The decade 2005-2015 marks the period when corporate responsibility entered the mainstream. Early adopters now have programs mature enough to compare for success and best practices. I have observed that the world's best corporate citizens share a set of characteristics on how they view themselves and interact with society:
1) Corporate Responsibility and environmental responsibilities are embedded in the company's Mission Statements and Charters.
This means that the company has institutionalized safety, good governance, charity and environmental stewardship beyond just stand-alone programs. The company's strategy, and business model embrace corporate responsibility and consider it as a factor in its future viability.
2) The company recognizes its long-term societal and environmental impacts and incorporates them into its strategic planning and risks management processes.
Progressive companies see the world beyond just their own corporate-owned assets. They hold their suppliers accountable for performance and impact; they act to minimize their negative impacts of their products and services through the entire lifecycle - not just the point of sale. They recognize that corporate citizenship means supporting safe, healthy employees; and they actively contribute to the prosperity and well-being of the communities where they have operations and sell their goods.
Risk assessments and strategic planning incorporate externalities beyond just company profits.
3) The most senior management team and the board of directors actively guide the company's CSR programs, goal setting and sustainability reporting.
Senior executives do more than conduct an annual review of programs. They understand the connection between profitability and corporate responsibility. They demand accountability for performance. They push the organization to greater heights, challenge the status quo, and approve resources to advance programs.
4) The company internally and externally aspires to be the best in their industry in the areas of governance, sustainable product development, ethical business practices and environmental stewardship.
CSR is seen as a competitive advantage, a marketplace driver, and a risk mitigation strategy. The company hates to lag and always seeks to be the leader.
5) The company transparently reports its sustainability performance, both successes and shortcomings.
Most companies today benefit from an image of authenticity and honest. In fact, investors demand these qualities. By admitting mistakes and laying out a plan for improvement, the company is signaling that it is well-managed.
6) The connection between the company's long-term prosperity and CSR is effectively articulated.
Leading companies can communicate how CSR programs make money, mitigate risk, bolster long-term viability and create opportunity. CSR programs aren't stand-alones or nice to have. They have business plans, goals and success criteria -- just like any other company initiative -- and their managers are held accountable.
7) CSR Champions are consulted and rewarded.
Let's face it. Many managers don't embrace CSR as part of their jobs. There is usually a small group of champions who drive the majority of achievements. Leading companies consult these champions, leverage their enthusiasm and ultimately reward their efforts - either monetarily or with recognition.
8) Stakeholder engagement is authentic and leads to change.
Stakeholder engagement has risen in importance over the last five years. Companies are expected to reach out proactively to external and internal groups impacted by operations. Their ideas, criticisms, and viewpoints are now expected to be part of the corporate decision-making process. This feedback should supplement senior management opinions as a check and balance on performance. At its best, stakeholders can provide innovative perspectives that can change the direction of the company and make it a stronger company. In turn. stakeholders view the company as a sincere listener of their concerns - a company willing to act on their guidance for the good of all.
9) CSR performance metrics follow international standards.
The most widely accepted reporting metrics are defined by the Global Reporting Initiative and the Carbon Disclosure Project (environmental only). These often step beyond the established operational and functional metrics used by companies internally. Although this complicates data collection, the variance helps companies look at their performance in a way that better reflects external expectations and eases benchmarking.
10) The company takes a long-term view.
Sustainability programs inherently take a long-term view of a company's viability. There's an awareness that a company's impact may live far beyond the current tenure of its executives. And the company often cites the desire to benefit not only today's shareholders but also the next generation.
How does your company stack up? Are you a leader or a laggard?