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CSR 2.0: Beyond the Age of Greed

CSR 2.0:

Beyond the Age of Greed

Chapter by Wayne Visser

Extract from Reframing Corporate Social Responsibility

Quotes

The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, for knowledge has marked the upward surge of mankind. – Gordon Gekko, Wall Street (the movie)

Responsibility is literally what it says – our ability to respond. To be responsible is to be proactive in the world, to be sensitive to the interconnections, and to be willing to do something constructive as a way of giving back. Responsibility is the footprints we leave in the sand, the mark of our passage. What tracks will you leave? -Wayne Visser, Business Frontiers (the book)

Abstract

The 1987 movie Wall Street and our recent global financial crisis (GFC), despite one being fictional and the other painfully real, tell a common story. Over the past few decades, we have been living through an Age of Greed, characterised by a colossal failure of corporate responsibility and corruption of individual morality. This Crisis of Responsibility has had catastrophic consequences for the global economy, bankrupting whole economies (like Iceland) and wreaking havoc with the lives of ordinary citizens around the world, many of whom are now without a job and without a roof over their heads.

In this chapter, I want to explore the ways in which the GFC represents a multi-level failure of responsibility – from the individual and corporate level to the finance sector and entire capitalist system. I will also examine the impact of the GFC on what is traditionally viewed as corporate social responsibility (CSR). To conclude, I will set out my conviction

that unless CSR itself is fundamentally transformed, into CSR 2.0, it will do nothing to prevent an equally (if not more) devastating Crisis of Responsibility from recurring in future.

The Age of Greed

Gordon Gekko’s words, although spoken by a fictitious character of Oliver Stone’s imagination, captures the spirit of a very real age: the Age of Greed. This was an age that, in my view, began when the first financial derivatives were traded on the Chicago Mercantile Exchange in 1972 and ended (we hope) with Lehman’s collapse in 2008. It was a time when ‘greed is good’ and ‘bigger is better’ were the dual-mottos that seemed to underpin the American Dream. The invisible hand of the market went unquestioned. Incentives – like Wall Street profits and traders’ bonuses – were perverse, leading not only to unbelievable wealth in the hands of a few speculators, but ultimately to global financial catastrophe.

The story of Gordon Gekko (and his modern day real-life equivalents like Richard Fuld, the captain of the titanic Lehmans before it hit the iceberg) gets to the heart of the nature of greed …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/chapter_wvisser_age_responsibility.pdf”]Pdf[/button] CSR 2.0: Beyond the Age of Greed (chapter)

Related pages

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Page[/button] The Age of Responsibility (book)

Cite this chapter

Visser, W. (2010) CSR 2.0: From the Age of Greed to the Age of Responsibility, In W. Sun, et al. (eds.), Reframing Corporate Social Responsibility: Lessons from the Global Financial Crisis. Bingley: Emerald.

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CSR 2.0: Evolution and Revolution

CSR 2.0:

Evolution and Revolution

Chapter by Wayne Visser

Extract from Responsible Business

The Rise and Fall of CSR

Corporate social responsibility (CSR) has been debated and practiced in one form or another for more than 4,000 years. For example, the ancient Vedic and Sutra texts of Hinduism and the Jatakas of Buddhism include ethical admonitions on usury (the charging of excessive interest) and Islam has long advocated Zakat, or a wealth taxi.

The modern concept of CSR can be more clearly traced to the mid-to-late 1800s, with industrialists like John H. Patterson of National Cash Register seeding the industrial welfare movement and philanthropists like John D. Rockerfeller setting a charitable precedent that we see echoed more than a hundred years later with the likes of Bill Gatesii.

Despite these early variations, CSR only entered the popular lexicon in the 1950s with R. Bowen’s landmark book, Social Responsibilities of the Businessmaniii. The concept was challenged and strengthened in the 1960s with the birth of the environmental movement, following Rachel Carson’s critique of the chemicals industry in Silent Springiv, and the consumer movement off the back of Ralph Nader’s social activism, most famously over General Motors’s safety recordv.

The 1970s saw the first widely accepted definition of CSR emerge – Archie Carroll’s 4-part concept of economic, legal, ethical and philanthropic responsibilities, later depicted as a CSR pyramidvi – as well as the first CSR code, the Sullivan Principles. The 1980s brought the application of quality management to occupational health and safety and the introduction of CSR codes like Responsible Care.

In the 1990s, CSR was institutionalised with standards like ISO 14001 and SA 8000, guidelines like GRI and corporate governance codes like Cadbury and King. The 21st century has been mostly more of the same, spawning a plethora of CSR guidelines, codes and standards (there are more than 100 listed in The A to Z of Corporate Social Responsibility), with industry sector and climate change variations on the theme.

Why is all this potted history of CSR important in a discussion about the future? Well, first, it is to realise that CSR is a dynamic movement that has been evolving over decades, if not centuries. But second, and perhaps more importantly, it is to acknowledge that, despite this seemingly impressive steady march of progress, CSR has failed. Furthermore, we are witnessing the decline of CSR, which will continue until its natural death, unless it is reborn and rejuvenated.

That is a bold claim, so it deserves substantiation. CSR has undoubtedly had many positive impacts, for communities and the environment. Yet, its success or failure should be judged in the context of the total impacts of business on society and the planet. Viewed this way, on virtually every measure of social, ecological and ethical performance we have available, the negative impacts of business have been an unmitigated disaster, which CSR has completely failed to avert or even substantially moderate.

A few facts will suffice to make the point …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/chapter_wvisser_csr_2_0.pdf”]Pdf[/button] CSR 2.0: Evolution and Revolution (chapter)

Related pages

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Page[/button] The Age of Responsibility (book)

Cite this chapter

Visser, W. (2010) CSR 2.0: The Evolution and Revolution of Corporate Social Responsibility, In M. Pohl & N. Tolhurst (eds.), Responsible Business: How to Manage a CSR Strategy Successfully. Wiley.

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Corporate Sustainability and the Individual

Corporate Sustainability and the Individual:

Understanding What Drives Sustainability Professionals as Change Agents

Paper by Wayne Visser and Andrew Crane

Abstract

This paper looks at what motivates sustainability managers to devote their time and energies to addressing social, environmental and ethical issues. It is rooted in the literature on the role of individuals as change agents for corporate sustainability, in particular in their capacity as environmental or social ‘champions’. The paper presents in-depth research among sustainability managers, providing a rich, nuanced understanding of different types of sustainability change agents. It identifies four such types – Experts, Facilitators, Catalysts and Activists – and uncovers the pivotal role of values, inspiration, expertise, empowerment, strategic thinking and social contribution as sources of meaning for these purpose-inspired managers. The findings deepen our understanding of the psychological dimensions of corporate sustainability management, and provide a useful tool for improving individual and team performance, enhancing recruitment and retention of sustainability talent, and developing more effective organisational leadership for sustainability.

Keywords

corporate social responsibility, corporate sustainability, change agents, environmental champions, meaning in life, psychology, sustainability managers, values 

Introduction

As social, environmental, and ethical issues like persistent poverty, climate change, financial market instability and economic globalisation continue to move up the geo-political and economic agendas, corporate sustainability is increasingly touted as a timely and necessary response by business (Dunphy et al., 2003; Shrivastava, 1995; Zadek, 2004). Viewed in this way, sustainability can be thought of as a conceptual framework and practical mechanism for creating change that results in improved social, environmental and ethical conditions (Van Marrewijk, 2003).

Attention to corporate sustainability has tended to focus on how change can be achieved at the organisational level (Benn, et al. 2006; Dunphy et al., 2003). By contrast, comparatively little research exists on the role of the individual as a change agent for sustainability (Sharma, 2002). What literature there is on corporate sustainability and the individual level typically focuses on four areas: 1) The importance of values congruence between managers/employees and organisational values (Fryxell and Lo, 2003; Hemingway and Maclagan, 2004; Van Marrewijk and Werre, 2002); 2) the instrumental association between individual concern, knowledge and commitment and corporate social and environmental responsiveness (Bansal and Roth, 2000; Keogh and Polonsky, 1998); 3) narrative accounts by sustainability managers of corporate ‘greening’ (Fineman, 1997; Georg and Fussel, 2000; Starkey and Crane, 2003); and 4) the role of sustainability managers as champions, entrepreneurs or agents of change in their organisations (Andersson and Bateman, 2000; Prakash, 2001; Walley and Stubbs, 1999).

This literature brings insights to our understanding of individuals within a corporate sustainability context by highlighting the importance of ‘intangibles’ like values, attitudes and beliefs in driving corporate sustainability, the crucial role of education and awareness in achieving behaviour change, the scope and necessity for managerial discretion in making change happen, the power of corporate culture in shaping a consensus ‘story’ on sustainability, and the pivotal role of leadership support for sustainability. However, the literature also shows certain limitations. We still know little about what drives individuals to be sustainability managers, how this affects such individuals, and what they seek to achieve from their actions on a personal level. Moreover, the notion of sustainability champions …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/06/paper_sustainability_individual_crane_wvisser.pdf”]Pdf[/button] Corporate Sustainability & the Individual (paper)

Related pages

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/making-a-difference”]Page[/button] Making a Difference (book)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.cpsl.cam.ac.uk”]Link[/button] Social Science Research Network (website)

Cite this article

Visser, W. & Crane, A. (2010) Corporate Sustainability and the Individual: Understanding What Drives Sustainability Professionals as Change Agents, SSRN Working Paper Series, 25 February 2010. First published on SSRN at: http://ssrn.com/abstract=1559087

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The Future of CSR Codes

The Future of CSR Codes and Standards

Article by Wayne Visser

In this piece, I look at the lessons we have learned so far (both positive and negative) and what part CSR codes and standards play in an emerging New Governance model. Let me start with what I think we’ve learned about CSR codes and standards over the past 30 years or so.

  • Codes can be a useful activist tool
  • Codes can help to generate consensus
  • Codes can embed incremental improvement
  • Codes can change industry sectors

There are also downsides to CSR codes and standards, which we have come to realise.

  • Codes create auditing and reporting fatigue
  • Codes create confusion in the market
  • Codes can be a mask for irresponsibility
  • Codes are no substitute for regulation

With the usual caveats that the future is unpredictable, it does seem to me that there are several trends in CSR codes and standardsthat indicate the direction of their evolution.

  • Principle-based codes will consolidate
  • Process-based codes will struggle
  • Performance-based codes will strengthen
  • Sector-, product-, issue- and geography-based codes will expand

My fundamental belief is that CSR codes and standards will not disappear, because they form part of an emerging new form of governance, based on a multi-stakeholder approach …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_csr_codes_wvisser.pdf”]Pdf[/button] The Future of CSR Codes (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/the-a-to-z-of-corporate-social-responsibility”]Page[/button] The A to Z of Corporate Social Responsibility (book)

Cite this article

Visser, W. (2009) The Future of CSR Codes and Standards, CSR International Inspiration Series, No. 6.

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CSR and the Financial Crisis

CSR and the Financial Crisis:

Taking Stock

Blog by Wayne Visser

The Scale of the Crisis

There is nothing small or trivial about this financial crisis. According to the Bank of England’s recent Financial Stability Report, governments worldwide have already pledged more than $7 trillion in loans, guarantees, capital injections, and other assistance in their coordinated effort to prop up the global financial system. And the ILO estimates the crisis will cost 20 million jobs by next year.

This is not the first financial crisis the world has seen over the past century. The worst, of course, resulted in the Great Depression in the 1930s. But there have been numerous others, all of which carried painful economic and human costs. For example, the crises inArgentina (1981-1990), South Korea (1997-1999) and Thailand (1997-2000) all cost more than 30% of those countries’ GDPs.

But even by historical standards, the 2008 crisis is BIG. In what’s been dubbed “Wall Street’s Red October”, the S&P 500 plunged 16.9%, or 198 points, for the month. That’s the worst-ever monthly point decline for the S&P 500. The Dow similarly dropped 14.1%, or 1,526 points. And the ILO estimates that the crisis will bring the total unemployed to more than 210 million for the first time in history.

The key difference is that, unlike the Asian and Latin American crises in the 1980s, this crisis is truly global. Some countries, like Iceland andPakistan, are threatened by bankruptcy. Others, like Japan, have been hit by huge volatility in the markets. And even the cash-rich, high-flyers like China are seeing their growth suffering as a result. But what does any of this have to do with corporate social responsibility (CSR)?

The Links to CSR

Irresponsible banking

I’d like to suggest a multi-level approach to this. At the first and most obvious level, we can say the financial crisis is a direct result of irresponsible banking. According to the Mortgage Bankers Association, the number of sub-prime loans offered to risky borrowers increased more than 15 times since 1998. Essentially, the banks got greedy and compromised good banking practices of credit risk assessment.

Irresponsible financial markets

At another level, the crisis is the predictable consequence of irresponsible financial markets. Since the deregulation of the 1980s, the derivatives market has grown to around $600 trillion dollars, almost 10 times the value of global GDP. This speculative trading (which some call the “casino economy”) is meant to hedge risk, but it also increases the volatility and systemic risk of financial markets.

We would do well to recall economist John Maynard Keynes’ warning: “Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done.”

Irresponsible corporations 

Others argue that the crisis is the inevitable consequence of irresponsible corporations. This is linked to the short-termism of shareholder value driven public companies …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/05/blog_financial_crisis_wvisser.pdf”]Pdf[/button] CSR and the Financial Crisis (blog)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Link[/button] The Age of Responsibility (book)

Cite this blog

Visser, W. (2008) CSR and the Financial Crisis, Wayne Visser Blog Briefing, 4 November 2008.

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The Long Tail of CSR

The Long Tail of CSR:

Achieving Scalability in Corporate Sustainability and Responsibility

Article by Wayne Visser

I recently read The Long Tail, by Chris Anderson and it started me thinking: What is the Long Tail of CSR? The Long Tail – named after the extended tail of a statistical distribution curve – is the idea that selling less to more people is big business. It’s the business model that has spawned the most successful companies of the Web 2.0 age. The Long Tail questions the conventional wisdom that says success is about generating ‘blockbusters’ and ‘superstars’ – those rare few products and services that become runaway bestsellers.

Anderson sums up his message by saying that:

  1. the tail of available variety is longer than we think;
  2. it’s now within reach economically; and
  3. all those niches, when aggregated, can make up a significant market.

He also notes that this Long Tail revolution has been made possible by the digital age, which has dramatically reduced the costs of customised production and niche distribution.

There are three enablers of successful long tail businesses, according to Anderson:

  1. democratising the tools of production (e.g. digi-cams, content editing software, blogging tools);
  2. democratising the tools of distribution (e.g. Amazon, eBay, iTunes, Netflix); and
  3. connecting supply and demand (e.g. Google, blogs, Rotten Tomatoes).

So how might this apply to CSR? To me, the Long Tail of CSR is all about extending the reach of CSR, and improving its ability to satisfy specific social and environmental needs. Let’s use Anderson’s enablers as a framework for thinking about this …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_long_tail_csr_wvisser.pdf”]Pdf[/button] The Long Tail of CSR (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Page[/button] The Age of Responsibility (book)

Cite this article

Visser, W. (2008) The Long Tail of CSR: Achieving Scalability in Corporate Sustainability and Responsibility, CSR International Inspiration Series, No. 5.

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CSR Myths

CSR Myths:

Popular Misconceptions on Corporate Sustainability and Responsibility

Article by Wayne Visser

In an article published by Ethical Corporation, I set out to explode 7 myths about corporate sustainability and responsibility (CSR). Most of these myths exist as a result of the feeding frenzy that inevitably occurs every time the media has hunted down and sunk its teeth into one or other juicy story of corporate exploitation. The myths are also sustained, however, by whole legions of largely well-intentioned people who have vested interests in promoting their particular brand of the truth about CSR. The 7 myths are:

  1. Economic growth is not compatible with CSR
  2. Multinationals are the biggest CSR sinners
  3. Multinationals are the biggest CSR saviours
  4. Developing countries are anti-multinational
  5. CSR is the same the world over
  6. Developed countries lead on CSR
  7. Codes can ensure CSR …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_csr_myths_wvisser.pdf”]Pdf[/button] CSR Myths (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/business-frontiers”]Page[/button] Business Frontiers (book)

Cite this article

Visser, W. (2008) CSR Drivers: The Forces Shaping Corporate Sustainability and Responsibility, CSR International Inspiration Series, No. 3.

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CSR Drivers

CSR Drivers:

The Forces Shaping Corporate Sustainability and Responsibility

Article by Wayne Visser

In doing research for my chapter CSR in Developing Countries, published in The Oxford Handbook of CSR, I identified 10 drivers for Corporate Sustainability and Responsibility (CSR), which I summarise below.

National (or internal) drivers refer to pressures from within the country and include:

  • Cultural tradition
  • Political reform
  • Socio-economic priorities
  • Governance gaps
  • Crisis response
  • Market access

International (or external) drivers tend to have a global origin and include:

  • International standardization
  • Investment incentives
  • Stakeholder activism
  • Supply chain …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_csr_drivers_wvisser.pdf”]Pdf[/button] CSR Drivers (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-world-guide-to-csr”]Link[/button] The World Guide to CSR (book)

Cite this article

Visser, W. (2008) CSR Drivers: The Forces Shaping Corporate Sustainability and Responsibility, CSR International Inspiration Series, No. 3.

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CSR Change Agents

CSR Change Agents:

Experts, Facilitators, Catalysts and Activists

Article by Wayne Visser

In research conducted for my PhD on CSR, I identified four types of Corporate Sustainability and Responsibility (CSR) change agents: Experts, Facilitators, Catalysts and Activists.

Each type represents a constellation of attributes. It is expected that any individual CSR change agent will embody elements of all of these types, but that the relative influence of each type will differ per individual. Hence, the dominant type can be thought of as a centre of gravity for each CSR change agent’s work, i.e. the mode of operating in which they feel most comfortable, fulfilled or satisfied …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_csr_change_agents_wvisser.pdf”]Pdf[/button] CSR Change Agents (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Link[/button] The Age of Responsibility (book)

Cite this article

Visser, W. (2008) CSR Change Agents: Experts, Facilitators, Catalysts and Activists, CSR International Inspiration Series, No. 2.

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CSR 2.0: The New Era

CSR 2.0:

The New Era of Corporate Sustainability and Responsibility

Article by Wayne Visser

The field of what is variously known as CSR, sustainability, corporate citizenship and business ethics is ushering in a new era in the relationship between business and society.

Simply put, we are shifting from the old concept of CSR – the classic notion of “Corporate Social Responsibility”, which I call CSR 1.0 – to a new, integrated conception – CSR 2.0, which can be more accurately labelled “Corporate Sustainability and Responsibility”.

The allusion to Web 1.0 and Web 2.0 is no coincidence. The transformation of the internet through the emergence of social media networks, user-generated content and open source approaches is a fitting metaphor for the changes business is experiencing as it begins to redefine its role in society. Let’s look at some of the similarities …

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[button size=”small” color=”blue” style=”download” new_window=”false” link=”http://www.waynevisser.com/wp-content/uploads/2012/04/inspiration_csr_2_0_wvisser.pdf”]Pdf[/button] CSR 2.0: The New Era (article)

Related websites

[button size=”small” color=”blue” style=”tick” new_window=”false” link=”http://www.csrinternational.org”]Link[/button] CSR International (website)

[button size=”small” color=”blue” style=”info” new_window=”false” link=”http://www.waynevisser.com/books/the-age-of-responsibility”]Page[/button] The Age of Responsibility (book)

Cite this article

Visser, W. (2008) CSR 2.0: The New Era of Corporate Sustainability and Responsibility, CSR International Inspiration Series, No. 1.

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