Cover Story
Spring 2018 / Issue 57
Cover Story
Spring 2018 / Issue 57
Doing Well by Doing Good - Corporate Social
Responsibility as a Boon for Business
I
n the development world,
“business” used to be some-
thing of a dirty word. This is
because the profit-centered
competition driving the capitalist
economy was seen as running
counter to efforts to promote
equality, protect the environment,
and ensure decent living condi-
tions for all. This negative image
(in fact often a caricature) helped
to spur the emergence in the
1960s of the concept of “corpo-
rate social responsibility”- the idea
that private companies ought to
pay heed to the impact that their
operations have on their employ-
ees, their communities, and the
natural environment.
Times have changed since then.
Particularly since the adoption of
the Sustainable Development
Goals (SDGs) by all the UN mem-
ber states in 2015, the private
sector is being embraced as an
essential ally and even a pioneer-
ing partner for development.
“We know that public resources
will only go so far in securing SDG
achievement,” explains UNDP
head Achim Steiner. “We are com-
mitted to strengthen our partner-
ships with the private sector and
to help support the alignment of
business interests and invest-
ments with the SDGs.”
The evolution of corporate social
responsibility (CSR) has a lot to do
with this change of attitude. Ini-
tially the idea was understood as
corporate charity or simpls public
relations. Executives viewed CSR
as mainly a cost, so when times
turned tough, CSR initiatives were
the first thing chopped.
The turnaround in attitudes is in
part due to the work of the Global
Compact, the UN framework for
corporate social responsibility.
Since its creation in 2000, the
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AmCham Macedonia Magazine
Autor:
Louisa Vinton, UN
Resident Coordinator
and UNDP Resident
Representative
Global Compact has signed on 12,500 participating entities and
helped build 85 local networks in more than 160 countries. This
scope makes it the world’s largest voluntary network for respon-
sible business practices.
The Global Compact set out to demonstrate how companies
of all shapes and sizes, in all sectors and in every corner of the
world, could play a role in improving life for both people and the
planet.
The ten simple principles that underpin the UN Global Compact
are derived f rom the founding documents of the United Nations.
Together they provide a concise roadmap for socially responsible
business practices, in the areas of human rights, labour freedoms,
the environment, and corruption.
To appreciate their simple comprehensiveness, it’s worth enu-
merating them here:
First, businesses should support, respect and protect
internationally proclaimed human rights;
Second, they should make sure that they are not com-
plicit in human rights abuses.
Third, they should uphold the freedom of association
and the the right to collective bargaining;
Fourth, they should eliminate all forms of forced and
compulsory labor;
Fifth, they should abolish child labor;
Sixth, they should eliminate discrimination in respect of
employment and occupation.
Seventh, they should support a precautionary approach
to environmental challenges;
Eighth, they should promote greater environmental
responsibility;
Ninth, they should encourage the use of environmen-
tally friendly technologies; and
Tenth, they should work against corruption in all its
forms, including extortion and bribery.
It is not enough for companies to make a rhetorical promise
to obey these “ten commandments.” After initial complaints that
companies were using the Global Compact merely to add spar-
kle to their brands, the UN put muscle behind the initiative by
requiring members to submit annual
reports called “Communications on
Progress” to document their adher-
ence to the ten principles.
This ambitious code provides
a good illustration of how far the
concept of being a good corporate
citizen has evolved in the past few
decades. A company’s duty to the
community was once seen as ful-
filled through simple philanthropy.
Now it is seen as central to business
strategy and operations.
Indeed, the mission of the UN
Global Compact is a transformative
one. Its aim is to encourage com-
panies to re-orient the way they
do business and to shift from an
exclusive focus on profit towards a
broader engagement in addressing
social, environmental, and ethical
concerns – something that in man-
agement lingo is known as the “qua-
druple bottom line,” comprising – in
addition to profit – the imperatives of
people, planet and “purpose,” or the
greater good.
This movement has been aided
by a growing body of empirical evi-
dence showing that corporate social
responsibility is not just the right
thing to do, but it also makes good
business sense. Research finds a
clear correlation between respon-
sible business practices and good
corporate results. One can have
a “chicken and egg” debate over
which comes first, but what is clear
is that the two go hand in hand. Or,
as our Secretary-General puts it,
“principles and profits are two sides
of the same coin.”
Here in this country, as in many
other settings where adherence to
the rule of law is sometimes shaky,
corporate social responsibility has
been slow to gain traction. This is
at least in part owing to a fear by
executives and owners that playing
by the rules is a “sucker’s game” –
complying with laws, paying taxes
and eschewing corruption looks like
surrendering a crucial competitive
advantage.
There are some good examples,
however. In 2016, for instance,
the Usje cement company con-
tributed EUR 50,000 to an ener-
gy-efficiency overhaul of the Krume
Kepeski primary school in the com-
pany’s hometown of Kisela Voda
that was co-funded by UNDP
and the municipal administration.
In its truest meaning, though, corpo-
rate social responsibility also means
transforming standard business
practices. In Croatia, for many com-
panies the first step in this overhaul
was the inclusion of persons with
disabilities in the corporate work-
force. As is the case now in Skopje,
for Zagreb-based firms this was ini-
tially seen as an act of beneficence
– or something that was essentially
forced on business by levying fines
on firms that failed to hire their quota
of employees with disabilities.
However, many Croatian com-
panies soon found that hiring staff
with disabilities brought unexpected
rewards, through the extreme loyalty
of new recruits and also the discovery
of entirely new markets. This is what
management consultants are calling
“disability confidence” - the idea that
creating a welcoming atmosphere
for both employees and customers
with disabilities is good for business.
Rather than look at disability as a
potentially expensive hurdle to over-
come, companies are coming to see
becoming disability-friendly as a way
to stand out in a highly competitive
marketplace.
Moreover, global experience shows
that being flexible for persons with
disabilities makes companies more
flexible for all groups – an important
advantage in markets where people
expect more customized service.
The example of Tesco is instructive;
the UK retailer found that customers
preferred the website it had created
for people with impaired vision to its
regular site because it was so easy
to use. Similarly, airports find that
rushed travelers prefer to use toilet
facilities that are designated for the
“handicapped” because they offer
ample room for luggage. What these
examples confirm is that adapting
for extremes (or “universal design”)
opens doors to new customers.
In the Macedonian context, where
the participation of persons with dis-
abilities in the mainstream workforce
is still a rare exception, this may
seem like science fiction. But UNDP
is working to change attitudes and
pilot new practices, so we expect
companies will soon recognize what
has been grasped elsewhere, namely
that “doing well by doing good” is the
new golden rule for business.
AmCham Macedonia Magazine
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