The Carbon Border Adjustment Mechanism (CBAM)
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In this article we’ll explore what the CBAM is, why it’s been created, and what importers need to know ahead of its introduction.
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4 Pitfalls to Avoid For an Effective CSR Policy
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A CSR policy is becoming essential for any business looking to become more sustainable and to comply with upcoming environmental regulations – but how can companies avoid the 4 main pitfalls when developing their CSR policy?
Ultimately, a CSR Policy helps companies to demonstrate their commitment to environmental reform, ethical practices, and local support. This means if a CSR policy isn’t written well, it can rub investors and customers the wrong way.
In this article, we’ll share the best practices to write an effective CSR policy and the 4 pitfalls to avoid.
What is included in a CSR Policy?
A CSR policy includes various statements on behalf of a company on how they plan to rectify various environmental and social injustices occurring in the world.
“ What is included in a CSR policy will depend on the company’s individual goals and values in terms of emission reductions or fighting against inequality. ”
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Here are some specific examples of what may be included in a CSR policy:
- Efforts to reduce global hunger and food insecurity
- Efforts to improve the current healthcare policies in the local area
- Efforts to provide safe drinking water or reduce water usage
- Efforts to offer free scholarships or training sessions to students and employees
👉 Ultimately, the main goal of a CSR policy is to hold companies accountable to their actions and inspire them to reduce the negative impact they may have on society via their economic, environmental, and social activities.
How do you write a CSR Policy?
Your company can write a CSR policy after thoughtful consideration of the environmental goals to be achieved and the social responsibilities to be rectified. Essentially, a CSR policy should serve as a “study guide” for your employees – clearly delineating all of the environmental and social factors your company should be held responsible for.
“ Seeing as a CSR policy refers to a set of ethical guidelines for your company to follow, it is important for your CSR policy to be clear and approachable in order to ensure those goals can be met. ”
A good CSR policy should include the following:
- Rules in line with customer feedback
- Policies which will work to bridge the gap between underprivileged and privileged workers
- Help to support customers under various situations such as during a natural disaster when financial resources are sparse
- Explanations on how supply chains will be better organized in order to reduce environmental impact or improve efficiency
When writing your company’s CSR policy, it is important to determine which areas make your company the most unique and how you can draft a CSR policy that will naturally align with your already existing mission statement.
Therefore, it’s important to look to other big companies which have already drafted and implemented their CSR policies for inspiration – as well as to take the values of your employees, customers, and stakeholders into account. This ensures that your company will draft a CSR policy that will be beneficial for everyone.
👉 Additional areas to be considered in an effective CSR include efforts to reduce carbon emissions, use renewable energy sources, volunteering programs, sustainable packaging, and human rights and safety.
What are the 4 pitfalls to avoid in CSR Policy?
There are 4 main pitfalls to avoid in a CSR policy: writing a CSR policy to never be implemented, not communicating the CSR policy across the company, only drafting a CSR policy for show, and ignoring the use of digital technology.
It’s important to avoid these 4 main pitfalls in your CSR policy to avoid greenwashing accusations on behalf of your customers, investors, or even employees.
For instance, Monsanto presented Roundup as a biodegradable product, Coca-Cola repainted its cans in green and H&M created a vaguely eco-sounding collection.
“ Nowadays, these superficial actions are inevitably called out by increasingly seasoned and ecologically aware consumers. In other words, companies can't boast about CSR like they used to anymore! ”
Nevertheless, it is now essential for companies to adopt a sustainable approach, whether start-ups or large corporations, if they want to avoid alienating their consumers. And for good reason: customers are increasingly influenced by the practical commitments made by brands, from the sourcing of raw materials to carbon offsetting, to inclusiveness and transparency. So, how do you ensure that you have implemented a truly effective CSR policy that is recognized as such?
Let’s consider some of the pitfalls to avoid for companies thinking about implementing a CSR policy.
Avoiding these 4 main pitfalls in a CSR policy is paramount to ensure your company doesn’t fall subject to accusations such as greenwashing.
👉 Objective: to avoid making wild claims and to implement genuinely sustainable measures.
Pitfall 1: Not implementing a CSR policy
Yes, it’s as simple as that! It may surprise you, but many organizations still make this mistake, especially major corporations.
With the majority founded in the 20th century, large companies and groups are often stuck in rigid (and sometimes outdated!) management and ecological practices, which are difficult to alter and align with the expectations of today’s employees and consumers.
At first glance, the strategies available to these companies may seem limited compared to those of smaller, newer and more agile structures. However, the introduction of a CSR policy within large groups will be all the more beneficial if it makes a major impact in line with the scope of the company’s operations, and it is likely to bring about a more significant change in society.
A CSR policy should be implemented for social or ecological reasons, and neglecting to do so is never a good idea. This was demonstrated by a study published by Oney and OpinionWay which examined consumer behavior in France, Spain, Portugal and Hungary. It reported that 90% of respondents expect retailers to be committed to social engagement.
In the age of global warming, minimalism, questioning the status quo and the trend for second-hand goods, consumers take into account not only the commercial cost of each purchase but also the ecological cost.
These findings are supported by a report published by the Capgemini Research Institute analyzing brand’s sustainability initiatives and their impact on consumers’ buying behavior and expectations. The report highlights the growing importance of sustainability as a key driver for consumers:
79% of consumers are changing their purchase preferences based on social responsibility, inclusiveness or environmental impact. 67% of consumers said that they will be more cautious about the scarcity of natural resources due to the COVID-19 crisis and 65% said that they will be more mindful about the impact of their overall consumption following the health crisis.
The survey found that, at present, concerns about sustainability are affecting the purchasing behavior of more than half of the population: 53% of consumers overall and 57% of consumers in the 18–24 age group have switched to lesser-known brands if they are sustainable. More than half (52%) of consumers say that they share an emotional connection with products or organizations that they perceive as sustainable.
Pitfall 2: Not communicating across all levels of the company
In order to implement an effective CSR policy, it is important to communicate with all the company’s stakeholders. To this end, the department responsible for developing CSR should take the opportunity to attract and build loyalty among the company's employees. Employees working for companies that have set up a CSR department are more inclined to stay with the company in the long term.
According to a study conducted in 2019 by HelloWork, 40% of recruiters think that candidates are more demanding than before. And the same is true for almost two thirds of respondents to the survey “Le regard des Français et leur Appropriation de la RSE” (French People’s Views and Adoption of CSR).
A company's CSR policy is undoubtedly a key criterion when it comes to applying to an organization, especially for younger people. These results were corroborated by the barometer published in 2019 by MEDEF, which stipulates that CSR is now essential for half of employees, and their performance and commitment improves in correlation with the sustainable policies adopted.
Pitfall 3: Getting involved in CSR for the sake of appearances
Greenwashing, otherwise known as when companies use false ecological claims to promote a brand and make it appear more eco-friendly in the eyes of the public – is no longer an option.
Not only is greenwashing easily identified by increasingly suspicious consumers, it has also been criticized by ARPP (French Advertising Self-Regulatory Organization), ADEME and the National Assembly, which in 2019 adopted an amendment banning the terms “biodegradable” and “environmentally friendly” on packaging.
Similarly, CSR-washing no longer fools anyone. So, rather than extolling empty measures (the use of green products by a company that is not green, suggestive images, misleading slogans or green jargon etc.), companies must provide transparent, accurate, quantifiable and verifiable data on their operations. To ensure that the actions taken are legitimate, reference should be made to certain internationally recognised standards: ISO 26000 (sustainable development), ISO 14001 (environment) and the SA 8000 standard (working conditions).
💡A tip from Greenly: The most effective way for a company to demonstrate its ecological commitment is still to reference an internationally-recognised and certifiable methodology, such as the carbon assessment. Along the same lines, obtaining certain labels, such as the B-Corp Label, proves the authenticity of the actions implemented. Another tool that can be used is the Pacte Law of 22 May 2019, which gives companies the right to declare a “purpose” defining their mission in a way that goes beyond simple profit making.
Pitfall 4: Not including digital technology in the CSR policy
It is important to remember that the digital sector is not an ethereal, abstract concept – it is embodied through a series of highly energy-intensive physical structures which generate significant greenhouse gas (GHG) emissions.
The sector is estimated to be responsible for 3.7% of total GHG emissions and 4.2% of global primary energy consumption. I
In France, the digital sector accounted for 2% of total emissions in 2019 alone!
According to studies carried out by INSEE and the think tank The Shift Project, 44% of the digital carbon footprint can be attributed to manufacturing computer terminals, IT centers and networks, and 56% can be attributed to their use, which ranges from sending emails to watching videos. Therefore, reducing this carbon footprint must also involve consolidating a company’s mobile phone fleet and its use.
Furthermore, aligning the use of technology with your CSR policy means carefully considering certain issues, such as data security and respect for consumer privacy, as well as all associated tools such as internal use and artificial intelligence. For example, in its 2019 CSR report, Microsoft set out some principles to guide sound and responsible AI development and use: fairness, inclusiveness, reliability, transparency, privacy, and accountability.
In short, they represent simple common sense, but this can sometimes be sorely lacking.
Overall, a good CSR policy is imperative for the future sustainability and success – but it’s important to avoid these 4 mistakes in the process of writing your company’s CSR policy.
What About Greenly?
If reading this article about the 4 pitfalls to avoid for an effective CSR policy has made you interested in reducing your carbon emissions to further fight against climate change – Greenly can help you!
It can be challenging to implement initiatives such as CSR into your business, but don’t worry z- Greenly is here to help. Click here to schedule a demo to see how Greenly can help you find ways to improve energy efficiency and decrease the dependency on fossil fuels in your own company.
Greenly can help you make an environmental change for the better, starting with a carbon footprint assessment to know how much carbon emissions your company produces.
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