Align CSR with Corporate Purpose and Values

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Ismael Bena MBA
Management Consultant, Netherlands

Align CSR with Corporate Purpose and Values

As argued by Rangan et al. (2015), CSR should not be designed to deliver business results. In contrast, companies should align their social and environmental activities with their business purpose and values. They go on arguing that business performance improvements should merely be the result of "spillover" and not the reason for being a responsible corporation.
This is a stark contrast with the shared value principles, which are predominantly grounded on improving a companies' performance through CSR/CSV (Porter & Kramer, 1999; 2002).

Studies have indicated that well operating companies are less interested to integrate CSR in their corporate strategies and opt for self-standing initiatives. A challenge with this approach is the misalignment of well-intended initiatives, hence creating non-coherence across business units and demographics, which in turn results into wasted capital.

It has therefore become more recommendable to align CSR activities, which Rangan, et al. (2015) classify in three 'theaters of activities': (1. Philanthropy, 2. Improving operational effectiveness and 3. Business model transformation) to create consistency with the company's purpose which correlates with the social importance of the company. In doing so, these activities are to be directly managed and overlooked by a C-suite executive, in combination with business unit managers to guarantee a coherent CSR vision.

Misalignment in CSR initiatives across business units will result in a waste for the company and does not contribute to its overall vision. Coordinated social initiatives, which are in line with the company's purpose, will positively affect the company across stakeholders groups as spillover even if that was not necessarily its objective.

Sources: Rangan, K. Chase, L. and Karim, S. (2015), 'The Truth about CSR - Most of these Programs aren't Strategic—and that's OK', Harvard Business Review 2015, Jan-Feb.
Porter, M.E. and. Kramer, M.R (1999) 'Philanthropy's New Agenda: Creating Value', Harvard Business Review. 77, pp.121-131.

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