As Corporate Social Responsibility continues to grow as a business imperative, the question that grows along with it is straightforward: To what end?
More and more companies are looking at CSR the same way they might other efforts — as a path to help drive business results. But according to a new Harvard Business Review piece, that’s likely the wrong approach: “That is asking too much of CSR and distracts from what must be its main goal: to align a company’s social and environmental activities with its business purpose and values.”
Indeed, the authors — led by Kasturi Rangan, the Malcolm P. McNair Professor of Marketing at Harvard Business School and a cofounder and cochair of the HBS Social Enterprise Initiative — have conducted numerous surveys on the topic, including one with 142 managers who attended Harvard Business School’s CSR executive education program during the past four years.
The authors report: “Despite the widely accepted ideal of pursuing ‘shared value’—creating economic value in ways that also create value for society—our research suggests that this is not the norm. Rather, most companies practice a multifaceted version of CSR that runs the gamut from pure philanthropy to environmental sustainability to the active pursuit of shared value. Moreover, well-managed companies seem less interested in totally integrating CSR with their business strategies and goals than in devising a cogent CSR program aligned with the company’s purpose and values.”
The challenge often rests in “poor coordination and a lack of logic connecting their various programs.”
The authors recognize that firms must inventory their CSR activities. Once that’s done, the authors — based on their research — offer a four-step process to bring “discipline and coherence to the portfolio as a whole.” These include:
- Pruning and Aligning Programs Within Theaters
- Developing Metrics to Gauge Performance
- Coordinating Programs Across Theaters
- Developing an Interdisciplinary CSR Strategy
The report concludes by noting that companies that employ CSR best practices “all have one thing in common: They are aligned with the companies’ business purpose, the values of the companies’ important stakeholders, and the needs of the communities in which the companies operate. These companies, of course, stand in stark contrast to those that are focused solely on creating value for their shareholders.”