Sustainability in Corporate Social Responsibility PDF

[Sustainable luxury and ethics] [Topic 3 -- Corporate Social Responsibility] Diagrama Descripción generada automáticamente **The modern era of social responsibility begins in the 1950s** Social Responsibilities of the Businessman (1953): It refers to the obligations of businessmen to pursue thos...

[Sustainable luxury and ethics] [Topic 3 -- Corporate Social Responsibility] Diagrama Descripción generada automáticamente **The modern era of social responsibility begins in the 1950s** Social Responsibilities of the Businessman (1953): It refers to the obligations of businessmen to pursue those policies, to make those decisions, or to follow those lines of action which are desirable in terms of the objectives and values of our society. **CSR Literature expands: the 1960s** "Businessmen's decisions and actions are taken for reasons at least partially beyond the firm's direct economic or technical interest" (Davis, 1960) "Social responsibilities mean that businessmen should oversee the operation of an economic system that fulfils the expectations of the public" (Frederick, 1960) "The idea of social responsibilities supposes that the corporation has not only economic and legal obligations but also certain responsibilities to society which extend beyond these obligations" (McGuire, 1963) "Social responsibility, therefore, refers to a person's obligation to consider the effects of his decisions and actions on the whole social system. Businessmen apply social responsibility when considering the needs and interests of others affected by business actions. In so doing, they look beyond their firm's narrow economic and technical interests:" (Davis and Blomstorm, 1966) **Definitions of CSR proliferate: The 1970s**...the social responsibility begins where the law ends. A firm is not being socially responsible if it merely complies with the minimum requirements of the law, because this is what any good citizen would do:" (Davis, 1973) Corporate Social Performance (CSP) and Corporate Social Responsibility (CSR) (Carrroll, 1977) Corporate social performance, corporate responsibility, social action, corporate citizenship, social responsiveness, social responsibility, public service, public responsibility, corporate social responsibility **The 1980s: Fewer definitions, more research, and alternative themes** "CSR involves the conduct of a business so that it is economically profitable, law-abiding, ethical and socially supportive. To be socially responsible...then means that profitability and obedience to the law are foremost conditions to discussing the firm's ethics and the extent to which it supports the society in which it exists with contributions of money, time and talent. Thus, CSR comprises four parts: economic, legal, ethical and voluntary or philanthropic." (Carroll, 1983)  **European Commission's definition of CSR 2010** "Concept whereby companies integrate social and environmental concerns in their business operations and in their interactions with their stakeholders on a voluntary basis:" The Asian view of CSR is:"a company's commitment to operating in an economically, socially and environmentally sustainable manner while balancing the interests of diverse stakeholders:" (Fukukawa, 2010) According to the ISO (2010), social responsibility is the responsibility of an organisation for the impacts of its decisions and activities on society and the environment through transparent and ethical behaviour that: - Contributes to sustainable development, including the health and welfare of society - Consider the expectations of stakeholders - Complies with applicable law and consistent with international norms of behaviour - It is integrated throughout its organisation and practised in its relationship **The UN Global Compact** The UN Global Compact is the world's largest corporate citizenship and sustainability initiative. Since its official launch on 26 July 2000, the initiative has grown to more than 10000 participants, including over 7000 businesses in 145 countries worldwide. It is a strategic policy initiative for companies committed to aligning their operations and strategies with ten universally accepted principles in human rights, labour, environment and anti-corruption. By doing so, business, as a primary driver of globalisation, can help ensure that markets, commerce, technology and finance advance in ways that benefit economies and societies everywhere. The Global Compact pursues two complementary objectives: 1\. Mainstream the ten principles in business activities around the world. 2\. Catalyse actions in support of broader UN goals, including SDGs. The Global Compact involves all relevant social actors: companies whose actions it seeks to influence; governments, labour, and civil society organisations; and the United Nations, the world's only truly global political forum, as an authoritative convener and facilitator. **THE TEN PRINCIPLES** The UN Global Compact asks companies to embrace, support and enact, within their sphere of influence, a set of core values in the areas of human rights, labour standards, the environment and anti-corruption. HUMAN RIGHTS - Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights - Principle 2: make sure that they are not complicit in human rights abuses LABOUR - Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining - Principle 4: the elimination of all forms of forced and compulsory labour - Principle 5: the effective abolition of child labour - Principle 6: the elimination of discrimination with respect of employment and occupation ENVIRONMENT - Principle 7: Businesses should support a precautionary approach to environmental challenges - Principle 8: undertake initiatives to promote greater environmental responsibility - Principle 9: encourage the development and diffusion of environmentally friendly technologies ANTI-CORRUPTION - Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery The Global Compact incorporates a transparency and accountability policy known as the Communication on Progress (COP). The annual posting of a COP is an important demonstration of a participant's commitment to the UN Global Compact and its principles. Participating companies must follow this policy, as a commitment to transparency and disclosure is critical to the initiative\'s success. Failure to communicate will result in a change in participant status and possible expulsion. **The International Standardisation Organisation** The ISO develops international standards. The organisation was founded in 1947, and since then, they have published International Standards covering almost all aspects of technology and business, from food safety to computers and agriculture to healthcare. ISO proposes 7 principles 1\. Accountability An organisation should be accountable for its impact on society, the economy and the environment.The organisation should account for: - The impacts of its decisions and activities on society, the environment and the economy (especially significant negative consequences) - The actions taken to prevent a repetition of unintended and unforeseen negative impacts 2\. Transparency An organisation should be transparent in its decisions and activities that impact society and the environment. The organisation should be transparent regarding: - The purpose, nature, and location of its activities - The identity of any controlling interest in its activity - The manner in which its decisions are made, implemented and reviewed - The sources, amounts and applications of its funds - Its stakeholders and the criteria and procedures used to identify, select and engage them Hard disclosure: measurable Soft disclosure: difficult to measure 3\. Ethical behaviour An organisation should behave ethically. The organisation should actively promote ethical behaviour by: - Identifying and stating its core values and principles - Developing and using governance structures that help to promote an ethical behaviour within the organisation - Preventing or solving conflicts of interest throughout the organisation that could otherwise lead to unethical behaviour - Defining and communicating the standards of ethical behaviour expected from its governance structure, employees, suppliers, owner and managers - Encouraging and promoting the observance of its standards of ethical behaviour - Establishing and maintaining mechanisms to facilitate the reporting of unethical behaviour without fear of reprisal - Recognising and addressing situations where local laws and regulations either do not exist or conflict with ethical behaviour - Adopting and applying international standards of ethical behaviour when researching with human subjects - Respecting the welfare of animals, when affecting their lives or existence, including by providing decent conditions for keeping, breeding, producing, transporting and using animals 4\. Respect for the stakeholders An organisation should keep respect, consider and respond to the interests of its stakeholders. The organisation should: - Identify its stakeholders - Recognise and respect the interests and legal rights of its stakeholders and respond to their expressed concerns - Recognise that some stakeholders can significantly affect the activities of the organisation - Take into account the relation of its stakeholders' interests to the broader expectations of society and to sustainable development 5\. Respect for the rule of law An organisation should accept that respect for the rule of law is mandatory. The rule of law refers to the supremacy of law, to the idea that no individual or organisation stands above the law and that the government is also subject to the law. In the context of social responsibility, respect for the rule of law means that an organisation complies with all applicable laws and regulations. 6\. Respect for the international norms of behaviour In countries where the law or its implementation conflicts with international norms of behaviour, an organisation should strive to respect such norms to the greatest extent possible. An organisation should avoid being complicit in the activities of another organisation that are not consistent with international norms of behaviour (supply chain). 7\. Respect for human rights An organisation should respect human rights and recognise their importance and universality (that they are indivisibly applicable in all countries, cultures and situations). An organisation should: - Respect and promote, where possible, the rights set out in the international bill of Human Rights - In situations where human rights are not protected, take steps to respect human rights and avoid taking advantage of these situations. Diagrama Descripción generada automáticamente **Relationships with Stakeholders** If a company ignores the preferences of interest groups, this has a negative effect on its own reputation, thus increasing its risk premium and, in turn, its financial results (Cornell and Shapiro, 1987). Cornell and Shapiro (1987) maintain that the cost of CSR is almost negligible compared with its potential benefits. A stakeholder is an individual or group interested in any decision or activity of an organisation (ISO). They may include anyone with more than a passing interest in the entity's activities (The Australian Standard, CSR). **The Stakeholder Relationship Management (SRM) (Freeman, 1984)** Stakeholders are those groups or individuals who can affect or are affected by the achievement of the company's objectives or those actors with a direct or indirect interest in the company. This perspective describes sustainability as the obligations of companies towards these groups (Maignan and Ferrell, 2004). Thus, it suggests a dimensioning of sustainability according to the primary target groups of the company. Clarkson (1995) proposes that companies and practitioners manage relationships with stakeholders instead of society as a general concept to better address stakeholders' concerns instead of social concerns. The SRM theory says that to be socially responsible, a company must identify its stakeholders, identify their main demands and establish dialogue mechanisms with them. Some typical stakeholders are employees, outsourced workers, suppliers, shareholders, customers, donors and governments (multiple levels):  Engaging with stakeholders can take various forms, such as individual meetings, conferences, round tables, public hearings, workshops, advisory committees, and web-based forms. **Benefits of incorporating SR in companies** Different theories consider CSR as a strategic tool in obtaining financial benefits through: competitive advantages in the market, an improved reputation, a better brand image and more legitimacy. **CSR Standards and reporting** Label: - Symbols that represent the achievement of certain principles or certain results - It is essential to distinguish between governmental labels and private labels - Different products: organic products, environment respectful products,... - There are around 240 labels Code: - Certain rules or formal declarations of values and practices developed by a company - The codes are specific to a company or an organisation - Code of conduct, code of ethics... Standard: - Management system established by a third party used to achieve certain results. The standards are applied in different sectors and/or regions - The standard is audited by an independent agent - The standards are produced by multistakeholder organisations, international associations supported by governments The conditions for a valid standard are the definition of the content, the verification system and the penalisation system. Possible disadvantages for codes, principles or certain standards: - There is no penalisation system in case the standard has not been achieved - The audits are normally not published or accessible to the public - Therefore, some organisations may not take it seriously [Standard in reporting CSR] The Global Reporting Initiative (GRI) is a non-profit organisation that promotes economic, environmental, and social sustainability. It provides companies and organisations with a comprehensive sustainability reporting framework that is widely used worldwide. Companies using GRI should create the report following these instructions: Vision, Strategy or SR or sustainability, company profile, corporate governance and management system, and economic, social and environmental indicators. [Standard in stakeholder engagement] AccountAbilitiy's AA1000 series are principles-based standards to help organisations become more accountable, responsible and sustainable. They address issues affecting governance, business models, and organisational strategy and provide operational guidance on sustainability assurance and stakeholder engagement. The AA1000 standards are designed for the integrated thinking required by the low-carbon and green economy and support reporting and guidance. GRI is focused on WHAT information should be included, while AA1000 is a standard based on the commitment and engagement with stakeholders and enable an external verification. [Standard in Labour Rights] - SAI8000: Social Accountability International works on child labour, forced and compulsory labour, health and safety, freedom of association and right to collective bargaining, discrimination, disciplinary practices, working hours and remuneration. - Clean Clothes Campaign is dedicated to improving working conditions and supporting the empowerment of workers in the global garment and sportswear industries. (women's rights, consumer advocacy and poverty reduction) - Fair Labour Association (FLA) is a collaborative effort of universities, civil society organisations and socially responsible companies dedicated to protecting workers' rights worldwide. It is an international organisation headquartered in Washington DC, with offices in China, Switzerland and Turkey. [Standard in Environment] - Forest Stewardship Council (FSC) shall promote environmentally appropriate, socially beneficial and economically viable management of the world's forests. - ISO14000 standards address various aspects of environmental management. They provide practical tools for companies and organisations to identify and control their environmental impact and constantly improve their environmental performance. - Marine Stewardship Council (MSC) wants to use its eco-label and fishery certification programme to contribute to the health of the world's oceans by recognising and rewarding sustainable fishing practices, influencing people's choices when buying seafood, and working with its partners to transform the seafood market sustainably. - EU Organic Farming is a holistic system for managing a farm and producing food, while ensuring the following: best environmental practices, high levels of biodiversity, preservation of natural resources, and high animal welfare standards. - EU Eco-Management and Audit Scheme (EMAS) is a management tool for companies and other organisations to evaluate, report and improve their environmental performance. - LEED promotes a whole-building approach to sustainability by recognising performance and impacts in several key areas - BREEAM is the world's leading sustainability assessment method for master planning projects, infrastructure, and buildings. It recognises and reflects the value of higher-performing assets across the built environment's lifecycle, from new construction to in-use and refurbishment. Tabla Descripción generada automáticamente **Sustainability in Hotels -- Different certifications hotel-related** The GSTC sets the global baseline standards for sustainability in travel and tourism. These standards can be utilised for education and awareness-raising, policy-making, and measurement and evaluation by businesses, government bodies, and other organisations, and they serve as a foundation for certification. There are two sets of standards: the GSTC Industry Criteria (for tour operators and hotels) and the GSTC Destination Criteria (for destinations). The hotel criteria are organised around four main themes: effective sustainability planning, maximising social and economic benefits for the local community, enhancing cultural heritage and reducing negative environmental impacts. ISO 21401 specifies environmental, social and economic requirements for sustainable accommodation establishments regardless of their type, size or location. It is a sustainability management system for accommodation establishments and has the following environmental, social and economic requirements: +-----------------------+-----------------------+-----------------------+ | Environmental | Social | Economic | +=======================+=======================+=======================+ | - Preparation and | - Local communities | - Economic | | response to | | viability of the | | environmental | - Work and income | organisation | | emergencies | | | | | - Health and | - Quality and guest | | - Natural areas, | education | satisfaction | | biodiversity, | | | | flora and fauna | - Native population | - Health and safety | | | | of guets and | | - Architecture and | | workers | | local | | | | construction | | | | impact | | | | | | | | - Landscaping | | | | | | | | - Solid waste, | | | | effluents and | | | | emissions | | | | | | | | - Energy efficiency | | | | | | | | - Conservation and | | | | management of | | | | water usage | | | | | | | | - Hazardous | | | | substances | | | | management | | | +-----------------------+-----------------------+-----------------------+ CSR standards and reporting mechanisms are critical in promoting ethical practices across industries. These include labels, codes, and certifications audited by independent agents to ensure compliance with sustainability benchmarks. For example, hotel certification schemes such as GSTC Industry Criteria and ISO 21401 provide sustainability management frameworks for accommodation establishments, offering benefits like increased credibility and appeal to eco-conscious travellers. Stakeholder engagement is essential to CSR efforts. It requires interactive, two-way communication through methods like workshops, advisory committees, and public hearings. This approach fosters transparency and accountability and ensures that diverse interests are considered. Labour rights remain a cornerstone of CSR, with initiatives like the SA8000 standard and the Clean Clothes Campaign advocating for fair treatment of workers. These frameworks aim to uphold ethical labour practices globally. Similarly, environmental standards such as ISO 14001 and LEED certifications focus on reducing environmental impacts through sustainable management and green construction practices. The UN Global Compact and ISO 26000 are foundational principles of CSR. They cover human rights, labour, the environment, and anti-corruption. These frameworks emphasise accountability, ethical behaviour, and respect for international norms. Certifications ensure environmental responsibility and align businesses with global sustainability trends, which customers increasingly value. A case study on LVMH illustrates how luxury brands integrate CSR into their operations. LVMH has adopted responsible sourcing practices for materials like leather and crocodile skins, emphasising ethical supply chain management and innovative approaches to sustainability.