The Great Battle of Terminology: Shifting From CSR to CSV Isn't the Solution

by Aman Singh Das | February 14, 2011

  • My Vault

Recently, Antonio Vives, a sustainability consultant and consulting professor at Stanford University's Civil and Engineering department, posted a blog stating, "If it isn’t broken, don’t fix it." He was commenting on the now-infamous article written by professors Michael Porter and Mark Kramer in Harvard Business Review last month on Creating Shared Value.

The professors' argument: CSR can benefit from a name change. The proposed change? A shift to creating shared value or CSV.

Vives' argument: The professors are not only arguing for an ineffective change, they are further hindering the progress of CSR by adding confusion of terminology.

Soon after, the Inspired Economist addressed the same question, responding to a post by Vault's CSR Blog's Aman Singh (Why Don't Executives Understand CSR?), calling it a problem of semantics.

And these are only three recent examples of the ongoing dialogue on terminology.

Ten years after the concept of CSR was first floated, we still cannot agree on what it involves. For a long time now, we have advanced with considerable stubbornness and little or no thought toward implementation of "social" programs and projects.

And that’s why it is time finally to accept that CSR is, in fact broken and, therefore, must be fixed once and for all.

What is the problem?

"Social Action" and "Philanthropy" have won the battle against CSR.

If we ask the general public, CSR is perceived as something related to social projects carried out by corporations than, for example, management of business-related risks of social, economic or environmental impacts.

The problems associated with the concept of CSR:

1) Corporate Social Responsibility Sends the Wrong Message

The concept of 'responsibility' in the English-speaking world is closely related to legal implications. In the western world, responsibility often equals compensation, lawsuits, and compliance—and why management of ethical codes is dealt by lawyers, not CSR execs. This makes the tenets of CSR as a voluntary act much harder to digest.

The term 'social' further evokes concepts of solidarity, instead of trustworthy relationship-building. And the term 'corporate' serves to instantly exclude every institution outside the realm of corporations.

2) Information Overload

We are using the same umbrella concept to discuss issues that vary widely in scope and focus: From environmental management and climate change to ethics, diversity, and work/life balance; from corporate volunteering programs to minority hiring, social entrepreneurship, multi-stakeholder dialogue, transparency, reputation, and human rights!

3) Absence of Global Standards

Since launching the Global Compact in July 2000, and till the subsequent approval of ISO 26000, we have not agreed on what to measure and how to measure it.

So, how to move forward?

Why not try some simplicity? The Dow Jones Sustainability Index (DJSI) provides the perfect definition for this. It states:

"Corporate Sustainability is a business approach that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments".

This definition contains everything that is important:

      •Business approach, not peripheral activities.

      •It seeks to create long-term shareholder value, not making a quick profit.

      •Embracing opportunities. The public agenda generates new business opportunities: energy efficiency, accessibility, etc.

    •Managing risks from economic, environmental and social developments.

This is where the future lies: A unified return to corporate sustainability. Not sustainability only in terms of ecological or green concepts but a sense of sustainability related to value, opportunities and risk management.

--By Alberto Andreau

Alberto Andreau is the Managing Director of Corporate Reputation & Sustainability at Telefonica. He teaches Organizational Behaviour and Corporate Identity and Culture at the IE Business School, and holds a seat on the Spanish CSR Council. Andreau also serves as the Vice President of the Global Compact Spanish Steering Committee; counsellor of the Javier Benjumea’s Chair of Ethics at Universidad Pontificia de Comillas (ICADE-ICAI); and is the General Secretariat of the Spanish Intangibles Institute.

Related Reading:

Antonio Vives: If it isn't broken, don't fix it
The Inspired Economist: Perhaps The Definition of CSR is Semantics
HBR: Creating Shared Value

Filed Under: CSR

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