After a slow start, the concept of corporate social responsibility (CSR) has finally taken off on a grand scale. The pressure for corporations to become more accountable has grown steadily, fueled in part by public disgust over corporate malpractice.The explosive growth of the Internet has had a profound impact, too: Its becoming harder than ever for companies to keep their actions secret.
The impact of CSR can be felt on every level of a business. If they are to claim to operate ethically, businesses must consider the welfare of their employees and of the communities in which they operate, their relationships with investors, customers and suppliers and their impact on the environment.
Part of the reason for the growth of CSR is that there is no longer any doubt that operating in a responsible way is good for business. In a commercial world where image and brand are increasingly important, appearing to be a goodcompany can be priceless. It can lead to higher sales,more interest from the socially responsible investment funds, less attention from pressure groups and activists. Acting responsibly is also a highly effective riskcontrol tool. If a company is consciously managing its environmental impact, for example, it is far less likely to end up saddled with a bill for a huge clean-up operation in the future.
Sadly, unethical behavior can still pay off handsomely, too. But the chances of getting caughtand the penalties or sanctions applied to corporate wrongdoersare getting greater all the time.
How do companies become more responsible? While we often view corporations as homogeneous organizations, they are, nonetheless, made up of individuals.When a company makes a decision, it is really people making decisions, and it is the choices those people make that define a companys behavior. Before there can be meaningful corporate social responsibility, there must be personal accountability: individuals taking responsibility for their own actions. Its the people who stick their necks out, who make a stand for something they believe in, who make the difference.
As you will read in our cover story, critics and supporters of big business agree on at least one thing: Its a companys leaders who shape the way it does business. If those leaders are serious about corporate responsibility, the message to them is clear: Its time to make it personal.