According to the second edition of the CSR “Open-Source Barometer”, published in 2022, the COMEX of the companies surveyed is the driving force behind or supportive of CSR in 89% of cases.
The survey, co-initiated by 14 key CSR players including “Vendredi” and “1% for the Planet”, is based on a sample of 790 companies ranging from VSEs to multinationals. It therefore affects a sample of committed companies and this figure can be put into perspective slightly downwards for companies in general. However, this allows us to make one observation: CSR is really beginning to emerge as a strategic subject and no longer just as a communication object. So how can CSR contribute to the overall performance of the company? How can it be a lever for business opportunities and innovations?
Connecting the CSR strategy with the core business
Today, CSR is not always linked to the core business of certain companies. Compelled by increasing regulations on the subject, some groups have sometimes implemented CSR policies on the various social and environmental aspects, but rather with a ” compensatory approach to the negative impact ” of their business. These social actions do not call into question our business decisions, such as the choice of investments or the composition of our products.
To have a real strategic impact, CSR must ” have a positive impact “, i.e. it must lead the company to bring benefits to its stakeholders directly through its core operational activity. In this way, CSR is aligned with the company’s business model.
To establish this coherence, it is necessary to start by defining a Raison D’être that integrates a corporate mission that is broader than economic: what makes a body of individuals work together over time and for what contribution? The company’s activities may change over time. The reason why human beings in and around the company work together, no. Stakeholders work together for a common impact on each other and on the planet. Defining the company’s raison d’être is therefore the first step in positioning CSR as a strategic issue.
Detecting new business opportunities through stakeholders
A key objective of CSR is to move from working with shareholders to working with stakeholders. Identifying internal and external stakeholders, and initiating effective dialogue with them, enables us to better understand the needs of the company’s ecosystem. This opens up a world ofbusiness opportunities and innovations that we might not have seen if we had remained focused on our own interests or those of our shareholders.
Open innovation, which consists in opening up the company to a diversity of external players in its ecosystem (researchers/research laboratories, partner startups, customers, suppliers, students, universities, local authorities, NGOs, etc.) or internal players (all employees, whatever their department), can thus take on its full meaning when a CSR approach is in place.
To identify business opportunities, the company can seek to meet the needs of its ecosystem (customers, employees, the planet, etc.) with its extended stakeholders through CSR. The problems encountered by our ecosystem constitute interesting constraints that will feed the framework of reflection ofinnovation workshops. This will allow us to identify new, more responsible and positive business models to be tested (e.g.: rental subscription, second hand, durability and reparability…). In the long term, this could even lead to the evolution of operational activities that had a negative impact (e.g. pollution via waste generation…) and thus ensure the sustainability and resilience of businesses.
Implement a global performance measurement: financial and extra-financial
Today, extra-financial reporting, also known as ESG/RSE reporting or DPEF (declaration of extra-financial performance of companies), only concerns companies:
- with 500 or more employees;
- with a balance sheet total of €20 million or net sales of €40 million;
- unlisted companies with a balance sheet or sales total of €100 million and 500 employees.
What’s more, this reporting can take a fairly free form today (e.g. structured by issue, by risk, with or without mention of a CSR strategy, etc.).
The European regulation in full evolution on the subject comes to upset these principles. The CSRD(Corporate Sustainability Reporting Directive) will impose not only extra-financial reporting for a wider audience, but also a stricter format to be respected with standards. The CSRD will be applicable as of 2024 and as of 2025 for the new companies concerned. Shareholders will be able to consult these CSR standards in the same way as the financial standards. According to the 11th edition of the study “Priorities 2023 for Finance Departments” by PwC and the DFCG, 73% of CFOs plan to change their management model to integrate CSR dimensions within three years. This new regulation demonstrates that company performance is no longer limited to economic performance. It must be considered in its entirety, including the principles of CSR.
It is therefore important to put in place a strategic vision of the company including CSR, which could be accompanied by monitoring indicators (KPIs), but also to involve the financial directors in the subject. Another important point will be to centralize the company’s data necessary for global performance, which may come from different departments and information systems (HR, Finance, Purchasing, Quality, etc.).
Conclusion: CSR as a lever for global performance and innovation
Today, CSR is no longer considered as a simple communication tool, but as a performance and innovation lever for companies. It can contribute to overall performance by linking it to the company’s core business and by detecting new business opportunities thanks to stakeholders.
By adopting sustainable and ethical practices, companies can strengthen their brand image, attract and retain talent, and satisfy consumer demands. CSR can therefore be a real asset for companies wishing to maximize their overall performance. To achieve this, once the CSR strategy has been defined, it needs to be rolled out to the various business units, so that it can be applied in practice.
At SQORUS, we have been implementing CSR actions for several years and we improve them on a daily basis. We also provide our customers with CSR Council services. If you have any questions or requirements, please contact us to discuss them with our experts.
See also our feature on "HR strategy management tools".
- What are the key issues facing HR departments today?
- Organization, talent management, recruitment: priority HR projects?
- Human resources management: what HR strategies for the future?
- Best practices to manage your HR strategy in an optimal way
- The different HR management tools to carry out your HR strategy
- HRIS software: the different areas of intervention for the HR function
- How to convince your management to invest in an HRIS tool?
- Is it necessary to be accompanied in the management of an HR strategy?
- What indicators should be defined to measure the performance of an HR strategy?
- HR strategy: how to achieve effective HR reporting?
- Who should drive HR projects in the company?
- Setting up a working group for an HR project: who should be involved?
