at large. Planet refers to protecting
the world that supports us and, if possible, improving the shape that it's
in. Purpose relates to the reasons why a company operates as it does and
whether the mission continues to make sense given new, three pillar
priorities. Profit encourages companies to assess the feasibility of their
direction, operations, and projects.
 ENVIRONMENTAL PILLAR
 The environmental pillar often gets the most attention. Many companies are focused on
reducing their carbon footprints, packaging waste, water usage, and other damage to the
environment. Besides helping the planet, these practices can have a positive financial
impact. For example, reducing the use of packaging materials can reduce spending and
improve fuel efficiency.
 For example, Walmart keyed in on packaging through its zero-waste initiative. It pushed
for less packaging throughout its supply chain and for more of that packaging to be sourced
from recycled or reused materials.
 One of the challenges with the environmental pillar is that a business's impact is often not
fully costed. This means that there are externalities that are not reflected in consumer
prices. The all-in costs of wastewater, carbon dioxide, land reclamation, and waste in
general are not easy to calculate because companies are not always the ones on the hook for
the waste they produce. The practice of benchmarking tries to quantify those externalities
so that progress in reducing them can be tracked and reported in a meaningful way.
 SOCIAL PILLAR
 The social pillar ties to the concept of social license. A sustainable business
should have the support and approval of its employees, stakeholders, and the
community it operates in. How such support is secured and maintained
varies, but it comes down to treating employees fairly and being a good
neighbour and community member, both locally and globally.
 On the employee end, businesses can refocus on retention and engagement
strategies. These can include more responsive benefits such as better
maternity and family benefits, flexible scheduling, and education and
development opportunities.
 For community engagement, companies have come up with many ways to
give back, including fundraising, sponsorship, scholarships and investment
in local public projects.
 ECONOMIC PILLAR

 The economic pillar of sustainability is where most businesses feel they are on
firmer ground. To be sustainable, a business must be profitable. That said, profit
cannot trump the other two pillars. In fact, profit at any cost is not what the
economic pillar concerns. It's about compliance, proper governance, and risk
management.
 Sometimes, this pillar is called the governance pillar (as in the ESG acronym). This
refers to boards of directors and management aligning with shareholders' interests
as well as those of the company's community, value chains, and customers.
 For example, investors may want to feel certain that a company uses accurate and
transparent accounting methods, and that stockholders are given an opportunity to
vote on important issues.
HOW TO IMPLEMENT CORPORATE
SUSTAINABILITY

The general points below can serve as a guide as you plan a corporate sustainability program or
project.
1. Become familiar with the fundamental principles of people, planet, purpose, and profit and
prepare to incorporate them into your company culture.
2. Assess the current state of your business needs, goals, and opportunities. Review business
priorities and decide what sustainability goals are appropriate.
3. A mission statement that aligns with sustainability goals can help underscore the direction a
company should take.
HOW TO IMPLEMENT CORPORATE
SUSTAINABILITY

4. Be sure to get buy-in from top leadership and management.

5. Invite feedback from stakeholders. Shareholders, employees, suppliers, other
partners, customers, and even the greater community should understand the potential
benefits of a more socially-aware way of doing business.
6. Establish strategies that will help you achieve your sustainability goals.
7. Select a tracking method (and the personnel who will manage it) to measure change
and results.
 WHAT IS CORPORATE
SUSTAINABILITY REPORTING?

Corporate sustainability reporting is a process whereby

companies regularly publish sustainability goals and their
progress in achieving them. This helps the public understand
how a company is contributing to a sustainable global
economy. Sustainability reports may include information
about the company's use of resources, the positive and
negative effects of their operations on the environment, and
their strategies to become more sustainable in the future.
 HOW DOES SUSTAINABILITY AFFECT
CORPORATE GOVERNANCE?

The economic, or governance, pillar of

sustainability involves practices such as honest
accounting, transparency, and regulatory
compliance. These practices can keep a
company's values in line with those of society at
large. It can be important for a company to align
with values of the community, value chains, and
end-users.
 WHAT ARE SOME BENEFITS OF
CORPORATE SUSTAINABILITY?

In addition to the social benefits of serving the

community and environment, sustainable practices can
also advance corporate profits in the long term. For
example, adopting policies that benefit their employees
and the community can generate goodwill for a
company. They may also increase the disposable income
of potential customers. This can result in more new
customers buying the company's products.
 WHY SHOULD COMPANY PROMOTE
CORPORATE SUSTAINABILITY?

 Essentially, the premise is simple. The more work a company puts into prioritizing
corporate sustainability now, the less they need to put energy into their overall success in
the long run.
 Corporate sustainability is like building up your endurance for a run. Once you’ve built
up your endurance, it’s easier to run for longer, burn more calories, and keep working
towards the goals you set for yourself – even the ones you thought you couldn’t achieve
before.
 Longevity in a company is nearly guaranteed if corporate sustainability is made priority.
 WHAT IS THE GOAL OF
CORPORATE SUSTAINABILITY?

Its goal is to change business practices from those

that may damage the environment (locally and
globally), negatively affect aspects of society, and
obscure a company's financial data and methods
of operating into business practices that have
positive, long-lasting effects for all concerned in
all three areas.
THE IMPACT OF SUSTAINABILITY
 The main question for investors and executives is whether or not sustainability is an advantage for a
company. Properly implemented, it certainly can be. Sustainability strategies have been borrowed from
other successful business movements, such as Kaizen, community engagement, the BHAG (Big Hairy
Audacious Goal), talent acquisition, and more.
 Sustainability provides a larger purpose and some new deliverables for companies to strive for. It can help
them renew their commitments to basic goals such as efficiency, sustainable growth, and shareholder
value.
 Perhaps more importantly, a sustainability strategy that is publicly shared can deliver hard-to-quantify
benefits such as public goodwill and a better reputation. If it helps a company get credit for things they are
already doing, then why not?
THE IMPACT OF SUSTAINABILITY

 For some companies, sustainability represents an opportunity to organize diverse efforts under
one umbrella concept and gain public credit for it. For other companies, sustainability means
facing business practices that ultimately could have a negative impact on their operations.
 For the companies that cannot point to an overall vision to improve themselves vis-a-vis the
three pillars, there is, as yet, no real market consequence.
 However, sustainability and a public commitment to its essential business practices may grow
to equal the importance of compliance for publicly traded companies. If this comes to pass,
then companies lacking a sustainability plan could see a market penalty.
 WHAT IS CORPORATE SOCIAL
RESPONSIBILITY?
 Corporate social responsibility (CSR) is a business practice that considers the impact a company has on
society, employees, and other stakeholders. A CSR strategy is implemented by an organization to:
minimize harm, practice fair business, be responsible along a global supply chain, exercise philanthropy
and create a self-oriented human resource management system.
 For a company to be socially responsible, it first needs to be accountable to itself and its shareholders.
Companies that adopt CSR programs have often grown their business to the point where they can give
back to society. Thus, CSR is typically a strategy that's implemented by large corporations. After all, the
more visible and successful a corporation is, the more responsibility it has to set standards of ethical
behaviour for its peers, competition, and industry.
 RELATIONSHIP BETWEEN CSR AND
CORPORATE SUSTAINABILITY
 Good CSR practices can create a socially sustainable organization. Both
corporate sustainability and CSR help companies run in a way that allows
them to be ethically profitable, but never at the expense of others.
 Practicing good CSR is regarded as the engine to social sustainability and
progress, supporting companies to fulfil their responsibilities as good
citizens.
 CSR is a business commitment that contributes to corporate social
sustainability. Corporate social sustainability works with employees, their
families, local communities and society at large to improve human-life
quality, the environment and the economy in the long-term.
 RELATIONSHIP BETWEEN CSR AND
CORPORATE SUSTAINABILITY
 In the process of manufacturing, a company consumes certain natural
resources belonging to the society, though it pays for it. Every manufacturing
process causes damage to the nature by the exploitation of natural resources,
pollution and harm to the environment in many ways (extraction of minerals,
release of effluents after manufacture; and pollution of water, soil, air, etc.).
 We continue to encourage establishing manufacturing companies because we
need products, employment and revenue in the form of taxes.
 However, the law prescribes an acceptable level of pollution i.e. the effluent.
But, effluent gets accumulated and over a period of time it reaches
unacceptable levels.
 RELATIONSHIP BETWEEN CSR AND
CORPORATE SUSTAINABILITY
 At that stage, it is not possible to close the industry as many interests
are developed in the process, like employment, dependent subsidiaries
and revenue in the form of taxes to the government. Logically, the
polluter must pay for the damage and to repair the same, that is in fact
the basis for the concept of Corporate Social Responsibility (CSR).
 Damage done to the nature cannot be repaired, and cannot be
compensated in the form of money; the concept of CSR is trying to
find out a monetary equivalence to the damage done. This damage
prevents the idea of the sustainability of the natural resources.
 RELATIONSHIP BETWEEN CSR AND
CORPORATE SUSTAINABILITY
The principle of sustainable development as it is understood today is usually traced back to the definition offered by the
Brundtland Commission: sustainable development is, “a form of development that meets the needs of the present
without compromising the ability of future generations to meet their own needs”. This principle relates to the whole of
society and entails a clear political objective. Social, ecological and economic concerns, the Brundtland Commission
concluded, must be given equal consideration if sustainable development is to become a reality. The sustainability
principle additionally includes the ideas of both intragenerative and intergenerative justice; Companies are challenged
to help society as a whole to achieve a sustainable development. Sustainable management thus revolves around what
the company does to advance sustainability and attempts to maximize its contribution in this respect. The minimum
requirements for sustainability in society as a whole are reviewed systematically and efforts are made to ensure that
they are always met. Like the principle of sustainability itself, sustainable management covers all three dimensions of
sustainability (that is to say the ecological, economic and social aspects).
 DIFFERENCE BETWEEN CSR AND
CORPORATE SUSTAINABILITY
VISION
• CSR often looks backward and reflects on what a company has done to contribute to society.
• Corporate sustainability looks forward and develops a sustainable strategy for the future.

TARGET
• The targets of CSR initiatives are often opinion formers (e.g., media, politicians, and pressure groups).
• Corporate sustainability looks at the whole value chain (i.e., everyone from end-consumers to stakeholders).

MOTIVATION
• The motivation and driving force behind CSR initiatives is to protect a company's reputation.
• For corporate sustainability, the drive has more to do with creating new opportunities for emerging markets.
EXAMPLES OF CORPORATE
SUSTAINABILITY
 GOOGLE
 Google’s aim is to continue to develop efficient technologies that do not burden
existing resources. They became one of the first large-sized companies to declare
themselves carbon-neutral in 2007 and the first company to sustain their annual
electricity consumption needs through renewable energy sources with an aim to
further decarbonize their electricity supply and run on 24/7 carbon-free energy.
 Google’s data centres have been designed as efficient operational units that make
optimum use of water, energy, and materials, to boost environmental performance and
create LEED certified places. Recycled materials have been included in all their Nest
and Pixel devices that were launched since 2020. The brand is also tapping into their
solar potential through their Sunroof project that enables people to tap into solar
energy using their rooftops. Another initiative Google has taken for the community is
to map air quality at the micro level across every street to help city planners make
more informed decisions and formulate effective health plans.
 APPLE
 Apple has developed a range of sustainable goals that it supports through
programs including climate change support initiatives, smarter eco-friendly
products, recycling technologies and more. Apple’s recycling program began
in the early 90’s and has become a global initiative in partnership with third-
party retailers that comprises recycling centres, offices, and other support
facilities that recovers and processes recycled materials.
 In support of this, based on the 2021 Apple Environmental Progress Report, it
designed the iPhone 12 and Apple Watch Series 6 with 100 recycled rare
earth elements, and manufactured MacBook Air with Retina Display using 40
percent recycled materials. Another initiative is to harness the power of clean
and renewable energy to run its data centres, support facilities and stores so
they can achieve carbon neutrality by 2030.
 COCA COLA
 Coca Cola’s comprehensive sustainability strategy is centred
around the environmental pillar of sustainability. They have
identified four key areas that comprise water stewardship,
packing and recycling, energy and climate, and agriculture.
 Their sustainable packaging strategy is based on the global
plastic waste crisis and is designed to create change through a
circular economy for all their packaging. The Coca‑Cola water
strategy focuses on ensuring sustainable water security using
smart water policies, and responsible use of water use across its
operations, sourcing processes and communities
 CONCLUSION

 There is direct relation between CSR and the sustainability of the resources as the
more consumption of the resources the less sustainability of the resources.
 Companies are challenged to help society as a whole to achieve a sustainable
development. Sustainable management thus revolves around what the company does
to advance sustainability and attempts to maximize its contribution in this respect.
 Corporate social responsibility and corporate sustainability are distinct practices.
However, when it comes to building a positive business reputation and long-term
success, it’s best to invest in both initiatives.
THEORIES OF CSR
 SHAREHOLDER VALUE
THEORY/TRADITIONAL VIEW OF CSR
Shareholder Value Theory (SVT) postulates that the only responsibility of business organisations is to
create wealth for its shareholders by increasing the profits and consequently, the value of shares.
Fulfilment of social responsibility is secondary; rather it is to be fulfilled to the extent of statutory
requirements in that behalf.
 Milton Friedman opines that there is one and only one social responsibility of corporate houses - to
utilise all its resources and pursue activities in of to increase its profits so long as it plays by the rules
of the game, i.e. , engages in open and free competition, without deceit or fraud.
 In this theory, there are two other components:
• Decision-making is based on principal-agency theory and
• Corporate structure should facilitate the fiduciary duties of the executives towards shareholders.
 STAKEHOLDER THEORY
 According to the Stakeholder Theory, the shareholders' interests are secondary, and it is the social
responsibility of the company to frame policies to benefit various groups that represent the stakeholders,
other than the shareholders, of the company; and in doing so, the company may be required to go beyond the
ambit of statutory requirements regarding social responsibility.
 Evan and Freeman justify the stakeholder theory on the basis of following two principles:
i. The Principle of Corporate Rights', which asserts that the corporation and its managers may not violate the
legitimate rights of others to determine their future"; and
ii. The Principle of Corporate Effects', which asserts that "the corporation and its managers are responsible for
the effects of their actions on others”. These two principles are supported by Kant's dictum regarding
respect for human beings.
 CORPORATE SOCIAL PERFORMANCE
(CSP) THEORY
 Corporate Social Performance refers to the configuration in a business organisation of
principles of social responsibility; processes of response to social requirements; and policies,
programmes, and tangible results that reflect the organisation's relations with society. This
theory postulates that the activities of business organisations are not restricted to the creation
of wealth; they also have social responsibilities, which may exceed the statutory requirements.
 These social responsibilities include; carrying out activities that promote social welfare and
solve problems created by the organisations themselves a problems arising out of other causes.
Thus, philanthropic activities and social welfare initiatives give an idea about an organisation's
relationship with society. For example, the Tata group is synonymous with philanthropy, as
they are at the helm of many public charitable trusts.
 CORPORATE CITIZENSHIP
THEORY
 This theory suggests that business is a component of society as are the citizens. Windsor
believes that corporate citizenship is a movement that, so to say, bestows citizenship upon
corporate entities, along with responsibilities thereof.
 The constitution of a country bestows its citizens with rights and expects the performance
of duties.
 Thus, businesses as citizens have the right to carry on business and the duty to fulfil social
responsibilities. This is in agreement with the theory propounded by Aristotle that
businesses are seamlessly woven into a society and just as every part contributes to the
whole, businesses should contribute to the welfare of society.
THANK YOU!