Corporate social responsibility, or CSR, is now a basic tenet of any good business strategy. Due to a shift in consumer expectations over the past decade, companies are finding ways to ensure their operations are more “socially responsible.” This has led businesses to develop CSR initiatives that are intended to reduce their impact on the planet and help contribute to a more sustainable and ethical world.
CSR is a broad term that can take many forms. As a society, we are facing several issues today—from sustainability to social justice—and companies choose to address those that make the most sense for their business and industry. Most CSR initiatives fall under one of the following three categories.
A company’s environmental CSR goals are typically the most well-known, due to media coverage and high consumer interest. Sustainability is a hot topic and consumers expect businesses to take steps to address their environmental impact on the planet.
Environmental goals typically address a company’s net emissions, recycling efforts, waste reduction efforts, and/or sustainable packaging. Common goals include achieving a “circular economy,” where materials are reused or recycled with the ultimate goal of eliminating waste, and becoming “carbon neutral,” which involves reducing or removing emissions to offset a company’s carbon footprint.
Environmental CSR goals include:
- PepsiCo: Reduce absolute GHG emissions across their value chain by 20% by 2030
- Microsoft: Become “carbon negative” by 2030
- Unilever: Ensure 100% of plastic packaging is reusable, recyclable or compostable by 2025
- Danone: Implement carbon positive solutions and achieve carbon neutrality by 2050
Social and human rights
Social CSR goals addresses how the workers involved in the creation of a product, from the original source to the final product, are treated. This can involve specific issues such as fair wages, fair treatment (e.g. appropriate working conditions, limited working hours), and safe facilities, as well as broader issues such as forced labor, modern slavery, and child labor.
Certain industries in particular are strongly associated with social and human rights issues. For example, child labor is common in cocoa, coffee, cotton, and gold supply chains. Many countries have also implemented regulations around modern slavery and human rights, such as Australia, the United Kingdom, and France.
Social CSR goals include:
- AB InBev: 100% of direct farmers will be skilled, connected, and financially empowered
- Barry Callebaut: Eradicate child labor from their supply chain
- adidas: Empower supply chain workers by expanding and refining grievance systems and skill training programs
Supply chain and sourcing
Supply chain or sourcing CSR goals focus on ensuring supply chains are transparent and traceable. For businesses, this translates to knowing who their suppliers are, where they are located, where their raw materials come from, and how they were sourced.
Such initiatives often involve publishing lists of Tier 1+ suppliers, achieving a certain percentage of responsibly-sourced materials, or even committing to broader transparency and traceability objectives for critical supply chains.
Supply chain and sourcing CSR goals include:
- Mars: Source Responsible Cocoa across the entire supply chain by 2025
- Tapestry Inc.: 95% traceability and mapping of raw materials by 2025
- Campbell’s: Achieve 100% traceability of priority raw materials to country of origin
For a comprehensive CSR strategy, businesses should make multiple commitments that address all branches of corporate social responsibility: environmental, social, and supply chain/sourcing.
Transparency-One helps companies meet their CSR goals by empowering them to identify, understand, and analyze their supply chains at any level. With this knowledge, businesses can collaborate with their supply chain partners, collect critical information on supplier practices and compliance, and proactively monitor and address potential risks.