19 Feb Is doing good good for business?
Is doing good good for business? This is the central theme behind a recent collaboration between the University of Carolina and Fortune, who are offering a joint course called ‘Change the World: Lead with Purpose’. The University’s Business school website states that ‘for modern companies, injecting purpose into the core of business strategy is a key element of success’; it also claims that, through its programme it will teach participants how to advance strategic leadership whilst learning how to manage change successfully therefore addressing challenges and solving problems effectively.
Amongst the business community, there seems to be a rising concern with putting purpose at the core of business operations. In fact, last year it was reported that a ‘record number of companies joined CSR day 2017’.
However, there is one major shortcoming – what is reported as ‘CSR’, and what most local companies understand by it, is not CSR at all, but rather one-off philanthropic initiatives or ‘pet projects’.
The European Commission defines CSR as ‘companies taking responsibility for their impact on society.’ It is clear therefore that sponsoring a good cause, or collecting donations for an NGO, is not how companies should take responsibility for their impact on society.
Real CSR requires a greater commitment and focus and it should encompass various themes such as good governance, employment standards, human rights, environmental impact, implementing fair operating practices, consumer issues and community development. Besides bringing the much needed ‘good’ and sense of ‘purpose’ into the corporate world, a well structured CSR programme can address various current business challenges such as the struggle to attract and retain suitable employees, the need to evolve and innovate, the need to comply with an ever increasing body of laws and regulations and increased brand equity.
A study carried out by the IBM Institute for Business Value found that out of the 250 business leaders surveyed across the globe, 68 percent are focusing on CSR to create new revenue streams, and more than half (54 percent) claim that their companies’ CSR activities give them a competitive advantage over their top competitors. Of course, it would be interesting to carry out a parallel local study to determine whether this drive is also happening on a comparable level in Malta.
A properly constructed and well-managed CSR strategy can be instrumental in creating a sense of purpose, driving leadership and innovation and enabling businesses to stand out amongst the competition. Forward thinking business leaders such as Tesla’s Elon Mask, Vodafone’s Michael Joseph and Starbucks’ Schultz have understood this and harnessed it. Globally, it seems that many are following suit. The question remains – are Maltese business leaders going to make the leap? Will they step up and become the visionary leaders that are needed in today socio-economic climate?