What is corporate responsibility?


Corporate responsibility (CR), also known as corporate social responsibility (CSR), is about managing businesses’ impacts on their own workforce, the environment or society. Small and medium-sized enterprises often have a strong tradition of sustainability. Many see themselves as an integral.

part of society, operating with the interests of their workers, customers and communities very much in mind. However, most SMEs have never sought to align this perception of themselves systematically with their business operations, even though corporate responsibility can actually boost their success over the intermediate and longer term. For many such companies, then, putting a CR strategy in place is something new. But with CR Kompass, SMEs have the support they need in finding a pragmatic way forward.

 Areas of corporate responsibility

Corporate responsibility encompasses a breadth topics. CR Kompass groups these topics into the following key areas:

 Human rights and workers’ rights

The focus here is on taking responsibility for your workforce and others affected by your business operations by:

  • Minimizing negative impacts on people – in other words, protecting your company’s own workers and others in the supply chain against accidents, illness, and exploitative practices. This also extends to possible negative impacts of business operations on local communities.
  • Extending the company’s beneficial impacts, both in the business sphere (through the creation of training and career opportunities, for instance) and the private sphere (through flexible working hours, helping workers reconcile work and family life, and paying appropriate wages).

 

Example: Employees (1)

This example, provided by Bau-Fritz GmbH & Co. KG, is from the German CSR website Zukunft Mittelstand!

Sector: Construction
Company size: 240 employees

Formed in 1896, Baufritz is a family-owned company which employs 240 people at its base in Erkheim, Germany. It builds houses, offices and commercial buildings according to a holistic approach.

How does the company engage in corporate responsibility?

Baufritz does everything possible, both technically and economically, to provide a healthy work environment for its people. In every area of its operations, it offers extensive training aimed at improving employee health. There are large balconies where staff can work outdoors on laptops if they wish. Rocking desk chairs, standing desks, and foot rests are also provided to help ease the burden on muscles and joints.

Another highlight in terms of health promotion are body relax massages. Introduced more than a year ago, these are available to all employees. A specially qualified masseuse visits twice a week to give back massages in a room specially styled to foster motivation.

How does the company benefit from its CSR activities?

The workforce is exceptionally satisfied with the workplace and is highly motivated. As a result, employee turnover is very low, helping the company to retain its in-house expertise. Employees identify closely with the company’s goals, products and corporate culture. Because they feel part of the organization, they actively propose ways in which products and processes can be improved. A large number of promising future developments have started out as suggestions for improvement put forward by company employees. It’s important that the entire workforce identifies with Baufritz quality standards and environmental awareness, as this will help to safeguard customer and employee satisfaction in the longer term.

How do the stakeholders benefit from the company’s CSR activities?

Employees suffer less often from job-related health issues.

Example: Employees (2)

This example, provided by Wall AG, is from the German CSR website Zukunft Mittelstand!

Wall AG is a family-run SME that relies both on highly qualified employees and on a ready supply of junior staff with specialized skills. The company is currently training more than 20 young people as industrial clerks, mechatronics technicians, structural engineering technicians and cleaners. The Potsdam Chamber of Industry and Commerce honored this commitment in 2006, according Wall AG official status as an apprentice training center.

Excellent staff relations and retention of its core workforce have the utmost priority for Wall. Employees who work in production receive a wide range of training so that they can be reassigned temporarily to other roles if order levels fluctuate. To reflect current demographic change, the company also takes on older employees who, thanks to their extensive career experience, are an asset to the company. Initiatives to help employees balance work and family life include options for working from home and support payments of EUR500 net per month to families with three or more children. Wall also operates a free vaccination program.

 



Environment

This section looks at responsible environmental practices and consumption of natural resources. These include:

  • Minimizing negative environmental impacts as far as possible – in other words, cutting environmental consumption and any outputs that adversely affect the environment (waste and wastewater volumes, carbon dioxide and other emissions)
  • Extending beneficial impacts – by mitigating emissions and other outputs (making use of others’ waste, and planting trees to offset carbon emissions) and by helping nature to rejuvenate (by creating more greenery, for example).

 

 Example: The environment

This example, provided by Wall AG, is from the German CSR website Zukunft Mittelstand!

Wall AG seeks to make a difference by engaging in continuous R&D and by introducing environmental initiatives designed to reduce the company’s footprint and minimize energy consumption.

The company makes street furniture from a range of high-quality materials, including aluminum, stainless steel, glass and wood. These materials are not just highly durable, they are also pollutant-free and recyclable. For the most part, the street furniture can be cleaned and maintained using environmentally compatible, biodegradable, universal cleaning agents.

Wall AG designed a bus shelter with a built-in 300Wp photovoltaic generating system that produces clean power from solar energy. The power it delivers during daylight hours is fed into the public grid, then used at night to run the shelter’s technical systems (poster lightboxes, a live passenger information display and a multimedia internet terminal). The company also equips poster displays like advertising columns and lightboxes with reflector systems and energy-saving lightbulbs. The patented roof structure on Wall advertising columns is power-efficient, consuming just 35 watts and cutting energy use by 85% compared to the prior type of lighting. At night, the columns are lit from top to bottom.

To reduce carbon emissions, Wall AG now runs vehicles on natural gas and is gradually migrating its fleet over to this alternative fuel. Since January 2007, the company has had more than 30 natural gas vehicles in service. The maker of street furniture and outdoor advertising installations also optimizes the routes taken by cleaning and billposting crews. Setting up various service points across the city of Berlin has reduced crews’ journey times, energy consumption and environmental footprint.

 

Integrity and prevention of corruption

Another important area of corporate responsibility is to create healthy markets. This can be achieved by:

  • Minimizing negative impacts on the marketplace – by not tolerating corruption and not engaging in lobbying that could negatively affect society, for example.
  • Exerting a positive influence by being transparent to stakeholder groups and consumers, and signing up to an anti-corruption alliance.

Example: Marketplace

This example, provided by memo AG, is from the German CSR website Zukunft Mittelstand!

memo AG

Sector: Mail order

Company size: 83 employees

Memo is a mail-order company with a portfolio of 9,000 environmentally and ethically responsible, high-quality, fairly priced products for schools, the home, and businesses; the products for businesses include office furniture and promotional items. The portfolio includes more than 400 sustainable own-brand products. For memo AG, sustainability has been a core principle of its business from day one. Formed in 1990, the mail-order company has focused consistently on being environmentally sound, socially ethical and community-driven, while operating according to sound business principles.

Product range:

All the products in memo’s portfolio are selected according to rigorous qualifying criteria: Environmental and social compatibility throughout a product’s value chain are essential – from raw material extraction and production methods to distribution, utilization and eventual recycling or disposal. The product’s quality, too – its fitness for use and its price/performance ratio – are key to its selection for inclusion in the memo portfolio. Anyone placing an order with memo can be confident that they’re getting goods that are the most sustainable the marketplace currently has to offer.

How does the company benefit from its CSR activities?

Memo differentiates itself from rivals by delivering exceptional product and service quality while taking care to protect nature and humankind. The workforce is highly motivated and identifies closely with the company. 

Environment and society:

With its carefully chosen portfolio of high-quality, resource-efficient recyclable products for offices and the home, memo meets customers’ everyday office and household needs with eco-friendly, socially conscious and affordable goods. The portfolio of intelligent, refillable, recycled and energy-efficient goods delivers additional environmental and economic advantages compared to other vendors’ offerings. In addition, the health-friendly materials and constituents used throughout the product range help to improve users’ quality of life and ensure a worry-free purchase experience.

Corporate citizenship

Another pillar of corporate social responsibility is to make a positive contribution to society by:

  • Keeping the negative impacts on society to a minimum – by not producing harmful products and not exploiting suppliers, for example
  • Being a force for good through engagement with local communities

Example: Corporate citizenship

The following example, provided by the Gundlach Group, is from the group’s website

The Gundlach Group has a tradition of employee and community engagement parallel to its day-to-day business and has been actively involved in social welfare, education, and support for the arts, culture and sport for a long time now. All our subsidiaries engage actively in citizenship, both at the local level and on a broader scale, by supporting social welfare organizations like the child cancer foundation Deutsche Kinderkrebsstiftung and the child protection charity Deutscher Kinderschutzbund, as well as youth sport, charity poster campaigns, and the cycling body RadClub Deutschland. Responsibility for our almost 900 employees is about more than protecting jobs. We offer our workforce an environment in which they can be creative, come up with innovative ideas, and allow their potential to unfold. We also provide extensive career training opportunities and a systematic health management program.


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Unit 1: An introduction to CR for SMEs is the foundation level of our CR Kompass tutorial. 
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