Category Archives: Sustainability Governance & Management

CSR – An Opportunity for Lawyers to Do Good and Be Well

The legal profession is much maligned in the business community and in society in general, and many lawyers complain of deep dissatisfaction with their choice of career and the day-to-day tasks associated with their roles in the legal system.  Proactively participating in environmental and social responsibility initiatives, either as individual lawyer and as law firm team members or by assisting clients, is a real opportunity for attorneys to change their lives and the communities in which they practice in a positive and impactful manner.  Many attorneys entered law school with the goal of acquiring the tools necessary to help those who needed support from others and, in some small way, to “change the world”.  For those who may have lost their way, for whatever reason, or are looking for ways to do more, corporate social responsibility (CSR) is a welcome and promising platform and this post discusses the various roles that lawyers can play in CSR planning, governance, management and implementation.

While CSR is often described as “going beyond the law”, a good deal of the work relating to social and environmental responsibility involves understanding how to comply with existing laws and regulations and planning for and addressing the risks of misbehaviors in areas generally associated with CSR and sustainability such as human rights and child labor issues in the supply chain, discrimination in the workplace, health and safety issues, environmental practices, and cybersecurity and privacy.  As such, the legal department, particularly the general counsel, has a significant role to play in developing and implementing the CSR and sustainability initiatives of any organization.   The legal department is also a natural contributor to organizational efforts to comply with voluntary standards, some of which will inevitably become hard law, and an experience guide on questions of materiality that arise as organizations expand their disclosure and reporting activities to include social and environmental goals and performance.

Individual attorneys, in-house legal departments and law firms can be affected by CSR in several ways.  First of all, all attorneys, regardless of whether they work on their own or for an organization, are subject to various professional ethics codes with respect to the work that they perform on behalf of their clients and the role that they play in the justice system.  Second, lawyers may be requested by clients as suppliers of services to submit themselves to the client’s CSR policy.  For in-house lawyers this means formally acknowledging and agreeing to the code of conduct and other CSR-related policies of their employers.  Prospective candidates for law firm positions are increasingly asking firms about their own CSR policies (e.g., in areas such as diversity and work-life balance) and activities and those of the clients that have the most substantial economic impact on the firm.  Third, lawyers can receive requests from their clients for advice on development and implementation of CSR and overall compliance plans and, in fact, compliance is an area of CSR in which lawyers are already heavily involved on a day-to-day basis.  Fourth, lawyers are often asked to assist client in performing audits to verify compliance.  Finally, lawyers, either on their own or as part of a group (i.e., other lawyers from their in-house legal department or law firm or legal colleagues from a bar association), may engage in activities intended to have an environmental and/or social impact such as provide pro bono legal services to client otherwise unable to afford a lawyer who have claims based on a violation of their human rights or damage to health and/or property due to environmentally irresponsible actions of others.[1]

Even if a lawyer is not engaged directly in some sort of CSR-related activity, he or she needs to be aware of the role that environmental and social activists are playing in the marketplaces in which their clients are operating and be able to counsel their clients on the litigation and reputational risks associated with failing to adhere to CSR norms and practices.  Lawyers must be familiar with the impact that CSR is having on the type and magnitude of claims based on the negligence of their client, such as the willingness of judges and juries to impose substantial economic sanctions on defendants found to have caused injuries to people and damage to properties due to failure to take their environmental and/or social responsibilities seriously.  Transactional lawyers must be mindful of the impact that development projects and acquisitions may have on local communities and counsel their clients on the social aspects of consolidation of workforces and making changes to workplace practices and benefits.  Lawyers should also expect to be involved in corporate governance and counseling boards about the role that sustainability plays in their oversight responsibilities; monitoring the activities of supply chain partners; and crisis management in the event that a client, either recklessly or accidently, engages in activities that cause harmful environmental and/or social impact.  All of this flows from the growing belief that companies are more than just legal entities and are citizens of the world in which they operate with duties and responsibilities to others and vulnerability to being held financially and criminally accountable for poor citizenship.

Vernon described some of the ways that individual attorneys as well as entire groups within corporate legal departments may become involved in counseling on CSR matters and the manner and consequences of stakeholder engagement.  He noted that attorneys are often called upon to advise their clients on internal policies and procedures, external policies and procedures, supplier contracts, gover­nance, compliance, public relations and contractual obligations with various business partners and each of these are areas in which CSR issues and obligations may be relevant.  Examples may include consulting on the potential impact from a compliance perspective of adoption of a new human rights policy applicable to the company’s own facilities and the facilities of its supply chain partners around the world; advising on the compliance and transparency obligations that would come from the adoption of a corporate-wide wa­ter stewardship policy; and reviewing proposed sustainability reporting to be initiated as part of the company’s efforts to demonstrate more transparency.[2]

A June 2015 publication prepared under the auspices of the UN Global Compact included the following recommendations for general counsels with respect to their role in the corporate sustainability initiatives of their organizations[3]:

  • Embrace the breadth of the role: Reflect on key drivers of change; create “heat” map of drivers against corporate strategy; identify and assess gaps and trends; and develop “legal model” change plan based on corporate priorities
  • Prioritize sustainability: Mirror corporate emphasis on sustainability within strategic priorities for legal; regularize on your agenda; and commit financial and human resources to capacity-build within legal
  • Communicate expectations to third party advisers: Communicate to external advisers about your strategic priorities; reinforce your expectations about the support and engagement needed from them; have an open dialogue about strengths and weaknesses; and discuss specific changes in approach and team
  • Build internal credibility: Create legal SWOT (“strengths, weaknesses, opportunities and threats”) with business and sustainability experts; agree on areas of focus for legal with the business; agree on plan of engagement for legal with relevant constituencies’ operations; and formally reassess progress with business periodically to underscore engagement
  • Redefine career path for legal: Articulate that an increased focus on corporate sustainability is key to career development given underlying trends; and assess progress annually and communicate as part of core role
  • Establish KPIs and rewards: Tie sustainability KPIs to team taking a “broadened” role and engagement; agree objective and subjective elements with business and team; create financial and nonfinancial incentives;
  • Create integrated objectives with business units: Objectives for cross-functional teams should be integrated into annual performance assessment of legal team members
  • Drive change from the top: Proactively engage with C-Suite/Board on sustainability issues; communicate strategic importance of corporate sustainability with legal team
  • Peer-to-peer engagement: Discuss the drivers of change and broadened role with other GCs or “C-Suite” executives; discuss approaches to driving corporate sustainability from legal, including through the use of KPIs; capture and share best practices
  • Embed within legal strategy: Identify aspects of key sustainability issues where legal can engage; embed points of engagement on corporate sustainability within legal department strategy/objectives
  • Engage with third parties: Engage with NGOs to develop expertise and credibility; set the tone within legal that “balanced engagement” is a key corporate strategy; and encourage legal team to be part of stakeholder engagement strategy from earliest stages
  • Communicate initiatives and engagement regularly: Regularize reporting to GC on sustainability/engagement issues; communicate efforts/initiatives of legal team periodically; and use both formal and informal mechanisms to communicate
  • Build familiarity in legal team: Dedicate legal resources to corporate sustainability issues; regularize internal engagement on sustainability issues; focus on practical application of “traditional” legal skills; and engage in skills development and training
  • Build cross-functional teams: Embed legal expertise in key areas; encourage early and regularized engagement by legal team; elevate issues/developments across internal “silos”; and periodic “progress” reports to GC/legal team

For further discussion see Sustainability Governance and Management.

Notes

[1] Adapted from Corporate Social Responsibility and the Role of the Legal Profession: A Guide for European Lawyers (Council of Bars and Law Societies of Europe, June 2008).

[2] K. Vernon, “Corporate Social Responsibility: Stakeholder Engagement: Opportunity for Business to Thrive?”, Business Law Today (January 2015).

[3] Guide for General Counsel on Corporate Sustainability (UN Global Compact and Linklaters LLP, June 2015).  See also Corporate Social Responsibility and the Role of the Legal Profession: A Guide for European Lawyers (Council of Bars and Law Societies of Europe, June 2008).

Structures and Staffing for Environmental, Health and Safety

In 2012 the National Association for Environmental Management (“NAEM”) issued a report on the results of a survey of the organizational structure, staffing levels and responsibilities of the function that supported a company’s environmental, health and safety (“EHS”) and sustainability goals.[1]  The survey consisted of online questionnaires to full time, “in house” corporate EHS and sustainability professionals and qualitative interviews with senior EHS and sustainability leaders across different industries.  The results reflect the views of 199 senior leaders (i.e., managers, directors and vice presidents) working within combined EHS and sustainability functions at U.S.-based companies with revenues ranging from $250 million to $50 billion.  Among the key findings described in the executive summary to the report were the following:

  • Most of the respondents managed EHS through a single consolidated, centralized function. Two-thirds of respondents reported a governance structure that centralized authority and policies, and one-third also incorporated a centralized budget process.
  • The function generally reported into one of several core areas: legal, operations, human resources or the C-Suite.
  • While there were multiple approaches to organizing the EHS function, the most common department structure tended to be one that integrated EHS at the corporate and facility levels.
  • Staff levels were driven largely by perceived EHS risk, industry and structure. Companies that identified as operating under a high degree of EHS risk (e.g., companies in the utilities, extractives and chemicals industries) tended to have larger staff sizes. Decentralized structures tended to require higher staff levels per total employees, as did small and mid-sized companies; however, companies with higher revenues reported fewer EHS staff per total employees.
  • EHS budgets (normalized by total employees) were largely driven by employee needs such as salaries, benefits, expenses and travel. Because of this interdependence, the same factors that influence staff levels also influenced budgeting.  In other words, high-risk companies, or those with decentralized EHS structures, tended to have more staff and therefore, larger budgets.
  • EHS and sustainability professionals were highly credentialed, seasoned leaders with 79% of the respondents having worked in the field more than 15 years and strong backgrounds in science or engineering.
  • The EHS function generally took the lead in regulatory compliance, auditing and information management and was primarily responsible for setting environmental goals, waste management, pollution prevention, regulatory tracking/compliance/disclosure and due diligence.[2] Data management and EHS management information systems were also key areas of responsibility, likely driven by the growth in external reporting of environmental metrics.
  • EHS professionals also played a key role in sustainability and respondents indicated that the EHS function either led, or shared responsibility for, the majority of activities including establishing sustainability strategy and tracking and reporting the sustainability metrics.
  • Most of respondents reported they were managing sustainability through a cross-functional team with members drawn from corporate communications, operations, legal sales and marketing and EHS. These teams were most often led by the EHS function or a combined EHS and sustainability function. When sustainability was assigned to a stand-alone department, EHS was most often in the lead, followed by stand-alone sustainability department.

In the summer of 2014 NAEM conducted an online survey to identify the skills, knowledge areas and attributes for members of the EHS and sustainability profession.[3]  NAEM collected information from 345 respondents at 197 different companies.  Most of the companies were operating globally and the three most represented industry sectors were manufacturing, pharmaceutical/medical products and chemical.  A majority of the respondents had at least 15 years of professional and EHS experience and respondents tended to be at the leadership level (7% were executive leaders at the vice president level, 22% were at the senior director/director level and 13% were senior managers).  EHS professionals generally were placed in the corporate function as opposed to acting from a site/facility or business unit and most of the respondents worked in a combined EHS or EHS/Sustainability function as opposed to working in an organizational structure in which environmental, safety and/or sustainability issues and activities were treated as stand-alone functions.  Use of a combined function was notable in that illustrated that companies were concerned that stand-alone groups might compete with one another for resources and/or promote conflicting policies.

NAEM found that compliance was a core focus for EHS leaders at all levels, regardless of the size of the company.  The list of the top responsibilities of the respondents, including areas where they took the lead and areas in which they played a role as a strong collaborator, including the following:

Reporting to meet internal and external requirements 91%
Environmental compliance 88%
EHS management information systems 86%
Regulatory tracking 86%
Auditing 84%
Setting EHS goals 84%
Waste disposal 81%
Chemical management 81%
Hazardous materials 80%
Waste recycling 79%
Information management 79%

The survey asked EHS leaders to identify the activities in which they generally acted as leaders and assumed direct and/or shared responsibility and other activities in which they were involved without having responsibility.  The results indicated that while EHS leaders were accountable for a set of core compliance and pollution prevention programs (e.g., reporting to meet internal and external requirements; EHS management information systems; environmental compliance; regulatory tracking and setting EHS goals), they were also involved with, collaborated on, or influenced the management of a broad range of activities within their organizations including employee engagement, emergency management preparedness, corporate annual reports, risk management, supply chain engagement and building energy efficiency.

One of the interesting outputs of the survey was a set of descriptions of the roles and responsibilities of EHS professionals at various levels of their career progression.  In general, the information confirmed that as EHS professional advanced their roles became more strategic:

Level Top Responsibilities

 

Specialist Environmental compliance, Reporting, EHS management information systems, Information management, Regulatory tracking
Technical Expert Reporting, Environmental compliance, Regulatory tracking, EHS management information systems, Auditing
Manager Reporting, Environmental compliance, EHS management information systems, Auditing, Setting goals, Identifying KPIs, Regulatory tracking
Sr. Technical Expert Reporting, Regulatory tracking, Auditing, Environmental Compliance, EHS management information systems, Permitting
Sr. Manager Setting goals, EHS management information systems, Reporting, Regulatory tracking, Identifying KPIs, EHS audit training, Auditing
Director Setting goals, Identifying KPIs, EHS management information systems, Regulatory tracking, Auditing Reporting
Executive Leader Identifying KPIs, EHS management information systems, Setting goals, Due diligence

The survey was also an opportunity to explore the skills, knowledge and other competencies that EHS professionals should expect to have to develop in order to be successful and advance.  EHS professionals must not only be knowledgeable about business operations but must also have the interpersonal skills necessary for managing people and processes and being successful as an integrator and influencer including the ability to team build, motivate others and manage without authority. Other important business skills included written communications, interpreting regulatory requirements, oral communications, decision making, program and project management and training.  The most important areas of general and technical knowledge for EHS professional included EHS risks, regulatory compliance systems, waste management, training, environmental science, communications, management systems and budgeting.  As for business acumen, EHS professionals needed to demonstrate knowledge across a number of areas including training, communications, budgeting and business operations and the presenters of the survey results noted that these skills were consistent with the core EHS responsibilities associated with creating a strong EHS culture, communicating its value across silos and collaborating across functions to embed EHS principles into business operations.

Another important issue with respect to the competencies and roles of EHS responsibilities is how they were integrated into the organization’s overall strategies and processes with respect to risk management.[4]  Traditionally organizations have created and maintained separate departments for EHS and risk management and while professionals in each of the departments share many of the same goals there have often been breakdowns in their ability to work together.  For example, risk managers typically see EHS professionals as being a subdivision of the risk management department whose job is limited to compliance (i.e., doing inspections/audits, accident investigations and focused on employee safety) while EHS professionals downplay the role of risk managers as simply being the purchasers and administrators of insurance.  The problem with this situation is that the organization needs to maintain two different budgets and personnel groups, which is inefficient and expensive, and management is confused about the value and purpose of each of the departments.

The solution to the dilemma posited above lies in the transition from the traditional roles of EHS and risk management to a more comprehensive solution referred to as enterprise risk management (“ERM”).  The scope of ERM is enabling all strategic, management and operational tasks of an organization throughout projects, functions, and processes to be aligned to a common set of risk management objectives.  EHS professionals can contribute to this process through their skills with respect to the recognition, evaluation and control of environmental factors or stresses, arising in and from the workplace, which may cause sickness, impaired health and wellbeing or significant discomfort and inefficiency among workers and/or citizens of the community.[5]  At the same time, risk managers can provide their expertise in making and implementing decisions that will minimize the adverse effects of accidental and business losses on an organization.[6]  However, in order for the collaboration to be effective, EHS professionals need to have a new job description that not only includes providing professional knowledge and expertise in the administration, integration, and support of environmental health and safety programs at all levels of the organization, but also working in coordination with risk managers to develop environmental health and safety programs that reduce hazard, financial, operational, strategic, reputational, and compliance risks in support of the strategic objectives and mission of the organization.

For further discussion see the Sustainable Entrepreneurship Project’s materials on Sustainability Governance and Management.

[1] National Association for Environmental Management, EHS & Sustainability Staffing and Structure: Benchmark Report (November 2012).

[2] Specific environmental management areas mentioned in the survey included EPA compliance, hazardous materials, waste disposal, spill prevention/control, permitting, air pollution, storm water, waste recycling, chemical management, carbon foot printing, site remediation and industrial emissions reductions.

[3] The discussion of the results of the survey included herein is adapted from Key Competencies for the EHS & Sustainability Profession: Benchmark Report (NAEM, February 12, 2015).

[4] The discussion in this paragraph and the paragraph immediately below is adapted from Risk Managers are from Mars, EHS Professionals are from Venus: The EHS Professionals’ Role in ERM (California State University Risk Management Authority).

[5] Id. (citing NSC, Fundamentals of Industrial Hygiene, 3rd Edition)

[6] Id. (citing Fundamentals of Risk Management, 3rd Edition, Volume 1)

What’s a Chief Sustainability Officer?

We have previously discussed the role and responsibilities of chief responsibility officers; however, many companies refer to that position as the chief sustainability officer, or CSO.  In a 2007 White Paper on the changing role of the CSO, Heidrick & Struggles noted that for many years the primary role of a company’s chief environmental, health and safety (“EHS”) leader was to handle audit and compliance matters and interact mainly with permit writers, safety inspectors and low-level compliance staff at regulatory agencies.  However, as companies had come to understand the crucial role that EHS performance played in overall company performance they had begun to recognize that EHS could no longer be treated as a cost center but instead should be regarded as an important strategic asset that could easily become a significant liability if not properly managed.[1]  As such, Heidrick and Struggles found that companies were changing their organizational structures to move away from the traditional practice of having the CSO report into Legal or Human Resources toward a new alignment in which the CSO reported directly to the CEO and interacted regularly with other members of the senior executive team as a peer.[2]  The CSO was also being expected to communicate directly with board members, another sign that the position was regarded as being an important driver of company growth and performance and an architect of overall company strategy.

Heidrick & Struggles cited a range of pressures and sources that were forcing companies to take a new look at how their EHS and sustainability activities were managed including aggressive governmental enforcement activities in the US and in the European Union, financial and legal considerations, concerns about climate change and energy costs and availability, the need to develop new technologies to address environmental challenges and intensified scrutiny from public interest groups and the media into sustainability practices generally and oversight of environmental and social matters in supply chains specifically.  Companies also had to address the emergence of numerous guidelines and reporting standards for sustainability and social responsibility that were changing the expectations of stakeholders regarding corporate performance and communications.  While at first many companies were reacting to changes in their environment as opposed to taking the initiative to transform their businesses to take into account sustainability, most eventually began to appreciate significant business benefits such as enhanced brand, preservation and enhancement of reputation, decreased costs, protection of assets, increased efficiency and competitive advantage.[3]

Creating a list of necessary competencies for an effective CSO, Heidrick & Struggles began with the ability to think strategically, which was described as the ability to look toward the horizon, identify an opportunity or challenge before it affects the company, and develop and implement a strategy to either take advantage of the opportunity or manage the challenge.  Particular attention was given to the creation of business opportunities by the CSO, a marked shift from focusing primarily on prevention, mitigation and compliance.  For example, the CSO can proactively seek out technological solutions to environmental problems that simultaneously reduce costs and improve productivity, a true “shared value” proposition.  A second key competency for the CSO identified by Heidrick & Struggles was the ability to communicate effectively and translate complex technical concepts and strategies into terms that resonated with the company’s top leadership and key constituencies (i.e., employees, investors, lenders, insurers, rating agencies, customers, suppliers, the media and the public).  When communicating the CSO needed to be able to adapt his or her tone and approach to a wide range of audiences ranging from the CEO, directors and regulators to each of the employees who would be called upon to change their skills and behaviors in order to execute the sustainability strategy.[4]

While strategic and communication skills were at the top of the competency list, Heidrick & Struggles pointed out that the CSO must also have or quickly develop a a wide range of interdisciplinary and cross-functional competencies, including the following[5]:

  • Ability to hire, lead, develop, and inspire a diverse staff and to develop trusting relationships with a variety of company constituents before an issue becomes a problem.
  • A solid grounding in a wide range of EHS requirements, processes, procedures, technologies, and, depending upon the scope of the operation, familiarity with these issues at the local, state, federal, regional, and international levels.
  • A knowledge of financial operations that extends beyond budgeting to include project financing, corporate finance, an understanding of how finance intersects with EHS and sustainability, and the ability to make a business case for a new direction.
  • Knowledge of the company’s processes, products, technologies and business processes coupled with the ability to manage EHS systems within the company and the ability to assess and audit those systems with vendors, suppliers, and distributors.
  • Familiarity with technological and process advances and an understanding of the trends in EHS and the influences on the company and the industry segment.
  • Ability to communicate with community leaders and activists and to communicate with the media in a crisis.
  • Ability to develop and manage a marketing campaign related to the EHS and sustainability aspects of the company’s performance, products, or liability.

Heidrick & Struggles reported on the important role that the CSO can play with respect to development and implementation of EHS and sustainability strategies and policies.  For example, one of the companies described in the White Paper explicitly integrated EHS and CSR and created a Corporate Social Responsibility Council that included the company’s equivalent to the CSO position, the CEO, two of the company’s ten business unit managers, the Chief Technology Officer, Chief Strategy Officer, Director of Human Resources, Director of Communications, and the Marketing Manager.  The Council met several times a year to set and evaluate the company’s EHS and CSR policies and the CSO was responsible for ensuring that those policies were understood and implemented throughout the organization through an extensive network of some 200 EHS managers.  In order for this type of structure to work, the CSO must have a clear understanding of how things work throughout the organization and the skills to participate in the design of appropriate management systems so that information can flow upward and downward and be available for use in reporting to directors, the CEO and other members of the executive team and the company’s stakeholders.

Comments from various interviews with CSOs included in the White Paper emphasized the important of the CSO being able to drive employee engagement through his or her vision, communication skills and demonstrated enthusiasm.  As a promoter of significant change throughout the organization the CSO must be able to understand human nature and behavior, build trust, forge alliances and facilitate collaboration among people, departments and external stakeholders.  Also, since sustainability challenges cannot be tackled and resolved by any one company, the CSO must be able to work effectively with broader initiatives focusing on particularly environmental and social issues, perhaps assuming a leadership position in those initiatives, and convince other companies in the same industry to stand down from their day-to-day competitive views of one another and develop appropriate new standards that would benefit them and their customers and employees and fend off regulatory intrusion.  In that regard, Heidrick & Struggles reported that CSOs were serving on senior-level advisory groups and associations aimed at influencing public policy developments and regulations or dealing proactively with specific challenges to their particular industry or value chain as a whole.[6]

[1] A. Luijkenaar and K. Spinley, The Emergence of the Chief Sustainability Officer: From Compliance Manager to Business Partner (Heidrick & Struggles International, 2007).

[2] Heidrick & Struggles found that many companies were expanding EHS, areas which had already been combined for a number of years, to include sustainability and corporate social responsibility and referring to the leader of activities in the expanded area as the CSO.  Id. at 3.

[3] Id. at 6-7.

[4] Id. at 9.

[5] Id. at 10.

[6] Id. at 3.

For further discussion see Strategic Planning for Sustainability prepared and distributed by the Sustainable Entrepreneurship Project.

What’s a Chief Responsibility Officer?

Rangan et al. argued that well-managed CSR creates social and environmental value, while supporting a company’s business objectives and reducing operating costs, and enhancing relationships with key stakeholders and customers.[1]  Rangan et al. joined others in recommending that companies establish an independent full-time position to oversee CSR and sustainability (they referred to this position as the “Chief Responsibility Officer” (“CRO”)) and who would have access to the CEO and input into the company’s business strategy.  Rangan et al. emphasized that it was important for the CRO to hold that position as his or her primary responsibility, noting that too many companies delegated CSR oversight responsibilities to human resources or operations managers who were only able to devote a portion of their time to that job while continue to spend most of their time on their day-to-day line responsibilities.

The CRO should be given the resources to do his or her job in the form of a dedicated CSR unit that would be formally and publicly tasked with coordinating and integrating CSR initiatives across the organization, even if responsibility for implementation of the various initiatives remains dispersed throughout the company.  While the CRO cannot attend every planning meeting or event, representatives of the unit can be knowledgeable participants for each program including have decision rights in the design and execution of programs.  The knowledge collected from the activities of the CSR unit will allow the CRO to elevate strategic CSR topics and priorities to the highest levels within the organization quickly and effectively.[2]  Rangan et al. conceded that coordinating a company’s CSR initiatives in a strategic manner is a challenging task given that companies may be engaged in a diverse set of programs that include philanthropy, value chain activities and wholesale business transformation that may be driven and led by a range of actors including community affairs managers, operations managers and members of the executive team.

Rangan et al. pointed out that having CSR represented in the C-suite serves as a catalyst for the strong leadership and support for CSR initiatives that must emanate from the senior executive team in order for those initiatives to capture the imagination and energy of employees and other stakeholders.  The CRO should be sure that CSR is taken into account when business strategy is being discussed and established in the boardroom and in meetings among senior executives and should take the lead in communicating with operations managers about how budgets and performance metrics for particular programs have been established taking into account CSR priorities.  The CRO should also join the CEO in engaging with stakeholder groups to explain the company’s CSR strategy and obtain feedback and address concerns.  Finally, the CRO should be responsible for ensuring that the company adheres to the continuous process of auditing and evaluating its CSR activities necessary for a coherent and effective CSR strategy.

[1] K. Rangan, L. Chase and S. Karim, Why Every Company Needs a CSR Strategy and How to Build It (Cambridge MA: Harvard Business School Working Paper 12-088, April 5, 2012), 21.

[2] Id. at 21-22.

For further discussion of the model proposed by Rangan et al. for developing a CSR strategy, see Strategic Planning for Sustainability prepared and distributed by the Sustainable Entrepreneurship Project.