In 1998 HRH The Prince of Wales challenged BITC and its member companies to establish a framework for measuring and reporting corporate social responsibility. The group managing director of BT , Bill Cockburn, agreed to chair the task force (Bill ‘speaks out’ later in this issue.) Members included PricewaterhouseCoopers, FI Group, TNT and Merrill Lynch . Among organisations helping were DTI, BQF, EFQM and NCVO, The Centre for Tomorrow’s Company, ISEA and The Prince of Wales Business Leaders Forum.
Bill describes the final report, Winning with Integrity , as “a first attempt in the UK to refine corporate responsibility to its essential core”. It seeks to define good quality management and the key impact measures that all businesses should be using. There are four main thrusts to the CSR_business case:
•building trust: among employees, suppliers, customers, investors, the community;
•building the business : safeguarding customer relationships, reducing costs and risks, feeding product development;
•building the people : attracting and retaining staff; developing multi-stakeholder partnerships, thus encouraging new markets, new people, products and ideas;
•building communication : with the attendant business benefits.
CSR definitions differ. What did the task force say?
Every company has an impact on society. Some is positive – the value of core products and services, the wealth and jobs it creates. Some is negative – environmental impact, the social costs of products and services. A socially responsible company maximises positive impacts and minimises negatives.
Winning with Integrity looks at this in terms of seven areas:
•the purpose, vision and values of the company;
•marketplace : impacts of the company’s products and services, plus buying and selling activities;
•environment : impacts of company products, services and operations on the physical environment;
•workplace : work/life balance, diversity, health & safety, lifelong learning and people development;
•community : impact on, and investment in, local communities;
•human rights : particularly in companies with plants or suppliers in developing countries;
•principles of business behaviour.
Some companies are well developed, others just starting out. Can one size fit all?
No. That’s why recommended actions are graded at three possible levels – Level 1 for first time adopters through to Level 3 for aspiring market-leaders. On workforce, for example, Level 1 measures include staff absenteeism, formal grievances and legal non-compliance rulings on health & safety. Suggested Level 2 measures are staff turnover, training and development offered, and pay benchmarks. Level 3 extends to more complex measures such as perceptions among employees on issues such as work/life balance. The perception measures inform the hard figures and make them more meaningful.
After the report, what next?
BITC is now responding to the task force’s suggestions for spreading take-up of the report’s principles. We particularly want to see:
•recognition and reward : we need a more robust database of good practice examples. We will start by basing the BITC Impact on Society award – the winner becomes BITC’s Company of the Year – more explicitly on the report framework.
•a Social Responsibility Index , modelled on the Business in the Environment index, which has over the last five years proved to be immensely powerful in getting the environment on to boardroom agendas. We are delighted that Derek Higgs, who chairs the BiE business leadership team, has agreed to advise on such an index.
•encouragement to ‘tomorrow’s managers’ : much training and development material is already available on http://www.business-impact.org/courses and we plan to put more from Ashridge on-line during 2001.
•helping businesses to make a start : we will be offering our member companies a CSR review based on the report framework, to help them identify their current impact on society and how well are they managing it. Other tools are available to help them organise their thinking and approach – such as the simple self-assessment tool on the website.
That sounds very welcome: how will momentum be maintained?
At BITC’s AGM in December, we announced the setting up of a Business Impact Review Group, comprising up to 20 companies. They will measure themselves against the report criteria, and start to share their findings through an interactive web portal on the BITC site. Among those signed up are Prudential, Hasbro, Carillion, Jaguar Cars, Severn Trent, Thames Water, CIS, Sainsbury’s and Zurich Financial Services .
This pilot process is expected to last for about two years, at which point we plan to report on outcomes and any necessary adjustments to the measures. Interim updates on the testing of the measures will be available via the web portal, which should be launched in about six months’ time.
How will this affect BITC’s existing members and remit?
Membership of BITC is now seen as a commitment to continually improve your positive impact on society. The report gives the framework for achieving this – and therefore goes to the heart of the member relationship.
BITC account managers will gradually engage companies in discussion about their whole range of impacts, going beyond the scope of campaigns to date.
BITC is broadening its skillbase, but aims also to signpost companies towards specialists in newer fields covered by the report, such as human rights, rather than trying to develop in-house competencies in every area. Our role should be to act as a catalyst for change – growing the market for the specialist consultancies – not competing with them.
With this wider agenda, we hope to engage with a broader range of company ‘change agents’ – beyond the community affairs practitioner.
What can companies gain from using this methodology in an increasingly crowded market?
It was never our intention to produce a separate set of standards. Rather, we saw our brief as cutting through the growing morass of codes, standards and guidelines to provide a simple set of indicators and actions. These should be informed by, and derived from, many of the codes out there – such as the Global Reporting Initiative. But they distil these down to an essential core of indicators – based on business information of interest to a variety of stakeholders.
Most of our member companies see themselves at the start of this journey. The report can be a route map to take them as far as they need to go.
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