CSR: Death or Rebirth?
Blog post was written by Social Purpose Institute Advisor, Coro Strandberg.
Feb 8, 2021
Is corporate social responsibility (CSR) dying? Many think it is. Leading companies who practiced CSR over 10 and 20 years ago believe CSR, which largely operated on the side of the company, is outdated and no longer reflects how they operate their companies. These companies have evolved to become social purpose companies, embedding their societal ambition into their core purpose and everything they do. They have moved along the Social Purpose Continuum, transitioning their philanthropy, corporate citizenship, and CSR programs as they’ve traveled. Here is an example of such a company: Maple Leaf Foods. Their Social Purpose is to “Raise the Good in Food” and their vision is to be the most sustainable protein company on earth.
However, it is not as simple as it may seem. In my experience working with the Social Purpose Institute and other companies that have defined and are embedding their social purpose, CSR undergoes a significant evolution in that process. It does not stay the same. But it does not die. And – as I see it – CSR is a dress rehearsal for becoming a social purpose company.
Here is what I see – and advise.
First, social purpose companies abandon CSR terminology. They no longer have CSR strategies, issue CSR reports, or have managers of corporate social responsibility; they rebrand all those things to align with their social purpose narrative. They do this both to avoid confusion and to build momentum and excitement for the organizational changes ahead. Legacy CSR efforts are reframed as “investments in our purpose”.
Social purpose companies also stop using philanthropy to describe what they do. They still flow grants and sponsorships to external partners but, as with CSR, these grants are used as purpose investments; philanthropy budgets become “innovation funds”. This might seem like mere semantics, but it is much more. It represents the paradigm shift that is underway in the business. To overcome old mindsets, they adopt the language of the future business model, one that is fully aligned with purpose.
Similarly, social purpose companies streamline their partnerships and move from tactical, transactional, short-term, and ad hoc relationships to those that are collaborative, long-term, and co-innovative with partners who share their social purpose ambition. As one ex-CSR – now social purpose – professional recently said to me: “Our purpose is broad enough that we can wedge all of our CSR in, but if we can make it more streamlined, we can have more impact.”
These newly-minted social purpose companies use their new social purpose as a filter or lens on all of the organization’s priorities, including the organization’s social and environmental (CSR) priorities. While measures continue unabated (or are even accelerated) to reduce and manage the risks of the organization’s social and environmental impacts, social purpose companies reprioritize their CSR efforts to focus on those things that have the greatest and most beneficial impact, which, in turn, frees up bandwidth for their more purpose-aligned initiatives. They pause their old programs, transition out of those that don’t help achieve material progress on their purpose, and use the liberated resources for their societal mission.
B Corp companies have a special challenge and opportunity. The challenge is the multitude of potential CSR investments they can make to increase their score and further their B Corp progress. The opportunity is to prioritize the B Corp practices that have a tie-in to, and align with, their social purpose and become role models in those areas.
To help their employee base understand this transition from CSR to purpose and their role in it, they give workshops on how CSR is different from social purpose. Companies with a long and proud history in CSR invest in training to help employees understand and embrace the shift and to empower purpose at work. This is necessary.
Companies like IKEA, with such a history of CSR programming excellence, include their CSR commitments in their purpose story, as revealed in this highlighted sentence from IKEA’s website: “Our purpose is to create a better everyday life for the many people. And to do so in a way that is affordable, sustainable and respects human rights”. As you can see, the second sentence is a summary of their CSR priorities. IKEA and others ladder their CSR up to their purpose and show stakeholders how they are addressing their social and environmental risks, impacts, dependencies, and opportunities – not abandoning them. They pursue their purpose in a way that sustains the social and environmental systems we – and they – rely upon. This is necessary.
We are early on this journey to social purpose, so the roadmap is being built under the feet of these pioneers as they walk the Purpose Path. Leaders are showing us that they do not abandon their CSR investments, they repurpose them to support and provide proof-points on the corporate purpose.
If your company is going through its own Purpose Pivot, consider using and building upon these ideas to inform your strategic approach and your internal CSR transformation.
CSR: Death or rebirth? I’d say rebirth.