CSR, ESG, Triple Bottom Line, sustainable, regenerative…is it all the same thing?
Our understanding of how to create a long-term future that works for everyone is constantly evolving. And so is the language that we use to talk about it. Unfortunately, this can lead to confusion, miscommunication or even tension when outcomes don’t line up with expectations.
Two of the terms that often get mixed up are sustainability and corporate social responsibility (CSR).
What is sustainability?
In 1987 the World Commission on Environment and Development defined sustainable development as ‘meeting the needs of the present without compromising the ability of future generations to meet their own needs’. It’s that tension between today and tomorrow that is central to sustainability.
An example of a sustainable business decision looks like Unilever committing to only purchasing Rainforest Alliance certified tea for its Lipton Tea brand even though it cost them more money to do so. Traditional tea production can degrade the soil, lead to erosion and pollute local water supplies.
Rather than joining their competitors in a race to the bottom to see who could extract the most tea leaves before they became unviable, Unilever instead invested in their future supply of a quality product in the quantity that it needed.
What is CSR?
Corporate Social Responsibility is an ongoing programme of activity that is internally proposed and executed by businesses to improve their impact on society. It’s often about giving back to society and trying to do good.
The agenda is often set by a small team of employees in response to external factors. It’s success is measured internally and most CSR programmes are focused on meeting or balancing the immediate needs of stakeholders today.
Hinting at the difference between CSR and a sustainable approach, Professor Tima Bansal and Mark DesJardine wrote in the Ivey Business Journal:
‘A socially responsible oil company would build local schools and hospitals to compensate communities for their resource extraction. But such measures do not always acknowledge the long-term impact on the communities. Keep in mind that schools and hospitals require staff and ongoing servicing. So CSR measures can actually impose long-term liabilities on affected communities, making well-intentioned actions unsustainable.’
So what are the big differences between sustainability and CSR?
While there can be cross-over between the themes and activities a business undertakes, here are five key ways I think sustainability and CSR are different.
As we’ve seen, sustainable business strategies prioritise long-term thinking whilst CSR is often focused on the immediate now. Many companies CSR programmes are changed annually, while the trends that sustainability deals with may take 5-10 years to come to fruition.
As mentioned above, many CSR initiatives are employee-driven and are connected to the immediate landscape that the business operates within. I’ve seen a few articles say that CSR is sometimes used as PR to target investors, media, politicians and pressure groups.
I would argue that sustainability has its gaze turned further outward – toward the planet as a whole and to all the stakeholders that are touched by the business. This goes beyond in-house employees to supply chains, communities near and far and consumers.
Because CSR is often done at a cost to the business, it is limited to a few key areas – charities it will donate to, a certain number of days its employees can volunteer, training initiatives it will run in the community, etc.
Sustainability naturally deals with much broader topics tied to the profitability of the business. It needs to have a plan for dealing with extreme weather events, resource management, social justice, public health crises…It’s starting to edge toward systems change.
Sustainable business practices can be measured externally through various certification programmes, like the Rainforest Alliance, Soil Association and B Corp among many, many more. And businesses who are certified can pay to display those badges as social proof that they are putting in the work.
Because CSR is quite personal to the business and its employees, there is often no third-party measurement framework that will determine the effectiveness of the programme or quantify its impact.
CSR has often been linked with PR campaigns and enhancing the business’ reputation with customers as well as a being a way to engage employees around their values. And while sustainable businesses also benefit from happier employees and authentic connections with their customers, they are also driven to mitigate the big risks and identify opportunities to grow.
Both CSR and sustainable business strategies have their place in modern-day, purpose-led companies. If you’d like to speak with us about how you can raise your game to the next level, simply fill in our contact form or email us at email@example.com.