Helping business toserve shareholders AND society

SIMULTANEOUSLY

CSR SWOT discover risk, value and more

-by Wayne Dunn

CSR budgets, requirements and external expectations have increased astronomically in recent years.

At the same time the depth and breadth of stakeholder groups and related interest has continued to grow.

Layered on top of all this has been an ongoing increase in regulatory requirements around CSR and Sustainability and an almost immeasurableincrease in voluntary standards, norms and reporting demands and expectations.

CSR and Sustainability are significant costs to modern corporations in many sectors. And failure to ‘get it right’ is a huge risk with potentially devastating impacts on brand, projects, careers and even companies.

CSR SWOT discover risk, value and more

CSR and Sustainability are continually getting more complex and more costly but often without a corresponding increase in value for shareholders and society.

Sometimes it seems like it gets more complex and more costly and produces less value.

Is this your CSR?

CSR SWOT discover risk, value and more

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In many cases the cost and complexity of CSR has grown rapidly and often without an effective framework to ensure that shareholder value and societal value is optimized at both the project and the corporate level.

CSR can seem Eyes Glazing Over complex

At the project level CSR activities are relatively efficient at optimizing value to society and to the project. Theimmediacy and discipline of social license and stakeholder interests drives discipline and focus.

CSR projects and activities at the site level (minesite, production site, factory, etc.) are normally fairly well aligned with societal and shareholder interests and enhancing overall social license.

In my work at the corporate and project level I have often found

As CSR has become more important it has gotten more complex, more costly and often less efficient at producing value.

A CSR SWOT can help discover risks and opportunities, and help to CSR more comprehensible to key internal and external stakeholders

1. CSR is efficient at value creation at the

project level.

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There is seldom a corporate level strategy/framework for maximizing shareholder/corporate value from CSR activities and budgets at the project level.

At the corporate level CSR value is more often realized across communications, social value branding, talent acquisition and retention, financial market relations, marketing and sales and other areas.

Whereas CSR and value creation at the site level is often responsive and, in some ways almost instinctive, at the corporate level it is much more nuanced and requires broader, more strategic and proactive approaches.

Few companies are efficient at fully capturing value from CSR at the corporate level. This is somewhat ironic in that corporate level CSR value is a highly leveraged and low-risk value creation opportunity.

For the most part the money has already been spent (at the site level) and capturing value at the corporate level is relatively low cost and high impact.

Corporate wide-metrics and reporting frameworks are difficult to fit to project-level needs and often simply add complexity and work without apparent project-level value.

Metrics important for management at the project level are not understood or accepted at the corporate level, and often not even at executive levels on the project itself.

2. CSR is inefficient at value creation at the corporate level.

3. CSR/Sustainability Metrics are confused

and confusing.

CSR SWOT discover risk, value and more

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There is more discussion on this in CSR Metrics: You can’t measure temperature with a speedometer

CSR Metrics should meet project and corporate level needs. Often they meet neither

The reporting demands of the obligatory, regulatory-driven compliance reporting coupled with what often seems like a disconnected and confusing hodgepodge of voluntary reporting are confusing and overwhelming.

4. CSR/Sustainability Reporting is

inefficient and overwhelming.

CSR SWOT discover risk, value and more

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Compliance with regulatory driven reporting requirements is mandatory and can be driven by site level and host country requirements, home country requirements and the requirements of various membership organizations.

Voluntary reporting requirements are often selected somewhat randomly and companies end up complying with sets of voluntary reporting requirements that may not make sense when looked at objectively.

Too often companies end up complying with one or more voluntary requirements that simply don’t make sense when looked at through a value and efficiency lens.

Those that do often find that there is little marginal value in some of their voluntary areas and that there may be other voluntary areas where there is a much better value/cost relationship.

Even fewer look at where and how they may extract more corporate level value from their overall reporting commitments.

There has been significant improvement in this area in recent years but it is still often the case that CSR is often somewhat of a bolt-on piece of the corporate structure.

Fortunately, there are increasing numbers of companies that have CSR and related interests represented at decision making levels throughout the organization

5. CSR is ghettoized.

CSR SWOT discover risk, value and more

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CSR efficiency (especially efficiency at creating shareholder value) too often ends up in the important but not urgent category and simply doesn’t get done.

Executives and managers recognize that there are inefficiencies, that there are value opportunities and that there are likely unnoticed risks and threats.

They know that a CSR SWOT should be done. But, the urgency of day to day demands and priorities keeps pushing this out and it doesn’t get done.

8. We’ll get to it soon

CSR SWOT discover risk, value and more

Few companies have invested the time and resources to develop effective CSR communication strategies at the site level or at the corporate level.

Too often CSR communications is ad-hoc and sporadic, ranging from ‘shout from the rooftops’ to ‘keep your head down and mouth shut’ strategies. Sometime both at the same time.

Communications is a very efficient way to extract more shareholder value from CSR spending and yet too often this is literally left to whim and chance.

For more on this see CSR Communications: Eleven mistakes to avoid

7. Confused strategy for external CSR

communications.

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An objective and dispassionate ‘fresh-eyes’ review will often find:

• Opportunities for increased shareholder and societal value from existing CSR budgets and programs.

• Opportunities for improved efficiency and effectiveness in CSR/Sustainability reporting

• Unnoticed risks and threats

Executives and managers who can’t find the time to undertake a CSR SWOT should look to bring in someone who can bring fresh-eyes and fresh perspectives and just do it.

CSR SWOT discover risk, value and more

This isn’t to blame the leaders and practitioners of CSR, nor the C-suite team. It is simply the reality of companies and leaders working hard to keep up with a dynamic and rapidly evolving field.

However, a CSR SWOT does represent an important opportunity for companies, especially in these days of economic uncertainty and increasing budgetary pressures.

A CSR SWOT can often uncover value, opportunities and risks that have developed and gone undetected as managers and executives have scrambled to keep up with the rapidly evolving CSR space in recent years.

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CSR SWOT discover risk, value and more

To read other CSR Articles and Thoughtpieces click here>>>

A CSR SWOT doesn’t have to be comprehensive to be valuable. Most can be done, at least to a preliminary level, without travel to project sites and remote locations.

A CSR SWOT can help companies to unlock new value and better manage risks. But, only if they actually get done and not just thought about.

A CSR SWOT can help your organization to better support and capture value from your CSR budgets and activities.

CSR SWOT discover risk, value and more

Eleven strategiesfor maximizing value from CSR

CSR in Budget Crunch Times12 strategies for success

Multi-sector CSR PartnershipsNatural Partnerships – Un-natural Partners

From Pariah to ExemplarApplying the 6 best practices

Engaging Internal StakeholdersSeven proven strategies

CSR CommunicationsEleven mistakes to avoid

Stakeholder EngagementSix best practices

Creating a CSR Programin eight self-serving steps

CSR Metrics:You can’t measure temperature with a speedometer

Stakeholder EngagementFive common mistakes

CSR Value ContinuumA unique perspective on Shared Value

Smarter CSR Budgets8 steps to connect budget to value

28 Expert tipsOn stakeholder engagement

Don’t be an Altruistic AngelBe transparent about what’s in it for you

13 Mistakes that prevent & destroyMulti-sector CSR partnerships

NHL Sustainability ReportGood but incomplete.

Below are some recent articles and publications on Corporate Social Responsibility and stakeholder engagement that you may find interesting.

Professor Dunn brings a practical and realistic approach to CSR, blending theory and practice to develop realistic models and approaches to address real-world challenges

Dr. Ellis ArmstrongFormer CFO, BP Exploration

…coherent, thoughtful, stimulating and insightful… state of the art! The network of participants from the public, private and civil society sectors was incredible, some of the leading experts in the field.  

Kojo Busia, Ph. D.Snr. Mineral Sector Governance AdvisorUnited Nations Economic Commission for Africa/UNECA

…pragmatic blend of theory and practice, very applicable to helping organizations meet real-world challenges.

Frank McShaneManager, Corporate Responsibility Policy and Ethics, Talisman Energy

… readily available to provide support to organizations like Amref that are seeking partnerships, and looking to bring about positive change in a collaborative and concrete way. Wayne and the CSR Training Institute helped us to identify and connect with potential partners and are always available. The training, the expertise, the network and the overall support are world-class.

Onome AkoDirector of Strategic Partnerships, Amref Health Africa

“The program enhanced the CSR knowledge and strategic skills of our Kosmos Energy Ghana team, and offered the participants a platform for networking with professionals from other organizations across Africa and Ghana.” 

Reg ManhasSr VP Kosmos Energy

Very much helpful Wayne; some of the tips and questions you gave will be an extremely helpful guide in the process of developing a CSR Strategy for my company.

Emmanuel AubynnRegional Social Responsibility Manager, Newmont Africa

The CSR Program was excellent. A key aspect of my work is to encourage and support private sector development that contributes to Ghana’s overall socio-economic growth. The learning that I and my staff take away from attending this program will help us immensely with this responsibility. I highly recommend this program.

Hon. Rashid Pelpuo (MP)Minister of State for Private Sector Development and Public Private Partnerships (Ghana)

New and exciting insights into the theory and practice of CSR… great faculty and participants, very diversified. An excellent learning experience, very practical and useful. I’m very happy I was able to participate in it.

Hon InusahFuseini (MP)Minister of Lands and Natural Resources (Ghana)

WHAT OTHERS SAY ABOUT OUR WORK

Should Business Serve

Helping business to serve society andshareholders, SIMULTANEOUSLY.

Should Business Serve

WAYNE DUNN, PRESIDENT AND FOUNDER

SHAREHOLDERS?

SOCIETY?IT SHOULD SERVE BOTH.

Wayne Dunn is President & Founder of the CSR Training Institute and Professor of Practice in CSR at McGill. He’s a Stanford Sloan Fellow with a M.Sc. in Management from Stanford Business School.

He is a veteran of 20+ years of award winning global CSR and sustainability work spanning the globe and covering many industries and sectors including extensive work with Indigenous Peoples in Canada and globally. His work has won major international awards

and has been used extensively as ‘best-practice’ by industry and academia.

He’s also worked oil rigs, prospecting, diamond drilling, logging, commercial fishing, heavy equipment operator, truck driver and underwater logging, done a couple of start-ups and too many other things to mention.

Wayne’s career includes big successes, and spectacular failures. He hopes he’s learned equally from both.

www.csrtraininginstitute.com