Self-Interest of CSR Rating Providers

http://adage.com/article/guest-columnists/ways-improve-csr/295139/

What Gets the Worst Marketing ROI? Your Corporate Social Responsibility Report
Three Ways to Improve the Value of Your CSR Report

By Paul Klein. Published on September 26, 2014.

[…]

Finally, CSR reporting has become a case of the tail wagging the dog. There is a growing industry of suppliers that specialize in defining, collecting and packaging environmental, social and governance (ESG) data. This industry advocates for annual reporting but, given the results, the current model seems to be driven by self-interest rather than real value.

[…]

The real value (and objective) could be reduced scrunity.

Key Stakeholders of a Company:
its Employees

http://www.pando.at/2013/07/22/if-employees-are-not-engaged-csr-becomes-an-exercise-in-public-relations/:

If employees are not engaged, CSR becomes an exercise in public relations.

Employee · Engagement

CSR strategies, sustainability reports and the integration of ecological and social values in vision and mission are very often addressed to external stakeholder groups rather than to one of the key stakeholders of a company: its employees. It is a missed opportunity if own employees don’t know what is going on, as they are the most valuable brand advocates of a company and CSR measurements are becoming more credible for external stakeholders when shared by all employees.

CSR – HR = PR. If employees are not engaged, Corporate Social Responsibility becomes an exercise in public relations. The credibility of an organisation will become damaged when it becomes evident that a company is not ‘walking the talk’. […]

10 Reasons Secrecy Is a Bad Idea at Work

http://www.inc.com/geoffrey-james/10-reasons-secrecy-is-a-bad-idea-at-work-infographic.html:

Open communication leads to stronger, more nimble organizations.
By Geoffrey James, Contributing editor, Inc.com
[…]

@Sales_Source:

Only mediocre managers feel the need to keep secrets from their employees.

What do you think of CSR managers, who even hide reports on Corporate Social Responsibility (CSR) from their employees?

CSR Evaluation and Corporate Hypocrisy

http://surface.syr.edu/cgi/viewcontent.cgi?article=1025&context=etd

Syracuse University
12-2013

The Role of Ethical Evaluation of Corporate Social
Responsibility in the Perception of Corporate
Hypocrisy, the Intention of Opinioned
Communication and Behavior toward a Firm

KyuJin Shim

ABSTRACT
Corporate hypocrisy refers to publics’ negative perception of CSR (Corporate Social Responsibility) as a result of ethical attribution of CSR to normative ethics, and thus can be a useful indicator of the disappointing and ineffective role of CSR programs geared toward raising publics’ goodwill toward a firm. However, scant scholarly effort has been made to explore the concept of corporate hypocrisy in relation to corporate issues and crises, publics’ ethical orientation, cultural and national influence, and polarized sentiments toward global business in the media landscape. These aspects collectively constitute the unpredictable, uncontrollable public opinion, in particular the opinion of the socially minded general public, and these aspects thus generate a turbulent business arena across the globe.
        To fill this void, this dissertation concurrently conducted two sets of research: one used a survey methodology on a real company’s CSR case and the other used an experimental method. […]

Legitimate Stakeholders

 According to EcoVadis (see http://www.endress.com/_storage/asset/1576641/storage/master/file/6849002/download/eh_EcoVadis_Premium_Report_2016.pdf, chapter 10, p. 24/31) “legitimate stakeholders” are:

  • Governmental organizations (i.e. government environmental protection administrations, anti-trust agencies, customers protection agencies)
  • CSR networks and initiatives
  • Trade unions and employers’ organizations
  • International organizations (i.e. UN, ILO, UNEP, …)
  • NGO’s (i.e. Greenpeace, Clean Clothes Campaign, Transparency international, UFC, …)
  • Research institutes and reputable press (CSR Asia, Blacksmith Institute, …)

A corporate stakeholder is a party that can affect or be affected by the actions of the company and the achievement of its objectives (i.e. employees, clients, suppliers).

 I think that, presently, EcoVadis treats employees as 2nd class stakeholders.

Imbalanced Inclusion

RobecoSAM (Dow Jones Sustainability Yearbook) explained by CINCS (Creating Intelligent Natural Capital Solutions) in: Sustainability Indices and Environmental Reporting, 2013-04-23
(http://cincs.com/dev/wp-content/uploads/2014/07/InFocus23.pdf):

“[…] Environmental-business analysts and investors have challenged the credibility of DJSI’s information source for some time. DJSI [Dow Jones Sustainability Index] has four steps to follow in the evaluation process:

[1] First, each participating company has to fill in an industry-specific company questionnaire distributed by RobecoSAM, which evaluates the overall social and environmental strategies of each company.
[2] After that, DJSI will analyze industry-relevant media reports, press releases, news articles, investor commentaries and employee feedback to get a comprehensive understanding of how the company is perceived by opinion leaders and stakeholders.
[3] Following this is the company documentation section, in which RobecoSAM will request sustainability reports, environmental reports, health and safety reports, social reports and annual financial reports from each company.
[4] The last part is the company contact, in which SAM will have discussions and phone conversations with corporation leaders.

Of these, three of them are based on companies’ self-provided reports, data, resources and articles. In that circumstance, data could be optimized or even manipulated to generate better evaluation scores. For example, in the company documentation section, there is no standard sustainability reporting regulation regarding how companies should file sustainability and environmental reports. Therefore, companies are able to polish and further dress these data to make them appear glorious and “trustworthy.”
[…]
Conclusions – With the growing awareness of and demand for sustainability assessment, DJSI is a great tool for companies who are dedicated to gaining ongoing financial growth while meeting high environmental and social standards. The major benefit of being listed in DJSI is that it will help companies to be more transparent for investors through a thoroughly planned and designed corporate sustainability ranking system. The two major deficiencies of DJSI and other similar indices are that they lack authenticity in their auditing process and use imbalanced inclusion. […]”

Imbalanced inclusion: Inclusion of pros only while neglecting cons. In advertising that is legitimate. However, a performance evaluation or an audit which allows imbalanced inclusion is not credible.

Leftist Trade Unions not interested in CSR

http://www.etui.org/News/Trade-unions-and-corporate-social-responsibility-pragmatism-wins-out-against-mistrust (2015-02-26)

[…] The more left-wing the trade union, the less it will be interested in CSR’ was how Lutz Preuss summed up the situation. According to this researcher, it is in Finland that the trade union movement is most open to CSR, a finding that can be explained by the fact that this country is able to boast a highly developed social legislation that endows it, to some extent, with a safety net that can protect it from any undesirable side-effects of negotiations undertaken in the framework of CSR. […]

If “left-wing” stands for left-wing conservativism, I agree to that. As for CSR, old fashioned unions too often leave the agenda setting to the employers and lack the competency and professionality required to challenge corporate story telling and corporate “reputation management”.