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You’ve probably heard the term ESG (environment social governance). You may have heard it be interchanged with CSR (corporate social responsibility). Are they the same thing?
The answer is no. CSR and ESG, although promoting the same general concept, are distinct. CSR is everything a company does to positively contribute to societal issues that it’s not required to do by law or regulation. ESG is CSR that has been formalized into measurable criteria that are disclosed to investors and the public. As Lexology puts it: “While CSR aims to make a business accountable, ESG criteria make such business’ efforts measurable.” ESG criteria focus on quantitative data used to help investors, employees and consumers make decisions regarding a company. In essence, a company's ESG reporting shows if it’s “walking the talk” in terms of their CSR goals across:
There are several frameworks to help companies structure their ESG work, the most common of which are listed below.
Why should your company care about ESG? If your company executes ESG right, it’s likely to be more profitable. Also, investors increasingly expect companies to disclose ESG data. For example, the newly incorporated International Sustainability Standards Board (ISSB) is developing international ESG reporting standards and the US Securities and Exchange Commission (SEC) is incorporating ESG into its work. In summary, ESG is quickly becoming a standard part of managing a business.
It has been over two years since COVID-19 first forced a massive shift to remote work. Since then, most companies have adapted to conduct business efficiently using more technology. For most workplaces, returning to pre-pandemic levels of in-person work is unlikely. How do we ensure that this permanent increase in remote work ends up reducing carbon emissions, as opposed to increasing them?
At first blush, remote work appears to be a boon for the environment. Fewer employees making the commute to the office reduces carbon emissions. For example, India’s second largest IT service provider, Infosys, reduced its carbon emissions by 46% in the year following the start of the pandemic. This number sounds good but is misleading.
It turns out that having your employees work from home doesn’t necessarily reduce their total carbon emissions. Although they’re no longer commuting, they’re now using more lights, computers, internet, heat and air conditioning in their own homes. They are also purchasing lunch food and office supplies, both of which have supply chains and associated emissions. Additionally, if your employees followed global trends, many moved during the pandemic from
cities to suburbs, where houses are bigger, public transportation is scarcer and driving is more commonplace. If their home offices are less energy efficient and if their purchasing decisions are less environmentally sustainable than yours as an employer, your team members could be spewing more carbon into the atmosphere as remote workers than as office workers. Despite its elimination of the commute and office use, remote work does not necessarily reduce carbon emissions.
Fortunately, your company can ensure that the modern remote-work era is climate friendly by:
1. Promoting clean and efficient home energy. Many companies have switched to purchasing renewable electricity for their operations. It’s time to consider doing the same for employee electricity use outside the office. Consider incentivizing or funding employee upgrades to clean power sources. Similarly, consider paying for employee home energy efficiency improvements.
2. Cutting down on business travel. Air travel is a bigger source of emissions than offices. Consider cutting back on nonessential business travel. Have employees to ask themselves “can this meeting or event be successful online?” before booking a ticket.
3. Encouraging public transportation. Consider company policies that reward or reimburse employees for use of public transit for work-related travel.
4. Measuring total impact. Calculate your company’s total emissions – including from commuting and use of home as office – to ensure you’re minimizing your company’s overall carbon footprint. This Watershed calculator can help.
In summary, if your company has many remote or hybrid workers, it’s time to include the carbon impact of employees working at home in your overall climate policies, measurement and goals.
Given Colorado laws, the US Supreme Court’s recent decision to overturn Roe v. Wade has little impact on state residents’ immediate access to legal abortions. It does, however, have an impact on Colorado employers. In today’s world, companies need to manage their relationship to this, and all, political developments involving societal issues. Employees and customers increasingly expect your corporate social responsibility (CSR) to address societal issues they consider important. As shown in a prior post, ignoring this expectation is costly and increasingly infeasible as CSR drives business performance and financial results.
The bottom line is that businesses need to consider their response to the Supreme Court’s Roe v. Wade ruling. To help your company craft its response, following are the principal ways major brands have responded:
CSR involves managing positions on key societal issues, including those that are politicized. These include diversity equity and inclusion, climate change and now abortion. Long gone are the days when companies could be good corporate citizens by only supporting uncontroversial causes far from the political fray. Today, it’s impossible to conduct CSR without making political statements. The only question is how effectively companies manage their CSR and, thus, successfully navigate through the highly politicized civil society they operate in.
For assistance in designing and executing your CSR strategy, contact us.
Eighty percent of the Colorado companies recognized for being exceptional corporate citizens, The Civic 50 Colorado, offer their employees volunteer time off (VTO). VTO allows workers to support charitable causes while on company time.
VTO communicates to employees their employer’s commitment to supporting service to societal causes, which employees increasingly value. It also makes it easier for fulltime employees with scarce free time to find the time to volunteer.
VTO functions similarly to other paid time off (PTO) policies. It typically includes a requirement to obtain approval from a manager or supervisor, a definition of eligible volunteer activities and a maximum number of hours per year. According to CECP, the median number of hours offered by U.S. companies is 16 and it’s rarely less than 8 or more than 40, although a few companies offer over 80 or have no limit. Some companies limit VTO to signature causes, skills-based volunteering, board service or other types of volunteering that align with their corporate social responsibility (CSR) strategy. Most, however, make all volunteering eligible.
If you’re looking to institute VTO at your company, Harvard Business Review has a superb article with guidance and our partner organization, Points of Light, has a fill-in-the-blanks template.
In 2018, we launched the Civic 50 Colorado in partnership with Points of Light, the world’s largest organization dedicated to volunteer service. The Civic 50 Colorado recognizes the 50 most community-minded companies in Colorado. Companies with 15 or more employees in state are eligible to apply. The application is free and closes on August 15th. Winners will be announced in the fall.
The Civic 50 Colorado is a unique opportunity to gain recognition for your community engagement program, take a leadership position in corporate community involvement and to share their best practices with the broader business community. Many companies have also said that the process of taking the survey and receiving their complimentary individual scorecards with information on their rankings helped them understand how they could improve their processes and strategies in the future.
To learn more, access support resources and apply, go to our website.
If corporate social responsibility (CSR) is one of your responsibilities, you might pine for guidance in this rapidly evolving business function. You might have questions like, “What foundational principles do I use to make decisions?” or “What policies or programs should I consider?” or “What’s a reasonable target for employee participation in volunteer activities?”
Good news! Our partner organization, Points of Light, asked an esteemed group of CSR experts these questions. Their responses led to The Civic 50 framework, which is reviewed annually and updated as needed. Both The Civic 50 Colorado award program and its national counterpart, The Civic 50 US, are based on the framework. Therefore, in addition to having access to conceptual guidance through the framework, you also have access to performance metrics of US and Colorado award-winning CSR programs on the framework.
So, what does the Civic 50 framework suggest? At a high level, it specifies that strong CSR program have four dimensions:
When companies donate to nonprofits, it’s usually one of three thing: the products/services they sell, volunteer hours or cash. Pharmaceutical companies donate medicine and law firms donate pro bono legal services – and almost all donate volunteering and money. Businesses, however, are also trove of other assets that can also be repurposed for good. Below are 20 examples.
Donating Items (beyond the company’s commercial products/services)
Offering Space as a Communications Tool (used for marketing, education, etc.)
Sharing Internal Programs and Processes
You get the idea. There are an infinite number of novel contributions companies can make to charitable causes! What might your business contribute?
If you’re interested in deepening your corporate social responsibility (CSR) expertise, here are three recommended reads.
Net Positive: How Courageous Companies Thrive by Giving More Than They Take by Paul Polman and Andrew Winston
Net Positive is a deeply helpful and easy-to-read blueprint on what business leaders should consider including in their CSR. Every business leader will benefit from the ideas within it, even if they are not yet ready to institute them fully.
Purpose Work Nation: Leading Organizations in Service of Our Nation's Powerful Purpose by Brandon Peele
Purpose Work Nation offers leaders a novel pathway to diversity, equity and inclusion (DEI) at their organizations based on the nation’s powerful purpose of “E Pluribus Unum.” It helps companies free their work cultures from mistrust and divisiveness. Purpose Work Nation is research-backed, elegant and as American as apple pie. Read it to bring out the most productive and inspired work across the full diversity of your workforce.
Do Good at Work: How Simple Acts of Social Purpose Drive Success and Wellbeing by Bea Boccalandro
What type of CSR works best for employees? Do Good at Work answers this question. It weaves rigorous evidence, captivating stories, pen and ink illustrations and more than
100 real-world examples into concrete ways CSR practitioners and managers can help team members ignite a sense of purpose.
All three books are critically acclaimed and have Amazon ratings of close to a perfect five out of five stars. So why not curl up with a good book that will deepen your CSR knowledge?
Photo by Hoan Ngọc
Carbon credits were first introduced at the 1997 United Nations Kyoto Protocol, the first global agreement to cut carbon emissions. A carbon credit is a permit that allows the owner, a company, to emit a certain amount of CO2 or other greenhouse gas. This might sound like an undesirable transaction but it actually helps limit net carbon emissions. Imagine a company emits 100 metric tons of carbon in a year and would like to offset those emissions. It can purchase a carbon credit that uses some method of carbon capture to offset 100 tons of emissions. Companies can buy or sell carbon credits – or even create more by funding new carbon offset projects. Carbon offsetting was found to be an effective way to reduce greenhouse gas emissions by reputable studies. The four main types of carbon offset methods are:
Each of these methods offsets carbon damage by creating carbon repair that otherwise may not have happened. When companies or organizations buy carbon credits, they are helping to fund these projects that cannot be funded on their own. Carbon credits can be used for businesses that are required to lower their carbon emissions by legal regulations or for companies looking to improve their corporate social responsibility (CSR).
Carbon credits are a way for companies to maintain operations while managing greenhouse gas emissions. Participating in carbon credits can help your company in many ways:
Despite these pros, there are also criticisms of carbon credits. For example, what if the development of wind power in that small village would have happened without the trading of carbon credits? Also, are the carbon measurements accurate? And are we truly offsetting as much as we're emitting? All of the concerns are valid and should be addressed when trading or creating carbon credits. Nevertheless, for small companies starting their sustainable strategies, carbon offsets can be a good option. There are even companies, like Radicle, that help track your emissions, lower your emissions, create carbon credits and trade carbon credits – all in compliance with regulatory and environmental standards. Bottom line? If you want to reduce your carbon emissions, consider carbon credits.
We are thrilled to announce the publication of a research report detailing the practices of the Colorado companies that earned 2021 state-level recognition for their corporate social responsibility (CSR): the 2021 Colorado Civic 50.
What can we learn from Colorado’s best CSR exemplars? The report has dozens of data points, but some of its most applicable lessons for organizations looking to improve their CSR include:
Spark the Change Colorado, Community Shares of Colorado, B:CIVIC