Corporate Social Responsibility, business and society source of wealth
AFRECOMEnergie, Infrastructures et Développement DurableEnergy, Infrastructure & Sustainable Development
Chief Frederic Nguime Ekollo, CEO AfrecomDouala, Amcham - April 17, [email protected].: 77 09 70 00
Agenda
1. Why CSR?2. What is CSR?3.How to effectively deliver CSR ?4.The virtue matrix & the local content challenge in developping economies
AFRECOMEnergie, Infrastructures et Développement DurableEnergy, Infrastructure & Sustainable Development
1. Why CSR?
Corporate reputation is companie’s source wealth
Corporate reputations : strategic assets and sources of economic value
Profit, Sustainable development & Corporate social responsibility are integrated business challenges
.
AFRECOMEnergie, Infrastructures et Développement DurableEnergy, Infrastructure & Sustainable Development
1. Why CSR?Corporate reputation is companie’s source of wealth
2010 Gulf of Mexico oil spill BP at World National Oil Companies Congress in London commented:
“Everyone at BP is devastated, and we deeply regret what’s happened. Our hearts go out to those who have lost loved ones. And we are profoundly aware of our responsibilities to those people whose livelihoods and neighborhoods have suffered… I’d also like to make it clear this is not simply about fulfilling our legal obligations ….We feel a huge moral responsibility…. For many years BP has been a part of those communities. Thousands of our employees live in the region, as do thousands more of our retirees. And caring about the communities in which we operate is a core part of what BP is about. As challenging as it may seem in the current crisis, we intend to prove it here too.”
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1. Why CSR?Corporate reputation is companie’s source of wealth
1985 : Intel Corp’s new Pentium chip calculations limits
1995 : Motorola : cell phones and brain cancer. According to global business executives surveyed, Reputation recovery takes
approximately three and one-half years.
“Any assault on the reputation of a company is a crisis and reputations are built on how management responds to crises.”
Clarke Caywood, professor, Northwestern University.
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1. Why CSR?Corporate reputation is companie’s source of wealth
Business values & corporate reputation
Vision & values first
Corporate reputation six categories 20 attributes
The Value cycle : from Shell, A better way to do business – External
affairs in the 21st century
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Corporate reputation
Profits & prospects
Financial valueSupportive stakeholders
Strategic initiatives
1. Why CSR?
Reputation management principles
Five principles
Distinctiveness
Focus
Consistency
Identity Transparency
Pillars of sustainabilityCSR intangle benefitsKey benefits & opportunitiesSlides 16 à 20 Present 1
.
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Fortune’s most admired companies have two things in common – They have performed well and their performance has been noted. Corporate reputation is a combination of both perception and reality.
Council of Public Remations Firms, US
1. Why CSR?
Key benefits & opportunities
Intangible benefits Improved image Sounder license to operate Increased credibility Consumer and employee loyalty and trust
Key benefits & opportunities Brand value & reputation Improvement s in human capital Revenue generation
.
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2. What is CSR? Sustainable Development : the basic paradigm
.
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Economic performance
Environmentalperformance
Social performance
Sustainability
Socio economic
Eco development
SocioEnvironmental
The 3 pillars of sustainability Source : Shell
2. What is CSR? CSR is generally understood to be the way a company achieves a balance or
integration of economic, environmental and social performances (imperatives) while at the same time addressing shareholder and stakeholders expectations . Canadian government
CSR as business contribution to the sustainable development goals. It is all
about how business takes account of its economic, social and environmental
impact in the way it operates; maximizing the benefits and minimizing the
downsides. UK Government
CSR is a concept whereby companies integrate social and environmental
concerns in their business operations and in their interaction with their
stakeholders on a voluntary basis. European Union
CSR as business commitment to contribute to sustainable Economic development, working with employees, their families, the local
community, and society at large to improve their quality of life - World Business
Council for Sustainable Development
CSR intangle benefitsKey benefits & opportunitiesSlides 16 à 20 Present 1
.
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AFRECOM3. How to effectively deliver
CSR?
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Developping local community
potential to bene-fit from impact ofan activity.
PHILANTHROPYSOCIAL INVESTMENT
STRATEGIC SOCIAL INVESTMENT
SOCIAL IMPACT MANAGEMENT
Communities recognise they benefit fairly from the revenues generated by the industry
Social impact is identified, planned and addressed as integral part of project management
Support for programs /projects related to corporate responsibilities.
Grants and Donations unrela- ted to operations or
business objectives.
Helpful Desirable Essential Critical
Valu
e to
Bus
ines
s &
So
ciet
yType
ofCSR
3. How to effectively deliver CSR?
AFRECOM3. How to effectively deliver
CSR?Rules for delivering social investment programs & projetcs Adopt a Strategic approach including policy, strategies, programmes & projects 3 main pillars of the approach
Stakeholder management Issues identification & management Strategic impact assessment
Projects/Programs Implementation on Strategic Social Investment Manage perceptions/expectations
Build Strategic MoUs with and put Delivery Responsibility to Communities
Tell me, I will forget
Show me, I may remember
Involve me, and I will care
Measuring & monitoring CSR activities performance
AFRECOM3. How to effectively deliver
CSR?
“When Prudential allowed people with AIDS to tap into the death benefits in their Life insurance policies to pay for medical expenses, the move generated by so much goodwill that competing insurers soon offered viatical settlements as well. Very quickly, corporate behaviour that had seemed radical became business as usual”
Source: Roger L. Martin in Harvard Business Review on CSR, « The virtue matrix: calculating the return on CSR »
AFRECOM3. How to effectively deliver
CSR?Twelve lessons learnt from successful CSR activities
1.Inclusiveness2.Be proactive3.Be honest4.Perception is reality5.Philanthropy only if required6.Philanthropy/ Social Investment projects cannot replace impact management.7.Stakeholder views are what count8. Know your audience:9.Face to face communications are the most effective method of communication10. Utilise existing communication hooks and materials (tools)11. Use people and resources across operations12. Encourage external stakeholders to take ownership
4. The virtue matrix & the local content challenge in develop-ping economies“In general, CSR in economicallyadvanced countries in generated by deep,solid foundations supporting relatively smaller strategic and structural frontiers.The civil foundations of countries with developing economies , by contrast, arerelatively shallow and weak, and their strategic and structural frontiers areCorrespondingly large”… “Nike, by running its Southeast Asian PlantAnd paying its workers in accordance to localCustoms and practices was accused of “averaging down” its level of CSR”.
.
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Frontier (Intrinsic)
Civil Foundation (instrumental)
Compliance
Source: Roger L. Martin in Harvard Business Review on CSR, « The virtue matrix: calculating the return on CSR »
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• Value Creation Value Added Knowledge retention Economic multiplier effect
• Economically Sound
Find an acceptable local content definition
• Equal or Better Quality Cost Delivery Safety & Environment
• Nurture not Subsidize
“What is the extra mile that you need to take?”
Key definition features Basic premises
Source: INSTOK, Willy Olsen in « Maximising benefits for the host nation , the role of local content »
4. The virtue matrix & the local content challenge in developing economies
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Source: INSTOK, Willy Olsen in « Maximising benefits for the host nation , the role of local content »
4. The virtue matrix & the local content challenge in developing economies
Technologytransfer
Research
technologyFocus onskills
Looking for technology transfer - Getting to the core will take time
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Source: INSTOK, Willy Olsen in « Maximising benefits for the host nation , the role of local content »
4. The virtue matrix & the local content challenge in developing economies
Qualification Industrial policy Industry performance
Industry capacity
Technology qualification
Professional qualification
RegulationFinancing
Tax policy Foster SMEs
CompetitiveSustainable
HSE
Strategic issues
ChallengeMaximize local
content
Supplier development
Funding initiatives
Initiatives on competitiveness
The strategic approach
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Source: INSTOK, Willy Olsen in « Maximising benefits for the host nation, the role of local content »
4. The virtue matrix & the local content challenge in developing economies
Venezuela
Brazil
Nigeria
T&TLibya
Saudi
Canada
Norway
AzerbaijanAlgeria
TanzaniaEcuador
Bolivia
Ghana
UK
Mexico
Uganda
Kazakhstan
Russia
Iran
Australia
Timor Leste
Indonesia
PNGMalaysia
Old timers New initiatives
Local content policies in more and more countriesMany are looking for more benefits
Angola
HSE & RSE
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Dialogue with communities
Horizontal & vertical Partneship
Local content
Protection of environment (ecosystems & biodiversity)
Thank you
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