CSR can, at times, be rather formulaic. We get used to seeing the same themed sections in CSR reports and on corporate websites time and time again. Not that necessarily there is anything wrong with this. If it aint broke, dont fix it is an adage which springs to mind each time I see a CSR report following the tried and tested model of workplace, marketplace, environment and community. The subthemes tend to be fairly predictable too – and rightly so. It is inevitable that businesses, whether they are based in Bogotá or Brighton will face similar challenges, whether it be carbon emissions reduction or responsible procurement.
These formulaic frameworks are valuable, and help focus attention on key issues. However, they shouldn’t be deployed without regard for responsibilities which might lie outside the model. For example, the traditional themes associated with the workplace element of a CSR strategy include ‘diversity and inclusion’, ‘training and development’, ‘health and safety’ and even ‘work/life balance’. But stories in this edition of CCB highlight some other, very pertinent, issues which are often overlooked by companies outlining their responsibility to employees. The political wrangling over paid internships is one, and the announcement by Unilever, that it will replace its final salary scheme with an average salary scheme and defined contribution option, is another.
It can be argued that these two news items, although representing the two poles of the employment cycle, are two sides of the same coin; namely the changing attitude of employers to their workforce. In the past, there was an assumption that, firstly, a job was for life, and secondly, that employers had a responsibility to their employees during the whole course of their lives, which therefore had implications for pension provision. These days, it is an anomaly to find someone at the same firm for thirty years, and people typically change jobs and even careers a number of times during their working lives. With this change in working patterns has come a significant change in what companies consider to be their responsibility in a financial sense. You almost never see a discussion of this kind in a CSR report, but the issue is surely an absolutely fundamental part of a company’s impact on perhaps its most important stakeholder; its employees.
The recent announcement that Unilever is winding down its final salary scheme represents a further nail in the coffin for final salary pensions, which have been disappearing rapidly in the private sector for the past few years. As employers move to schemes such as the money purchase pensions, employees are left more vulnerable to the possibility of not having enough to live on in their twilight years. In effect, employers have backed out of their traditional covenant to employees on pensions, and replaced it with less costly and inferior provisions. The economy has made it an employers market, and it can be argued that failure to provide a reasonable salary for interns is also breaking with the ethos of how a responsible employer should behave. Especially when one considers that most firms get a huge amount of work out of their interns during the course of a placement.
It cannot be denied that the economic downturn necessitated a review of costs for almost all companies – including employment costs. However, what seems to have happened is that companies are cutting corners, and damaging the fundamental concept of a responsibility to ones’ employees. A bit of creative thinking might enable employers to keep their employees’ best interests in mind, without having to provide unsustainable pension funds or vast salaries. As home ownership becomes more and more difficult for first time buyers, what about providing loans for a deposit on a house? Or, considering the rise in tuition fees, what about helping employees plan and provide for their children’s university education?
It is ironic that there are often lengthy sections in CSR reports devoted to how well companies have been engaging with a broad range of stakeholders, yet often a total absence of evidence showing real engagement with employees over key issues that matter, such as wages and benefits. Employers in the UK have been pretty uninventive in how they look at the total cost of their employees, and those employees’ needs in terms of financial planning and providing for the future. But they have also been rather blinkered when considering that this is not just a human resources issue, but a corporate responsibility issue too. Remuneration is surely the principle way in which businesses impact on their employees. Companies should be taking a creative approach to pensions, benefit packages and internships, and communicating those beliefs and commitments in their CSR reports.
Francesca is a senior researcher at Corporate Citizenship. She has been at the company for three years and provides research assistance on the full spectrum of client offerings, including assurance, community investment, employee engagement, strategy development and supply chain. Francesca was previously acting editor of Corporate Citizenship Briefing and co-authored the report ‘Volunteering – The Business Case’ (2010). She previously worked as a researcher for the editorial team at The Ecologist Magazine, and graduated with an MA in History and Anthropology at Edinburgh University.
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