Economist’s view of importance of CSR to Reputation

The followers in the CSR industry are many. By now they probably produce a glossy report which lists numerous worthy activities—too many, in fact, when it would be better to concentrate on those that really work and benefit the business. The companies concerned may have little idea whether their carbon-offset scheme is effective or their ethical-purchasing plan costs jobs. Their real motive is public relations, and the telltale sign is that the person responsible for CSR sits in the corporate-communications department.

And the laggards? There are two types. Companies in the first group have simply failed to pay much attention to CSR; they risk being attacked as “late adopters”. Those in the second group, more cynically, think they can afford to ignore CSR, at least for now. Perhaps they are in an industry with a low profile, or operate in countries where scrutiny is minimal. They do not mind being viewed as freeloaders by competitors who spend time and money on trying to be good corporate citizens. Over time, though, this could also be risky if they find themselves subject to greater scrutiny or miss out on opportunities.

Doing what comes naturally  One way of looking at CSR is that it is part of what businesses need to do to keep up with (or, if possible, stay slightly ahead of) society’s fast-changing expectations. It is an aspect of taking care of a company’s reputation, managing its risks and gaining a competitive edge. This is what good managers ought to do anyway. Doing it well may simply involve a clearer focus and greater effort than in the past, because information now spreads much more quickly and companies feel the heat.

So paying attention to CSR can amount to enlightened self-interest, something that over time will help to sustain profits for shareholders. The truly responsible business never loses sight of the commercial imperative. It is, after all, by staying in business and providing products and services people want that firms do most good. If ignoring CSR is risky, ignoring what makes business sense is a certain route to failure.

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So  dont just have a policy, publisise it. GCS