Assess Your CSR Strengths and Weaknesses

How does your company's social and environmental performance stack up? Are you meeting the expectations of your stakeholders? Are you taking advantage of your corporate social responsibility (CSR) opportunities? Are you having a positive impact on the world around you?

An assessment is the best way to get answers to these questions. While a proper assessment involves investigating a number of areas, such as the expectations of your stakeholders, the pressures for CSR, the potential benefits, the relevant issue areas, and your major opportunities, today we review just one aspect: assessing your social and environmental performance. In other words, how do you determine your major strengths and weaknesses?

There are two major things to think about:

Your Impact: Every company has both positive and negative effects on the world around it. When assessing your company's social and environmental performance, your challenge is to define and measure these effects.

Your Activities: Many companies also conduct policies or initiatives, either formally or informally, that are designed to enhance their social responsibility. Like any business initiative, these activities can be successful or unsuccessful, effective or ineffective. Your assessment of CSR performance should also evaluate the effectiveness of these policies and initiatives.

Assessing Your Impact

Your first step is to analyze the positive and negative impact that your company creates - both intentionally and unintentionally - for its customers, suppliers, employees, community, environment, the public-at-large, and other stakeholders. A simplified impact assessment will look like this:

Determine the areas to assess: Begin by listing the individuals, groups, and environments on which your business has a positive or negative impact. Who does your company influence? Who does it have responsibilities to? Who depends upon your organization? You might also consider those impacted by your entire supply chain.

Next, list the most significant areas of impact that your company has on each of these groups. What areas are most important to employees? To the community? To your customers? To the environment? Conversations with your stakeholders will help you develop this list, but you might also consider using CSR standards to get ideas. Standards and guidelines such as the UN Global Compact, the GRI G3 Performance Indicators, the SA8000 Labour Standard, or the Caux Round Table Principles for Business list various CSR-related issues that you can choose to include in your assessment.

Collect information about your impact: For each of these significant areas, you will need information with which to assess your impact. Impact assessment data can come from a variety of sources. Smaller businesses will find it useful to simply talk to or survey customers, employees, or other stakeholders to reveal their impressions and expectations. Relatively simple measures of environmental impact are also available, like electricity consumption (which can be converted to greenhouse gas emissions) and raw material use. Larger companies will find value in more thorough, statistically-robust methods of data collection.

Evaluate your impact: For each area that you assess, you will need to define "good performance." Does good performance mean that you meet expectations? Or that you exceed them? You might also consider the number of people affected, the value of the issue to those people, and the presence of controversy around the issue.

Evaluating Your Activities

You might have in place an ethical code of conduct, employee volunteering programs, a waste-diversion system and socially-responsible procurement, but are these initiatives effective? Are they advancing your company's social and environmental objectives? Are they improving the positive impact you have on other people? Could they be better?

The answers to these questions are important. They will help ensure you are focused on the right initiatives in the first place. They will also guide you to remedy or eliminate weak programs and build upon the strengths of successful ones.

While every initiative could be evaluated on different merits, there are three generic ones you should always think about:

Content: Is the initiative aligned with your company's business and strategy? Does it relate to your company's products, services, and/or stakeholders? Do stakeholders care about it? Does it contribute to the most significant areas that you identified when assessing your company's impact?

Management: Does the initiative have goals? Are staff members responsible for its success? Is the initiative well-communicated to internal and, if appropriate, external stakeholders? Is the impact of the initiative being measured and reported? Are there systems in place for continuous learning and improvement?

Results: Is the initiative producing desirable results? Is the intended benefit being realized? What is the magnitude of these results? Are there any unintended consequences - positive or negative - being caused by the initiative?

Next Steps

What do you do with this performance information once you have it? Knowledge of your strengths and weaknesses shows you where deficient performance can be improved and where strong performance can be built upon. Coupled with the other important elements of an assessment, you will be able to make informed decisions about your CSR initiatives: removing the irrelevant ones, improving the under-performers, and adding new initiatives in under-served areas. You will be able to focus your efforts on those areas with the greatest potential to benefit your business, society and the environment.