Date post: | 29-May-2018 |
Category: |
Documents |
Upload: | azhar-mirza |
View: | 227 times |
Download: | 0 times |
of 191
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
1/191
Corporate ResponsibilityCorporate Citizenship
Corporate SustainabilitySustainability Reporting2009
Reana RossouwNext Generation Consultants
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
2/191
Overview The basics and definitions
Responsibility vs Irresponsibility
Sustainability Trends
Sustainability in Practice Case Studies
Strategy Development, implementationand integration
Reporting
Frameworks and Compliance
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
3/191
The Basics
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
4/191
Organisations today faces a threefold pressure to succeed:
To be:More
innovative andcompetitive
Moreproductive andprofitable
Moreresponsible
andsustainable
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
5/191
Sustainability Reporting
is an organisationspublic account of itseconomic,environmental andsocial performance inrelation to its
operations, productsand services.
Note: Organisation
includes corporate,governmental and non-governmentalorganisations
*www.krikor.info
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
6/191
Doing well by doing good - CSIDoing well by being good CSR
Ensuring survival Sustainable Development
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
7/191
Sustainability FrameworkCorporate ResponsibilityManaging risks and impactsacross Economical, Social,Environmental dimensions
Corporate Governance:Compliance, Standards,Frameworks, Principles,Guidelines
Corporate CitizenshipValues, Beliefs, Principles,Policies, Contexts,Definitions
CorporateSustainability
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
8/191
CS and the different interpretations Different strokes for different folks:
To Chinese consumers, the hallmark of a socially responsible
company is safe, high quality products For Germans, it is secure employment
In Thailand, sustainable development is defined as holisticdevelopment which involves six dimensions: economic, social,environment, politics, technology and knowledge, and mentaland spiritual balance.
In Bolivia, there is a particular emphasis on political dimensions(e.g. good governance and participation) and on the cultural andspiritual identity of diverse indigenous peoples
For Africans it is about proving legitimacy and credibility andensuring poverty is alleviated
In South Africa what matters most is a companys contributionto social needs such as healthcare and education
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
9/191
The Definitions
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
10/191
Theoretical Model
www.naturalstep.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
11/191
What drives businesssustainability?
Changing Supply:
Natural ResourcesEmployeesCapital Markets
Changing Rules:
Policy &Regulation
Changing Demand:
ConsumersStakeholders
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
12/191
Sustainabilitys Influence on
Corporate Functions
The very markets in which companies compete are poised for further
change. In some industries, the adaptation of sustainability isparamount to corporate survival
Strategy
New regulations with which to comply.Legal
Need to minimize the energy inefficiencies in older technologies.Developing technologies to minimize the need for virgin materialsused to provide value to consumers.
Information Technology
Eliminating energy inefficiencies in owned operations.Ensuring suppliers compliance with a code of conduct.Ensuring access to needed (and limited) resources, such as waterand energy.
Operations
Stakeholders demand for increased transparency.Financial markets growing evaluation of companies sustainability
efforts.
Finance
Talent pools growing interest in working with companies that attendto sustainability.
Talent Management
Changing consumer interests might lead to missed opportunities.The need to align sustainable consumption and production.
Marketing
ImpactFunction
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
13/191
Lets Define
Sustainability
Meeting the needs of thepresent withoutcompromising the ability offuture generations to meettheir own needs
Triple-bottom-line (TBL)
Considers, measures andrefers to achieving a
balance betweenintegrated (economical)financial, social andenvironmental contributionsand performance to society
www.deloitte.uk
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
14/191
Definitions (contd) Corporate sustainability
A business approach to createlong term shareholder value
by embracing opportunities andmanaging risks derived fromeconomic, environmental andsocial developments
Sustainability reporting Generic term for extra-non-
financial reporting. Refers tothe account an organisation
gives to describe itsperformance on a number ofsustainability dimensions suchas economic, environmental,social, ethics, governance,product and market
responsibility, performancesand impacts.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
15/191
Corporate Citizenship (CC) Considers the rights and responsibilities of companies within a
broader societal context relating to:
Managing the enterprise how efficiently and ethically thecompany governs, controls and manages its operations
Workplace practices how it manages its employees, workplaceconditions and employment practices
Third party interactions how it engages external stakeholders inthe company supply chain, marketplace, government and community
Environment how it controls its impact on the environment
Transformation how South African companies meet theirobligations to help all citizens become meaningful economicparticipants
Product and market stewardship how it markets, what it
produces, how it goes about taking product to market and owning upto the promises made in marketing and product development
Definitions (contd)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
16/191
Definitions (contd) Corporate governance
Generally refers to the process by which organisations aredirected, controlled and held to account. It encompassesauthority, accountability, stewardship, leadership, direction andthe control exercised in the organisation
Corporate (Social) Responsibility (CSR) (CR)
A good corporate citizen (a responsible one) is one that has
comprehensive policies and practices in place. These enable it tomake decisions and conduct its operations ethically, meet legalrequirements and show consideration for society, communitiesand the environment.
Corporate Social Investment (CSI) Refers to a companys contributions to society and community
that are extraneous to its regular business activities.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
17/191
Definitions (contd)
Integrated Sustainability Reporting (ISR)
Relates to non-financial reporting as suggested andoutlined in the King Report on CorporateGovernance for South Africa namely reporting onthe nature and extent of a companys social,
transformation, ethical, safety, health andenvironmental management practices and policies.
Most companies in South Africa use the GRI GlobalReporting Initiative as the benchmark for their reportingstandards
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
18/191
Definitions (contd)
In South Africa, it is expected that the Companies Actwill be passed into law on July 1, 2009. The Act will beeffective from March 1, 2010.
The new provisions (in the Act) will be based on King IIIwhich applies to all entities, regardless of the manner
and form of incorporation and establishment. King III recommends that sustainability reporting should be focussed on substance over form and should transparently
disclose information that is material, relevant, accessible,understandable and comparable with past performance of the
company be formalised as part of the companys reporting processes
have independent assurance
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
19/191
The Concept It is no longer just about being ethical and fair inour dealings, nor just about managing our socialor environmental impacts, nor just about being agood neighbor in our local communities,although all of these are important
It is about turning social, economic and
environmental challenges into opportunitiesfor brand/product/process innovation, businessdevelopment and competitive advantage.
CR is not only central to business strategy
but is increasingly becoming a critical driverof business growth
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
20/191
The DriversThe Business Case
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
21/191
Key Drivers Key driving forces include:
Investor and consumer demands and governmental and publicpressure
Particularly important is the support from Socially ResponsibleInvesting (SRI) Indices .
The corporate responsibility movement is now entering amainstreaming phase aided by standardisation activities such as
the GRI, the AA1000 series and the ISO2600 guide. The field of responsible business strategy and practice is
becoming one of the most dynamic and challengingsubjects corporate leaders are facing today and possiblyone of the most important ones for shaping the future of our
world.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
22/191
Foundations of the business case
An international imperative
The power of multinational companies
Universal rights and standards across developed anddeveloping economies
A national imperative
Conscious effort to address past imbalances and exclusions
The socio economic benefits of a stable, more equitablesociety
Individual company rationale it makes business sense Strong brand and reputation
Employer of choice
Market Position
Trust of financial markets and increased shareholder value New green products/services and new markets
Both risk and opportunity management
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
23/191
What should business be doing
Commit to corporate action Incorporate long-term measures into a
definition of success, targeting profitabilitythat is sustainable, and supported by aresponsible record in managing social,environmental and employment matters
Understand the issues Making operations environmentally andsocially sustainable, making societysustainable, selling products responsibly,influencing suppliers
Use precedent and best practice
Comply with standards, codes andguidelines
Embed the right managementapproach From board and executive level the
authority for sustainability must be
devolved throughout the organisationthrough all processes, systems andoperations
Convert risks and opportunities intoactions
Manage and measure performance
Communicate and reportwww.leryco.co.uk
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
24/191
Benefits of Sustainability
Increased profit
Increased access to capital new sources (investment)
Reduced operating costs/increased operational efficiency
(environmental practices) Enhanced brand image and reputation
Increased sales and customer loyalty
Increased productivity and quality
Increased ability to attract and retain employees Reduced regulatory oversight
Reducing risk and increased risk management
Competitive advantage
Increased market share
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
25/191
Challenges of Sustainbility Managing in an integrated manner the full lifecycle of CR strategy
formulation, implementation, evaluation and evolution incorporatingstakeholder participation
Aligning responsibility strategy to corporate strategy focusing on:
Rationalising and harmonising the economic, compliance, ethical andsustainability dimensions of corporate responsibility and sustainability in thecontext of stakeholder requirements
Managing non-financial risk, particularly brand, reputation, local licence tooperate and to performance instability as an integral part of corporatesustainability management
Integrating eco-design and other sustainability requirements into product andservice offerings
Managing the sustainability performance requirements into product andservice offerings
Managing the sustainability performance optimisation process tocontinually increase stakeholder satisfaction Developing strategic responsibility and sustainability capabilities
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
26/191
Challenges for individual
companies Discussion How do we define
sustainability What is our language What matters to us most What will drive us in
future What are our (company
specific, industry specific)future risks and
challenges What is our 2020/2025
vision
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
27/191
Objectives and motivations of
sustainable companies Increased transparency and improved
governance aimed at rebuilding public trust andinvestor confidence
Delivering wider societal value including supportfor health and human rights improvements andenvironmental protection
Contributing to regional development and globalpartnerships for sustainable development
Addressing in a balanced way the concerns oftheir key stakeholders
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
28/191
Shareholder
Value
Company Lawand compulsoryregulation
SustainableDevelopment
Stakeholdermanagement -
reputation
Risk Management regulation andcompetitive policy
Social Innovation performance stability eco efficiency fair globalisation
SocialAccountability -ethics
Investordemands SRI philanthropycorporatecitizenship
CorporateCompetitiveness
CorporateGovernance
CorporateSustainability
Corporate SocialResponsibility
VoluntaryRegulation
Strategic Map
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
29/191
Responsibility and Sustainability Pathway
Cost SavingEfficiency
ComplianceReputation
Risk
Management
ResilienceNew Future
ConnectivityStakeholders
Innovation
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
30/191
Responsibility and Sustainability Pathway
Revenue Generation
Licence to OperateFreedom to Operate
New Revenue Streams
Revenue Protection
Innovation
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
31/191
Framework Eight core characteristics
Understanding society: understanding the role of each player insociety government, business, trade unions, non governmentalorganisations and civil society
Respecting environment: considering the cost of natural economics,
placing a value on natural resources and calculating benefits Building capacity: participating in partnerships and creating strategicnetworks and alliances
Questioning business as usual: challenging the way of doing thingsand being open to new ideas
Shareholder relations: identifying stakeholders, building relations,
engaging in dialogue and balancing demands Strategic view: taking a strategic view of the business environment Harnessing diversity: respecting diversity and adapting to different
situations Quality control: feedback on the effectiveness of the CR process,
communication and training programs should be an integral part of CRquality management
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
32/191
InvestorDemands
Consumer
DemandsPublicPressure
CorporateResponsibility
andSustainability
GreenBuying
SRI
Regulation
PublicConfidence
GovernmentPressure
Driving Forces
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
33/191
CSR and Sustainability GuidesCorporate Responsibility and sustainability implementation
Corporateresponsibility andsustainabilitystrategic
management
Brand and Reputation Management
Innovation, Production, Distribution
Social Capital Management
Environmental Capital Management
Stakeholder Engagement
Corporate Responsibility and Sustainability principles, best practices case studies trendsReference sector specific CSR/CS Systems
Corporatesustainabilityperformancemanagement
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
34/191
Emerging Frameworks
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
35/191
TBL - CS FrameworkMarketImpact
ProductImpact
TransformationComplianceGovernance
Brand
Impact
Suppliers
Clients
Industry
SUSTAINABILITY
EnvironmentalImpact
SocialImpact
EconomicImpact
SUSTAINBILITY
TBL F k
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
36/191
TBL Framework
BEE; Employment Equity and skills development; Workplaceconditions and policies; Occupational health & safety
Employee wellness; HIV/Aids; Enterprise Development
Corporate Social Investment; Ethical consumerism
Responsible marketing and advertising; Product pricing
Product access; Packaging & Waste; Preferential procurementProduct sourcing and traceability
Water Consumption
Fuel consumption
Electricity Consumption
Waste and Effluent Management
Emissions and climate change
Carbon tradingEnvironmental rehabilitation
Focus Areas:Focus Areas:
High BEE ratings
Business partner of choice
Government business opportunities
Reputation gains
Lower carbon footprints
Decreasing operating costs
Productivity gains
Reputational gains
Opportunities:Opportunities:
Loss of business due to failure to achieve scorecard objectives
Government censure and loss of business
Operational restrictions
Additional regulations
Unquantified supply and cost risks for operations
Escalating building operating costs
Penalties and sanctions
Reputational damage
Risks:Risks
Making operations socially sustainable
Making society sustainable
Selling products responsibly
Influencing suppliers
Climate Change
Escalating operating costs
National Energy Efficiency strategy and accord
Whitepaper on renewable energy
Green Building Council of SA
Key Drivers:Key Drivers: SocialEnvironmental
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
37/191
Stakeholder FrameworkEmployeeRelations
CustomerRelations
SupplierRelations
BrokerRelations
ShareholderRelations
CommunityRelations
ProductAccess
ProductKnowledge
ProductManagement
ProductDistribution/
Marketing
MarketingPractices
Sales Practices
CommunicationPractices
PricingPractices
Sponsorship & PublicRelations Practices
ProductDevelopment
Investor
Relations
Product Stewardship
Market Stewardship
Brand Stewardship
Social Impact
Stakeholder issues
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
38/191
Stakeholder issues
Sustainable raw materialsEmissions water/airEnergy efficiencyWaste managementReduced packagingRecycling
Environment
Tax contributionLocal economic impactTransfer pricing policiesCharity contributionsCommunity investmentCommercial sponsorship
Government and Community
Jobs sustainedPayment of bills
Technology transfer
Business Partners
Price/ValueEasy access to products/services/ distributionQuality of productAdvertising policy
Consumers
Salary & BenefitsHealth & SafetyTraining & DevelopmentEqual OpportunitiesCommunications
Employees
Return on InvestmentCorporate Governance
Shareholders
Key IssuesStakeholders
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
39/191
Issues Framework
Environment Stakeholders
Products
Services
CS
Responsible InvestmentResponsible Drinking
Responsible Consumption
Medical Aid for the poorMedical Aid for retirees
Incentives for green/healthy livingEmployer of Choice
Zero Carbon footprintZero Omissions
Recycling
Reduction of electricity
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
40/191
Issues Frameworks
www.labnet.co.uk & www. Parlermo.co.uk
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
41/191
Industry Sustainability Frameworks
Economical
Environmental
SocialBrand Management
Customer Relationship ManagementInnovation Management
Piracy ProtectionSupply Chain Management
Privacy Protection
Market OpportunitiesPrice Risk Management
Business Risks & OpportunitiesClimate Change Strategy
Environmental Policy & management
Operational Environmental FootprintOperational Eco Efficiency
PackagingRaw Material Sourcing
Biodiversity
RecyclingTransport & Logistics
Emissions/Carbon
Hazardous Substances
Occupational Health & SafetyStakeholder Engagement
Standards for SuppliersAccess & Impact Products/Services
Social Integration
Product Quality & Lifecycle ManagementResponsible Marketing
Human Rights & CorruptionCapacity Building
Corporate Social Investment
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
42/191
Industry Framework
Digital Inclusion
Impact of TelecommunicationServices
Stakeholder Engagement
Standards for Suppliers
Climate Strategy
Electro Magnetic Fields
EnvironmentalPolicy/Management System
Operational Eco-Efficiency
Brand Management
Customer RelationshipManagement
Privacy Protection
Service Development
Telecommunications
Code of Ethics for Advertising
Editorial policy
Ethical Conduct
Protection of ChildrenStakeholder Engagement
Environmental managementsystems
Hazardous substances
Eco-efficiency
Volatile Organic Compounds
Brand Management
Customer Management
Lobbying Activities
Product Piracy
Media
Health & Safety
Standards for Suppliers
Environmental Policy/ClimateStrategy
Genetically ModifiedOrganisms
Reduced Packaging
Raw Material Sourcing
Customer Management
Health & Nutrition
Emerging Markets
Retailers
Code of Ethics inInvestments/Financing
Occupational Health & Safety
Financial Inclusion
Standards for suppliers
Business Risks andOpportunities
Financial Products & Services
Business Risks/ProjectFinance
Environmental PolicyCarbon Footprint
Anti Crime
Brand Management
Customer Management
Stakeholder Engagement
Financial Services
SocialEnvironmentalEconomicIndustry
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
43/191
Its not all about reporting
Its about management and
business practices.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
44/191
In the bigger scheme of things
Sustainability and Corporate Responsibility
Acts as a strategic lever
Supports marketingmessages & brandvalues
Supports and underwritesbusiness objectives,business developmentand business growth
Delivers on shareholder
value and wealth Adds strategic andeconomic value to theorganisation
Creates a new future
C
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
45/191
Effective CR requires companies to:
Develop guidelines
Build collaborative
partnerships Engage with external
stakeholders
Develop indicators to
measure progress Measure results and
impacts
Incorporate CR intostrategic businessdecisions and activities
Build social capital
among management
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
46/191
Sustainability Trends
Reputation vs Risk vs Compliance
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
47/191
What about the recession? According to a new study from PanelIntelligence, 80 percent of sustainabilityleaders surveyed (65 execs from Fortune500 companies) in November say theyintend to maintain or increase spendingin areas related to sustainability next
year. In fact, they reported thatsustainability and clean technologyspending, as a percentage of corporaterevenues, is expected to increase 73percent through 2010.
Another recent study by A.T. Kearneyreveals that, as a result of ecoflation(based on future analysis of increases incommodity prices, environmental andgovernmental policy and climate situations),packaged goods companies may expect areduction in earnings of 19 to 47 percentin the next decade if they do notimplement adequate sustainabilitymeasures. Thats nothing short ofstartling. Thankfully, unlike much of the restof the business world of late, optimism andsound business sense do not seem to be inshort supply among corporate responsibilityleaders of some of the worlds leadingcompanies.
www.coneinc.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
48/191
Sustainability & recession Responses from 65 sustainability executives of Fortune500 companies. Sustainability and clean technology spending - as a
percentage of corporate revenues - is expected to increase73 percent through 2010.
Eighty-two percent of respondents rated energy efficiencyas the most important area of current focus and investment.
Corporate spending on sustainable waste managementinitiatives is expected to grow by 20 percent in 2009, thehighest percentage increase of any subcategory.
Cost savings, revenue generation and brand strength arethe most important drivers of environmental and cleantechnology initiatives.
Nearly 55 percent of respondents observe no financialcriteria (i.e. ROI, payback period) when evaluatingsustainability projects for their respective organizations.
A majority of respondents believe capital remains availablefor sustainability projects.
Business practices are an additional purchasinginfluence, as today's savvy consumers are nowasking "Is this a good company?" and "What does itstand for?"
The environment and economic development areamong the top four causes consumers wantcompanies to address, along with health andeducation
Consumers may become activists if companiesengage in negative business practices; 85 percentwould consider switching to another company'sproducts/services
Relevant and compelling communication are key tobreaking through www.mckinsey.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
49/191
Green is the new black Sustainability labels, virtual
meetings and zero waste
are the order of the day Bottomline - Six Rs
rethink, refuse, reduce,reuse, repair and recycle
Closer tie between GreenMarketing and OverallBrand Image
Environmental and socialresponsibility initiatives willbe tied into overall brandcommunications.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
50/191
CS crossing the divide Smart grid takes off consumers getting serious
and off the grid own water, own heating, ownenergy, own recycling
Year of the carbon market While the U.S. hasntadopted any federal carbon regulations, 850 U.S.cities representing all 50 states have adopted thestandards laid out by the Kyoto Protocol.
Green building sets the code More and more
cities are adjusting commercial building code tolessen the environmental impact of the building.
Banks for the new economy Motivated in part bythe failings of large financial institutions in 2008,banks, particularly smaller firms, will focus oncreating long term personal relationships and willinvest in things that matter to their members. Andright now, members want to bank with sustainableinstitutions; firms that are showing that they careabout their environmental impact.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
51/191
CS crossing the divide Green jobs hiring blitz With more focus on energyefficiency and renewable energy more qualified individualswill be needed to fill empty slots. One study estimated thatnumber to be 4.2 million over the next 30 years. Two
sectors expected to lead this job creation aremanufacturing and utilities. Tapping into water conservation Of the earths natural
resources, water is one of the most undervalued relative toits diminishing availability. The often easy, but previouslyoverlooked, water efficiency measures are gainingrecognition for their ability to save the firm money with littleextra cost.
Get on the bus According to the American PublicTransportation Association (APTA), public transit use sawa 50-year high in 2007. Another study found 76% of
individuals surveyed support public funding for theimprovement and expansion of transit and 80% considerincreased investment in public transit as an increase intheir quality of life. Millions of government funded dollarsare set to expire in 2009, if not used or specific projectsbegan.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
52/191
CS crossing the divide Solars future luster - While solar
installations have predominantly beenphotovoltaic (PV) systems for homeand businesses, utility scale solarfarms and concentrated solar thermalplants are set to surge. This growthwill be accelerated by an increase inventure capital investment and anextension on the life of federal taxcredits.
'Go green goes down Businesseswill no longer be able to say they havegone green and have little to show forit. Consumers will want to see the longterm sustainable efforts businessesare making. Being green as becomemore common, which means firms will
need to be authentic and internallycommitted to being sustainable. Biomimicry a new language, a new
future, going back to nature for futuresustainable solutions
What are people talking about the
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
53/191
What are people talking about the
Buzz Trend Global Warming/Climate
change
Renewableenergy/Alternative fuels
Resource conservation
Carbon Emissions Pollution
Packaging/Plastic
Transportation
Toxins
Organics
www.greenconsumer.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
54/191
The future
THE FUTURE. CS will continue to spread across the supply chain and across
borders. Climate change, urbanisation, and poverty are globalchallenges that require global solutions. With their capital, power,
and innovative potential, firms have a moral responsibility to helpsolve these problems. As a result, CS has to consider an everincreasing range of social and environmental factors from aroundthe globe. Finally, globalisation results in an intensified scramblefor resources, capital, labour and market share. CS helpscompanies to raise their attractiveness as a customer, partner,
employer, or supplier.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
55/191
Finding Solutions CS is no longer just about being good, managing the public image,
or improving products: Sustainability and efficiency initiatives savecosts and increase the value of the company. The FTSE4Good
Index and the emergence of external CS rankings highlight howcompanies are increasingly assessed in terms of theirsustainability and CSR activities.
Solution-oriented CSR is the key vehicle to promote sustainability.CS could be the business blueprint for the future. It will reshape
business ecosystems, changing the way companies are organizedand engage with their stakeholders. In a customer-driveneconomy, CSR will be actively managed, an integral part ofcompany strategy, and a hard factor for company success. It willimpact the nature of competition, foster the development ofsustainability related innovations, and facilitate the emergence ofnew, more successful, business models. As companies are forced tobecome more socially and environmentally responsible CSR willmove into boardrooms and tighten its influence on decision-makingprocesses. For the future world of business, CS is clearly not ashort-term phenomenon, but a trend-driven necessity.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
56/191
Fad or Trend?
A new class of consumer* sustainability consumer
30% of adults in the US 40% of adults in Europe
people who value wealth, theenvironment, social justice, personaldevelopment and sustainable living
Make purchasing and charitabledecisions based on their own morals morals they expect the corporations
they buy from to respect Sustainability consumers are behind
the international expansion of organicfood sales
Sustainability investors make 50% ofall investment decisions and aredriving socially responsibleinvestments
* www.ethicalconsumer.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
57/191
CSR Monitor 2007 Global Study*
Key Findings
Significant numbers of investors take a companys social performanceinto consideration when making investment decisions 61%
In wealthy countries, social responsibility makes a greater contribution tocorporate reputation than brand image 49% of CSR factors comparedto 35% for brand image and 10% for financial management
Companies that ignore social responsibility place market share at risk 42% will punish socially irresponsible companies
Views and behaviors of opinion leaders indicate that consumers socialexpectations of companies will continue grow
North American consumers represent the most socially demandingmarket for companies
Two distinct groups of citizens making up a third of the world areengaged in pressurising companies to assume greater socialresponsibility conventional activists and social activists
*Mckinsey Research
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
58/191
2009 GlobeScan Report Consumers in India, Brazil and China scored the highest -- andthose in the U.S., the lowest -- for green behavior among thecountries included the Greendex survey conducted by Globescan
Green building is on the rise, spurring new technologies that save
energy and money while creating more healthful workplaces. There is a green race taking place in the automobile industry, with
every major manufacturer planning to introduce electric vehicles. The leading consumer product makers and retailers are starting to
rigorously assess the environmental impact of their products using
sophisticated metrics, sending signals up the supply chain thattomorrows products will need to hew to higher levels ofenvironmental responsibility.
www.greenbiz.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
59/191
Ethical Consumers Ethical Consumers worry about
Organic meat, produce and baby food
Fair Trade coffee, tea, bananas,chocolate, honey
Paper/Timber certified as sustainablymanaged by the Forest StewardshipCouncil
Energy-efficient light bulbs andrenewable energy
Unleaded petrol and low-sulphurdiesel
Recycled paper
Landfill and the management of
natural resources such as water, theenvironment and healthy food
But seriously how serious?* Marks & Spencer Plan A
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
60/191
Marks & Spencer Plan A
Business wide 500M Pound eco-plan Carbon neutral, no waste to landfill, extend sustainable sourcing,
set new standards in ethical trading and help customers andemployees live a healthier lifestyle
Tescos making sustainability a significant driver of consumption 500 MPound plan
Developing a carbon counter carbon calorie value of all products,introduce green loyalty card points for customers who buy organic,fairtrade and biodegradable products, increase range of energy-efficientgoods
MacDonalds health drives pays off sales growth of 5.8% sinceintroducing new advertising campaign introducing healthy eating and
exercise Danone, Kelloggs, Kraft, Nestle, Tesco, PepsiCo, Morrisons have
launched 4m Pound campaign to promote GDA labels (guideline dailyamount) for healthier eating committed to produce more responsible foodproducts
Kelloggs Special K products have become mega brands with over 500mPounds in retail sales per year Special K bars 286m Pounds per year 10 000 steps per day has increased brand awareness and market share bymore than 35% - being a responsible corporate citizen is working for us
* Food Review February 2007
More examples
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
61/191
p
The development of an innovative new centrefor the building and construction sector toshowcase technology and products that aredesigned to address sustainability concerns.
Wolseley
Establishment of a sustainable agricultureinitiative to secure a sustainable supply of rawmaterials necessary to deliver the business andits brands.
Unilever
Reducing the number of unbanked andproviding access to affordable credit through itsFinancial Inclusion programme
Barclays
Ethical retailing From Evil Empire to jolly green
giant
Walmart
GlaxoSmithKline believes slashing prices and
sharing patents will help the one in six people inthe world suffering from a neglected tropicaldisease
GlaxoSmith
Kleine
What is a corporates responsibility?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
62/191
What is a corporate s responsibility?
What is typically corporate socially responsiblebehavior and what is not?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
63/191
Lets Talk:
What about Tiger Brands and theR100 million fine?
Sasol and the 100m fine?
Industries in the spotlightT b d Li Ad ti i ddi ti t
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
64/191
Tobacco and Liquor Advertising addiction to
nicotine and alcohol (BAT, Distell) Total ban of advertising to children (Youth brands) -Kellogg's
Obesity amongst world population - McDonalds Consumer Boycotts Gillette and LOreal animal
testing
Heinz tuna fishing nets harming dolphins Lesbian/Gay rights Phillip Morris US electioncampaigns
Caterpillar War in Iraq Nestle, Nescare and Nescafe from babies to
mothers
Starbucks from coffee to drugs Nike and Gap child labour Coke anti globalisation more precious than water Sarah Lee food porn Enron, Worldcom, Parmalat internal corruption Cape plc exploited mineworkers in unhealthy
asbestos mines De Beers Blood diamonds in Africa Saambou, Masterbond. Fidentia and Leisurenet
defrauding investors Banks excessive credit, exorbitant fees Telkom - monopoly
How may liters of water does it
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
65/191
take to make one hamburger?Or 1 tin of coke/beer?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
66/191
Determining Sustainability
What best describes SustainableDevelopment/CR/CC in your company?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
67/191
e e op e t C CC you co pa y
Stage 1Elementary
Stage 2
Engaged
Stage 3Innovative
Stage 4Integrated
Stage 5Transforming
Credibility
Capacity
Coherence
Commitment
Just the basics:Jobs, Profit, Taxes
Functionality:
Philanthropy, community relationsEnvironmental protection
StakeholderEngagement and Management
An integrated concept:TBL, + economic, social and
environmental Factors
The way we define business:Embedded in the corporate DNA
Strategic
Path to Corporate Responsibility(Harvard Business Review)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
68/191
(Harvard Business Review)1
Defensive StageUnexpected Criticism
Activists, Media, CustomersResponds via crises communications
strategy
4Strategic Stage
Realign strategy to addressbusiness practicesCompetitive Edge
5Civil Stage
Collective actionsAdvocacyEducation
Practices
2Compliance Stage
Policies, Reputation Management,Risk Management
King II, JSE SRI, GRI, BEE, etc.
3Managerial Stage
Standards Past PR &Communication
Development of Citizenship
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
69/191
Outside In/Inside Out
Mainstream:BusinessDriven
Organisationalalignment
Crossfunctionalcoordination
Functionalownership
Marginal:Staff Driven
Structure
Visionary,ahead of thepack
Champion, infront of it
Steward, ontop of it
Supporter, inthe loop
Lip service,out of touch
Leadership
MarketCreation or
Social change
ValueProposition
BusinessCase
ReputationLegalCompliance
StrategicIntent
Change theGame
Sustainabilityor TripleBottom Line
ResponsibletoStakeholders
Philanthropy,EnvironmentalProtection
Jobs, Profits &Taxes
CitizenshipConcept
Respondingto society:
Inside Out
Full ExposureAssurancePublic
Reporting
Public
Relationships
Flank
Protection
Transparency
Multi-OrganisationalAlliances
PartnershipMutualInfluence
InteractiveUnilateralStakeholderRelationships
DefiningPro-Active
Systems
Responsive
Programmes
Reactive
Policies
DefensiveIssues
Management
Relating to
society:Outside In
Stage 5Transforming
Stage 4Integrated
Stage 3innovative
Stage 2Engaged
Stage 1Compliant
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
70/191
Defining Sustainability Discussion non-negotiables
Senior Management
commitment and understanding Establishing sustainability
objectives Leadership on key issues Establishing partnerships
Integration of sustainabilitythroughout the Organisation
Sustainability managementsystems , measurement andreporting
Framework for stakeholderengagement
Enabling innovation Building capacity
Effective corporate governance
What is good citizenship?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
71/191
What are corporate responsibilities?* Ethics, governance and acting
responsibly
Responsibility towards society Serving broader stakeholderinterests
Good HR Practices andemployment equity
Good environmental practices Product and market
stewardship
Focus wider than the pursuit of
profits Assist government with socio-
economic agenda
Ensuring long term businesssurvival
*Corporate Citizenship Handbook
Inhibitors of Good Citizenship
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
72/191
b to s o Good C t e s p
Lack of financial resources
Lack of time to understand and implement
Poor awareness and knowledge of the
subject area Lack of skills and understanding of the
subject area
Poor management buy-in in the importanceof responsible business practices
Employees not interested see it as aburden
No real business benefit evident toexecutive management
Poor executive support
Its really very simple . sustainable and
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
73/191
responsible business practices means Discontinuing product offerings that are considered harmful but not
illegal Selecting suppliers based on their sustainable business practices
Choosing manufacturing and packaging materials that are the mostenvironmentally friendly
Providing full disclosure of product content Developing programs that support employee well being
Establishing guidelines for marketing to children Providing increased access for disabled populations Respecting privacy of consumer information Developing process improvements such as eliminating the use of
hazardous waste materials
Ensuring everybody can afford your product
Is this serious stuff?Is anyone paying attention to this?
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
74/191
Is anyone paying attention to this? Sustainability strategy and management
Anglo American, Anglo Platinum, Exxaro, Kumba, Liberty, Mondi, Pick &Pay, Santam
Stakeholder engagement Engen, Sasol, Exxaro
HR management and development, skills development and training,BEE & Transformation Old Mutual, Rand Merchant Bank, Liberty Group, Absa, Engen
Enterprise Development Anglo Plat & American
Customer Care and Satisfaction Nedbank & Liberty Supply Chain Management Metropolitan, SAB Emissions, air pollution and carbon footprint ArcelorMittalo, Exxaro,
Mondi CSI Absa, Engen
Energy use, efficiency and renewables Anglo American, Engen,Exxaro
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
75/191
If its any consolationIts a journey.
Some of us are starting out
Some of us are re-aligning and re-focusing, re-adjusting
Some of us are perfecting
Some of us are benchmarking already.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
76/191
Standards & ComplianceFrameworks & GuidelinesIndustry Initiatives
Refer to Handout
Laws and compliance
SA Constitution & Bill of RightsUniversal Declaration of HumanPrescribed laws,
LocalInternational
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
77/191
Broad Based BEE ActEmployment Equity Act
Skills Development ActIndustry ChartersPreferential Procurement Act
Region-specific InitiativesTransformation Initiatives
King IIJSE Listing Requirements
JSE SRI Index
New Partnership for AfricasDevelopment (NEPAD)
Global Reporting InitiativeAA 1000 Series
SA8000 Standard
UN Global CompactSigma Guidelines
Dow Jones Sustainability IndexFTSE4Good Index
Guidelines
SA Constitution & Bill of Rights
Companies ActBasic Conditions of Employment Act
Labour Relations ActOccupational Health & Safety Act
National Environmental Management ActMineral & Petroleum Resources Dev. Act
National Water ActDirectors Fiduciary DutiesCommon law & judicial precedent
NOSA gradingNational Small Business Act
Environmental Management Act
Universal Declaration of Human
RightsInternational Labour Organisation(ILO) StandardsISO 9000
ISO 14001OHSAS 18000
OECD GuidelinesEcocertFairtrade and Ethical Trading Initiative
Kyoto ProtocolEquator Principles
AA1000
Prescribed laws,
aspirational principlesconventions andstandards
Dont let it scare you Select appropriate standards by asking
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
78/191
What material challenges face your company? Are there any codes or standards that you cannotavoid?
What are the expectations of the marketplace andyour shareholders in relation to the management ofnon-financial issues?
Categorise the standardswhich standards relateto the different stages of business management i.e.planning, implementation, accounting and reporting or categorise according to functional business uniti.e. HR, marketing etc?
Which business strategies and management
practices, add value and economic growth andcontribute to social cohesion?
In choosing a standard, companies may need totake in more than one context, i.e. the industry,geography, political context, regulatory
environment The chosen standards should further businessgoals and strategy and improve business efficiency
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
79/191
One step at a time
IT DEPENDS ON WHAT YOUWANT TO DO/ACHIEVE
IT DEPENDS ON WHO YOU ARE
(Industry)
Equator Principles (financial)
Ethical Trading (retail)
Forest Stewardship (paper)
Industry Standards
www.cdproject.netCarbon Disclosure Project
AA1000 Assurance Standard
AA1000 Stakeholder EngagementStandard
Issues Management Tool
www.accountability.org.uk
Assurance
GRI www.globalreporting.orgReport
JSE-SRI; King III, Companies ActGovernance
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
80/191
Industry Based Initiatives The rise of industry based initiatives in CSR is one of the major
transformations in the landscape of CSR Momentum is growing in developing countries around sustainability issues,
and industry initiatives provide an architecture that allows for consultationbetween Developed and developing countries Private and public sectors Producers, buyers and retailers
Industry based initiatives can be useful in
Establishing collective to-do lists Identifying comparative advantages of individual companies Defining roles for individual companies Distributing CSR activities by working in partnership Stakeholder engagement is easier
Providing common systems for monitoring, verification, certification and reporting Building consumer confidence and managing reputation risk better than a singlecompany can on its own
Providing economies of scale and access to public funding for structural changeswithin an industry, within supply chains or regions
Serving as portals for dissemination of information in a coordinated manner
Global Compact
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
81/191
p
The UNGC is a multi-stakeholder platformrooted in universally accepted conventions Human Rights Labour Standards
Environmental Principles Anti Corruption Principles
More than 6000 participants in 120 Countries SA Sasol, Nedbank, Eskom, etc. 40
signatories SA Part of GRI and Sustainability Reporting
process
UNGC Membership
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
82/191
Commitments Leadership commitment (board & management) Letter
to UN
Willingness to engage in continuous performanceimprovement (set strategic & operational goals,measuring results, communication internally andexternally)
Openness to dialogue and learning around critical issues(participate in events local and global, engage instakeholder engagement and dialogue)
Commitment to transparency, accountability and publicdisclosure (annual COP Communication on Progress)
COP Report against at least 2 indicators Labour, environment, human rights, anti corruption
UNGC COP Reports
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
83/191
p
CEO Statement of commitment
Description of practical implementation of10 principles (1st year only 2 indicators)
Definition of performance indicators &
measurement of outcomes (GRI/ETHOS) Post on GC website and own plus
communication to stakeholders
Verification external consultants,stakeholder feedback, peer review
Case Study Global Sports
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
84/191
y p
Case Study Danisco
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
85/191
(2 indicators 1st report)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
86/191
Where do we start
What is the process
In summary
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
87/191
Allowing external stakeholders toInfluence corporate strategy toensure the future sustainability
of the company and all its stakeholders.
Its about owning up to yourresponsibilities
Its about the learning in the processof becoming more responsible
It is a new awareness and consciousness
Changing and adapting businessstrategy and operations to support
the new responsibilities
Managing CR the process
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
88/191
Engaging Stakeholders
Embedding citizenship in organisation
Structures and resources for managingcorporate citizenship
CEO involvement
Management commitment
Communicating citizenship
Reporting
Referencing codes and standards
Verifying reports
Elements of integration
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
89/191
ManagementSystems
Reporting and
Verification
StakeholderEngagement
Lets make it work!
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
90/191
Engaging with stakeholders
By obtaining input and feedback, managementsystems can be developed and changed
Embed management systems and actions
Developing a framework to translate policy intomanagement systems and actions, and to entrenchresponsible and considerate behavior across allmanagement structures
Reporting should follow performance Reporting becomes a logical extension of responsible
citizenship practices, using it as a tool to support theprocess, focusing on issues that are material, settingtargets derived from action plans and tracking
performance
Sustainability Process
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
91/191
10.
Assess, Redefine and re-map
9.Measure, monitor
And assess performance
8.Operationalise
And internalise learnings
7.Understand material
Aspects, identify opportunitiesAnd risk 6.
Build and strengthencapacity
5.
Determine and defineWays of engaging that work
4.
Establish engagementPlan & period schedule
3.Determine and define
Engagement, objective andscope
2.
Initial IdentificationOf material issues
1.
IdentifyStakeholders
Stakeholder
Engagement
Sustainability Process (1)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
92/191
http://www.wbcsd.org/web/images/case/Alcoa/sustainability-process.jpg
Sustainability Process (2)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
93/191
www.fmcg-sustain.com.au/.../approaches/
Sustainability Process (3)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
94/191
Sustainability Process (4)www melbournewater au
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
95/191
www.melbournewater.au
Case Study: SAP
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
96/191
StrategicSustainability
Strategic Sustainability is: integral to the business model and fundamental
to the business
a source of differentiation, builds organisationalreputation with key stakeholders and helps
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
97/191
p y pbranding
gives a leading edge through innovation,patents, licences, low cost, speed to market andfirst mover advantage
hard to copy builds margin and returns via increased prices,
lower costs, lower assets; and importantly
it is likely to be specific to the company, in theorganisations upstream business processesand is often externally focused
Tactical Sustainability, on the other hand, is: an add on and does not impact core business
every company can do it. It is not a source ofdifferentiation; it offers no real leading edge (andin the case of carbon will become purely acompliance issue), and is easy to copy bycompetitors. It does not build margin because allfirms use it and customers can compare andbargain. Tactical Sustainability is likely to begeneric to the industry, in the organisationsdownstream processes and often internallyfocused.
What Should You Do? Develop Capability: Sustainability is becoming more important. Organisations need to develop the
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
98/191
p p y Sustainability is becoming more important. Organisations need to develop thecapability to scan the external environment for changes in legislation, pressurefrom key customers, consumers and competitors, cost increases in key inputs,technology opportunities, etc.
Bottom Line Focus: During this economic crisis, economic performance is even more important. Set
sustainability strategies with higher expectations of economic benefits andfocus on those sustainability initiatives that attract customers and consumers,and address costs, without being capital intensive.
Link to Business Strategy: Consider how your approach to sustainability aligns with your overarching
business strategy and differentiates your offer and market position from your
competitors. The more strategic your approach, the greater the benefits will be. Set Targets:
Research / develop targets, measures and controls and report regularly.
Resource Appropriately: If you have a sustainability strategy, allocate good people, assign clear
responsibilities, clarify priorities, coordinate/simplify the multiple initiatives ,and share/replicate successes.
Build Capacity: If you dont have a sustainability strategy, educate managers and seek out best
practice (including results), pilot various approaches and demonstrate results,audit key areas to identify improvement opportunities, prepare a strategy toprioritise and coordinate the overall approach.
Design and execute an implementation plan
Develop objectives and communicate objectives (communications)
Review organisational structure to provide for new processes andsystems (human resources)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
99/191
g p psystems (human resources)
Create committees for specific development areas, and ensure it is part ofjob descriptions. Reward systems should also be developed.(management)
Business planning must be modified to reflect new priorities
Management information systems must be enhanced to reflect newinformation requirements (information technology)
Marketing activities require enhanced market research efforts, whichinfluence the way products are designed, produced, packaged, marketedand promoted (marketing & sales)
Production processes and operating procedures must be assessedagainst regulations, industry practices or new standards (production)
Regulatory requirements must be identified (corporate affairs) Managers responsible for procurement must reassess (buyers) their
choice of suppliers, to ensure sustainable and responsible objectives arebeing met right throughout the supply chain
Financial planning should consider capital requirements for processchanges and the effect of new mechanisms (finance)
It involves the whole organisation!
Implementation Groups Define governance structures and
management systemsThe Board + Committees
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
100/191
The Board + Committees Board structure, accountability, remuneration Board composition
Stakeholder management Identify stakeholders Engaging stakeholders Identifying stakeholder requirements Responding to stakeholders concerns
Reputation Management Identify and assess issues influencing
reputation Conduct Corporate Reputation Audit Evaluate shareholder and stakeholder
activism issues Risk Management
Identifying, evaluation, managing and
monitoring material risks pertaining tosustainability Implementing governance and risk
management plan Reporting on material risks and progress on
measures
www.volkswagen.com
Process
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
101/191
Sensitising becoming aware of the issues
Discovering becoming aware through experimentalism small
projects and concrete projects Embedding linking structure and strategy with systems
Routinising linking CR to the companys core competencies
Develop a supportive corporate culture
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
102/191
Re-training may be required
Exposure to new stakeholder
groups may be required
The importance of change and
the impact of change needs to
be explained to all levels withinthe organisation
The lead must come from
senior executives and theboard
Develop measures and standards of
performance
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
103/191
performance Industry charters, BEE scorecards are
already public measurement tools, others
will have to be developed
Other compliance issues both global andlocal reporting initiatives need to be studied
to ensure relevance and appropriateness of
reports
Industry specific sustainability initiatives
need to be evaluated: Clothing Industry (Ethical Clothing)
Retail Industry (Fairtrade)
Mining Industry (Kimberly Process)
Petrochemicals & Manufacturing Industry
(Kyoto Agreement)
Liquor Industry (Dublin Principles)
Embedded Sustainability For CR and sustainability to
become part of the business,company leadership must Take ownership of the
consequences of corporatebehaviour and the
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
104/191
company's inter-connectedness in society
Understand the broadsocial and environmentalrisks, challenges,opportunities
Understand the possibleprogression andconsequences for the
company of economic,environmental and socialimpacts
Drive appropriateresponses as an integral
part of the core businessstrategy and long-termvalue
Embed CR into corporatevalue systems
Developing a strategy Benchmark locally
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
105/191
y
Benchmark globally
Benchmark against industry
Benchmark against
competitors
Benchmark outside the
industry
www.cadbury.com
Effective Sustainability Management
Be sure to get approval and buy-in from the executive Appoint a champion to drive the process
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
106/191
Appoint a champion to drive the process Engage senior management and make them understand the rational for
the companys sustainability agenda Make sustainability issues relevant for the management team in the
context of their business operations Ensure that they are involved in co-creating the companies sustainability
policies, criteria and measures Fine-tune, with management a population of sustainability measurement
indicators that are appropriate and relevant for the business Agree on targets against which to be measured in relation to each
sustainability indicator Embed the process in the organisations management system in a rigorous
and structured way Measure, monitor and provide feedback on a regular basis
This is going to cost money
Indicators of performance Realistic levels of
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
107/191
Realistic levels of
expenditure (how much?)
Expenditure within the
definition of CR & CS Continuity of expenditure
Staff participation
Partnerships
Stakeholder participation Application of non-cash
resources
Reporting on outcomes
Reporting on businessbenefits
www.dfic.co.uk
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
108/191
Stakeholder Engagement
Stakeholders
Customers
MediaOwners
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
109/191
Consumers
Shareholders/Investors
Financiers
LocalAuthorities
ProvincialGovernment
National
GovernmentFutureGenerations
Environment
Lobby Groups
Society
LocalCommunities
Suppliers
Employees
Corporation
Stakeholder
Engagement andManagement
Identify all stakeholders
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
110/191
Identify all stakeholders
Find out what are the
imperatives
Define the key drivers
(needs and expectations)
Enter into dialogue
Understand the challenges,
obstacles and conflicts
Develop indicators of
performance
*www.stakeholdermap.com
Coca Cola
Stakeholder Engagement Methodology
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
111/191
g g gy
*www.cocacola.co.uk
Key Challenge1. Failure to identify and engage with stakeholders is likely to result in sustainabilityreports that are not suitable and, more damaging, that lead to poor performance by (a)damaging customer satisfaction and perceptions, (b) adversely affecting employee
motivation and morale, (c) damaging relationships in the supply chain, and (d) possiblycompromising an organization's reputation with the wider community.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
112/191
compromising an organization s reputation with the wider community.
2. Balancing stakeholder expectations in a way that does not compromise the long-termsustainability of the organization.
Stakeholder engagement should inform
future business strategies It assists with priority
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
113/191
It assists with priority
determination
Confirms material risks
Set sustainable development
policies and objectives
Developed by internal
stakeholders in response toexternal stakeholder
expectations
Responses to stakeholder
issues through policies andstrategies must be clear,
concise and measurable
determine level of aggregation
www.gsk.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
114/191
Determining Risks, Impacts,Targets
Materiality
Determine Risks
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
115/191
Materiality, Impact & Risk
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
116/191
www.kovet.hu
Materiality (1)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
117/191
www.segro.com
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
118/191
Materiality (3)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
119/191
www.intel.com
Materiality (4)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
120/191
www.omron.com
Risk Profiles (5)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
121/191
www.gtnews.com
AIG Risk Profiling (6)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
122/191
www.aig.com
Working with indicators (1)MarketplaceComplaints about late payments of billsAverage time to pay bills to suppliers
Proportion of suppliers and partners screened for human rightscompliance
Proportion of suppliers and partners meeting expectedstandards on human rights
MarketplaceCustomer complaints about products and servicesAdvertising complaints upheld
Upheld cases of anti-competitive behaviourCustomer satisfaction levelsProvision for customers with special needsEnvironment
Specific - BasicCore - Basic
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
123/191
standards on human rights
Perception of the company's performance on human rights byits customers
Proportion of companys managers meeting the companys
standards on human rights within their area of operationPerception of the companys performance on human rights byits employeesEnvironmentUse of recycled materialPercentage of waste recycledWorkplacePay and conditions compared against local equivalent averages
Workforce profile compared to community profile for travel towork area for gender, race, disability and age
Perception of the company's performance on human rights byits employeesCommunity
Perception of the company's performance on human rights bythe local community
EnvironmentOverall energy consumptionWater usageSolid waste produced by weight
Upheld cases of prosecution for environmental offencesCO2/greenhouse gas emissionsOther emissions (eg Ozone, Radiation, SOX, NOX etc.)Net CO2/greenhouse gas measures and offsetting effectWorkplaceWorkforce profile by GenderWorkforce profile by RaceWorkforce profile by Disability
Workforce profile by AgeStaff absenteeism
Number of legal non-compliances on health and safety andequal opportunities legislationNumber of staff grievancesUpheld cases of corrupt or unprofessional behaviourNumber of recordable incidents (fatal and non-fatal)including
sub-contractorsStaff turnoverValue of training and development provided to staffPerception measures of the company by its employeesExistence of confidential grievance procedures for workersCommunityCash value of company support as % of pre-tax profitIndividual value of staff time, gifts in kind and management
costs
Working with indicators (2)
SpecificCore
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
124/191
MarketplaceCustomer loyalty measuresRecognising and catering for diversity inadvertising and product labelling
CommunityProject progress and achievement measuresLeverage of other resources
MarketplaceSocial impact, cost or benefits, of the companyscore products and services
Environment
Environmental impact over the supply chainEnvironmental impact, costs or benefits ofcompanies core products and services
WorkplaceImpact evaluations of the effects of downsizing,restructuring etc.
Community
Impact evaluations carried out on communityprogrammesPerception measures of the company as a goodneighbour
pAdvancedAdvanced
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
125/191
Fast Track Learning
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
126/191
Corporate Responsibility Mistakes Lacking vision
It is not about where are we now and what might we do about CR.
It is about where do we want to be in 10 years time
Then its about what and how do we need to change to bring about our vision for the
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
127/191
Then it s about what and how do we need to change to bring about our vision for thenext ten years
Oblivious to the scale of required change
The magnitude of change, the required new creative and innovative thinking is notabout selectively modifying existing business practices
It is about new, more responsible and smarter ways to create shareholder value andwealth
Sub strategic
It is not a staff function at a sub-strategic level with little connection to the strategy of thebusiness, its core competencies and capabilities or management know-how
It requires an understanding of the significance of the range of issues that contribute toCR and the ways that it may affect business. This means to address the possibility ofchanging systems in the core of the business, changing incentive systems,changing the focus of decision-making, and management systems in the core of
the business while implementing CR projects in specific business units
CR Mistakes (contd) Unsophisticated view of CR
Many companies do not separate the two roles of CR protecting the assets of the firmand providing a basis for the creation of new value
Inability to hear outside voices
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
128/191
Inability to hear outside voices
CR demands new views from a range of stakeholders. With no clear distinction betweenvalue protection and value creation, it is not easy to engage stakeholders in appropriate
ways, to ask them appropriate questions and to listen, understand and adhere to theirsuggestions
Sticking with old managerial competencies
Few have recognised that the competencies required in the past may not meet the
needs of the future. I.e. stakeholder engagement, product development, environmental
management, risk management are new management skills development areas
One worldview approach
Many CR programs, focus only or a companys home country specific compliancerequirements. This does not do justice to the real difference between CR agendas acrosscountries, or specific communities and stakeholders. Excessive uniformity is an almost
universal mistake in CR.
CR Mistakes (contd) Uneven approach
Making substantial commitment and achieving good CR performance insome divisions, or business areas, while other parts of the companymight view it as irresponsible. E.g. many companies have made carbon-neutrality pledges without tackling other big CR issues such as child labour orunsafe working conditions.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
129/191
In doing so they often create the impression that their CR are driven by imageconsiderations rather than a deep-seated conviction that requires CR as a
core business asset. Non-participative management Many CR programs have been formulated and implemented through top-
down directives, not matched by the requirements to make CR a part ofcompany culture and procedures.
Best practice requires companies to manage CR through a network of
change champions but this is rarely practiced Failure to see CR as innovation
The failure to see that CR is best practiced on a continuous innovationprocess that links CR to a companys business model. Many companiesare seeking to be more innovative for competitive reasons, yet few regard
their CR programs as directed to value protection or value creation or asinnovation in its own right.
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
130/191
Working with actual reportsand strategies
Practical Session
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
131/191
Best Practice
Awards and Recognition
Accountability Rating
Top 10 2006 Top 10 2007BHP Billiton
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
132/191
BHP Billiton
Anglo Platinum Anglo American
Nedbank Group
Sasol
SAB Miller
Anglogold Ashanti
Santam
Barloworld Kumba Resources
BHP Billiton
Sasol
Lonmin
Anglo American
Nedbank Group
Anglo Platinum Gold Fields
Barloworld
Anglogold Ashanti Santam
Accountability Rating Assessed according to
Strategy, Governance, Performance Management,
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
133/191
gy, , g ,Stakeholder Involvement, Public Disclosure,
Assurance
Key Trends
Materials sector mining, chemical, metals and
glass, oil and gas best performing sector Followed by Financial sector (38%) and industrial
sector (35%), retail/FMCG sector (29%)
SA Accountability Ranking
36.4AECI3254.9Anglogold Ashanti7
37.0Firstrand Group3161.6SAB Miller6
37.4Unitrans3066.0Sasol5
38.1Investec Plc2967.4Nedbank Group4
38.1Investec Ltd2869.4Anglo American3
38.8Richemont Securities2770.1Anglo Platinum2
39.7Edgars Consolidated Stores2678.6BHP Billiton1
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
134/191
13.0Remgro5040.0Sanlam25
14.5Naspers4941.1Metropolitan Holdings24
16.9The Spar Group4841.7Gold Fields23
18.9Mittal Steel4741.7Bidvest Group22
19.0Steinhoff International Holdings4643.0MTN Group21
19.3New Clicks Holdings4545.1Woolworths Holdings20
20.0Murray & Roberts Holdings4445.7Standard Bank Group19
22.5Shoprite Holdings4346.6Pick & Pay Stores18
22.6Dimension Data Holdings4246.6Absa Group17
24.0Super Group4148.0Telkom SA16
24.1Datatec4048.4Impala Platinum Holdings15
24.9Nampak3948.9Sappi14
25.2Old Mutual3849.1Aveng13
30.1JD Group3751.3Massmart Holdings12
31.7Imperial Holdings3652.9Harmony Gold11
32.8Network Healthcare Holdings3553.8Kumba Resources10
34.8Liberty Group3454.2Barlowworld9
35.5Allied Electronics Group3354.7Santam8
SRI Index High environmental impact classification
2006: Anglo American PLC, AngloAmerica Platinum Corp Ltd, ImpalaPlatinum Holdings Ltd, OceanaGroup Ltd, Sasol Ltd, Tongaat-HulettGroup Ltd
2007: Anglo American, AnglogoldAshanti, Aveng, Gold Fields, GroupFi Hi h ld St l Ill S
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
135/191
Five, Highveld Steel, Illovo Sugar,Merafe Resources, Sasol, Tongaat
Hulett Medium environmental impact
classification 2006: Edgars, Medi Clinic, Telkom,
Woolworths
2007: Massmart Low environmental impact classification
2006: Liberty, Nedbank, Remgro 2007: Absa Group, African Bank
Investments Set criteria to measure environmental,
social, corporate governance andbroader economic practices - Alsoconsider policies, management,performance and reporting
Others - SA Results
SA Companies on the Dow JonesSustainability World Index
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
136/191
African Bank Investments Ltd, Investec Ltd,
Nedbank Group Ltd, Bidvest Group Ltd
Good Governance Awards
Focuses on remuneration practices, corporateethics and integrity, risk management, BBBEEand transformation
Overall Winner - 2006 FirstRand Group 2007 FirstRand Group
SA Sustainability Reporting Rewards
Ernst & Young Excellence in Sustainability Reporting 2006: Sasol (1st), Anglo American Platinum (2nd), Bidvest (3rd),
BHP Billiton(4th), Kumba Resources(5th)
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
137/191
BHP Billiton(4 ), Kumba Resources(5 )
2007: Sasol, Barloworld, Massmart Holdings, Nedbank Group,
Absa Group, Telkom, Kumba Resources, Anglogold Ashanti,Edgars Consolidated Stores and Aspen Pharmacare Holdings.
Focuses on sustainability context, report content and boundary,triple bottom line impacts, report quality and effectiveness,assurance and credibility
ACCA South Africa Awards Anglo Platinum, Spier (1st runner up), African Bank & Sasol
(jointly 2nd runner up), Woolworths (best improved report),Massmart (best newcomer)
Focus on completeness, credibility, communication
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
138/191
Reporting
Reporting Process
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
139/191
Why report? In response to pressure from advocates and communities related to specific
events or business practices It is an effort to strengthen the reputation and market competitiveness, Maintain the licence to operate
Demonstrate a serious commitment to a code of conduct to whichorganisations subscribe
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
140/191
organisations subscribe Maintain and strengthen trust with community and advocacy groups,
investors, consumers and other stakeholders Link disparate functions such as finance, marketing, R&D and operations into
a more strategic vision and operation, opening new conversations that pave theway for discovery and innovation
Identify trouble spots and unanticipated opportunities, in supply chains,among customers, communities or regulators, or in the areas of reputation andbrand management
Access and measure the value of sustainability practices in theorganisation in relations to the organisations overall business strategy andcompetitiveness
Reduce share price volatility and uncertainty occasioned by surprise,
untimely or incomplete disclosure
From Annual Report to SustainabilityReport
Annual financial reports now need to include environmental, social and economic
impact and not just focus on publishing of historical financial results.
Description of commitment to economic, environmental and social goals Performance against benchmarks targets and industry norms
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
141/191
Performance against benchmarks, targets and industry norms Major challenges for the organisation in integrating financial performance with
environmental and social performance Percentage of board directors that are independent, non-executive directors
Profitability
Increase/decrease in retained earnings at the end of the period, used tocalculate return on average capital employed
Total recycling and reuse of water Organisations indirect economic impacts
Taxes and subsidies Subsidies received broken down by country or region Total sum of all taxes of all types paid broken down by country or region
Reporting (contd) Corporate social responsibility policies
Externally developed voluntary charters orprinciples to which the organisationsubscribesPolicies and/or systems for managing
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
142/191
Policies and/or systems for managingupstream and downstream impacts
Approaches to stakeholder consultation andfrequency
Awards received relevant to social, ethicaland environmental performance
Restrictions Descriptions of policies including child
labour Descriptions of policies, guidelines and
procedures to address the needs ofindigenous peoples
Amount of monies paid to political partiesand institutions whose prime function is tofund political parties and candidates
Reporting (contd)
Director liability and future expectations Explanation of whether and how the
precautionary approach or principle isaddressed by the organisation
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
143/191
addressed by the organisation
Status of certification pertaining toeconomic, environmental and socialmanagement systems
Explanation of the nature and effect ofrestatements of information provided in
earlier reports and the reasons for suchrestatements
Description of policy for preservingcustomer health and safety during the use
of products and services
Reporting (contd)
Key performance indicators for balanced scorecards
Percentage of materials used that are wastes Direct energy use segmented by primary source Standard injury lost days, absentee rates and fatalities
Preferred supplier standardsP t f t t th t id i d ith d t
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
144/191
Percentage of contracts that were paid in accordance with agreed terms Descriptions of policies, guidelines, corporate structure and procedures to deal with all
aspects of human rights Performance of suppliers relative to environmental requirements
Tradable permits Greenhouse gas emissions
Use and emissions of ozone-depleting substances
Significant environmental impacts of transportation used for logistical purposes Voluntary regulations and standards
Location and size of land owned, leased or managed in biodiversity rich habitats Changes to natural habitats resulting from activities and operations and percentage of
habitat protected or restored
Voluntary code compliance, product labels or awards with respect to social/and or
environmental responsibility that an organisation is qualified to use or has received
Linkages between sustainability and financialreporting
Sustainability reporting complements financial reports with
forward looking information that can enhance the report and theunderstanding of key value drivers such as human capitalformation, corporate governance, management ofenvironmental risks and liabilities and the ability to innovate
8/9/2019 Microsoft Power Point Csr 2009 091104110512 Phpapp02
145/191