InsightsStrategy DocumentsI06/2011Public AffairsThe functions andlocation of CSR in thecompany’s organizationchart: a step...
The functions and     Ethics and business                                         3.	 Analysis of the current situation: l...
The functions and     Example of each stakeholder management                     We can also segment into 4 big groups the...
©2011, Corporate Excellence - Centre for Reputation LeadershipBusiness foundation created by large companies to profession...
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The functions and location of CSR in the company’s organization chart a step forward


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Insight Corporate Excellence

Is there a specific function dedicated to managing CSR or is it an all-firm function that cuts across all activities of a company? Can CSR function be exercised by an internal committee, is there a need for an executive committee or should it be implemented via communication?

There is a clear tendency to manage this function from the heart of the organisation, both in terms of its internal recognition and its weight in the decision-making process. However its place has not yet been defined clearly, and the same is true about other intangibles, such as the reputation, the brand or corporate identity.

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The functions and location of CSR in the company’s organization chart a step forward

  1. 1. InsightsStrategy DocumentsI06/2011Public AffairsThe functions andlocation of CSR in thecompany’s organizationchart: a step forward Should there be a specific function dedicated to managing Corporate Responsibility or is it a transversal function which crosses all areas of a company? Is an internal committee sufficient, should it be represented on the Executive Board, should it depend on Communications or be included within another Department? The emergence of CSR as a discipline of Governance chair at IESE, there are 4 clear increasing importance in business management responsibilities in the profile of the Director or has brought a result, as had already occurred with Manager of Corporate Social Responsibility: other intangible areas such as Communications or Human Resources: the inexcusable debate 1. Education, guide, awareness: someone regarding its functions, situation and profile of the who can raise awareness about the need person responsible for it. for it in the heart of the organization. 2. Management of the CSR plan: someone who There are different visions and realities in companies can plan the main lines, fix the steps to be regarding this question: in some, CSR initially taken, and generate the indicators to track. emerges as an interest of the Communications 3. Communication, indicators and Department, motivated by the need of external reports: someone who can explain the reporting or, in the worst case, by the need to create company’s progress with the matter. a socially responsible reputation. 4. Dialogue with interest groups: someone who can establish open relationship In other companies, as an area of interest in the Human channels with stakeholders and manage Resources Department, as a result of concern about a productive dialogue for both parts issues related to the Talent Management, Internal in which shared value is created. Reputation or Labor Relations. In a few companies, as a special interest of the CEO by responding to a For this reason, the person responsible for CSR different business management model. must be in permanent contact and relation with stakeholders, but he must also have a global vision, The profile of the person he must believe in Corporate Social Responsibility responsible for CSR and coordinate the CSR Committee, ensuring that For Dr. Argandona, Professor of Economics and directors feel responsible for each area and for their holder of the ‘la Caixa’ CSR and Corporate own responsibilities. This point is crucial.
  2. 2. The functions and Ethics and business 3. Analysis of the current situation: location of CSR • Self-assessment. in the company’s organization chart: • Analysis of indicators (what a step forward Business they say about us). Strategy • Knowledge of expectations and requests from stakeholders (due diligence process, as recommended by ISO 26000). Advice for CSR Business Strategy • Analysis of strengths and weaknesses the responsible (identification of areas of improvement). work 4. Planning, strategy and actions: • Dialogue with stakeholders. Ethics • Proposals for improvement. • Criteria assessment: effectiveness, viability, cost-profit, impact, reputation. • Establishment of priorities. Source: J & K business model and ethics, 2011. • Drawing up action plan: desired results, objectives, actions, resources, budget, calendar, indicators. The vision of each department is also key to 5. Execution of plan: carrying out an integral management, integrated • Integration in the general strategy: in CSR. Those who are responsible for each scorecard and annual plan. department in the company must endorse the CSR • Planning communication: vision and mission and apply it to their stakeholder. with stakeholders. ‘To achieve Furthermore, he must have a strategic vision and 6. Results: a deep knowledge of the activity and operations ofthe required the company, knowing the company thoroughly, • Evaluation of indicators. • Results communication. organic the business it integrates and, why not, maybe even 7. Monitoring: being one of the possible CEO’s of the company. recognition • Continuous learning. • Review of the mission and vision. it is neces- The location of CSR is also a disparate matter in organizations, normally it is a second level sary to pre- function, integrated or not within the framework A relationship model with stakeholders One of the key responsibilities in managing CSR viously of other intangibles somehow associated with it and in general of the entire senior management (reputation, brand and identity) and in some cases prove the a first level function in the Board of Directors of an organization is the management of relations with the different interest groups around thevalue of the (in these cases usually under the umbrella of company. Fundamentally, we highlight 3 types ‘Sustainability’) or a direct line of reporting to function the CEO, although this is something that is still of activities: and its con- evolving and under discussion. 1. Dialogue: tribution to Professionalizing the function • Identification and classification in groups and subgroups, in the the busi- to the maximum extent most detailed way possible. ness.’ But to achieve the required organic recognition it • Information about its expectations, is necessary to previously prove the value of the demands and interests, through function and its contribution to the business. For meetings, investigations, interviews, that reason it is essential that CSR management suggestions boxes, observation, etc. be professionalized as much as possible, that it is • Impact on the company: primary equipped with the most appropriate instruments and and secondary stakeholders. tools to achieve it and that it guarantees a process • Impact on the company’s guided by planning and measurement. actions with stakeholders. • Map of stakeholders: person responsible There are 7 steps in this process of updating and for each group in the company, spokesman advancing organically Corporate Social Responsibility: on its behalf and methods of relating. • Integration of petitions in the 1. Analysis of the starting point: CSR planning process. • Reality of the organization. • Reply and communication model. • History. 2. Link: • Corporate Culture. • Shared vision of CSR policies. • Business. • Joint work at meetings, work 2. Commitment: groups, commissions. • Extension of the CSR mission, vision • Collaboration in common projects. and values in the entire company. • Participation in the CSR planning process. Insights 2
  3. 3. The functions and Example of each stakeholder management We can also segment into 4 big groups the type location of CSR of answer from organizations to social demands in the company’s organization chart: presented by interest groups: a step forward Consumers Staff 1. Reactive: initial resistance, Focus group subsequent reply to the demand. Focus group and survey Customers staff Suppliers 2. Inactive: without changes in Interviews Review the current situation. and Continuous Company meeting 3. Interactive: changes in the same communi- cation Entrevistas direction as the environment. Government focalizadas NGOs Focused Continuous 4. Proactive: the demanded change interviews communi- is acted upon immediately. cation Special interest Communities groups 3 CSR organizational models The Associate Professor Antonio Vaccaro, from the Source: Issues PR, 2011. Business Ethics Department at IESE, explains that there are 3 models of company management, defined according to their conception of CSR, and which correspond to 3 different types of organizations: 3. Communication: • Information about the company. 1. Traditional: typical of organizations • Information about CSR policies: in the old economy (1.0). levels and content. • Bureaucratic.‘The person • Styles and channels of • Competitive. communication: messages, etc. responsible • Rigid. • Dehumanizing. for CSR Identifying the 3 levels of • Tayloristic. must be in responsibility in the company • Not interested in CSR. A relevant task for the management of CSR is to 2. Handmade: typical of organizations permanent identify the 3 levels of company responsibility in in the social economy (NGO). contact, its context, sector and reality, according to Joan • Disorganized. Fontrodona, Associated Professor of Business • Based on the community/society.relation and Ethics at IESE: • Flexible. dialogue • Centered on people. 1. Primary: inherent in the company’s own • Simplistic. with stake- activity, not only to satisfy clients and obtain 3. Hybrid: typical of organizations holders and an economic return (wrong focus of company’s in the new economy (2.0). primary responsibility), but also the prior • Well organized. also have a respect towards the environment and human • Centered on people. global and rights within the exercise of that activity, not • Flexible. as a palliative ‘after the event’ measure. In • Humanizing. strategic this section we also include the creation of • Centered on CSR. vision.’ wealth, the sustainability of the business or the improvement in clients’ quality of life through Conclusions: the future challenges its products and services. for the CSR function 2. Secondary: improve the effects of the activities There is a clear upward trend of this function within on stakeholders with complementary actions organizations, both in its organic recognition as in its to the activity carried out in the Primary weight in decision making, although its final fit is still Responsibility, prioritizing those who are not resolved, as also occurs with other intangibles closer to the company. In this section we can such as Reputation, Brand or Corporate Identities. differentiate the key stakeholders (employees and shareholders), the periphery ones (clients But, irrespective of this, the professionalization of the and usual suppliers) and the independent function, the vision of contribution to the activity ones (potential clients and suppliers, local and to the real creation of value, and the provision community and competitors). of human and economic resources are the secure 3. Tertiary: contribute to the improvement ways to obtain the necessary weight to influence of certain social issues through actions not important strategic decisions in organizations. included in the activity and to prevent the erosion or harm to the common good, acting as a good corporate citizen, outside of its own activity, not as a result of it. In this section Corporate Philanthropy is included. Insights 3
  4. 4. ©2011, Corporate Excellence - Centre for Reputation LeadershipBusiness foundation created by large companies to professionalize the management of intangible assets and contribute to the developmentof strong brands, with good reputation and able to compete in the global market. Its mission is to be the driver which leads and consolidatesthe professional management of reputation as a strategic resource that guides and creates value for companies throughout the world.Legal NoticeThis document is property of the Corporate Excellence - Centre for Reputation Leadership and has as its objective to share businessknowledge about Brand, Reputation, Communication and Public Affairs Management.This document is directed exclusively towards its addressee and contains confidential information, subject to professional secrecy, whosedisclosure, copy or non-authorized use is against the Law. If you receive this document by mistake, let us know immediately and erase itwithout keeping a copy.Corporate Excellence - Centre for Reputation Leadership is the owner of all the intellectual property rights of the images, texts, designsand any other content or elements of this product and has the necessary permission for its use, and therefore, its copy, distribution, publicrelease or transformation is prohibited, without express authorization from the owner.