Definition of sustainability and its focus on environment and society
Discuss about the Organisational Behaviour for Corporate Social Responsibility.
Sustainability can be defined as the process of growth that is focused not only on the monetary and fiscal limitations but is also focused towards the development of the environment and the society. The concept was introduced in 1985 by Brundtland Commission of the United Nations (Brundtland 1985). Sustainable development is the acknowledgment of organisations as well as individuals of the duties they have towards the environment and the society (Benn et al. 2014). The resources that are incorporated in the process of development depend upon the environment or the society therefore it becomes the duty of all to monitor the well being of the foundation of these resources. Based on this concept the approach of Corporate Social Responsibility (CSR) is built. It is the actions that is taken by a Corpoate entty to put together sustainability into the functions of the company, effective governance and the style of leadership of the organisation. Corporate Social Responsibility functions revolve around the social, environmental and economic benefits to all the stakeholders of the organisation (Tai and Chuang 2014). It is a contrast to the traditional business model as it does not focus on the growth and development of the business alone, slowly organisations all over the world has adapted to this business model, several rules and regulations based on the industry of operation have been developed by authoritative bodies like government and United Nations etc.
The concept explains why it is important to have equal focus on the three Ps: Price, Planet and People. Triple bottom line was coined by John Elkington in 1994, hence it can be said that the concept is contemporary; Elkington states that corporate should not have one particular area of significance while planning for the growth and development of the organisation (Glac, 2015). He emphasizes on the importance of all the three aspects that are aforementioned. The theory sets a juxtaposing suggestion with the traditional business model that the management of the organisation previously followed. According to Milne and Gray (2013), the traditional business model, the variables and the actions of the organisation revolved around growth and development of the company itself, which means financial growth of the company. On the other hand, any other factors that call for deviation from the above mentioned objective were identified as a weight on the organisation as well as consider as a liability because the organisation had to invest in these aspects which take away from the revenue and the profit. The thought of the future generation is what initiates the process of being sustainable. Corporate organisation evaluates the investment in a venture or action based on the return on investment that could add to the development of the organisation. Sustainable ventures are mostly supported on thorough research investment as well as the installation of new technology. It also needs capital investment therefore the companies are anxious because these strategies do not guarantee affirmative return on investment (Milne and Gray 2013). According to Tatari et al.(2015), The triple bottom line concept is fundament of CSR, an organisation adapts to the triple bottom line concept by incorporating CSR activities in the day to day operations of the business. For example: heavy industries like oil and gas, metal and mining etc have CSR activities planned according to the adverse impact the organisation have on the environment as well as on the society.
Introduction of the concept of Corporate Social Responsibility (CSR)
Figure: Triple Bottom Line
Source: (Glac, 2015)
The current interpretation of the concept can be simplified and said that it is where corporate organisations do not only think about the own betterment but looks in to the bigger picture and greater good. Base on the principles of sustainability this concept is approached by various organisations new and old.
- The Economic principle: organization and growth of the material goods.
- The principle of Life: this provides framework and guidelines for appropriate behavior in the environment.
- The Spiritual principle: the global code of ethics is taken in to consideration while considering this principle
- The Social principle: social communications process which should be maintained in order to attain a balance in the society.
- The Material principle: includes the basis of regulating the flow of materials and energy (Benn et al. 2014).
Organisation such as Wesfarmers, BHP Billiton, Westpac etc are all from various industry and are organisation of various scale and format but each of them have specific CSR department who launches a report like the annual general report that is released by the organisation at the end of a financial year. In this document the company entails what are the CSR objectives that the companies have undertaken and what are the milestones that are achieved by these activities. These reports also state people who are involved in the process and the way they are planning to improve the activities and its approach.
Some of the CSR examples in contemporary practice are as follows:
In case of industries like chemical manufacturing, agriculture, mining and energy the operations of the business can bring on permanent damage to the local ecosystem. Therefore organizations in these industries focus on conservation and development. With activities such as afforestation, innovation of process and technology to reduce the impact etc are some of the strategic sections taken by the companies. Companies adapt to energy friendly operations to reduce the energy consumption.
Corporate set up charitable funds to raise money for various societal concerns, the organisation focus on the development and well being of the society that are in need. Companies set up medical camps as a part of their CSR activity, development and investment in local communities and promote the cultural of the communities as well (Tai and Chuang, 2014).
The CSR concept is directly connected with the organisation’s ethics which is based on the values and principles upon it they are based. Though the incorporation of CSR is being made mandatory in most countries, it is ethics in the business that drives the essence of the concept, the idea of realization of the responsibilities that one has towards the society and the environment.
Apart from ethics innovation is also a significant aspect in CSR in recent times. Innovation in terms of formulation of decisions and policies as well as in terms of technology can help the organisation make sure that the philosophies of sustainability are fulfilled as per the guidelines that are mentioned above. In order to incorporate a new idea like CSR, the company must follow an adaptive course of operation in order to undertake and implement any new idea of innovation (Halpern et al. 2013).
United nations have set four areas which are of concern in sustainability actions: these human resource, environment, anti-corruption and environment. There are ten principles that are explained in the UN Global Compact. These principles can be used as guidelines by organisation to develop their action plan and manage their CSR activities. Today organisations have separate CSR department who just looks after the management of these aspects. The principles stated by the UN are as follows:
- Internationally accepted human rights guidelines and rules have to be incorporate in the operations of the busienss
- Exploitation of human resources is a is a punishable crime
- The liberty of organization and the efficient recognition of the right of combined negotiation should be employ by the organisations
- Forced or compulsory labor is also punishable offence
- There should be encouragement in the organisation in terms of work ethics and situations like abolition of child labor
- There should be no unfair ways of employment and occupation growth in the company
- preventative measure must be taken by business companies that deal with the environment depletion
- The organisation must support and promote environmental accountability
- Sustainable innovation and development should be encouraged in the organization
- Corruption is explained by two aspects extortion and bribery organisation must avoid these at every step (The Ten Principles of the UN Global Compact 2017)
Conclusion
It can be concluded form the above discussion that the organisations all over the world are increasingly becoming aware of the depleting environmental situation as well as the responsibility they have towards ensuring societal well being, large corporations like Wesfarmers, Westpac, BHP Billiton, Microsoft, Google etc are setting benchmarks in their CSR approaches encouraging the new organisations to do the same.
Reference list:
Benn, S., Dunphy, D., & Griffiths, A., 2014. Organizational change for corporate sustainability. Routledge.
Brundtland, G.H., 1985. World commission on environment and development. Environmental policy and law, 14(1), pp.26-30.
Glac, K., 2015. Triple Bottom Line. Wiley Encyclopedia of Management.
Halpern, B. S., Klein, C. J., Brown, C. J., Beger, M., Grantham, H. S., Mangubhai, S., …&Possingham, H. P., 2013. Achieving the triple bottom line in the face of inherent trade-offs among social equity, economic return, and conservation. Proceedings of the National Academy of Sciences, 110(15), 6229-6234.
Milne, M.J. and Gray, R., 2013. W (h) ither ecology? The triple bottom line, the global reporting initiative, and corporate sustainability reporting. Journal of business ethics, 118(1), pp.13-29.
Schrempf-Stirling, J., Palazzo, G. and Phillips, R.A., 2016. Historic corporate social responsibility. Academy of Management Review, 41(4), pp.700-719.
Tai, F.M. and Chuang, S.H., 2014. Corporate social responsibility. Ibusiness, 6(03), p.117.
Tatari, O., Kucukvar, M. and Onat, N.C., 2015, February. Towards a Triple Bottom Line Life Cycle Sustainability Assessment of Buildings. In Science for Sustainable Construction and Manufacturing Workshop Volume I. Position Papers and Findings (p. 226).
The Ten Principles of the UN Global Compact., 2017. unglobalcompact.org. Retrieved 30 April 2018, from https://www.unglobalcompact.org/what-is-gc/mission/principles
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