CB BureauLooking to the future, what is needed – and what is just starting to emerge – is a new approach to CSR, which I call Systemic CSR, or CSR 2.0. This is a purpose-driven, principle-based approach, in which business seeks to identify and tackle the root causes of our present unsustainability and irresponsibility, typically through innovating business models, revolutionizing their processes, products and services and lobbying for progressive national and international policies. This leads to my first forecast.
Trend 5 – In the future, companies practicing CSR
2.0 will be expected to comply with global best practice principles, such as
those in the UN Global Compact or the Ruggie Human Rights Framework, but
simultaneously demonstrate sensitivity to local issues and priorities. An
example is mining and metals giant BHP Billiton, which have strong climate
change policies globally, as well as malaria prevention programmes in Southern
Africa.
A clear
failing of our current economic and commercial system is based on a
fundamentally flawed design, which acts as if there are no limits on resource
consumption or waste disposal. Instead, we need a cradle-to-cradle approach,
closing all resource loops and ensuring that products and processes are
inherently ‘good’, rather than ‘less bad’, as Shaw Carpets does when taking
back its carpets at the end of their useful life and Nike is starting to do
with its Considered Design principles.
Trend 6 – In the future, progressive companies
will be required to demonstrate full life cycle management of their products,
from cradle-to-cradle. We will see most large companies committing to the goal
of zero-waste, carbon-neutral and water-neutral production, with mandated
take-back schemes for most products.
The way
that we measure and report on social, environmental and ethical performance is
changing. As the Global Reporting Initiative, the Carbon Disclosure Project and
other standards are strengthened, a consensus on useful metrics is emerging.
What is still missing, however, is an agreed set of mandatory metrics, publicly
accessible in a database, which makes comparison possible. Current CSR indexes
rank the same large companies over and over, often with differing conclusions.
Trend 7 – In the future, much like the Generally
Accepted Accounting Practices (GAAP), some form of Generally Accepted
Sustainability Practices (GASP) will be agreed, including consensus principles,
methods, approaches and rules for measuring and disclosing CSR. Furthermore, a
set of credible CSR rating agencies will have emerged.
Still,
the role of government in the next 40 years will be crucial. Many of the issues
that CSR is currently trying to tackle on a voluntary basis will be mandatory
in the future, especially with regards to emission reductions (toxics and
greenhouse gases), waste practices and transparency. There will also be a
gradual harmonisation of country-level legislation on social, environmental and
ethical issues.
Trend 8 – In the future, many of today’s CSR practices
will be mandatory requirements. However, CSR will remain a voluntary practice ”
an innovation and differentiation frontier – for those companies that are
either willing and able, or pushed and prodded through non-governmental means,
to go ahead of the legislation to improve quality of life around the world.
The form
and media for transparency are rapidly evolving. We can expect annual CSR
reporting to be increasingly replaced by online, real-time CSR performance data
flows. Feeding into these live communications will be Web 2.0 connected social
networks (such as those on Justmeans, where companies can stream their data and
updates) and Wiki-style forums for crowdsourcing (such as OpenEyeWorld, where
companies can electronically interact with hundreds of sustainability experts
and gauge the ‘wisdom of the crowds’).
Trend 9 – In the future, corporate transparency
will take form of publicly available sets of mandatory disclosed social,
environmental and governance data – available down to a product life cycle
impact level – as well as Web 2.0 collaborative CSR feedback platforms,
WikiLeaks type whistleblowing sites and product rating applications (like the
GoodGuide iPhone app).
The way
that companies manage CSR will also change. CSR departments will most likely
shrink, disappear or disperse, as the role for a CSR generalist is confined to
small policy functions. By contrast, more specialists in various aspects of CSR
will be required and performance across responsibility and sustainability
dimensions will increasingly be built into corporate performance appraisal
systems (salaries, bonuses, promotion opportunities, etc.), as is already the
case in companies like Arcor, the confectionary company in Argentina.
Trend 10 – In the future, CSR will have diversified
back into its specialist disciplines and functions, leaving little or no CSR
departments behind, yet having more specialists in particular areas (climate,
biodiversity, human rights, community involvement, etc.), and more employees
with knowledge of how to integrate CSR issues into their functional areas (HR,
marketing, finance, etc.).
Collectively,
these trends reflect a scenario of widespread adoption of CSR 2.0 In the future,
a future in which companies become a significant part of the solution to our
sustainability crisis, rather than complicit contributors to the problem, as
they are today. Given the current global crises and mounting system pressures,
and knowing business’s ability to adapt and rapidly change, I regard this as a
highly likely prediction sketched out by a concerned pragmatist, rather than
the wish-list of a CSR ‘true believer’.
Read PART 1 here: Future Trends in CSR – The Next 10 Years