Corporate social responsibility (CSR) became popular during the 1980’s and has continued to remain a pillar of corporate structure. Gulf Coast Environmental Systems (GCES) serves as an integral part of many organizations with pollution control as a component of their CSR policy. In this article we will review how to develop a CSR, the advantages and disadvantages of publishing a CSR policy and how to effectively communicate your organizations CSR to improve community relations and public perceptions.
To begin let’s review what is corporate social responsibility? Simply defined, CSR is a company’s legal and moral responsibility towards the community and the environment (both social and ecological). Companies express this responsibility in a variety of ways, including (1) through their waste and pollution reduction process, (2) by contributing educational and social programs and (3) by earning adequate returns on the employed resources. Some broader definitions include an expanded focus on stakeholders to include philanthropy and employee volunteering.
Corporate social responsibility has continued to receive increasing attention as corporations, stakeholders, investors, employees and perhaps most importantly, the media has placed increasing importance on the following:
- Globalization: As cross border trade has increased the ability for corporations to affect
- labor conditions including health, safety and wages
- environmental protection
Export oriented firms doing business in emerging nations that focus on showing responsibility and respect to the communities they are conducting business in, will maintain and build public relationships.
- Ethics: The media has brought attention to breaches in corporate ethics and made it front page news when such incidents occur. Corporations with business practices that damage the environment, employees, shareholders and communities have contributed to a negative perception of big business and are the reason corporate social responsibility programs are necessary to improve transparency, accountability, ethical standards and corporate governance.
- Sustainable development: It has been widely publicized that humankind is using natural resources at an unsustainable rate. Deforestation, oil supply, clean water and fertile and available land is all diminishing at an alarming rate. Corporations by their natural size have large carbon footprints. The media and public have demanded that for corporations to be truly responsible they must address their carbon footprint and manage pollution through implementing pollution control strategies.
- Communications: Changes in modern technology have allowed for improved opportunities to increase dialog, share information, create partnerships and improve responsiveness.
- Finance: Consumers and investors are looking beyond stock prices and branding when choosing how to invest their money. Corporations with transparency who operate utilizing responsible business practices are building strong community relations which can increase share price, reduce capital costs, improve market access and potentially improve overall profit margins.
- Governance: Corporations operating across multiple countries and continents face many differences is laws and regulations. Intergovernmental bodies such as the United Nations, the Organization for Co-operation and Development and the International Labor Organization have developed guidelines, compacts, declarations and principles that outline internationally agreed upon goals and laws that address human rights, the environment and anti-corruption.
- Leadership: There is an increase awareness and knowledge to both the personal and professional lives of corporate leaders. An effective CSR program address leadership goals, roles and acceptable codes of conduct.
“In the next decade, the most successful companies will be those that integrate sustainability into their core businesses” – Jim Owens, CEO Caterpillar
Advantages of an effective CSR program can include:
- Improved risk management through an increase in anticipation of critical events. Strong community ties in all areas of operation will increase communication in regards to potential social, environmental and legal issues.
- Strong reputation management is based on trust, credibility, reliability, quality and consistency. Companies that fall short in these areas can face damage to both their brand and their bottom line.
- Employee retention can be improved through a correctly executed CSR. Employees that are proud of their employer are proven to be more loyal. This directly results in decreased costs associated with human resources, retention, recruitment and training.
- Effective community relationships allow for easy of operation within the community. These relationships can lead to alliances the create “social capital” with the public, private businesses and governing bodies.
- Efficient supply chain relationships can result from a well thought out CSR. Companies with similar approaches can form profitable long-term partnerships that produce opportunities for preferred support.
- Regulator relationship management can be improved with transparency provided by a properly implemented program.
Disadvantages of a CSR program can include:
- A loss of focus on profitability. When focus shifts from shareholder obligations to community welfare there can be a financial impact. It must be said that some companies have seen the opposite effect.
- With transparency being a cornerstone of many CSR programs a company’s shortcomings must be disclosed effecting corporate reputation. When shortcomings are disclosed an action plan for correction should be disclosed at the same time or shortly there after.
- Consumers expect instant results from a new CSR program and they often do not recognize that implementation takes research, planning, funding, procurement, training and implementation. All of which takes time. Consumers may feel if changes are not acted upon quickly that the CSR program is a PR stunt rather than a corporation’s commitment to change and improvement. Transparency and ongoing communication can help to address this potential pitfall of a CSR program.
Production costs often increase with corporate responsibility. These increases come in many forms from capital costs, wages, operating costs, etc. Recently a GCES customer was facing a corporate wide zero waste initiative. Their concern with the disposal of spent dry scrubber media led to an examination of possible uses. GCES worked with the customer to find both EPA approved disposal options but also additional uses that ultimately resulted in a reduction in operating cost through the resale of spent media. Similarly, we assisted with implementing a solution to reuse the CO2 in a steel production facility by adding a desorption model. In producing direct reduced iron (DRI), carbon dioxide (CO2) is released as an off-gas to the process. When steel plants upgrade their process to include a CO2 desorption module they can recapture the CO2 which is then used in oilfields or bottling operations developing additional profit lines for the steel production facilities. Other options for creating revenue through implementation of environmentally conscientious practices can be found in waste heat recovery and biofuel development. GCES maximizes every reasonable effort to provide beneficial use Waste Heat Recovery equipment (WHR) equipment with the supply of all high temperature Air Pollution Control equipment devices. By implementing Waste Heat Recovery options a facility can greatly reduce operating costs and increase efficiencies.
Some possible options for Waste Heat use include:
- Heat Transfer Fluid
- Steam Production
- Boiler Feed Water
- Building Heat
- Process Supplemental Heating
Biofuels are developed by turning waste into wealth. GCES offers turn-key solutions for turning agricultural, industrial, and natural waste into power and revenue generating fuels. Options for this includes:
- Biofuels to Electricity: With a solution from GCES you can turn Methane Biogas into Electricity. Methane is collected and utilized for fuel in combined heat and power Generator Sets. Power can then be sold for a profit or consumed by a facility.
- Biofuels for Vehicle Power: GCES offers options for the cleaning, purification, and pressurization to utilize Biogas as fuel for vehicles, farm equipment, construction equipment, commercial fleets, transportation trucks and more.
- Recovered Heat as Energy: GCES systems are able to retrieve the heat generated through Pollution Control, Fuel Development, Manufacturing, Industrial Processing, and more. Heat is used to power operations, for hot water production, drying operations, facility heating, and decrease operating costs through reducing natural gas consumption, propane consumption and dependency on the power grid.
With an ever-expanding population, growing economy, increasing legislation and shrinking natural resources the demand for environmental conscious, renewable alternative clean energy is constant. Corporation around the world are developing biofuel processes which reduce waste, improve the bottom line and are highly effective in promoting their corporate social responsibility.
“Corporate Social Responsibility is a hard-edged business decision. Not because it is a nice thing to do or because people are forcing us to do it, but because it is good for our business” – Niall Fitzerald, Former CEO, Unilever
To recap. The steps to implementing an effective CSR program are as follows:
- Define the focus of your organization: Carefully review where your organization could improve community perception and relations. Development of a CSR program is the perfect time to address and correct any communication issues.
- Develop your strategy for your program: Included in this strategy should be end goals, tasks for implementation, responsible parties/teams, timelines, costs and methods for measuring effectiveness.
- Communication: Stakeholders across the globe are making it clear that they want corporations to have the same standards of social and environmental care without regard to the changes in geographic operations and standards. Firms can help build a sense of community and share approaches to common problems in their CSR programs.
- Implement your CSR program: As you begin to implementing your CSR program set up regular check points. At those check points review and communicate success and shortcomings.
- Evaluate: On an ongoing basis evaluate, address and improve upon the results of your CSR program.
- Recognize stakeholder participation and support: To encourage ongoing support of your CSR initiative find ways to recognize employees and stake holders. This will lead to enhanced community involvement and establish goodwill along with improved employee satisfaction.
When addressing the environmental impact of your CSR program make sure your pollution control partner understands your CSR goals and is working with you to meet those goals. A good partner will review with you both environmental goals as well as financial implications to ensure that your fiduciary and social interests are addressed. For more tips on selecting a pollution control partner click here.