Note: From January until June 2015, our events were promoted under “Values in Perspective”. We have since changed our name to IdeasXChange.
Is it possible for a company to add value to society and still make profits without harming the environment?
Is it enough to let governments and NGOs take care of the environmental and social issues prevalent in the world today and let businesses escape corporate responsibility?
And if it isn’t, to what extent should businesses and people be held responsible for the damage they cause?
On March 24, 2015, IdeasXChange engaged 30 UBC students and faculty, practitioners and community members in a panel and discussion on corporate social responsibility.
Western Canadian Anchor at Purpose Capital Christie Stephenson; and Robert Crawford, UBC professor and chair of Multinational Corporations course, were both panelists at the workshop. Participants gathered for case studies and a discussion after the panel.
What is Corporate Social Responsibility?
Milton Friedman, an American economist famously stated, “there is one and only one social responsibility of business — to increase its profits so long as it engages in open and free competition without deception or fraud.” However, the business landscape is changing, and more and more people are considering the social responsibility of business to incorporate far more than responsibility to shareholders and maximising profits.
At the very heart of Corporate Social Responsibility is the triple bottom line- the notion that businesses should consider all three economic, environmental and social impacts of their actions. These three pillars are often abbreviated as the 3 Ps- People, Planet, and Profit, and a firm with a strong CSR mission would incorporate all these into their values, culture, decision making, strategy and operations. These increases businesses’ responsibilities to consider other community stakeholders, like the responsibility to provide clean air for residents and hence to reduce carbon emissions.
There are many components of CSR, and improving social and environmental conditions could range from addressing the supply chain (looking at more ethical ways of sourcing materials, finding better ways to dispose waste) to human resources (improving the company culture, providing health benefits that increase wellbeing for employees and their families).
Stephenson, talked about her experience with social impact from a financial perspective, and described the components of Impact Investing– investments made to generate social or environmental impact while not compromising the financial return. She also talked about metrics and ways to measure these impacts. One of the better known metrics are called ESG-Environmental, Social and Governance metrics.
Although CSR does have its credits, it also has its shortcomings. Professor Crawford, was able to touch on some of the bigger picture issues surrounding CSR, such as the potential for Greenwashing– when a firm advertises itself as an advocate for CSR but does so purely for profit purposes and doesn’t attempt to incorporate it into its operations and firm mission, and the lack of incentives for Multinational Corporations to monitor its behaviour.
Christie Stephenson: Western Canada, Purpose Capital. She has spent the past 15 years involved in impact investing and social enterprise as an investor, board member, mentor, and through her work in the socially responsible investing field. She spent 14 years at Canada’s leading socially responsible investing firms Sustainalytics and NEI Investments, where she managed the environmental, social and governance evaluations program. She has also served on the boards of numerous social enterprises.
Robert Crawford: UBC Professor and Arts One Program Chair. Professor at UBC since 1995, focusing on international relations, political philosophy, and international political economy. His Multinational Corporations (MNCs) and States in the Modern Era course evaluates the perceived benefits and costs of foreign direct investment in select countries, regions, and industries, while analyzing the effectiveness or desirability of various attempts to control, limit, and regulate MNC behaviour. He has taught at SFU, UVIC, published two books on international relations, and is the UBC Arts One Program Chair.