CSR 2.0: Reinventing Corporate Social Responsibility

for 21st Century

PROF.DR.AUNG TUN THET

Problem

RISE & FALL OF CSR

Images 

CSR

Concept not newEvolved over time“Doing Well, Doing Good”3 Ps (Profit, People, Planet)

Failure of CSR

Three factorsTriple Curse

Curse 1: Incremental CSR

Tackling social, environmental and ethical challenges

Fail on two counts: 1. Speed 2. Scale

Curse 1: Incremental CSR

Micro-scaleGradual improvementsNo impact on massive sustainability

crises

Curse 2: Peripheral CSR

Lack of top management commitmentPeripheral functionObsession with short-term financial measures Culture of greed embedded in DNA

Curse 3: Uneconomic CSR

Need for ‘business case’ Evidence CSR pays‘Inconvenient truth’ - sometimes pays

Solution 

BURYING THE PAST

CSR 1.0

OutdatedOutmoded Admit failure

CSR 1.0

Redefine contribution No serious impact on social,

environmental and ethical challenges

CSR 1.0

Beyond outmoded approach as philanthropy or public relations

More interactive, stakeholder-driven

CSR 2.0EMBRACING THE FUTURE

Principle 1: Creativity

‘Creative destruction’ “Cannot solve today’s problems with

yesterday’s thinking.”

Principle 1: Creativity

Business creativity directed to solving social and environmental problems

M-PESA Freeplay’s battery-free wind-up technology Social enterprise or Social business Age of Responsibility

Principle 2: Scalability

Shining pilot projects and best practice examples

No vision to transform core business CSR solutions cannot match scale and

urgency

Principle 2: Scalability

Not limited to retail sectorFinancial services - Grameen Bank -

from $74 loan in 1974 to $2.5 billion enterprise

Tata’s $2,500 Nano, cheap and eco-friendly car

Principle 3: Responsiveness

UncomfortableTransformative Industry or business part of solution or

part of problem

Principle 3: Responsiveness

Greater transparencyExchange platforms - connect directly

with beneficiaries via web, tapping ‘long tail of CSR’

Principle 4: Glocality

Global localization‘Think global, act local’ Local solutions without forsaking

universal principles

Principle 4: Glocality

Replaces ‘either/or’ with ‘both/and’ thinking

Harmonious society - dynamic productive tension of opposites – Tai Chi of CSR, balancing yin and yang

Principle 5: Circularity

‘Spaceship economy’ - verything constantly recycle

Three basic rules for sustainability: 1. Waste equals food2. Nature runs off current solar income3. Nature depends on diversity

Principle 5: Circularity

Replacing product-sales economy with service-lease model

Cradle to Cradle aspirationsCreate buildings like trees produce more

energy than they consume Purify own waste water

Principle 5: Circularity

Feeding and replenishing social and human capital

Importance of meaning in work and life

Shifts in CSR 1.0 to CSR 2.0

Table 2: Shifting CSR Practices

CSR 2.0

NEW DNA OF BUSINESS

CSR 2.0 Model

Corporate Sustainability and Responsibility’ ‘Sustainability’ (environmental) ‘Responsibility’ (social activist)

CSR 2.0 Model

Like two intertwined strands of DNASustainability and responsibility different yet

complementary

CSR 2.0 Model

Sustainability - destination - challenges, vision, strategy and goals

Responsibility - journey – solutions, responses, management and action

Corporate Sustainability & Responsibility (New CSR)

DNA of CSR 2.0

New holistic model of CSREssence - Four DNA Responsibility

Bases1. Value creation2. Good governance3. Societal contribution 4. Environmental integrity

DNA of CSR 2.0 (Double-Helix Model)

Value Creation

More than financial profitabilityGoal economic developmentBeneficial products Inclusive business

Good Governance

Institutional effectiveness as important as social and environmental ideals

Transparency - social media and brand or product-linked public databases

Societal Contribution

Philanthropy rightful placeFair labour practicesStakeholder engagement, community

participation and supply chain integrity

Environmental Integrity

Maintaining and improving ecosystem sustainability

Not gamble with climate change

CSR 2.0

Purpose of business: Serve societyProvision of safe, high quality products

and services Enhance wellbeing, without erosion of

ecological and community life-support systems

CSR 2.0

Positive contribution to societyNot as marginal afterthoughtWay of business!

Evolution from CSR 1.0 to CSR 2.0

Five actions

1. Re-assess2. Re-align3. Re-define4. Re-design5. Re-structure

Embrace Responsible Capitalism

Investment Long termismTransparency Full cost accounting Inclusion

Today

Exciting timesNew model of sustainable business Purpose-inspired business

Sustainable Future

Pick it up Push forwardBelieve in what we are buildingNew form of business - serves society and sustain

planet