Q.4. What do you understand by the term “governance for sustainabjifty”? What are the different CSR governance guidelines?
Ans. Defluijtjon of CSR: Corporate Social Responsibility is defined as a company’s environmental, social and economic performance and the impacts of the company on its internal and external stakeholders Some companies use other terms for CSR such as corporate responsibility, corporate sustainability and “triple bottom line”. Other companies prefer to treat each CSR item separately, such as environmental management and community or employee relations etc.
Implications of CSR for Boards: CSR issues can represent significant risks and opportunities to company’s performance. Oversight of social and environmental risk can lead to profits. Management therefore needs to incorporate CSR performance into board governance to ensure that long term shareholder and stakeholder interests are protected and promoted.
Boards want to understand how and when CSR issues can:
(1) Impact or enhance a company’s strategy and Vision.
(2) Necessitate board level oversight and accountability.
(3) influence risk identification and management.
(4) Require changes to board composition and expertise and
(5) Improve external disclosure.
CSR governance can be particularly challenging because CSR performance is often reported through different business lines, making it difficult for boards to have an overall picture of CSR. The development of an effective CSR g governance framework can help boards to ensure that CSR issues and opportunities are well-managed and maximized.
governance Guidelines: Board of
directors’ recognizer that effective management of social and environmental
risks can improve business performance. This realization has led to increased
oversight by boards over how the company is managing its social and
environmental performance as part of their fiduciary responsibility. This
oversight is referred to as Corporate Social Responsibility (CSR) governance.
These guidelines provide guidance to board directors and senior management on a best practice approach for CSR governance. The guidelines are informed by CSR’s experience with member companies, consultations with board directors and senior management representatives, and international research into global trends and best practices.
The CSR governance guidelines have four components:
(1) An ‘Assessment Tool’ or checklist to help boards identify current practices anti gaps.
(2) A ‘Phased Approach’ or roadmap to help boards of directors develop a CSR governance framework or methodology, including suggested terms of reference for a CSR committee.
(3) ‘CSR Questions for Senior Management’ for directors to understand the firm’s approach to CSR management.
(4) Canadian examples of ‘Leading Practice’ in CSR governance.
Q.5. How does the business benefits from corporate social responsibility?
Ans. Corporate social responsibility (CSR) is not about just doing the right thing. It means behaving responsibly, and also dealing with suppliers who do the same. It also offers direct business benefits.
Building a reputation as a responsible business sets you apart. Companies often favour suppliers who demonstrate responsible policies, as this can have a positive impact on how they are perceived by customers.