CSR is often regarded as the new buzzword for ‘community involvement’. But
Ed Williams, head of CSR at Marks & Spencer, believes it has a strong
business case, maximising investment and encouraging innovation. Ross Wigham
reports
Employers that can prove they are socially responsible organisations will
benefit from increased investment, and find it easier to attract new employees
and customers.
This is the message from Ed Williams, head of corporate social
responsibility (CSR) at Marks & Spencer, who is convinced the issue will
prove increasingly central to the competitive advantage of organisations.
CSR’s profile has significantly increased since the Enron and WorldCom accounting
scandals prompted President Bush to call for CEOs to ensure business operates
more responsibly.
If proposals to make directors responsible for corporate behaviour are
introduced in next year’s Company Law Review as expec-ted, then UK employers will
also be forced to take the issue more seriously.
But Williams stressed the main driver for CSR should be an understanding of
the impact it has on the bottom line.
"The business case for CSR is very strong," he said. "In
retail, for example, media coverage of unethical products would cost a lot of
money. Ultimately, we are here to make money – but we want to do that in a
responsible and ethical way.
"CSR can give you a competitive advantage because it enables you to
retain and attract staff and bring in new customers."
Two years ago, M&S set up a department dedicated to promoting CSR within
the business, to ensure it is embedded in the company’s culture. It has also
produced a CSR framework (see box) to make sure all staff are aware of the
company’s values.
"Much of what we are doing was already in the company’s bloodstream. It
is essentially about trust, and that is so important because consumers are
making more informed ethical choices on what they buy," Williams
explained.
He said that as well as being vital for M&S’s brand image that its
products and services are ethical, the firm has a moral obligation to put
something back into the community.
"When you take a profit from a business, you have to accept a certain
responsibility with that. Some firms think it is just a trendy new word for
community involvement, but we think it runs through everything a company
does," he said.
Williams said new research shows that an organisation’s CSR record is
becoming increasingly important to investors, with 80 per cent of private
shareholders wanting information on the non-financial performance of a company.
"Good CSR can really maximise investment because it lets investors know
that a company is responsible," he said.
It can also encourage innovation by increasing shareholder discussion and
participation, which forces companies to continually look at new ways of doing
things.
Williams is supportive of the Business in the Community initiative to
produce a CSR index. It is due to be published next month, and will benchmark
the UK’s biggest companies on CSR.
He thinks this is a better way of providing information on a company’s
approach to corporate responsibility than forcing them to include details of
their non-financial performance in the organisation’s annual report.
"The annual report is already a big document, so I’m not sure companies
could add CSR to that. However, investors should be able to see what a company
does in terms of CSR," he said.
Last year, the EU considered introducing legislation to force companies to
meet certain standards, but Williams said regulation would hamper innovation
and lead to a tick-box approach.
"If the EU regulates further, it will stifle innovation and we’d lose
the momentum. It’s not reinventing the wheel – good companies should be doing
these things already," he said.
M&S has launched a range of recent initiatives to meet its own CSR
objectives. It also has a CSR forum made up of managers from all M&S
business units to ensure they are embedded throughout the entire business, and
Williams reports directly to the chairman.
This year, the retailer will offer 600 work placements to homeless people.
This follows a successful pilot scheme which saw 37 per cent of the placement
individuals securing jobs with M&S or another employer.
Under the scheme, candidates are given training, work experience, advice on
CVs and a reference. Williams is currently looking to expand the model to
include disabled people, the long-term unemployed and ex-offenders.
M&S has just extended its CSR remit overseas, giving free literacy
classes to staff at a supplier in Morocco. "It’s not a philanthropic
thing. It’s aligned to the business values as well as being a good thing to
do," he said.
People management forms a crucial part of any overall CSR policy, and
Williams himself has an HR background as a training and development manager
with the retailer.
The way a company deals with its people is the first strand of
responsibility and can often be the defining factor in a tight labour market,
he explained.
"Employees are making more informed choices about where they want to
work. That is often based on how much they see us as a responsible
organisation."
Williams believes HR is key in driving the CSR initiative and said people
processes are essential in making it work.
His next project is setting up an academy with the DTI to improve the skills
of CSR professionals. He hopes this will set an example and offer inspiration
to other organisations.
CSR – What does it mean to M&S?
M&S has developed an overall framework for what CSR means
and how it relates to its business:
Product
– To take care and act responsibly in business
– Add quality and value
– Animal welfare
– Environmental awareness
– Social awareness
People
– Creating great places to work
– Engaging staff
– Diversity
– Work-life balance
Places
– Become a good corporate neighbour
– Investing in the local community
– Making the community a good place to live and work
Source: Marks &Spencer
