Denise Bester: Clean image becoming pivotal for cleaning up

Opinion

Every organisation must assume responsibility for its impact on employees, the environment, customers, and whomever and whatever it touches. That is social (and environmental) responsibility. - Peter Drucker, International Business Expert.

With business now the world's most powerful institution, it has a key position in determining the quality of our future. Corporate social and environmental responsibility (CSR) is the philosophy asserting that businesses should be responsible for the entire life cycle of their product or service, and everyone and everything it has an impact upon. Not just their bottom-line.

And being a "good corporate citizen" is not the only reason to take CSR seriously. For a substantial large and increasing number of consumers, environmental and social considerations are as important as price and quality.

The argument often used against CSR is that doing "good" business will mean a shortfall in profit. However, business performance indexes such as the Domini Social Index in the US show that companies are able to do business ethically as well as profitably. In fact, ethical investment has been growing exponentially over the last decade in Europe and the US. And although it has been slower on the uptake in New Zealand, a survey undertaken by ShapeNZ showed that only 10 per cent of business, professional and government decision makers believe businesses should focus solely on providing the highest possible returns to investors.

From a purely environmental perspective there have always been at least some efficiency reasons to embrace environmental practices. Now companies need to focus not only on efficient use of resources, waste minimisation and smart energy consumption, but also on life cycle responsibility, organisational environmental policies, and public dialogue and transparency. Being open and engaging with communities they interact with is imperative in gaining consumer trust.

With carbon labelling recently being launched in the UK, there is now an increasingly compelling case for New Zealand businesses, as part of an export-oriented economy, to focus on improving their CSR portfolios and obtain some kind of "green" accreditation. A recent report by L.E.K. Consulting in the UK showed more than half of UK consumers want to know about the carbon footprint of the goods they buy and 44 per cent would switch to brands with smaller carbon footprints.

Taking environmental and social impacts into consideration when developing business solutions and products may require more thought but can result in more creativity and better, truly sustainable outcomes. Today CSR is no longer just about being "good", it is equally and indisputably about having the clean, green, competitive advantage.

* Denise Bester is from sustainable living website Ecobob.