A Strategic Approach to CSR

The European Commission has played a leading role in the development of public policy to advance CSR ever since its 2001 Green Paper and the establishment of the European Multi-Stakeholder Forum on CSR. In 2006 the Commission launched the European Alliance for CSR as its new policy.

A strategic approach to CSR is significant for enterprise competitiveness. According to the European Commission, the benefits that accrue from such an approach to CSR include risk management, cost savings, access to capital, customer relationships, human resource management, and innovation capacity.³⁶ Bhattacharyya (2010) drew on the CSR and strategic management literature and proposed a set of screens that would identify CSR programs that make business sense from among those that do not. Managers would be able to design strategic CSR programs based on its focus and direction, proactiveness, activity nature, characteristics, and benefits.

The EU’s treaty aims of sustainable development and a highly competitive social market economy can benefit significantly from the CSR of enterprises. CSR is the linchpin of the EU’s 2020 strategy for smart, sustainable, and inclusive growth, including the target for 75 percent employment. Responsible business behavior is especially important when private sector operators provide public services. Helping to ameliorate the social effects of the current economic crisis, including job losses, is part of the enterprise’s SR. CSR provides a set of values on which to build a more cohesive society and on which to base the change to a sustainable economic system. A prerequisite for meeting that responsibility is respect for applicable legislation and for social partners’ collective agreements.

For companies seeking a formal approach to CSR, especially large corporations, authoritative guidance is provided by internationally recognized principles and guidelines, such as the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises (MNEs), the 10 principles of the United Nations Global Compact, the United Nations Guiding Principles on Business and Human Rights, the ISO 26000 Guidance Standard on Social Responsibility, and the International Labour Organization Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy. To illustrate, the OECD (2011, 47) guidelines for MNEs acknowledge that enterprises “should not directly or indirectly, offer, promise, give, or demand a bribe or other undue advantage to obtain or retain business or other improper advantage” nor should enterprises be solicited or expected to render a bribe or other undue advantage.