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Suman Rao
Turnaround Manager, India
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How to Measure the Impact of Corporate Social Responsibility (CSR)?
If we keep in mind the Four Stages of CSR-implementation by Martinuzzi and Krumay (With a CSR-scope moving from Project ⇒ Quality ⇒ Strategic ⇒ Transformational), that makes me wonder how to assess the impact of the corporate dollars spent on CSR.
More particularly, how to assess whether CSR initiatives and investments are at all serving the (strategic/transformational/etc) objectives?
For example if a company has a choice between building a school and building a hospital, which one should it choose and why?
Appreciate any thoughts...
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john stahley
Management Consultant, United States
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Corporate Social Responsibility Accreditation The agency I work for is accredited through the American Correctional Association. Accreditation promotes improvement in the management of correctional agencies through the administration of a voluntary accreditation program and the ongoing development and revision of relevant, useful standards.
- Project Orientated: Staff prepared for ACA Audit for 6 Months.
- Quality Orientated: ACA renewal is every 3 years, Prison Rape Elimination Act brought new changes this review.
- Strategic: Information Sharing between institutions is enhanced, ie, lessons learned.
- Transformational: We are always moving from Good to Great, the triennial review aids in renewing employee awareness to laws and our corresponding responsibilities with implementation.
The ACA is a private entity, and enables our organization to assure the public that we are in compliance with all ACA standards and practices.
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Charles P. Keith
Management Consultant, United States
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Behavioral Scales for Corporate Social Responsibility I especially like the stages of CSR as described by Anneke and its link to competitive advantage. These stages are behavior oriented in that we can actually diagnose an organization's development using behavioral ranked scales and perhaps even predict the corporate's perception of its competitiveness or lack thereof. Nicely stated Anneke, thanks for the summary. Anyone interested in developing a behavioral rank scale for these levels?
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Tom Wilson
HR Consultant, United States
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Behavioral Scales for CSR @Charles P. Keith: Good idea, Charles, give it a go. You seem to have something in mind.
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john stahley
Management Consultant, United States
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To Build a School or a Hospital? The answer depends on trending demographics, infrastructure age, private and public interests as it relates to investment. The trend in the U.S. is to socialized medicine. This has repercussions as it relates to the availability in investment dollars. A construction company needs to use a long term forward thinking approach before it makes a determination to focus its business and CSR efforts on school or hospital construction.
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Suman Rao
Turnaround Manager, India
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School or Hospital? The Equity Concept @John: linking the dilemma to forward thinking has a lot of merit indeed. In sustainable development (an objective of CSR), there is a concept of equity: "Equity derives from a concept of social justice. It represents a belief that there are some things which all people should have, that there are basic needs that should be fulfilled, that burdens and rewards should not be spread too divergently across the community, and that policy should be directed with impartiality, fairness and justice towards these ends." (Falk et al. 1993, P. 2).
For CSR, a school investment is an investment in long term / intergen equity. While a hospital investment is an intragen / near term intergen equity.
One difference between good companies. And great corporate citizens is: to what extent their “equity” shares represent both types of equities: financial as well as sustainable. Perhaps some of the great corporate citizens have millions of intragen and intergen investors/shareholders because they believe in the corporate citizen’s abilities to deliver on both.
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Charles P. Keith
Management Consultant, United States
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School and Hospital? @Suman Rao: I find it interesting that the question is posed as an "either/or" proposition rather than "both/and". A community with school will supply the business with qualified workers who in turn, will create families that need medical care.
If the strategy is either school or hospital, it is still a good thing, but will not maximize the long term benefit for the company. Yes, the focus is on the long term benefit for the company which makes it strategic rather than philanthropic.
The question then becomes "what do we build and in what order do we build it?" Satisfying a true community need that will in turn position the company will be part of the determining factor as is sustainability of the effort, risk assessment, and a myriad of other considerations.
If the company is thinking through both options or more, they may be moving from the quality or project level toward transformational.
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Suman Rao
Turnaround Manager, India
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School or Hospital? Charles your point on "What do we build and in what order do we build it" is indeed a very objective way of looking at CSR. We are of course discussing community situations where there is choice of a school OR a hospital. If for example we were discussing the company's own employees and their families residing in the vicinity of a large manufacturing plant, then it would be school AND hospital discussion -part of employee welfare (not CSR...).
That said, school or hospital - as you rightly put is dependent of the need of the community. But how is this “community” defined and who decides what the community needs? There are layers of community need determining entities - from UN onward down to the local level...
One possible solution is to work with town planning authorities (assuming they have determined their social priorities correctly). Perhaps they need 2 schools in 2 locations instead of a school AND a hospital in the same area?
Are 2 schools (according to CSR coordinated with town planning) > 1 School + 1 Hospital for CSR? Maybe?
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Tom Wilson
HR Consultant, United States
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Seed Capital as a Transformational Constraint @Charles P. Keith: You have made exactly my point regarding designing a transformation process as a venture capital start-up. The first step is to define the mission of the project specifically to address the either/or - both/and dilemma.
When I refer to "community", I am referring to the client system as a discrete instrumental community that is an element in a larger, geographic community. The needs of the instrumental community come first. This is where your behavioral scales serve to define the boundaries or the transformation. Transformation begins with focus: thinking globally will follow.
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Suman Rao
Turnaround Manager, India
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Seed Capital as a Transformational Constraint Tom, your point on the need to define the mission of the project is well made. In general this holds for investments such as schools and hospitals.
Now, think of a community hall where the corporatio...
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Charles P. Keith
Management Consultant, United States
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Rationalize the CSR Decision @Suman Rao: Let's ensure the question of either a hospital OR a school does not become an academic discussion. As you pointed out, perhaps the community needs two schools and then a hospital or vice v...
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Tom Wilson
HR Consultant, United States
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Philanthropy is a Valid Investment Strategy @Suman Rao: You got my point exactly. In general, the instrumental community is better served to approach the stakeholder communities (a term your reply just suggested to me) as an exercise in philant...
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Suman Rao
Turnaround Manager, India
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Philanthropy is a Valid CSR Investment Objective Tom, I'm glad you brought the important points of stakeholders & dynamic capitalism (parable of talents). I think what distinguishes a CSR investment from other investments is its objective of philant...
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Suman Rao
Turnaround Manager, India
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Philanthropy is a Valid CSR Investment Objective Charles, good post! In some countries, it is (becoming) mandatory for “for-profit” companies to spend a % of their profits in CSR. That being so, it is only natural that companies would tend to link C...
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Charles P. Keith
Management Consultant, United States
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Philanthropy is a Valid CSR Investment Objective Suman, you make a valid point regarding government pressure (or even cultural pressure) for "for-profits to contribute into CSR related activities. If over time, pressure to increase contribution leve...
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Suman Rao
Turnaround Manager, India
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Philanthropy as a Valid CSR Investment Objective Charles very true. The balance is quite important. Just because one is an environment enthusiast, one does not relish being paid a visit by a dark snake to wish and shake hands for Happy New Year! Uns...
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