Connie Pillon Author Blog

A Quick Introduction to CSR and ESG

You will often see the acronyms ESG and CSR alongside sustainability in business.

Corporate Social Responsibility (CSR) reflects an organization’s commitment to practicing social and environmental responsibility. A strong CSR initiative integrated into a company’s operations can demonstrate its dedication to human rights, environmental sustainability, and ethical practices.

Environmental, Social, and Corporate Governance (ESG) is a broader concept that often encompasses CSR but also focuses on measurable data and financial outcomes related to a company’s social and environmental governance.

ESG has evolved from the original concept of CSR and is frequently the preferred term used by business leaders.

Why do companies need ESG/CSR?
• Socially responsible companies tend to have a positive reputation with the public and find it easier to attract quality business relationships.

• A strong focus on ESG/CSR leads to more innovative and sustainable business practices since companies are committed to continually improving their impact.

• Consumers are becoming more conscious of whether their purchases are socially and environmentally responsible.

• Companies that invest time and energy into ESG/CSR can build stronger and more authentic relationships with stakeholders.

• Studies show that employees find more meaning in working for companies that care about the greater good.

• Leaders who demonstrate a commitment to ethics and sustainability tend to influence employees to act in the same way.

• Companies that focus on social and environmental responsibility frequently experience cost savings by reducing waste and excess resource consumption, increasing efficiency, and improving risk management.

Below is a list of general resources and tips to help you integrate ESG/CSR initiatives into your business and achieve your corporate sustainability goals:

• B Corporation Certification is a private certification issued to businesses (including sole proprietors, small businesses, and publicly traded companies) by a global non-profit organization called B Lab. To be granted certification, companies must receive a minimum score on their social and environmental performance. Visit http://www.bcorporation.net to learn more.

• ISO Certification helps to ensure that a company’s products and services are high-quality.

The ISO 14000 series shows a commitment to sustainable environmental practices and helps companies to meet environmental regulations.

ISO 26000 provides detailed guidance on social responsibility to organizations of all sizes—the publication can be purchased from ISO. Visit http://www.iso.org to learn more.

• United Nations Global Compact is the world’s largest corporate sustainability initiative.

The United Nations has created 17 interconnected Sustainable Development Goals (SDGs) that businesses can use as a guide to help create a sustainable economy. Visit http://www.sdgs.un.org/goals to learn more.

• 3rd Party CSR Reporting, Certifications, and Environmental Audits can be obtained from several sources, depending on which industry you are in:

Reporting: External (3rd party) sustainability reporting helps a company to build validity and credibility with the public. GRI (Global Reporting Initiative) is an international organization that provides support for sustainability reporting. Visit http://www.globalreporting.org to learn more.

Certification: There are many types of 3rd party sustainability certifications to choose from; it is beneficial to research which certifications are ideal for the type of industry you are in.

• LEED (Leadership in Energy and Environmental Design) is a green building certification program helping to make buildings and communities environmentally and socially responsible. Visit http://www.usgbc.org to learn more.

• GBB Certification (Green Business Bureau) provides assessment tools and planning to help businesses become certified as a green business. Visit http://www.greenbusinessbureau to learn more.

• Create an environmental policy. A written policy helps companies to implement a better management system to reduce environmental impact. In some industries, an environmental management policy is mandatory.

• Create an ESG/CSR section on your company website. Add a page about your commitment to sustainability on your website. Consumers value transparency. Be sure to state your social mission and/or sustainability plan, the ways in which you are implementing ESG/CSR, and your future goals for improvement.

• Use government guides to (CSR) Corporate Social Responsibility and (ESG) Environmental, Social, and Corporate Governance. Governments often provide free downloadable guides for businesses on how to implement ESG/CSR.

• Create an internal social and environmental team. You can set up a social/environmental team within your company through which your employees can participate and contribute ideas. The team can focus on how to improve the company’s carbon footprint and social impact.

Additional Sustainability Tips:
• Measure your company’s environmental impact regularly.
• Find out the unique environmental concerns in your specific region and industry.
• Share your progress on sustainable development with the public.
• Practice green procurement by ensuring that purchases from suppliers are environmentally responsible. Sustainable products are often less toxic and hazardous to people and the planet. Check the environmental impact of each supplier. Businesses have tremendous purchasing power and can send a message to suppliers about the importance of sustainability.

In the office:
• Turn off lights. Make sure electronics are set to standby mode when unused.
• Choose reusable mugs and cups. Avoid single-use plastic.
• Print on both sides of paper. Go paperless whenever possible.
• Switch to non-toxic cleaners.
• Use recycled and environmentally friendly office supplies.
• Decorate with plants to offset CO2 and VOCs.
• Use light coloured paints to make the most of natural light.
• Ensure plumbing and HVAC equipment are serviced and running properly.
• Use weather stripping to minimize heat loss.
• Try to find alternatives to plastic whenever possible since it is derived from fossil fuels.
• Reduce energy/water usage and waste.

Socially Responsible Investing

Socially Responsible Investing (SRI) is gaining popularity. An increasing number of investors are choosing to avoid businesses known for exploiting people and harming the planet, instead opting to support companies that prioritize sustainability.

Financial and wealth management advisors are seeing an increasing number of clients who prefer purpose-driven investing, which aims to create a progressive social and environmental impact.

The trend of sustainable investing is expected to keep growing. Investors committed to purpose-driven investment strategies are seeing financial gains while achieving social and environmental returns.

The Importance of a Circular Economy

In a circular economy, products and raw materials are reused, recycled, remanufactured, and refurbished to reduce waste. Circularity more closely resembles the earth’s natural ecosystem of zero waste and transcends the unsustainable linear approach of take-make-waste in business.

A circular economy can help to provide a solution to the problem of natural source depletion, scarcity, and pollution.

Businesses with a circular model often rent products to consumers for a period of time as opposed to selling ownership of the goods. Consumers are then required to return the old product for recycling to receive a new product. This can encourage a positive, long-lasting relationship between companies and consumers.

An innovative circular business model can attract investors, government grants, and funding. Circularity is viewed by global leaders as a solution to achieving climate neutrality and protecting biodiversity.

The purpose of business is evolving. Socially Responsible Investing (SRI) and sustainability have become a global movement.

The author is not sponsored by/or affiliated with the organizations/authors cited or referenced in this article. The views expressed are the author’s own and do not reflect the opinions of the organizations/authors cited or referenced.

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