ebbf - introduction to csr and to a changing world

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ebbf offers an introduction to Corporate Social Responsibility and its role in bringing about more sustainable and successful companies. …

ebbf offers an introduction to Corporate Social Responsibility and its role in bringing about more sustainable and successful companies.
Starting from highlights of key changes that are taking place in today's fast evolving world we offer responsible solutions that companies are and need to embrace in order to gain a postiive competitive advantage.

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  • 1. Managing for Sustainability and Corporate Responsibility MBA at European School of Economics Spring 2011www.ebbf.org
  • 2. Are we living a period of crisis or of opportunity?www.ebbf.org
  • 3. January 2009 right in the middle of the financial crisiswww.ebbf.org
  • 4. “Hope you are doing great in these exciting times” Charlie O’Malleywww.ebbf.org
  • 5. In times of crisis it is necessary to change new ideas and new ways of operating are neededwww.ebbf.org
  • 6. In times of crisis it is necessary to change new ideas and new ways of operating are neededwww.ebbf.org
  • 7. What do you think, is there any crisis?www.ebbf.org
  • 8. Crisis = this is not working We need to find a new direction but everything is new - there is no mapwww.ebbf.org
  • 9. www.ebbf.org
  • 10. http://www.slideshare.net/jbrenman/shift-happens-33834
  • 11. Ten years ago there were no social networks.www.ebbf.org
  • 12. Ten years before that we didnt have the Web. www.ebbf.org
  • 13. If you work in the web programming, online marketing, or mobile phone industries…www.ebbf.org
  • 14. xist te no . d id ago ob ars r j ye ou t y y n tw ewww.ebbf.org
  • 15. Who knows what jobs will exist twenty years from now?www.ebbf.org
  • 16. How do you feel?www.ebbf.org
  • 17. What else is changing?www.ebbf.org
  • 18. New business models Apple’s Appswww.ebbf.org
  • 19. lower price of hardware to create a marketplace Apple’s TVwww.ebbf.org
  • 20. Google introduced FREE softwarewww.ebbf.org
  • 21. Changes e.g. cement innovation on motorway building in mobile placeswww.ebbf.org
  • 22. Biggest change is in communication and the way companies communicatewww.ebbf.org
  • 23. I can access - any - information I can access it - anywhere - I can write and influence - the world -www.ebbf.org
  • 24. the changing perceptions of PEOPLEhttp://www.bbc.co.uk/news/business-13123576 www.ebbf.org
  • 25. the changing perceptions of PEOPLE "The green agenda is increasing in its importance with the general public. If companies can be ahead of the curve in embracing this agenda, then it seems to me its of economic benefit." It is partly about reputation - something hugely important to the worlds big accountancy and auditing companies. But it is also about the companies ability to attract the best staff. "You have to remember that 70% of our staff are under 35," says Jon Barnes, who manages PwCs buildings across the UK. "That clearly means they are in an era that really does care about the environment. They really want to see substantial savings in our carbon footprint." http://www.bbc.co.uk/news/business-13123576www.ebbf.org
  • 26. the changing perceptions of PEOPLE "You could sit there and be cynical and say this is only being done for reputational advantage, but at the same time this is a means to an end - from an environmental agenda, things are getting better. Regardless of the motivation, the environment is damaged less." http://www.bbc.co.uk/news/business-13123576www.ebbf.org
  • 27. .... so, WHAT is changing?www.ebbf.org
  • 28. What else is changing? The environmentwww.ebbf.org
  • 29. www.ebbf.org
  • 30. www.ebbf.org
  • 31. www.ebbf.org
  • 32. Problems are global The solutions offered today are local / nationalwww.ebbf.org
  • 33. “The earth is but one country and mankind its citizens”www.ebbf.org Baha’u’llah
  • 34. www.ebbf.org
  • 35. www.ebbf.org
  • 36. Considering current consumption levels: Reserves of convential oil will last 40 years, gas 60 years and carbon 165-285 years. Uranium 30-60 years Hafnium, Indium (chips, LCDs) 5-15 years Copper (wire, coins, pipes) 40-60 yearswww.ebbf.org
  • 37. With current rates of consumptionQuantity Energy Supply Time www.ebbf.org
  • 38. • Demand for energy will grow 50% by 2030• 45% in India and China• Carbon demand will grow 73% (mainly India and China)• C02 emissions will grow by 57%(2/3 from US, China, India, Russia)IEA/OECD World Energy Outlook 2007 www.ebbf.org
  • 39. Demand for EnergyQuantity Supply of Energy Time www.ebbf.org
  • 40. Demand for EnergyQuantity Supply of Energy Time www.ebbf.org
  • 41. Demand for EnergyQuantity Supply of Energy Time www.ebbf.org
  • 42. Increase in temperatures in last 50 yearswww.ebbf.org
  • 43. Past and future CO2 concentration 20-35% will stay in the atmosphere for many centuries deforestation 1.5 Gt/year, 15% of total anthropogenic emissions
  • 44. Lo que dicen los modelos IPCC 2007www.ebbf.org
  • 45. Reduction in Arctic Ice Cap September 1982 and 2008www.ebbf.org
  • 46. www.ebbf.org
  • 47. Growth of world population Tripled in - one - generation Not enough resources nor food for the this size population Improvements in productivity in last 20 years from 1.8 a 2.5 t/ ha. - HOW?high energy consumption,high use of fertilizers ... www.ebbf.org
  • 48. Soil degradation
  • 49. price increaseswww.ebbf.org http://www.bbc.co.uk/news/business-13086979
  • 50. price increasesPrice increasein 2007 price of wheat 100% increase, maize 50%, rice20%, food price increase 10%in the mid 2008 price of food increased to 78%, soy andrice 130%Competition for energybio-energy = 800 m drivers competing with 2 bn poorestBuying other peoples’ landsRich countries and companies buying / renting land inforeign countries:South Korea 690,000ha and UAE and Egypt 400,000ha each in Sudan;Saudi Arabia 500,000ha in Tanzania; Daewoo 1.3m ha in Madagascar;Libya 100,000ha in Mali; South African businesses 8m ha in DR Congo;China 2.8m ha in Congo and 2m ha in Zambia, with 1 m Chinese farmlabourers in Africa in 2009.
  • 51. “Hope you are doing great in these exciting times” Charlie O’Malleywww.ebbf.org
  • 52. The sustainability of the planet requires a new mindsetYou are the protagonists of the greatest transformation that ever took place in the history of the earth Change is inevitable, and the speed of change is accelerating, requiring much more adaptive and intuitive people Global governance institutions need to develop accordinglyWe can actively work to help achieve the change that we wish to see happen or wait for a catastrophe that will force us to change Creativity and innovation, together with new values and a new ethic that highlights our role in serving the development of the global world community
  • 53. this is THE age where you can make anything happen overturning decades-old dictatorships ... in days done by the majority of the population: Generation Y ambitious yet peaceful with a new mindset of unity of purpose respecting diversitywww.ebbf.org
  • 54. We operate in a constantly evolving scenario To remain competitive, organizations need to adapt in a timely mannerwww.ebbf.org
  • 55. What is Corporate Social Responsibility - CSR Definition 1: European Commission Definition 1: European Commission “a concept whereby companies integrate “a concept whereby companies integrate social and environmental concerns in social and environmental concerns in their business operations and in their their business operations and in their interaction with their stakeholders on a interaction with their stakeholders on a voluntary basis” voluntary basis”www.ebbf.org
  • 56. What is Corporate Social Responsibility - CSR Definition 2:1: European Commission for Definition World Business Council Sustainable Development “a concept whereby companies integrate “the continuing commitment by business to social and environmental concerns in behave ethically and contribute to their business operations and in their interaction development while improving economic with their stakeholders on a the quality of life of the workforce and their voluntary basis” families as well as of the local community and society at large.”www.ebbf.org
  • 57. We operate in a constantly evolving scenario To remain competitive, organizations need to adapt in a timely manner Companies are made of people, so they will only change if their people are able to adapt and change with the evolving scenariowww.ebbf.org
  • 58. Enterprise eco system: The stakeholder concept Shareholders Cu s to m e s er ye s plo Em Enterprise Enterprise rs En lie vir p on S up Communities m en twww.ebbf.org
  • 59. PICK A STAKEHOLDER and be socially responsible Shareholders Cu s to m e s er ye s plo Em Enterprise Enterprise rs En lie vir p on S up Communities m en twww.ebbf.org
  • 60. http://www.greenpeace.org/international/campaigns/toxics/electronics/how-the-companies-line-up/www.ebbf.org
  • 61. www.ebbf.org
  • 62. http://www.greenpeace.org/apple/ www.ebbf.org
  • 63. How did that affect stakeholders? Shareholders Cu s to m e s er ye s plo Em Enterprise Enterprise s En plier vir p on Su m Communities en twww.ebbf.org
  • 64. There is crisis There is opportunity for change There is opportunity to build “our” companywww.ebbf.org
  • 65. Visions and broader Objectives"...a global enterprise that allowsindividuals to their double objectivefully develop their potentialitiesand contribute to improving the widercommunity”Baháí International Community’s Contribution to the 18th Session of theUnited Nations Commission on Sustainable Development - 2010www.ebbf.org
  • 66. Wikipedia’s 13 million articles are all written and maintained by the crowd.www.ebbf.org
  • 67. “Don’t just look to become more active, start to think more holistically on how your company participates as a global citizen. This doesn’t just come about through one or two projects – it is a mindset.” Starbucks former Senior Vice President of Corporate Social Responsibility, Sandra E. Taylorwww.ebbf.org
  • 68. avenues for success CompetitiveLONG TERM SUCCESS FACTORS Success Strategy Economic Success Social Success Monitoring, Evaluation www.ebbf.org
  • 69. social success Legislation . Monitoring supply chain ISO . Dialogue with stakeholders . Ability to respond to stakeholder Sarbey Oxley request in critical situations EU Modernization Directive . Spreading a culture of ILO ce responsible business an Ri i pl sk C om In n no tio va ta tio pu Development of production n Re FTSE4Good Eco Design DJ sustainability Index Eco Efficiency NGO Partnerships and sharing of Media Coverage information / innovation Brandwww.ebbf.org
  • 70. avenues for success CompetitiveLONG TERM SUCCESS FACTORS Success Strategy Economic Success Social Success Monitoring, Evaluation www.ebbf.org
  • 71. Financial ResultsIntellectual Capital www.ebbf.org
  • 72. Intellectual Capital Intellectual capital is the stock of internal knowledge (competencies, skills, capacities etc.) and the external (reputation, brand, customer satisfaction, etc.) of an organization, that allows it to transform human and material resources into a system that is able to create value for stakeholders by reaching sustainable competitive advantageswww.ebbf.org
  • 73. risk management The growth of intangible assetswww.ebbf.org
  • 74. Corporate image can be created but reputation has to be earnedCorporate image Reputation (ability to respect promises) Should be one of the main The brand items of corporate governance Vehicle of Promises www.ebbf.org
  • 75. Fundamental shift communication trust in ads trust in our friends’ opinions word of mouth transparencywww.ebbf.org
  • 76. www.ebbf.org
  • 77. www.ebbf.org
  • 78. www.ebbf.org
  • 79. www.ebbf.org
  • 80. www.ebbf.org
  • 81. www.ebbf.org
  • 82. Another Shift From explaining to making you feelwww.ebbf.org
  • 83. BMW no car appears only “intangible” feelings that need to be accomplishedwww.ebbf.org
  • 84. But “excitement” is short lived and unless you deliver on that promise you will be out of business soonwww.ebbf.org
  • 85. But “excitement” is short lived and unless you deliver on that promise you will be out of business very soonwww.ebbf.org
  • 86. What is important for stakeholders? For people?www.ebbf.org
  • 87. http://www.youtube.com/watch?v=XJh2LLoNLzwwww.ebbf.org
  • 88. www.ebbf.org
  • 89. What is important for us? Portrait of Gen Y (Offsprings of baby boomers 20 to 35) Ambition 84% profess to be very ambitious Loyalty vs. Quest 45% expect to work for their current employer for their entire career Multicultural Ease 78% are comfortable working with people from different ethnicities and cultures Healing the Planet 86% say it’s important that their work make a positive impact on the world Networking by Nature 48% say having a network of friends at work is very important www.ebbf.org
  • 90. avenues for success CompetitiveLONG TERM SUCCESS FACTORS Success Strategy Economic Success Social Success Monitoring, Evaluation www.ebbf.org
  • 91. governance accountability The “100 Best Companies to work for” show far better results than the S&P average Annualized stock market returnwww.ebbf.org
  • 92. The long term success of a company depends on the competitive, economic success and: . If it is socially responsible - able to satisfy the legitimate expectations of stakeholders . If it is able to adapt to the “cultural” change of the external environment . If it uses at its best its own intangible assetswww.ebbf.org
  • 93. Change is happening fastwww.ebbf.org
  • 94. its driving values have not taken us very far causing mainly crisiswww.ebbf.org
  • 95. We therefore need a vision of thefuture, not only of the future we want toavoid but the future we want to create.What did MartinLuther King say? I have a nightmare!www.ebbf.org
  • 96. We need a vision of the future,not only of the future we want to avoidbut the future we want to create.www.ebbf.org
  • 97. I have a planwww.ebbf.org
  • 98. Additional Materials
  • 99. Employees / WorkplaceQuality of lifeHuman resource policies "Responsible restructuringHuman rightsDiversityJob creationTraining and educationHealth and wellnessHarassment
  • 100. Customers/consumers Ethical marketing Products and Services Customer service Responsible procurement Audits Cause related marketing
  • 101. SuppliersCodes of conductSupply chain management and monitoringHuman rightsLabour standards (ILO)Minority VendingFair Trade
  • 102. Community Involvement Volunteerism Education Poverty alleviation Philanthropy
  • 103. Environment Life-cycle management Greening the supply chain Pollution Public procurement Eco-Efficiency (recycling, consumption, ..)
  • 104. Examples:Wal-Mart: increase fuel efficiency of trucks by 25% over 3 years (eco-efficiency)Wal-Mart: audit supplier factories and reward them for environmentalgoals and cut emissions (responsible procurement)Danone: closing factory in Mexico without layoffs or job loss(responsible restructuring)Starbucks UK: employees volunteering on Christmas Day to supportlocal homeless shelter; raising money for local causes (communityinvolvement)
  • 105. THE BUSINESS CASE FOR Corporate Responsibility• Hundreds of studies and articles indicate a correlation between good social and environmental practices and financial results, e.g.: •  CR vs share price performance •  Good HR practices vs ROI •  Low pollution vs PE ratios •  Quality vs market share •  Community involvement vs employee motivation
  • 106. THE BUSINESS CASE FOR Corporate Responsibility• Hundreds of studies and articles indicate a correlation between good social and environmental practices and financial results, e.g.: •  CR vs share price performance •  Good HR practices vs ROI •  Low pollution vs PE ratios •  Quality vs market share •  Community involvement vs employee motivation
  • 107. LOOKING AHEAD• CR will become more common practice.• Public expectations of business will increase as the government role continues to diminish.• There will be increasing demands for more transparency: “don’t tell me, show me”.• Audits and annual social reports will become common, even mandatory in some countries• CR will become a more strategic concern for management and be decentralized to business units• New scandals involving business and government officials will focus increased attention on business ethics.
  • 108. • New models will emerge for allocation of costs and benefits among companies, customers, and society.• Raw material shortages and environmental degradation will limit growth and job creation.• Treatment of employees will become even more important to win the “war for talent.”• Business will seek more partnerships with government and NGOs to address major issues.