Archive for the ‘Corporate Reputation’ Category

Update on ISO 26000 (Guidance on Social Responsibility)

posted by Tara Knight

This is an update to a post I previously wrote about the publication of ISO 26000

Since the official publishing of the long-awaited ISO 26000 (Guidance on social responsibility) code in November 2010, many companies have been excitedly leveraging the standard to their business process.  

The ISO 26000 code is intended to provide an international consensus on definitions and principles of Social Responsibility and guidance for integrate it throughout the operations of an organization. Unlike many other ISO standards, the working group that developed ISO 26000 decided that it would not be appropriate to be a certifiable standard – but that hasn’t stopped consultants from offering to certify it. 

To the ISO 26000 working groups’ surprise, it turns out that ISO’s national standards bodies are not bound by that decision. So, national ISO bodies are offering to certifying national variations of the international standard. Under the ISO system, the national bodies are within their organization rules to offer this certification. It is certainly creating a lot of confusion for an international code that expressly states is not intended or appropriately “certifiable” not to mention, creating a host of national versions of what is supposed to be one international consensus.

It is an example of how companies are clearly seeing value in CSR – why would organizations so ardently seek independent verification for their CSR policy if it didn’t offer them some reputational or organization value? However, to ‘get back to the basics” the aim of CSR – and the ISO 26000 standard – is to create and follow the policy and principals of social responsibility – not just acquire the symbols of it.

@TaraKnightHK
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Stock market says: CSR = $$

posted by Tara Knight

I feel one of the most pervasive characterizations of CSR is that companies experience a financial penalty as result of subscribing to or integrating CSR practices and policies into their business. Of course, the recent Wall Street Journal  “The Case Against CSR” op-ed is one example of the disconnect that many people have of the value of CSR to a profitable business (Boston College’s The Voice of Corporate Citizenship provides an excellent overview of some of the commentary.)

Making a business case for CSR within a company whose corporate culture believes that integrating CSR comes with a significant cost to the bottom line is a huge challenge.   Recently I have been circulating a couple studies with my colleagues that have been really helpful in reframing this “CSR costs money” debate.

An August 2010 working paper from Harvard Business School, The Impact of Corporate Social Responsibility on Investment Recommendations delves into how sell-side analysts perceive CSR information, and how this information affects their recommendations. The researchers reviewed a large sample of US firms over 16 years, examining the ways corporate CSR activity is communicated to investors through analysts, and how it this affects public equity markets. Analysts’ recommendations can substantially affect stock prices and trade volume. The researchers found that firms with strong CSR strategies are perceived to be value-creating, especially over time, and this is reflected in analyst’s positive recommendations for these firms.

Another collaborative study, Does Corporate Social Responsibility Affect the Cost of Capital? from Principles for Responsible Investment, used a sample of 12,915 U.S. firms. This study found firms with a better CSR score had a lower cost of equity capital – even after controlling for firm-specific issues or type of industry. The study found that CSR investment particularly in improving responsible employee relations, environmental policies, and product strategies substantially contributed to reducing a firms’ cost of equity.

It’s clear that investors are looking for, and paying attention to CSR information. Investors with Bloomberg’s Professional market data service for example are able to access carbon disclosure information supplied to the Carbon Disclosure Project (CDP) by the world’s largest firms.  Analysts and investors are certainly accessing information about CSR policies and practices, and considering this in their investment decisions. CSR may need investment, but whether environmental, social or governance related – smart companies are leveraging strong CSR  practice as a positive factor in improving their market valuation.

@TaraKnightHK

International Public Relations SUMMIT

posted by Boyd Neil

Unfortunately, it is unlikely that I will be able to attend the International Public Relations Association (IPRA) Summit in London this October. It takes place Friday, 30 October 2009 at Merchant Taylor's Hall, Threadneedle Street, London and the theme is PR in times of crisis – From austerity to opportunity. You can register here if you can spring for a thousand or so British pounds, plus travel.

This is one of the few international conferences I get to, having been to three IPRA Summits in London over the past 2 1/2 years. (Disclosure . . . I am a member of the IPRA's governing council.) Having not been offered a speaking platform (which I have in the past), and running up against the restrictions on business travel common to many agencies these days, the chances of getting to the U.K. for October 30th are slim.

I'll miss it.

The number of North American public relations and social media conferences is overwhelming. However, at them seldom do you hear the perspectives of French, British, Israeli, Norwegian, Russia, Irish, Indonesian, Indian, Nigerian, and Singaporean public relations professionals, for  example, as I have at the London meetings. Their experiences can be sharper than in North America; their stakeholders more aggressive; their governments over-intrusive; their cultures less - or more - flexible; their political sensibilities acute; and their use of mobile technologies extravagant.

The speakers at this year's conference include Nick Sharples, Sony Europe (who has tweeted all of once at @SharplesN); Fernando Rizo, Ketchum UK; Robin O’Kelly, T-Mobile; Rob Brown, author of Public Relations and the Social Web; Elizabeth Goenawan Ananto(Indonesia); Tim Weber - BBC Interactive (who tweets at @tim_weber); and Maria Gergova - IPRA.

Less cosmopolitan than usual, but still a strong cast.

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