The difference between strategies
A CSR Strategy – Corporate, Social, Responsible - in essence, represents the business model of a corporation i.e., the systems and processes in place to support the direction, supervision, and accountability of a corporation in being socially responsible.
- Ethics & Integrity
As represented by management’s commitment to standards and practices of the highest levels. - Stewardship
To ensure the long-term sustainability of the corporation, its assets, and its reputation. - Accountability
For its actions or lack thereof with Transparency provided through reliable communication channels and - Effectiveness
Demonstrated by outcomes that represent its diligence and dedication to its CSR Strategy and effective implementation of its ESG Strategy. - Roles and Responsibility
Management is characterized and outlined with proactive responses that are anticipatory, with Participation by all interested parties in the corporation through active involvement in the corporation’s development and growth.
An ESG Strategy – Environmental, Social, Governance - represents how a corporation operates in a socially responsible way as actioned within the:
- Environment
To ensure that not only its day-to-day operation but medium to long-term business model does not adversely affect the natural world or in a more proactive sense does contribute toward the sustainability and growth of the natural world. - Social
Is to be responsible for how a corporation treats complex social dynamics ranging from employees and product/resource sourcing to its consumer base with policies covering workplace health and safety to supply chain compliance that mirrors a corporation’s CSR Strategy and being sensitive and responsive to changing customer preferences. - Corporate Governance
Is supported by an active management providing and demonstrating functional leadership through its business model, and the business community as a whole.
Identifying
To find an exchange-listed company’s CSR Strategy you can start by looking at the company’s annual report, certainly its website as well as Corporate Register*, Sustainability Disclosure Database**, and CSRwire***.
How a company’s CSR strategy outcome is best measured is the effectiveness of its ESG Strategy and the results achieved and again to be found on the annual report and the company website. Managed investment products will highlight CSR and ESG in their investment mandates and outline the criteria used in the selection of exchange-listed companies.
As with all investment strategies, there is a trade-off and in the case of CSR and ESG strategies, these trade-offs are reflected by the limited number of exchange-listed companies available for investing and in the case of investment products the limitations placed by the investment mandate. On the other side is the ability to quantify how a company manages risk in its given industry, service, and/or product by engaging in such strategies.
It should be noted that this article and all articles published by Creative Coach Online are for information purposes only and should not be taken as advice. It is essential to discuss the appropriateness of any Strategy with a licensed / registered professional. For more details, please visit https://www.creativecoachonline.com/disclaimer
* Corporate Register: the global online directory of corporate responsibility (CR) reports past and present.
** Sustainability Disclosure Database: note that it has been decommissioned and replaced by GRI Standards Report Registration System to register information
*** CSRwire: is a source for sharing major news and updates on corporate social responsibility (CSR)
