Corporate Responsibility, is it a success factor?

It has been stated that Corporate Responsibility is a company´s responsibility over its social impacts. These impacts are economic, social and environmental by nature (Niskala, etc. 2013, 7).  There are  several  different kinds of stakeholder groups who have eyes for  a company´s social impacts (Niskala, etc. 2013, 73). Corporate Responsibility promotes innovativeness within companies, enhances risk management and enables growth that is in line with sustainable development. Responsibility within companies also helps to secure healthy business conditions in the long run. (http://www.fibsry.fi/fi/fibs25-en/cr-is-here-to-stay.)

Three corners of CR

Finnish Business and Society association (FIBS) states that  responsibility brings competitive edge as the company can offer something   the competitors do not have. By creating suitable solutions, a company can meet  customers’, the personnel’s and investors’ expectations and the company will differentiate from its competitors.  Companies are very willing to tell about their responsible behavior and luckily there are national and international directions on how to report uniformly of Corporate Responsibility (Niskala, etc. 2013, 7).

One of the most popular reporting models of Corporate Responsibility is Global Reporting Initiative (GRI). The GRI is a leading organization in the sustainability field. GRI promotes the use of sustainability reporting as a way for organizations to become more sustainable and contribute to sustainable development (https://www.globalreporting.org/information/sustainability-reporting/Pages/default.aspx).

GRI

Fokus 14 seminar was held in March, 2014 where Timo Ritakallio,  the deputy managing director of Ilmarinen  stated:” If you have not integrated responsibility into your business, today is the latest day to start “ (Kauppalehti, Analyysi, 14.3.2014).  Ritakallio has it right, and hopefully in near future responsibility will be seen in core of all businesses.  But I think there is a lot to do in  business-life. According to a Finnish study of Corporate Responsibility only 5 % of Finnish large companies are setting any targets over the Responsibility. This is odd because at the same time 42 % of companies are telling that with the help of Corporate Responsibility program companies have managed to reduce costs and gained additional sales. (FIBS, http://www.fibsry.fi/fi/uutishuone#/pressreleases/fibsin-yritysvastuututkimus-2014-yritykset-hyoetyvaet-vastuullisuudesta-enemmaen-kuin-uskovatkaan-973167).

Timo Routti,  the Managing Director of Finnish Business and Society association (FIBS ) commented  the result of the study: ”It seems that companies are profiting more about Corporate Responsibility than they have believed. It would be beneficial if companies set concrete economic targets to all operations and by indicators companies are able to follow the result and develop further its functions”.

The above-mentioned study shows that as far as Corporate Responsibility is known only by few members of the Board of Directors the importance and possibilities are not fully exploited. Unfortunantely it is not yet seen as a genuine success factor. Doing business responsibly is absolutely necessary for the society’s well-being. Corporations play a key role in resolving the  earth’s economic, social and ecologic problems. In the best-case scenario, corporate responsibility shows in people’s everyday life and in environmental conditions directly. (http://www.fibsry.fi/fi/fibs25-en/cr-is-here-to-stay.)

Sources:

FIBS association, http://www.fibsry.fi/fi/fibs25-en

Global Reporting Initiative, https://www.globalreporting.org/Pages/default.aspx

Kauppalehti, 14.3.2014

Niskala, Mikael & Pajunen, Tomi & Tarna-Mari Kaisa, 2013. Yritysvastuu, raportointi- ja laskentaperiaatteet. Bookwell Oy, Porvoo.

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4 Responses to Corporate Responsibility, is it a success factor?

  1. tarjal says:

    As always, it is mainly about the needs of the company first and only then the need of anything else. Very well written and gives us all something to think about. Especially, if we are the ones making the decisions in any company.

  2. niipel says:

    Your topic was very interesting. I agree that it sounds very strange that only 5 % of Finnish large companies have set any targets over the responsibility. Why companies don´t realize how much advantages they could reach by integrating responsibility targets into operations.

    If 42 % of companies use Corporate Responsibility program, they should also find the way how to bring it closer to the operations. I think every employee should commit to the company´s Corporate Responsibility program. The program could be part of the performance management. Maybe it already is in some companies, in responsible companies?

  3. 1tiina says:

    This truly is important topic. It is great that so many organisations want to work responsibly in Finland. FIBS association gives keys to be responsible and contacts to other companies with same value. It could be great to hear how large organisations, like Finnair and Stockmann, are responsible and how it shows in every-day-work.

  4. miny1 says:

    I agree that companies should set concrete economic targets to responsibility program. I think it would help the companies to plan their actions.

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