Now is the time

Short term pressures present a real challenge for business at this time.  However responsible business practices deliver quick wins, as well as longer term benefits.  Leading edge companies recognise responsible business practice as a unifying approach against which to review how the entire business is being run and the positive impact of that business in its broadest sense. 

There are great examples of where businesses have seized the opportunity.  The evidence shows that good governance of corporate responsibility builds companies’ financial viability and stability: “Companies consistently participating in the Corporate Responsibility Index outperformed the FTSE 350 on total shareholder return 2002 – 2007 by between 3.3% and 7.7% per year and demonstrated decreased share volatility”. (BITC/IpsosMORI, 2008)

It is because corporate responsibility programmes are in place and are responding to material risks and opportunities, that companies are able to get an edge:

• In competing for the right skills;
• Responding to an increasingly socially-minded and demanding consumer or client base;
• Becoming more informed and connected employers;
• Changing and keeping a radar on the changing regulatory environment.  

"Old fashioned decency is the new imperative" 

Robert Peston, speaking at our AGM in December ’08, talked about decency being the new imperative which had real resonance with senior business people attending.  He said that this is not just a cyclical downturn but the end of this era of capitalism and suggested a more humane, less greed driven version of what we have today might follow. 

It’s certainly not just Robert Peston that takes this view. Gordon Brown has said ‘the age of irresponsibility’ is over.  David Cameron talking at this year’s World Economic Forum at Davos called for a new ‘Moral Capitalism’.  And as President Obama’s argued in his inaugural speech, “[a] nation cannot prosper long when it favours only the prosperous”. 

It seems clear from these politicians, other commentators and the public mood that from the recession will emerge a differently shaped economy. 

Over the next year, Business in the Community is conducting research to unpick the lessons learned for corporate responsibility from the financial crisis and the concerns politicians, investors and the wider community are raising.  The research will look forward, identify what responsible business should look like in 2020 and what business can do now to prepare.

Beyond "box-ticking CR"

In the early days of establishing corporate responsibility in a business, indices are an imperative to manage and report on CR performance.  "You manage what you measure."  Indices have assisted many companies start the CR journey by exploring the relationships they hold with stakeholders and the new business opportunities responsible business practices can offer.

Surveys and benchmarking can continue to add value, but what’s vital is that companies then move beyond this.  Corporate responsibility is not just about processes and how they were developed and put in place, neither is it about the CR benchmarking and measuring part of the business.

Responsible business practice must be built into decision-making processes, embedded into the mentality and culture – the DNA – of the business so deeply that in time ‘CSR’ is no longer seen as a separate function of the business, or narrowly focussed on social issues.

Not CSR – Corporate Social Responsibility but Corporate Sustainability and Responsibility.

Rebuilding trust 

It is absolutely clear that its never been more important to build trust in business.  Trust is not going to be built by writing more reports.  Now is the time for businesses to be proactive, visible and engaged.

Business in the Community has developed the tools, and is making new resources available all the time, to help our members take practical action that will help rebuild trust.  One highly visible example is Give & Gain Day 09 on 5 June.

We have new research in the pipeline and we are creating new spaces for discussion and collaboration through a series of milestone conferences starting with ‘A new era of responsibility’ on 10 June 09, as well as this website. 

We are developing work with our finance sector members and have already convened a banking forum in Burnley. 

Our record of action

For 27 years Business in the Community has mobilised business & engaged leaders to take action in the areas of greatest need.  We are now the UK’s largest business membership organisation focussed on responsible business, working collaboratively with business leaders in areas that matter most.  We have a local and global reach through our regional network and global partners.

Some of the key foundations on which we will build moving forward are:

• CR Index
• Investing in the future: City attitudes to environmental and social issues (2001)
• Speaking the same language – improving communications between companies and investors on corporate responsibility (2003)
• Rewarding virtue (2005)
• Principles for good governance of corporate responsibility (2005/8)
• The Marketplace Responsibility Principles (2008)  

Business in the Community produced our initial analysis of the financial crisis and its implications for the future of corporate responsibility in October 2008.  At that time - speaking from his personal experience of leading businesses through previous recessions - Stephen Howard, CEO, Business in the Community gave his assessment of priorities for business leaders.  

Also in October a number of businesses shared their views on how community investment remains key in the current economic climate.  Early February 2009 Paul Rooney of PriceWaterhouseCoopers, a member of our Northern Ireland Board, added his views to the debate.