CSR on the agenda for directors

CORPORATE social responsibility is one of the most powerful ways to make a company stand out ahead of the competition, concluded speakers at the Suffolk Institute of Directors' annual conference which took place yesterday at Hintlesham Hall.

CORPORATE social responsibility is one of the most powerful ways to make a company stand out ahead of the competition, concluded speakers at the Suffolk Institute of Directors' annual conference which took place yesterday at Hintlesham Hall.

Research also shows that organisations which behave in a socially responsible way enjoy more financial success and a better reputation in the marketplace, according to keynote speaker Stelios Zyglidopoulos, a lecturer at Cambridge University's Judge Business School and an academic expert on CSR.

At the heart of CSR, said Mr Zyglidopoulos, is reputation and the moral capital that socially responsible companies build up.

“It seems that CSR activity leads to a better reputation - it is the last differentiating factor companies can have in the West.


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“Companies say the most important tangible resource they have is their reputation. A good reputation takes time to establish and if it is undermined it takes around 10.5 years to build it back up again.

“Yet reputation is something very sensitive, you can lose it overnight.

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“If you commit a crime and are taken to court, your lawyer will probably try to prove that you're a good guy - it was one bad act but you have a good mind.This is exactly how the argument goes as to why companies should invest in CSR because accidents happen and companies can end up on the front page of the newspapers for a scandal that wasn't really their fault.

“If they can point to all the good things they've done it can help. CSR offers a certain protection by providing a moral capital to draw on in times of crisis.”

The second principal reason why companies should get on board with CSR, he said, is that it leads to financial pay back.

In terms of environmental CSR, Mr Zyglidopoulos cited the example of car companies in the US wanting to address the environmental impact of their cars. One way was to filter the pollution as it emerged, the other way was to radically change the technology to prevent or minimise the pollution in the first place.

“Radically changing the technology was more expensive but it soon paid off as it was much cheaper than having filters to catch the pollution.”

Ending his presentation, Mr Zyglidopoulos said research also focused on the affect of media attention on companies taking up CSR. Organisations that are more visible are more at risk of negative exposure if mishaps or misdeeds occur, he argued, and therefore needed to build up more moral capital.

“It seems that media attention and reputation drives companies' CSR performance,” he said.

Introducing the conference theme, Clive Thomas, chairman of Suffolk IoD, said CSR was definitely growing in awareness and he hoped participants would go away with a better understanding of what it stood for and how to get involved.

For him, he said, CSR could be summed up in one word - respect: “Respect for the physical environment in which you operate. Respect for the community in which you operate. Respect for the people who work in your organisation, and respect for customers and suppliers. I think people want to buy from and work with people who have respect.”

Paul Winter, chief executive of Ipswich Building Society, said CSR was a major point of difference between IBS and its competitors, and of significant interest to the society's four key stakeholders - members, staff, suppliers and the community.

“In modern times, there is more to community than just economic well-being. People are concerned about a wider range of issues such as the environment and, also, local causes,” he said.

“Whilst I would love to have every person in Suffolk as a member, I am sure we can, through our work, establish ourselves higher up the shopping list if the community sees us as an organisation giving and not just taking.

“CSR need not be expensive. Whilst it is true some organisations do spend lots of money in this area, it needn't be so. Allowing staff time to help out with a charity once a month, say, really costs very little but the value it gives both the employee and the charity can be massive.”

Joanne Leah, general manager of membership engagement, presented many of the Society's CSR-related activities - primarily linked to staff individual and group volunteering - including advising 10 year-olds about keeping money and possessions safe, working with the YMCA to educate disadvantaged 15 to 17 year-olds about financial options and opening bank accounts, and helping to relay turf for the East Anglian Children's Hospice.

Steve Curzon, marketing director of Adnams, focused on the competitive advantage that CSR gives Adnams in an aggressive marketplace and also the financial payback - especially in terms of the company's renowned environmental ethics - that it affords.

Adnams' approach to CSR, he said, was based on the notion of “doing the right thing” and integrating that approach into the business so that it “makes sense for the business”.

“There is a feel-good factor and that's important, but fundamentally niceness is not enough because a company needs to be profitable. So we look for economic benefits both in the community, in environmental terms and for the brands from our CSR activity.”

Ipswich Town chairman David Sheepshanks, giving a presentation on the Suffolk Foundation - an umbrella organisation that facilitates giving to charities in Suffolk by helping to match donors with good causes - described CSR as giving support and taking responsibility for the local community.

“It's about giving something back which resonates with many people, especially staff,” he said. “When I started with Ipswich Town 12 years ago, I realised the club needed to give something back but also we needed to engage with a new generation of fans. We had 26,000 fans at our last match of the season, for a nothing match, because we integrate with our community.”

The Suffolk Foundation, he said, gives everyone in Suffolk the chance to play their part, acting as a vehicle for companies and individuals to give to good causes in the local community.

Jeremy Stock, of motor dealership Cox of Ipswich, highlighting the environmental benefits of the biodiesel Saab, Mr Stock said the Swedish company Saab Automobile took CSR very seriously because it realised consumers buy from companies they respect. This was why Saab is committed to being fossil fuel free and energy efficient by 2020, he added.

n For more about the work of The Suffolk Foundation, see the business supplement next Tuesday, May 21

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