Corporate Eye

The Great 2012 CSR Revolution

So let’s do another little survey here.  Hands up anyone who’s crossed Gypsy Rose’s palm with silver in the hope of having their fortune told?  No-one?  Oh, maybe one person at the back.  Well, it doesn’t surprise me, we’re not really into such superstitious claptrap these days.

Nevertheless, every year every CSR practitioner seems to feel they too can be Gypsy Rose.  Crystal balls get polished and predictions made.  If you’re lucky, there may even be a waft of incense in the air .. or is that just over-ripe pot-pourri?

Myself, I try desperately to eschew this tradition but every year someone says something in their own crystal ball gazing which needs a response.  This year is no different.

But first….

Mandatory CSR reporting will happen 

CSR will be regulated in 2012.

I’ve said this for several years now, and often I get the response “oh no, we can work this out voluntarily”.  Well the EU seems to think otherwise.

In 2011 the EU adopted the Single Market Act.  Buried within its guts is a commitment to “present a legislative proposal on the transparency of the social and environmental information provided by companies in all sectors”.

That proposal is well under way and is due to be published sometime in 2012.  As we all know, once a regulatory proposal is made it become de facto law while businesses have time to adjust before it comes into effect.  But the regulation will be published in 2012 and businesses will then start to feel its bite.

To find out more, and keep an eye on the legislative progress, check out the EU’s CSR: Reporting and Disclosure website.

STOP PRESS: the first concrete legislative changes have just been announced.  I’ll be reviewing and blogging here later.

What about the revolution?

OK, so that’s out of the way.  Now what?

Well, first up here’s a quote from UN secretary General Ban Ki-Moon at the January 2011 meeting of the World Economic Forum:

We need a revolution. Revolutionary thinking. Revolutionary action…It is easy to mouth the words ‘sustainable development,’ but to make it happen we have to be prepared to make major changes—in our lifestyles, our economic models, our social organization, and our political life.

Now here’s a quote from Charles Handy, the leading Irish philosopher specialising in business and organisational behaviour.

To turn shareholders’ needs into a purpose is to be guilty of a logical confusion, to mistake a necessary condition for a sufficient one.  We need to eat to live; food is a necessary condition of life.  But if we lived mainly to eat, making food a sufficient or sole purpose of life, we would become gross.

The purpose of a business…is not to make a profit. Full stop. It is to make a profit so that business can do something more or better. That ‘something’ becomes the real justification for a business.

This strikes at the heart of our common understanding of what business is all about.  The idea that business is just about profit and wealth is a very recent one and dates back little further than Henry Ford and “the business of America is business”.

Since then it’s been accepted that creating wealth is a good in itself.  This is rubbish.  As Charles Handy says, eating isn’t a good in itself, if you believed that you’d be inordinately obese.

And how about electricity?  Today, one of the biggest sustainability challenges is how to generate the electricity we need while cutting out carbon intensive and nuclear methods.  But no-one has ever suggested that to overproduce electricity, to have gigawatts of power created but never used, is beneficial.  And why would they, the idea is ludicrous!

Yet this is exactly the attitude we’ve adopted on wealth.

Hello Future

In the past five years the CSR movement surmounted the huge obstacle, that of greenwashing.  Being Green isn’t about marketing, it’s about a fundamental change in business attitude.

Now it faces a tougher challenge.  Many proponents see CSR as being the next thing to “infiltrate” business from the client or consumer’s point of view, much as quality and customer service did in the 1980s.  That’s great, but only in so far as it goes.

CSR, or more accurately sustainability, is about a fundamentally different business model to the one we have today.  It’s the discovery of that model which I believe will drive 2012.  Businesses will get down to the nitty-gritty of sustainability and realise there’s a fundamental discord between wealth creation for the sake of wealth creation, and sustainability.

2012 will be about the emergence of this new business model.  Sustainability will start to move from waste reduction and green energy towards a different way, a different reason, for selling goods and services at a profit.  Quite where this will end up we cannot tell.  However I have a good idea of who might be steering the ship.

The two quotes above dropped in my email from Allen White, founder and former Director of GRI and VP of the Tellus Institute.  These days he gives a large slice of his energy to another Tellus project, Corporation 2020, and is involved in Tellus’ global citizens’ movement, The Great Transition Initiative.

If you want a vision of the future, I suggest you look here first.

Picture Credit: Crystal Ball Rocky Irish Beach by garlandcannon under CC Attribution Share Alike License.

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A former CTO, Chris has a broad and varied background. He’s been involved with blue chips, consultancies & SMEs across a wide variety of sectors and has worked in Europe, the Middle East and Australia. In 2007 he decided to combine his knowledge of business and IT with his passion for all things sustainable and has been busy writing ever since. However, his greatest ambition remains to brew the perfect cup of coffee.