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Wednesday, 27 July 2011

Ed Freeman on "The Age of Responsibility"

"Wayne Visser has rightly identified responsibility as one of the defining issues of our time. Executives, students and citizens should read this book, and make it an integral part of our conversation about business."

Ed Freeman, Director of the Business Roundtable Institute for Corporate Ethics at the University of Virginia Darden School of Business and author of Strategic Management: A Stakeholder Approach


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The Age of Responsibility: CSR 2.0 and the New DNA of Business, by Wayne Visser is available from Amazon.co.ukAmazon.com and other leading book retailers (ISBN-10: 0470688572, ISBN-13: 978-0470688571).

Monday, 11 July 2011

Institutional Shareowner book review

By Robert Kropp


Author Wayne Visser argues that corporate social responsibility as practiced thus far has failed, and describes a world where CSR practices can contribute to genuine sustainability in meaningful ways.

Corporate social responsibility (CSR)—or corporate sustainability and responsibility, as author Wayne Visser terms the concept in his new book, The Age of Responsibility: CSR 2.0 and the New DNA of Business—has been a growing practice for at least the last 20 years. Today, signs of its widespread acceptance can be found everywhere: in the increasing numbers of companies that issue annual sustainability reports, the proliferation of environmental, social, and corporate governance (ESG) rating and ranking systems, and mainstream adoption of the United Nations' Principles for Responsible Investment (PRI).

So why then does Visser, who published his first book on corporate sustainability in 2002, now write, "CSR has failed"?

"We should judge the success of CSR on whether our communities and ecosystems are getting better or worse," Visser continues. "At the macro level almost every indicator of our social, environmental and ethical health is in decline."

Quoting Joel Bakan, the author of The Corporation, Visser notes that the original nineteenth-century concept of the corporation was that the entity had "some responsibility to create something that was in the public good," instead of merely "creating wealth for the owners." It did not take long for such a lofty concept to be abandoned; and Visser divides the history of CSR into four stages that have dominated the practice thus far.

During the age of greed, companies practice defensive CSR by focusing exclusively on shareowner value over the short-term. The practice, Visser writes, peaked with the bankruptcy of Lehman Brothers and the onset of the economic crisis in 2008. One of its key ideas is that gains are privatized, and costs socialized; that is, the social and environmental costs of corporate activity are externalized, to be borne by society.

In the age of philanthropy that follows, corporate leaders use their wealth to establish charitable programs to help communities. As laudable as charity by the rich may be, however, the practice does nothing to address the underlying consequences of business activity. In effect, corporations are making vast profits via unsustainable enterprises, then allowing a relatively meager percentage of profits to trickle down to the communities in which they operate.

It is with what Visser terms the age of marketing that we begin to see CSR as it is often practiced even today. CSR in this context is seen as a promotional tool, belonging to corporate public relations. In the extreme form of its practice, it amounts to greenwashing. The specific case study used by Visser for the age of marketing is BP, which for many years was ranked among the world's most sustainable companies, largely as a result of its sustainability reporting. Too many investors and CSR advocates failed to take sufficiently into account BP's already poor health and safety record until last year's Gulf of Mexico oil spill.

With the age of management, in which companies practice strategic CSR, programs include genuine measurement and establish goals for incremental improvement in core businesses. The concept of an extensive group of key stakeholders in addition to shareowners has taken root, and standards against which companies are expected to measure themselves have proliferated.

Clearly, progress can be traced along the path from greed to management. To what then does Visser attribute the failure of CSR? For companies stuck in the age of marketing, the fact that CSR is peripheral to their core business activities is significant. Furthermore, even today, CSR is practiced mostly by the world's largest companies. And the fact that markets persist in awarding short-term financial performance calls into question the economic sense of CSR activities.

Even for companies in the age of management, Visser writes, "The quality management model…results in incremental improvements that do not match the scale and urgency of the problems."
In other words, corporate activity is still destructive. The social and environmental costs of doing business are not borne by the companies profiting from it, but are externalized and borne by society instead. So what does Visser offer as a solution?

In the age of responsibility, companies practice what Visser has termed CSR 2.0, modeling it on the Internet revolution brought about by social media and user-generated content. Corporate practitioners of CSR 2.0 expand CSR beyond a "tick-box" mentality and attempt to find creative solutions for problems so large as to seem intractable. They offer scalability, an example of which is Muhammad Yunus, whose Grameen Bank started with a single $74 loan and grew into a $2.5 billion microfinance enterprise.

Practitioners of CSR 2.0 are responsive to an expanded set of key stakeholders, seek local solutions to problems that retain universal principles, and practice circularity by adopting a "cradle-to-cradle" approach to product design that recognizes limits to resource consumption and waste disposal.
"When all is said and done," Visser writes, "CSR 2.0 comes down to one thing: clarification and reorientation of the purpose of business…Ultimately, the purpose of business is to serve society."

Especially with the economic crisis still playing out in the form of 14 million Americans unemployed, the cynic could consider Visser's solution to daunting problems to be somewhat na├»ve. After all, haven't corporations refashioned themselves into predatory seekers of a profit motive to the exclusion of all else, and have pushed the overwhelming—soon to be insurmountable—social and environmental costs onto the rest of us?
Yet, as Visser's age of management demonstrates, genuine CSR practices have become more widespread. Their effects may be too incremental to stave off environmental disaster and social upheaval, but they do indicate that real work can get done.

Additionally, a handful of companies are committing themselves to the principles of CSR 2.0. While they may amount to no more than the merest ripple in a vast sea of corporate greed, they do provide templates for future CSR activity. Even after reading Visser's well-researched and informative book, I have no clearer idea on how those templates might be adopted on a scale to effect genuine change.

The CSR 2.0 Principle of Glocality - Origins

The term ‘glocal’ – a portmanteau of global and local – is said to come from the Japanese word dochakuka, which simply means global localization. Originally referring to a way of adapting farming techniques to local conditions, dochakuka evolved into a marketing strategy when Japanese businessmen adopted it in the 1980s.

It is said that the English word ‘glocal’ was first coined by Akio Morita, founder of Sony Corporation. In fact, in 2008, Sony Music Corporation even trademarked the phrase ‘go glocal’. Glocality was subsequently introduced and popularized in the West in the 1990s by sociologists Manfred Lange, Roland Robertson, Keith Hampton, Barry Wellman and Zygmunt Bauman.

The underlying concept of ‘think global, act local’ claims somewhat more varied origins. In a broad, abstract sense, it is captured in the ancient Hermetic idea of ‘as above, so below’ – the macrocosm is reflected in the microcosm and vice versa. Or as Goethe put it: ‘If (we) would seek comfort in the whole, (we) must learn to discover the whole in the smallest part.’ More concretely and recently, the Scots town planner and social activist Patrick Geddes applied the concept in his 1915 book Cities in Evolution, saying:

Local character is thus no mere accidental old-world quaintness, as its mimics think and say. It is attained only in course of adequate grasp and treatment of the whole environment, and in active sympathy with the essential and characteristic life of the place concerned.

Sometimes, glocality maintains its geographical rootedness. For example, Neighborhood Knowledge California is a project of the Advanced Policy Institute at the University of California, Los Angeles, which serves as a state-wide, interactive website that assembles and maps a variety of databases that can be used in neighbourhood research. Its aim is to promote greater equity in housing and banking policy. In addition, it functions as a geographic repository for users to map their own communities by uploading their own datasets.

When and by whom the phrase ‘think global, act local’ was first applied to environmental issues is a matter of some dispute. It may have been introduced by David Brower, founder of Friends of the Earth, in 1969, or by Rene Dubos as an advisor to the 1972 UN Conference on the Human Environment. Also, in 1979, Canadian futurist Frank Feather chaired a conference called ‘Thinking Globally, Acting Locally’. Whatever its origins, the notion of glocality has entered into the popular consciousness.

It was given its most visible and practical expression when the Rio Earth Summit issued Local Agenda 21 in 1992, which was a programme of action for applying the global principles of sustainable development in local contexts. Today, there is also a Glocalist magazine in Austria that offers a daily online newspaper, weekly digital magazine and monthly print magazine.

In a CSR context, the idea of ‘think global, act local’ recognizes that most CSR issues manifest as dilemmas, rather than easy choices. In a complex, interconnected CSR 2.0 world, companies (and their critics) will have to become far more sophisticated in understanding local contexts and finding the appropriate local solutions they demand, without forsaking universal principles. It is also a caution against applying global models and standards, without allowing for the flexibility of local adaptation and expression.


About the blogger

Dr Wayne Visser is the Founder & Director of CSR International and the author of 9 books on CSR, the most recent of which is The Age of Responsibility: CSR 2.0 and the New DNA of Business. He researches, writes, trains and teaches corporate sustainability & responsibility around the world, including at Cambridge University, Magna Carta College, Oxford and La Trobe Graduate Business School, Melbourne.

Source

This is an extract from Chapter 10 of The Age of Responsibility: CSR 2.0 and the New DNA of Business For more information and ongoing updates, follow the The Age of Responsibility Blog

Copyright 2011 Wayne Visser

Friday, 8 July 2011

Betty Sue Flowers on "The Age of Responsibility"

"Through a concise analysis of recent economic history and through the wisdom of parables, Visser’s book offers an illuminating analysis of the heart of greed—and of the path our institutions can take to move from corporate responsibility as a form of occasional philanthropy to an ethic of responsibility that is radically transformative. Visser’s new economic myth or meta-narrative creates a compelling vision of a possible sustainable world."

Betty Sue Flowers, Professor Emerita at the University of Texas at Austin and co-author of Presence: An Exploration of Profound Change in People, Organizations, and Society


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The Age of Responsibility: CSR 2.0 and the New DNA of Business, by Wayne Visser is available from Amazon.co.ukAmazon.com and other leading book retailers (ISBN-10: 0470688572, ISBN-13: 978-0470688571).

Thursday, 7 July 2011

Review on Bookgeeks.co.uk by Tannith Cattermole

By Tannith Cattermole, 26 June 2011
Bookgeeks.co.uk

Corporate Social Responsibility (CSR) today is not about being good, it’s about being less bad. No book needs to tell us that even if everyone were to start being good right now, we are still heading towards global degradation. Government legislation doesn’t seem work or hasn’t been rolled out with enough conviction, while NGOs lacks clout. In a world where corporations actually account for a larger slice of the global economy than countries do, Wayne Visser suggests that only businesses have the money and power to make big changes.

With that premise he begins by describing how we ended up here; how business and responsibility in the community has been evolving up till now in the ages and stages of CSR. Using case studies, he illustrates the Age of Greed, characterised in the 1980s by the dramatic rise and fall of Lehman Brothers and Enron. To describe the Age of Philanthropy, he recounts the story of John D. Rockefeller, known best for his extraordinary wealth built on the back of his oil monopoly, but less known for his forward-thinking social responsibility for staff welfare and charitable activities. The Age of Marketing is described by companies that ostensibly appear to be doing good things and garnering good public relations, but are doing little more than aligning CSR principles to their overall strategy, rather than aligning their overall strategy with CSR – a term Visser calls ‘Systemic CSR’. The Age of Management is characterised by contemporary brands Nike, Starbucks and Cadbury, where CSR has been embedded into management strategy. Finally the Age of Responsibility is populated by CSR 2.0 pioneers such as Seventh Generation, Body Shop and Grameen Bank.

Having brought us up to date with accepted business practices and inherited thinking from a variety of references, Visser illustrates clearly that our old view of CSR is not working, or simply won’t be enough to tackle the problems we are facing. He begins then to sketch out what new CSR could look like and achieve. He hitches two growing forces in today’s world together; sustainability and web technology, and likens ‘Web 1.0′ to early ‘CSR 1.0′ – in their emergence, new worlds trying to find ways of expanding, engaging communities and manipulating outward image, with early pioneers like Netscape and Traidcraft quickly being squeezed out by large multinationals like Microsoft and Wal-Mart. Likewise he compares ‘Web 2.0′ to ‘CSR 2.0′; the growth of networks: partnerships, shared information, collective intelligence and stakeholder involvement – power becoming decentralised, and experience becoming less exclusive and more shared.

The second part of the book describes the 5 principles of CSR 2.0, namely creativity, scalability, responsiveness, glocality and circularity. Visser dismantles common misnomers with regards to CSR and economic growth, pointing out that corporations up till now have made a mistake in excluding the billions of (base of pyramid) people that have nevertheless represent an significant market. A ‘glocal’ approach is needed to capture those markets and can do so both profitably and ethically. He describes a new paradigm that pushes boundaries in a way that is supportive, allowing for freedom and creativity, and fostering innovation. Now and in the future, customers should not have to choose between a product that is affordable, and one that is sustainable. He evaluates old models of business and CSR, and makes suggestions for new models, buzzwords and mnemonics to provide a framework for this new approach.

Every era has it’s theme, a wave on which the front-runners will surf and lead the way. The fifties birthed consumerism, in the sixties it was anti-war and free love, the seventies heralded a new technological revolution, and the 80s was the age of capitalism. Now a new age is dawning; the age of technology and the age of sustainability. Modern role models are increasingly at the forefront of these fields, and where other leaders are not, they are beset by advocates of sustainability from all corners to take definitive action. In this world, being socially-minded and environmentally conscious is fast becoming the norm, not the exception. Visser asserts that those that refuse to accept and recognise the changes are endangering themselves of retarded growth, public humiliation and loss of profits. Naming and shaming of bad practice is becoming more prevalent, and savvy brand-conscious consumers will vote with their feet. He offers examples of companies applying systemic CSR and leading the new marketplace for the conscious consumer, while the threat to others is that eventually they will be left behind. In this world, post-global economic crisis, surely it is clear that the end of shameless and rampant profiteering, and growth for growth’s sake simply isn’t sustainable?

Visser’s CSR 2.0 offers a wealth of case studies and over 300 references to support his observations and vision for the future. Together these offer an inclusive summary of the past 50 years, a broad review of the evolution of business theory in the realm of CSR, and illuminating examples that are relevant and familiar. The book is structured in chapters by dividing the ages of CSR, beginning with a case study that introduces the main theme, making them easy to navigate and digest. In the final chapters, far from pie-in-the-sky aspirations, he concludes with success stories and actual achievements from big name companies and household brands that have turned around the way they do business and the way in which they engage with the world. It is happening, it is real, we are becoming a more carbon conscious world, and Visser’s message is one of optimism and hope – we are not yet a foregone conclusion, but turning things around will take courage, and effort and a bold new way of thinking.

How we can make corporate sustainability and responsibility work (5-star Amazon Review)

By Andrew Dalby
(Oxford, UK)

Visser has been involved in CSR for the last twenty years and even he acknowledges that so far it has often failed and been nothing more than window dressing and green wash. For the first part of the book he looks at the history of CSR by using examples such as BP and Cadbury. He has shown how in the past we have failed because we look at repairing the consequences and not dealing with the causes. The second part of the book looks how we can change CSR to CSR 2.0 with the change from corporate social responsibility to corporate sustainability and responsibility. He tries to take a very pragmatic and not an idealistic (Utopian) approach and he sort of gets there but I am not convinced that we will make it. Certainly many in the new generation of business leaders will live by the "Do no evil" motto, but there is still a large amount of business that will not change its methods. 

This book should be essential reading for any MBA course. With the right focus I think we can build the critical momentum for the change to CSR 2.0 to succeed, but I suspect that not enough people will get the message and the ideas will not be widely adopted, and so over-shoot and collapse will become inevitable and only through this will business change.

A must for Anthropology and Developments Studies Students (4-star Amazon Review)

By F. Schubert, 21 June 2011
(London, UK)

To be honest I haven't read this book in its entirety as yet. However it is a excellent source for references for coursework of anthropology and developments studies (and similar subjects) at under- and post-grad level. I found the points that are being raised regarding the right and the wrong approach towards corporate responsibility and sustainability very refreshing. If you found 'The Spirit Level' useful & interesting then this is for you.

Useful and relevant (4-star Amazon Review)

By Sockymon, 23 June 2011
(UK)

I have a passing interest in corporate responsibility, partly because it impacts upon some areas of my work. As such, this seemed like a potentially helpful guide to the changing way in which CSR is viewed in the work of business. Indeed I found the tone of the book to be instantly accessible and though the details can be quite dense at times, I never felt bogged down in the text. The case studies are relevant and would be beneficial to someone who is either a student investigating these areas or for someone like myself who works in an environment that touches upon these themes. Some of the conclusions might seem a bit of a stretch, but then the author is very much 'an ideas man' so perhaps that is why they came across like that to me. An interesting read covering a topical subject.

Interesting, perhaps even important, but dry read (4-star Amazon Review)

By GSP, 24 June 2011
(London, UK)


Well, it's not an easy read - it was hard work for me to get into, but the subject matter of socially responsible enterprise is certainly of great interest to me, and this book is full of insights on it. 

It was slightly wider in scope to what I had expected, in that I thought it was going to be solely about companies where the social mission is a critical part of their DNA (like say, Kiva) as opposed to companies that practise some form of social responsibility/philanthropy but on the side in a way that isn't mission critical and of equal importance to the business of making a profit (like say, Goldman Sachs who donate quite generously to social causes and charities). This book covers both types, as well as a few others, and attempts to analyse the history and current state of corporate social responsibility, and then attempts to provide a manifesto for the future. 

Overall I'd say it's a very relevant, and perhaps even important book (and even fascinating - once engrossed in it). Most importantly, I like the fact that in addition to casting an honest and critical eye over the current state, the book is fundamentally optimistic and hopeful for the future - and actually useful in terms of trying to provide answers instead of just supplying a critique.

A manifesto for CSR with excellent ideas (4-star Amazon Review)

By Angus Jenkinson, 28 June 2011
(Cambridgeshire, England)

CSR 2.0 is more of a manifesto than a manual, but what it does it does excellently. It is packed with case studies and examples and trawls wide and deep through current and recent practice to explore practice, possibilities, ideas and vision for what CSR should (now) and could be (as we move forward). I defy the reader not to be appalled by the evidence of failure and risk and excited by the amazing things being done in the world. 

Visser has credentials from mainstream and CSR consultancy and academic research and is deeply informed. That means that for anyone wanting to understand and be inspired by the current phenomena and ideas, he makes an excellent guide. He 1) analyses the ills of the world and why action and change are needed as well as 2) plotting out some themes for how this needs to happen - creativity, scalability, responsiveness, glocality, circularity. These two sections, approximately equal in length, constitute the bulk of the book and serve as seedbanks of ideas and a manifesto to act. 

The last section is rather cursory and feels tacked on, pointing to some change models, methodologies and ideas and presumably hoping that the reader wanting to act will go read about or study them directly. And his suggestions are good approaches that deserve attention. I was glad to see David Gleicher's Formula for Change, for example. Perhaps the book would have benefited from building change method in from the start, although it would have made a chunky book even bigger? How and where do the Gleicher or the Scharmer principles show up in practice? The `monster matrix', which is his master model for change, is also flawed. First, in the Intention space it names two iconic figures (Newton and Descartes) whose thinking is widely seen now as totally counter to the principles of human system change (and this by figures he quotes) and the example he gives of Rachel Carson (not Caron, a proofing error!) and her book Silent Spring also shows the limitations of the thinking. He quotes her as the expert in the Cartesian mode but actually although her data and analysis was patiently plotted the impact of her work was devastating, paradigmatic, and revolutionary (another of his boxes). He also leaves our minimalist interventions and nudge as factors for change. 

If a manual is not what it is, the manifesto is welcome and needed and should be read by every manager, leader, activist, interested person and social entrepreneur.