Integrating CSR:
stakeholder engagement
Stakeholders are often the driver for organizations integrating CSR into their existing management systems. warns organizations not to forget them
The question is often asked: how can corporate social responsibility (CSR) be integrated into an existing management system? At Two Tomorrows Group we prefer to turn the question around by saying: how can existing management systems be integrated into a CSR strategy?
This approach gives organizations something clearer to work with. CSR is such a broad area that people often find it hard to know where to start. If a good health and safety, quality, or environmental management system is in place, then the organization already has an effective launch pad, where issues that fall under the CSR umbrella will be managed. These approaches may well provide the engine to deliver on CSR commitments, so why do more? Because what these approaches won’t do is give an overall strategic direction to CSR or voice what stakeholders think and how to engage with them.
Strategic direction within the CSR approach is guided by a principles base currently lacking in most management systems. Without a set of principles it is difficult to set a strategy that really focuses on the organization’s contribution to sustainable development. Principles provide a reference point when detailed management loses sight of the overall purpose – the dreaded tick-box approach, which has been one of the key criticisms of many ISO 14001 certifications.
Management systems also lack a stakeholder-based approach to identifying and managing issues. Shell’s Brent Spar debacle in the mid 1990s is a classic case of a lack of stakeholder focus. After the company’s announcement of the deep sea disposal of a North Sea oil storage and tanker loading buoy, they were forced to change their plans after facing a high-profile campaign by the media and Greenpeace. Recent corporate history is littered with other such examples. The chief executive of agriculture company Monsanto said simply: ‘We forgot to listen’, when its biotechnology division suffered a catastrophic plunge in share price.
What help is available?
There are various standards for managing non-financial issues, but as yet there is no certifiable international management standard covering all the aspects of CSR management. ISO 26000, currently under development, will provide guidance on managing CSR, but will not be a certifiable management standard.
There is a wide range of guidelines, frameworks and principles, all of which have something to offer. One recent survey identified more than 400 documents of relevance to one or more parts of CSR. Some that are commonly used and that cover a wide swathe of issues are the UN Global Compact that contains a set of ten principles, the Global Reporting Initiative’s Reporting Guidelines that are effectively the defacto standard for reporting on CSR, and the AA 1000 set of standards.
AA 1000 AS (assurance standard) and its related standard AA 1000 APS (accountability principles standard) together form the only globally applicable non-guideline standards that focus on the full gamut of CSR – but they are limited to assurance rather than management systems.
AA 1000 APS defines a set of core principles that CSR or sustainability reports must focus on. These principles provide a compass for companies to see if they are achieving their aims and defining their views of sustainability and it provides key criteria against which to assure. These principles are:
- Inclusivity: assuring that the organisation has effective processes and competencies in place to enable participation of stakeholders in developing and achieving its strategic response to sustainability
- Materiality: assuring that CSR reporting covers those issues relevant to you and your stakeholders
- Responsiveness: assuring that the reporting demonstrates how you have responded to the needs and concerns of stakeholders
Revisions made to AA 1000 AS in 2008 marked a major step forward for sustainability report assurance. They reflect developments in the understanding and practice of stakeholder engagement and materiality and provide greater clarity. These changes enable a more rigorous, consistent and high-quality approach to assurance of sustainability and CSR reporting.
AA 1000 AS puts greater emphasis on organizations ’ ability to identify and report on their material issues, and on the quality and scope of their stakeholder engagement. In communicating their accountability, companies will need to acquire the skill of addressing these principles while still producing engaging, interesting, clear and understandable content.
Indeed, part of the challenge for reporting companies is how to reflect the outcomes of the stakeholder engagement that is undertaken as part of their everyday business, and how stakeholders views and expectations are included in the decision making processes – and hopefully avoid admitting ‘they forgot to listen’.
About the author
Jason Perks is a director at Two Tomorrows Group which offers expertise in assisting organizations in the development and implementation of their sustainable strategies.
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