In a survey commissioned by the Prince of Wales Business Leaders’ Forum – a leading UK non-profit in corporate responsibility – 100 opinion leaders from France, Germany and the UK expressed their views on the relevance of corporate social and environmental responsibility to business. Participants were people who directly influence the CSR agenda and publicly punish or reward performance in this area: institutional investors, financial and business media, regulators and leading NGOs.
According to the report, “The survey provides vivid proof that CSR is not a passing fad but a legitimate and permanent feature of the business landscape.” Some of the key findings are:
* Only 54% of opinion leaders cite ‘making profits’ as the most important business function.
* 42% of opinion leaders agree strongly that CSR will increasingly affect share price.
* When asked to define CSR, 71% said, “Leadership that looks beyond the short term.” 53% define it as “treating employees with respect” and 35% cite “environmental responsibility.”
* Exemplary environmental performance is regarded as a minimum requirement; more attention to softer human relations is also necessary.
* Charitable giving by companies is viewed with suspicion unless social and environmental stewardship is in place.
The authors conclude that “business executives find the expanding range and unstable configuration of responsibilities placed on them frustrating, but the expectations are real. The imperative to meet them is the central leadership challenge of 21st Century business.
Another study, “Do Corporate Global Environmental Standards Create or Destroy Market Value?” asked whether global stringent environmental standards are a corporate asset or liability for multinationals investing in emerging/developing markets. The conclusion: multinationals that adopt a single stringent environmental standard have much higher market values than firms which default to less stringent or poorly enforced host country standards. 89 manufacturing and mining companies headquartered in the United States were examined.
The authors point out that developing countries that use lax environmental regulations to attract foreign investment will likely attract lower quality, less competitive firms.
PWBLF survey, “The Responsible Century”: contact Catherine Burger. The executive summary can be
downloaded.
“Do Corporate Global Environmental Standards Create or Destroy Market Value?” Published in “Management Science,” a journal of the Institute for Operations Research and the Management Sciences (INFORMS). Authors: Glen Dowell, University of Notre Dame’s College of Business; Stuart Hart, Kenan-Flagler Business School, University of North Carolina; and Bernard Yeung, New York University Stern School of Business.
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