Corporate Social Responsibly (CSR) is the latest buzzword that is on the minds of both upper management and investors. As governments begin to demand companies to issue reports on their environmental and social impacts, as is happening in the UK (https://www.theguardian.com/sustainable-business/eu-reform-listed-companies-report-environmental-social-impact), the board of directors and upper management is placing emphasis on the importance of CSR. Although critics argue that this can be a result of window dressing for shareholders, the fact remains that large multinational organizations are engaging with Corporate Social Responsibility for the long term.
Unilever has been accredited with being one of the greatest examples of sustainable business practices. In 2008 they embarked on a company-wide initiative to reduce their environmental footprint. Since then they have reduced overhead costs by €600 million by streamlining their production methods and reducing waste throughout their manufacturing and corporate operations (https://www.unilever.com/sustainable-living/the-sustainable-living-plan/reducing-environmental-impact/).
General Electric’s (GE) Ecomagination program in 2015, reported measurable environmental, social and financial benefits generated by the initiatives put in place over past 10 years. GE has generated over $232 Billion in revenue from a $17 Billion investment into research and development. GE has reduced green house gas emissions by 12% and reduced freshwater use by 17%. These percentages are on track for GE’s 2020 goal of reducing both GHG emission and water consumption by 20% (http://www.ge.com/about-us/ecomagination).
With new standards for sustainable business practices yielding favorable growth and a high return on investment, the question remains as to why there are still so many corporations lagging behind on investing in CSR and environmental initiatives?
Many companies assume that going green will cost money and is accessible only to large organizations. Despite this assumption, small and medium size enterprises (SME) actually have the greatest competitive advantage when "going green" according to, reports by the Government of Canada. The benefits of reducing an organization’s environmental footprint can attract and retain employees, reduce operating cost/risk, improve brand loyalty while providing access to various avenues of finances. As some of Canada’s major banks have started to analyze a companies environmental track record as a criteria when issuing new corporate loans. (https://www.ic.gc.ca/eic/site/csr-rse.nsf/eng/h_rs00174.html#business). With over a million SME’s in Canada, 97.9% of which are small enterprises, minor changes across industries can have a wide reaching impact (http://www.ic.gc.ca/eic/site/061.nsf/eng/h_03018.html#point1-1).
I strongly believe that there is evidence for SME's having the greatest environmental and social impact by implementing CSR and environmental practices. A shift towards responsible business practices can foster a competitive advantage with larger organizations while having a positive impact on both the environment and their local communities.
To observe this further I reached out to small and medium companies in my area. I aimed to observe which companies have a CSR strategy within their organization. I hypothesized that most companies in the southern West Island would have a CSR strategy in place and would be willing to share their stories of success. Conversely I was aware that organizations would be unfamiliar of the success brought on by sustainable business practices.
The southern west island of Montreal is primarily a low-density residential area with small pockets of commercial offices and industrial parks located between the boroughs and suburban blocks. Businesses operating in close proximity to residential housing, natural areas and the St-Lawrence river to the south. I assumed that the precautionary principle would apply and great care will be taken in assuring businesses will operate with a reduced environmental footprint.
I targeted 85 companies from all industries in the seven southern boroughs; Dorval, Pointe-Claire, Beaconsfield, Kirkland, Baie D’Urfe, St Anne De Bellevue and Senneville. I sent each company a short survey which aimed to better understand if and how their organization had approached environmental policy and practices, along with recycling programs and various other environmental and social initiatives.
In addition to the online survey I personally called each company, to discuss the project further in the hopes to render more data. Using the two methods, I received seven responses to the survey with only six stating that their company has an environmental program. Additionally, eight of the 85 organizations contacted, had an environmental report on their website. The data retrieved from the analysis was informative and in line with what the researcher expected (figure 1).
The results of the analysis proved to be contrary to my predictions, a majority of the companies in the southern west island of Montreal are unfamiliar with corporate social responsibility and the benefits of sustainable business practices. Although 86% of responses stated their organization has a detailed environmental program, a large percentage of operations leave the lights, computers and machinery on overnight. A remarkably low number of responses stated that they are involved in local community charity organizations, while 100% of responses stated their organization is actively involved in a recycling program.
The fact remains that impactful environmentally friendly business practices are accessible through simple and small changes to the status quo. The changes made can improve overall efficiency, and reduce waste, energy and costs. A change in policy can place your organization ahead of the curve by allowing you to streamline operations, improve production, and reduce emissions all while saving money. “There is no trade-off between sustainability and profitable growth.” Paul Polman CEO of Unilever.