Responsible Citizens, Responsible Companies

 

Over the past few decades, it has been interesting to monitor the importance that the Corporate Social Responsibility (CSR) movement has gained in the business world. Quality standards now integrate the social and environmental aspects of production and management processes in a way that “there is no longer quality without responsibility.”

 

Sustainability became exceedingly essential – many times as a highlight of a political agenda, or as a concern about the availability of natural resources, or, just as a marketing tool. However, this heightened corporate attention to CSR has not been entirely voluntary. Many companies awoke to it only after being surprised by public responses to issues they had not previously thought were part of their business responsibilities.

 

Debates about CSR have moved all the way into corporate boardrooms. In 2005, 360 different CSR-related shareholder resolutions were filed on issues ranging from labor conditions to global warming. Almost 10 years later, in 2014, CSR was included in the agenda of the annual economic summit in Davos, where new and innovative ideas related to sustainable development were explored.

 

At the same time, governments support and promote the concept of CSR by increasingly enforcing regulations that mandate social responsibility reporting, or even a generally socially responsible strategic planning. It is not a coincidence that the main themes of Dubai and the UAE for Expo 2020 focus on Sustainability, Mobility and Opportunity – themes that are at the heart of most CSR activities.

 

What is CSR - Areas of Impact

Officially, the European Commission defines CSR as a concept and a practice where “companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis. Being socially responsible means not only fulfilling legal expectations, but also going beyond compliance and investing ‘more’ into human capital, the environment and the relations with stakeholders.”

 

In general, the CSR Objectives focus on four main areas of interest: Corporate Citizenship: Giving back to the community but without expectation of corporate gain, such as revenue increase, and integrating corporations into communities by providing funding, skills and time. The indirect gains would promote the corporate’s brand and employee engagement.

 

Shared Value: Creating a community of responsible and mutually dependent stakeholders such as corporations, institutions and communities by creating shared value that would complement corporations and the surrounding community. Risk Management: Complying with ethical rules and policies in order to eliminate operational risks or damaged relationships. Branding & Visibility: Widening recognition of corporations through corporate citizenship, sponsorships and shared value.

 

Most of the times, today, companies that engage in CSR activities want to achieve positive impact on their clients and their employees, as well as enhanced branding and visibility. In more details, the companies aim at:

 

Increased Sales & Customer Loyalty: Studies show that 87% of clients prefer buying products/services from CSR driven companies. In addition, companies with engaging CSR activities have increased their pool of loyal clients in comparison to companies with lacking CSR initiatives.

 

Enhanced Branding & Visibility: A company that is socially responsible can benefit from its increased credibility and accountability and its reputable status within the business community, which in turn, increases a company’s ability to attract more funds and trading partners.

 

Employee Engagement: Improved employee performance results in developing human capital through innovation and creative thinking. Recent studies show that 80% of job seekers prefer to work for CSR driven companies and that 40% of employees in CSR driven companies have stronger morale and deliver better performances. Responsible Citizenship: Building a community of aware and committed citizens to promote public good and social causes.

 

The social impact of CSR activities includes Job Creation, by strengthening the development and growth of SMEs which, in turn, creates more jobs, Education, by improving educational systems to be responsive to the market needs and demands, including implementation of robust soft skills training programs, Capital, through increasing access to capital especially through transparent online platforms that monitor and evaluate results of capital investment to prospective and potentially excluded SMEs, and, finally, Economic Development, through encouraging corporations to be more responsible towards the community by investing in youth development and women empowerment through education, job creation and entrepreneurship.

 

Challenges
 

While businesses have awakened to the risks of not having a CSR strategy, as well as to the potential benefits of a socially responsible corporate face, they are much less clear on what to do about it. In fact, the most common corporate response has been neither strategic nor operational but cosmetic: public relations and media campaigns, the centerpieces of which are often glossy CSR reports that showcase companies’ social and environmental good deeds.

Thus, despite this trend of increased awareness, the meaning and scope of CSR as a concept have not been explored in any real depth, and we often face ambiguity and confusion. Is CSR a new way of managing an economy in the global era of “risk society” or it is just a different face of what has been labeled for years as “corporate philanthropy”?

 

This misalignment and lack of innovative connection between social missions and CSR strategies is coupled with lack of adequate transparency (for instance, lack of publically accessible and traceable CSR initiatives, such as online campaigns, that show the effectiveness and long lasting impacts on corporations and communities), questionable cost effectiveness and unclear accountability, leading thus to several questions about the role of corporate CSR in today’s economies. At the same time, there is lack of effective measuring of CSR impact, as there is concentrated attention on short-term results and lack of awareness and understanding of long-term outcomes of CSR initiatives. This results in the underdevelopment of proper indicators that measure outcomes, such as improved employee performance, increased understanding of the long-term impact of their investment in CSR initiatives, increased brand loyalty among clients; and strengthening the socio-economic development of communities. These examples illustrate the importance of implementing timelines for impact measurement. Finally, companies have neglected including in their CSR strategies target audience/beneficiaries who are geographically located outside of countries where their operations focus.

 

Many of the discussions and strategies developed regarding CSR share the same weakness: they focus on the tension between business and society rather than on their interdependence. This means that they create a generic rationale that is not tied to the strategy and operations of any specific company or the places in which it operates. Consequently, none of them is sufficient to help a company identify, prioritize, and address the social issues that matter most or the ones on which the company can make the biggest impact. The result is oftentimes a number of uncoordinated CSR and philanthropic activities disconnected from the company’s strategy that neither make any meaningful social impact nor strengthen the firm’s long-term competitiveness. Internally, CSR practices and initiatives are often isolated from operating units—and even separated from corporate philanthropy. Externally, the company’s social impact becomes diffused among numerous unrelated efforts, each responding to a different stakeholder group or corporate pressure point.

 

The consequence of this fragmentation is a tremendous lost opportunity. The power of corporations to create social benefit is dissipated, and so is the potential of companies to take actions that would support both their communities and their business goals.

 

Individual Social Responsibility

 

A relatively more recent way of perceiving and implementing Corporate Social Responsibility is the concept of Individual Social Responsibility (ISR). ISR promotes a proactive stance towards positively influencing and affecting the people and environments outside our immediate circle. ISR is at the roots of CSR, because a corporate comprises of individuals and hence determines the social responsibility culture it creates. Individuals are becoming more socially responsible and, in response to this, corporations and companies need to become more socially responsible to meet consumer demand. The individual social responsibility includes the engagement of each person towards the community where he lives, which can be expressed as an interest towards what is happening in the community, as well as in the active participation in the solving of some of the local problems.

 

Engaging Employees and Business Networks towards Creating Social Impact: a Stanton Chase – Pi Slice Project

 

Stanton Chase International, a leading leadership consulting company focusing on senior human talent, partnered with Pi Slice, a social web-based company operating in collaboration with MicroWorld, in order to develop a platform that offers Stanton Chase partners and consultants around the world, as well as the company’s fast network the opportunity to participate in the development of microlending opportunities towards the support of small entrepreneurs in the MENA region and, later, around the world.

 

The platform operates as follows:

 

Stanton Chase internal and external network become members of the specific platform just by registering in the specific page. Once they are members, they can lend small amounts of money (for instance 20USD) to the select micro-entrepreneurs presented in the specific page. The entrepreneurs are presented analytically, indicating the industry they work in, the reason the specific amount of loan is requested, the time frame for raising the amount and the impact this will have.

 

This project manages to address effectively some of the challenges described above. More specifically, Stanton Chase has a strong network of leaders and decision makers and, we believe, it is part of our responsibility, as global citizens, to find ways to unite the forces of this network towards a bigger goal. As such, this network of leaders from all industries and all geographic locations is engaged to be part of the new ecosystem of responsible individuals – responsible companies, that manage, through their individual actions to create a new social and economic reality.

 

Also, this platform is designed on the basis of a new, innovative and transparent model that directly connects companies and employees to support microfinance projects that are aligned with their social mission.

 

The platform allows both companies and individuals to regularly monitor and evaluate the impact of their investment on the selected microfinance projects, which allows for transparency and, above all, clear measuring of the impact created.

 

Finally, Stanton Chase and Pi Slice aim to engage private sector investments into microfinance and, as such, transform unemployment into prosperity, while promoting youth engagement, women empowerment and economic growth.

Conclusion:

 

CSR is still a new concept that seems to be having an increasingly growing impact on both companies and individuals. A new ecosystem is being developed, where corporate and personal initiatives focus on making changes towards the development of more sustainable economies and societies. Stanton Chase, in collaboration with experts like Pi Slice, aims to take advantage of its strengths in order to be part of this new social reality and engage in really developing the needed responsible leaders of tomorrow.

 

About Konstantina Sakellariou:

Konstantina Sakellariou is Partner at Stanton, Chase – Middle East. She leads the marketing and communication strategy for the whole GCC and broader Middle East region. Konstantina has an over-18-year experience spanning in various sectors. For the past 10 years, she has focused on human talent development at international level. Before joining Stanton Chase, she was appointed as Special Advisor to the Hellenic Ministry of Education. Konstantina has acted as member of the board in the Institute for Youth and has been elected member of the 2009 Board of Directors of Junior Chamber International, acting as International Vice President assigned to 7 European countries, while she has closely collaborated with ICC internationally. She was also awarded the HR Leadership Award at the World HRD Congress 2009.

About Genny Ghanimeh:

 

Genny Ghanimeh is Founder and CEO of Pi Slice. Following her passions for the MicroFinance and the online industries, she founded Pi Slice in March 2012 and negotiated a partnership agreement with MicroWorld from the Group PlanetFinance to build and administer the first microlending online platform in the MENA region. Prior to Pi Slice, Genny began her career in Development Project Finance, and later shifted her focus to the financial industry and business development, where she honed her entrepreneurial skills in founding her 1st company Pro-ID in 2003. Genny has an MA in Civil Engineering from the Lebanese University and an MBA from London Business School (UK).

 

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