Текст книги "Английский язык. Практический курс для решения бизнес-задач"

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Lesson 16
Corporate Social Responsibility

Read and translate the texts and learn terms from the Essential Vocabulary.

People, Planet and Profit

Corporate social responsibility (CSR) refers to a company’s obligation to be sensitive to the needs of all its stakeholders in its business operations. The principle is closely linked with the imperative of ensuring that these operations are «sustainable». ‘Sustainable development’ was defined by the 1987 Brundtland Commission as development that «meets the needs of the present generation without compromising the ability of the future generation to meet their own needs.» In other words, meeting the goals of sustainable development means searching for development paths that permit decoupling of economic growth from environmental degradation.

Today’s heightened interest in the proper role of businesses in society has been promoted by increased sensitivity to environmental and ethical issues. In some countries government regulation of environmental and social issues has increased, and standards and laws are also often set at a supranational level (e.g. by the European Union).

It is important to distinguish CSR from charitable donations and «good works». Corporations have often spent money on community projects, the endowment of scholarships, and the establishment of foundations. They have also encouraged their employees to take part in community work thus enhancing the reputation of the company and strengthening its brand.

CSR goes beyond charity and requires that a responsible company will take into account the impact on all stakeholders and on the environment when making decisions. This holistic approach to business regards organizations as being full partners in their communities, rather than being primarily in business to make profits and serve the needs of their shareholders.

CSR reporting

The application of Sustainable Development principles through the introduction of a CSR policy is often accompanied by what is called triple bottom line reporting which declares that it is necessary to account for not only financial results, but also for the social and environmental impact of the business, i.e. focus not only on Profit, but on People and Planet aspects as well. Some countries (e.g. France) have made such reporting mandatory. However the measurement of social and environmental performance is difficult and new measurement techniques need to be developed.

Advocacy for triple bottom line reforms is popular in Green Parties and in the United Nations circles.

While many people agree with the importance of social and environmental goals, there are also many who disagree with the ‘Triple Bottom Line’ as the way to achieve these goals. The main arguments against it may be summarized as:

Division of labor, which is characteristic of rich societies and a major contributor to their wealth, ensures that organizations contribute most to the welfare of society when they focus on what they do best. Business’s expertise is in satisfying the needs of society and generating a value-added surplus. Thus the ‘triple bottom line’ is diverting business attention away from its core competency. Just as charitable organizations like the Salvation Army would not be expected to pay a cash dividend, business should not be expected to take on concerns outside its core expertise.

Effectiveness. Concern for social and environmental matters is rare in poor societies (a hungry person would rather eat the whale than photograph it). As a society becomes richer its citizens develop an increasing desire for a clean environment and protected wildlife, and both the willingness and financial ability to contribute to this. The ‘Triple Bottom Line’ is said to be an example of the choices available to the citizens of a society made wealthy by businesses attending to business. Thus, Adam Smith’s Invisible Hand will ensure that business contributes most effectively to the improvement of all areas of society.

Nationalism. Some countries adopt a nationalistic approach with the view that they must look after their own citizens first.

Inertia. The difficulty of achieving global agreement on simultaneous policy may render such measures at best advisory. People would be unwilling to undergo a depression or recession in order to remediate lost ecosystems.

Many large companies now produce annual reports that cover Sustainable Development and CSR issues, and these reports are often externally audited. But there is no common template for the reporting and the evaluation methodology varies between companies. Critics often comment that some of these reports are just an ad and as an example note that Enron published a glossy «Corporate Responsibility Annual Report» and that tobacco corporations such as BAT also produce social reports.

The Global Reporting Initiative (GRI) is an attempt to standardize sustainability reporting and the AA1000 standard is an attempt to improve their legitimacy.

Criticism of CSR

Some critics of CSR, such as Milton Friedman, argue that a corporation’s principal purpose is to maximize returns to its shareholders, whilst obeying the laws of the countries within which it works. Others argue that the only reason corporations put in place social projects is utilitarian; that they see a commercial benefit in raising their reputation with the public or with government.

It is clear that a CSR activity generally can only be effective at achieving social or environmental outcomes to the extent that it maximizes profits: hence the CSR slogan – «doing well by doing good». This requires that the resources applied to CSR activities must generate a higher return than those resources could obtain if applied anywhere else, e.g. capital investment, lobbying for tax relief, outsourcing, fighting against unionization, or taking market risks.

Some argue that it is self-evidently «good» that businesses should seek to minimize any negative social and environmental impact of their economic activity. It can be beneficial for a company’s reputation to publicize any environmentally friendly business activities. A company which develops new engine technology to reduce fuel consumption will be able to promote its CSR credentials as well as increase profits.

A conflict can arise when a corporation espouses CSR and its commitment to Sustainable Development on the one hand, whilst damaging revelations about its business practices emerge on the other. The McDonald’s Corporation has been criticized by CSR campaigners for unethical business practices, including mistreatment of workers, misleading advertising, and unnecessary cruelty to animals. Similarly Shell has a much-publicized CSR policy and was a pioneer in triple bottom line reporting, but was involved in 2004 in a scandal over the misreporting of its oil reserves, which seriously damaged its reputation and led to charges of hypocrisy.

Source: Wikipedia.

People, Planet, Profit: The Value of CSR

CSR, also referred to as corporate stewardship or corporate citizenship, has become increasingly important to companies competing in today’s business climate. Companies focusing on the ideals of People, Planet, and Profit further bolster the notion that addressing social and environmental issues supports the attainment of financial goals and can be critical to long-term corporate success.

But the biggest question surrounding CSR is not «Is this the right thing to do?» but a more in-depth, «Why should we do this?» Profitable business and CSR are not mutually exclusive. There are many solid reasons as to why CSR is good business.

Branding

The market has become oversaturated with company messages touting the newest, hottest, or cheapest. This has lessened the effectiveness of traditional marketing efforts and jaded the audiences they are aimed at. Relationship and cause marketing are two avenues in which companies can realize the value of their brand, build good will, and establish lasting impressions with their stakeholders. Brands like Avon, The Body Shop, Timberland, and Target have made their social commitments a fundamental component of their corporate mission, and reputation. This attitude is reflected in their marketing efforts and has resulted in a stronger brand reputation, and increased revenues. People want to align themselves with companies they admire and respect.

Conversely, companies that have tarnished their brands by not acting responsibly in regard to their stakeholders have discovered that ignoring social responsibility has irreparably damaged their brand image as well as their bottom line. Enron and WorldCom are two highly publicized examples of companies who put profitability ahead of responsibility. The glare of the media is aimed directly at corporations nowadays; any small glitch in a company’s reputation could dramatically impact their revenues both long– and short-term.

Socially Responsible Investment Institutions

Socially responsible investment funds (SRIs) offer perhaps the most direct financial link to CSR. The influence of SRIs internationally can be seen in the hundreds of funds, the number of shareholder resolutions filed, and the financial performance of companies associated with SRIs.

Globally, this group of funds has tremendous financial leverage. While each fund offers a unique perspective, common themes include their CSR criteria used for company selection and evaluation. Equally, companies not meeting a minimum threshold of social performance are those typically targeted for shareholder resolutions.

Building a business case for CSR is strengthened by the performance of SRI-based companies. The Dow Jones Sustainability Index (DJSI) has historically tracked the performance of companies with active CSR initiatives, measuring them against companies not aligned with CSR principles. Companies with CSR programs have consistently outperformed those without CSR over the past five years.

Legislation and Litigation

Generally, a company’s actions are governed by its adherence to laws and compliance with business regulations. Historically, it has been assumed that corporate leaders are guided by their own moral compass; values and ethics influence decisions and legislation is not required to govern morality and behavior. However, certain corporations have sullied the reputation of business in general. As a result, recently we have seen a rise in legislation, fines, and litigation surrounding corporate responsibility. To be in compliance with current laws, avoid penalties and litigation, adopting a philosophy of CSR makes good business sense.

Avoidance of litigation is another motivator for companies to adopt socially responsible practices. Increasingly, activist and non-governmental organization groups are using litigation in an attempt to change corporate behavior. Previously, efforts by these groups included shaming a company to change behavior through adverse media and filing shareholder resolutions to demand change. These same groups are now filing lawsuits in their attempts to force companies to embrace socially responsible practices.

Employees and Customers

Employee recruitment, retention, and morale are strong business reasons for corporations to integrate CSR into their organizations. Research studies that evaluate the impact that CSR has on employee recruitment and retention offer the following data.

Companies demonstrating strong CSR commitments find it easier to recruit employees, particularly in tight labor markets.

A 1997 study of 2,100 MBA students found that more than half said they would accept a lower salary to work for a socially responsible company.

CSR efforts strengthen a company’s position as an employer of choice.

Morale, motivation, innovation, productivity and creativity are all improved by providing the opportunity for people to work for organizations that not only support their career but also provide for much deeper meaning in their life.

Integrity at work relates to employee loyalty. 40% of employees who say their senior leaders have high personal integrity are also truly loyal to their organization. That number drops to only 6% when employees do not believe their senior leaders have integrity.

Also, numerous studies have shown that there is a direct correlation between CSR and the ability to attract and retain customers. Customer choice has traditionally been driven by price, quality, appearance, safety, convenience, and accessibility. However, increasingly other value-based criteria are influencing purchasing decisions.

Product Improvement / Cost Reduction

Lower recruiting costs, larger market share, fewer regulatory fines, waste reduction, cost savings through recycling, and increased stock price and shareholder value are all tangible metrics for CSR.

Studies also suggest that reduced regulatory costs, and customer complaints are additional financial benefits realized after the implementation of a CSR program. However, there is research that supports a more direct cost/benefit analysis of CSR efforts. Intel provides a good case study of specifically measuring and quantifying their CSR improvement and associated financial benefit.

Intel has a system of assessments and audits that yields hard data regarding the social and environmental performance of its suppliers. This data allows Intel to better manage its supply chain by enabling the suppliers to become part of the company’s continuous improvement process. This process of assessing and auditing its supply chain has been integral in drawing a correlation between Intel’s CSR efforts and their business implications.

Source: www.eorm.com

Essential Vocabulary

1. Corporate Social Responsibility (CSR) – социальная ответственность корпораций

2. obligation n – обязательство, обязанность, долг

oblige v – обязывать, принуждать; делать одолжение

3. sensitivity n – чувствительность

sensitive a – чувствительный

4. sustainable a – устойчивый

5. supranational a – наднациональный

6. charity n – благотворительность

charitable a – благотворительный

7. endowment n – вклад, дар, пожертвование; (дарственный) фонд; дарование

endow v – обеспечивать постоянным доходом, наделять, одаривать, делать дар

8. foundation n – закладка (фундамента), фундамент, основание; обоснование, основа; фонд, пожертвованный на культурное начинание; учреждение или организация, существующая на пожертвованный фонд

9.triple bottom-line – тройная итоговая строка

10. advocacy n – защита, адвокатура; пропаганда

advocate n – адвокат, защитник, заступник, сторонник

advocate v – отстаивать, защищать, выступать в защиту, пропагандировать

11. division of labor – разделение труда

12.welfare n – благосостояние, благоденствие, благополучие; благотворительность

13. remediation n – исправление, лечение, восстановление

remedial a – исправительный; лечебный; ремонтный; являющийся средством судебной защиты

14. template n – шаблон, лекало, калибр

15. Global Reporting Initiative (GRI) – глобальная инициатива по отчетности

16.ad (advertisement) – реклама (амер. жаргон)

17. legitimacy n – законность; закономерность; законнорожденность

legitimate a – законный; допустимый; оправданный; законнорожденный

18. tax relief – налоговая скидка, освобождение от уплаты

19. union n – союз, профсоюз

unionization n – охват профсоюзом, объединение в профсоюз

unionize v – охватывать профсоюзом, объединять в профсоюз

20. environmentally friendly – экологически дружественный (безопасный)

21. credential n – мандат, удостоверение личности; рекомендация, (мн.) верительные грамоты

22. stewardship n – управление, распоряжение

steward n – управляющий, распорядитель; стюард

23. corporate citizenship – социально ответственное поведение корпораций

corporate citizen – социально ответственная корпорация

24. branding n – брендинг

25. socially responsible investments (SRI) – социально ответственные инвестиции

26. resolution n – выражение желания или намерения что-то сделать; резолюция или решение; разрешение спора

27.threshold n – порог

threshold a – пороговый

28. Dow Jones Sustainability Index (DJSI) – индекс устойчивости Dow Jones

29.fine n – штраф, пеня; тонкий; точный; первоклассный

fine v – взимать штраф, налагать штраф

30. litigation n – судебный процесс, судебное дело, тяжба

litigant n – истец или ответчик в судебном процессе

litigate v – судиться, оспаривать на суде

31. non-governmental organization (NGO) – неправительственная организация

32. morale n – моральное состояние, боевой дух

33. recycling n – рециклирование

recycle v – рециклировать

34. cost/benefit analysis – анализ издержек и прибыли

Exercise 1. Answer the following questions.

1. What does CSR mean? 2. What is the generally accepted definition of sustainable development and what does it entail in practice? 3. What is the difference between CSR and charity? 4. What is the triple bottom line reporting? 5. What are the key arguments against the triple bottom line reporting? 6. What are the views of CSR critics? 7. What kind of conflict can arise with respect to companies that proclaim their commitment to CSR? 8. What do advocates of CSR say and what are their arguments in favor of this concept? 9. Does it pay to be a good corporate citizen? 10. What do you think is the proper role of business in society?

Exercise 2*. Find terms in the text that match definitions given below and make sentences of your own with each term.

1. anything imposing a moral or legal duty; an agreement that may be enforced by law

2. pertaining to work or operations of a highly delicate, secretive, or precarious nature

3. outside the authority of any one nation or national government

4. the private or public relief of the poor

5. a state or condition of well-being, as of health, happiness or prosperity

6. the proceedings in a suit at law

7. payment exacted as punishment for an offense

8. mental attitude expressing courage, zeal, hope or confidence

Exercise 3. You are a journalist writing for The Economist, and your assignment is to interview BP’s HSE (Health, Safety and Environment) vice president on environmental objectives of the company. Make a dialogue between these two individuals using the following briefing materials.

BP Towards Sustainable Future

Minimizing Emissions

BP’s recognition of the need for precautionary action over climate change led to a program of action in which we set and met a target to lower our own emissions (выбросы) of greenhouse gases (парниковых газов) by 10% from the 1990 level. We have now set a new target – to maintain emissions at or below that level up to 2012, despite growth in production of energy.

The emission reduction program showed that economic benefits can accompany environmental ones. Overall, rather than damaging BP’s business, the four year program created over half a billion dollars of value in fuel saved. For example, the Texas City Refinery (НПЗ) reduced emissions by 300,000 tons of carbon dioxide equivalent in emissions and also saved $5 million.

Another way that BP has addressed the need to take precautionary action was to reduce flaring (сжигание газа в факелах) by 34%. The energy industry collectively flares almost 10bn cubic ft of gas a day – as much as is used by France, Belgium and the Netherlands together. BP has joined a partnership established by World Bank to cut flaring, along with partners including the Norwegian Government, Sonatrach and Royal Dutch/Shell.

BP has also reduced the environmental impact of the products it sells. Within the next 3 years we plan that half of our retail sales worldwide will be of cleaner fuels. These are designed to enable motorists to reduce the emissions from their vehicles and have been particularly targeted at cities where air quality problems are most acute. Already cleaner fuels are available at over 100 cities worldwide.

Leading in Renewables

Renewable (возобновляемые) energy sources hold out the promise of fuel with very low environmental impact. Although commercially viable in some situations today, these sources are generally too expensive to compete with oil and gas in the major energy markets. However, BP is committed to building a substantial renewable and alternative energy business focusing on solar, wind and hydrogen.

BP is a global solar leader, accounting for 20% of the world market for solar energy. BP Solar provides products to help our customers use cleaner energy in 160 countries. We use our own products to provide renewable energy at service stations, plants and offices.

Hydrogen has the potential to revolutionize energy for transportation. BP is already a major producer of hydrogen for industrial use, and we are taking part in R&D projects around the world to help overcome barriers to the introduction of hydrogen as a fuel for motor vehicles.

Source: www.bpamoco.org

Exercise 4*. Fill in the blanks using terms given below.

Shell’s Business Principles

Principle 2 – Responsibilities to Society and Employees

We continue to make a substantial……. to local economies in over 135 countries where we have an interest in……… through……… and the use of local contractors and suppliers.

Shell companies employ some 90,000 people the majority of which are local……. The number of employees has fallen at all levels of the Group since last year due to transfer of labor to other organizations and…….. exercises started in 1999.

In 50 countries Shell companies have a policy to promote…….. – the use of local contractors and suppliers. In 106 countries Shell companies spend more than 50% of total……… on goods and services inside that country.

Shell companies in 130 countries compare……… levels to ensure they are competitive. No member of staff receives less than the…….. wage. The lowest wage paid to a Shell company employee in 2000 was $50 per month plus $20 transport……. in a country in Africa where the national minimum is $25 per month.

Principle 4 – Business Integrity

We have a Group-wide policy and target of no……. ……. is a global problem that can occur at any level but in some countries the payment of bribes and……. payments to low-level government officials is common practice – putting managers under continuous pressure. The primer «Dealing with Bribes and Corruption» helps managers maintain the highest standards of……

In 2000, Shell companies reported four instances in which seven employees were detected……../accepting bribes. All seven employees were……..

There was one case in which a bribe was solicited by a third party offering to secure a Shell company a favorable place in the….. for a license. The offer was refused.

Principle 5 – Political Activities

We have a policy and…….. of no political payments. Shell companies in 117 countries operate a procedure to prevent and identify possible……… of the policy. In 2000, there was one case where a Shell company detected a political payment made on its……. through a marketing organization of which the company is a member. An official public…….. was made.

Principle 6 – Health, Safety and Environment

Climate change remains one of the most important……. issues of our time. We are acting to reduce our own………. and supporting our customers, partners and suppliers to reduce theirs. We strive to continuously reduce negative environmental……… across our operations. Over 90% of our major…….. have achieved ISO 14001………..

We deeply regret that in 2000 60 people (55 contractors and five Shell employees) lost their lives during work activity compared with 47 in 1999. This is unacceptable and we continue to promote local and global initiatives to address the……….. issues. As last year, the majority of deaths occurred in road accidents in……. countries where driving conditions are particularly difficult.

Principle 8 – Competition

Shell companies seek to compete fairly and ethically within the framework of applicable……… laws. In 95 countries Shell companies operate a…….. to ensure their operations do not……. such laws. In 71 countries employees receive…….. to help them understand applicable competition laws.

In 2000, nine competition cases involving Shell companies were……. In two cases, the Shell company was found…….. In both, Shell companies were judged to have…….. competition law by being part of price-fixing……. resulting in……. of $11,000 and $17 million.

A……. commission ordered eight wholesalers, including a non-Shell operated joint venture, to pay some $17 million for rigging……. in the supply of oil products to the…….. industry. This is being…….

Source: 2000 Shell Report (excerpts)

Terms:

defense, fines, contested, developing and emerging, bids, facilitation, installations, target, statutory, emissions, behalf, fair trading, environmental, bribes, competition, allowance, contribution, operations, bidding, guilty, employment, staff, downsizing, local content, infringed, expenditures, remuneration, corruption, integrity, soliciting, dismissed, breaches, complaint, procedure, impacts, certification, occupational safety, corruption, completed, cartels, training, violate

Exercise 5. Translate into English.

Политика ОАО «ЛУКОЙЛ» в области промышленной безопасности, охраны труда и окружающей среды в XXI веке

Стратегическая цель ОАО «Лукойл» в ХХI веке – обеспечить устойчивое развитие и стать одной из ведущих нефтяных компаний мира. Достижение поставленной цели осуществляется сбалансированным решением социально-экономических задач и проблем сохранения благоприятной окружающей среды.

Приоритетными задачами ОАО «Лукойл» являются обеспечение безопасных условий труда работников, защита здоровья персонала Группы «Лукойл» и населения, проживающего в районах деятельности организаций Группы «Лукойл», а также сохранение благоприятной окружающей природной среды.

Для этого в компании созданы и успешно функционируют системы управления промышленной и экологической безопасностью, охраной труда. Они построены в полном соответствии с действующим российским законодательством, на основе лучшей отечественной и зарубежной практики и прошли сертификацию на соответствие требованиям международного стандарта ISO 14001 и стандарта OHSAS 18001.

Политика ОАО «Лукойл» разработана и принята в полном соответствии со стратегией государства в области промышленной и экологической безопасности и рационального использования природных ресурсов.

Политика ОАО «Лукойл» в области промышленной безопасности, охраны труда и окружающей среды устанавливает на ближайшие пять лет следующие цели:

– постоянное улучшение состояния промышленной безопасности, охраны труда, окружающей среды и обеспечение контроля за выполнением этих обязательств;

– рациональное использование природных ресурсов как вовлекаемых в производство, так и находящихся в регионах деятельности организаций Группы «Лукойл»;

– достижение уровня промышленной и экологической безопасности, соответствующего современному состоянию развития науки, техники и общества;

– повышение промышленной и экологической безопасности производственных объектов компании, снижение негативного воздействия на окружающую среду за счет повышения надежности технологического оборудования, обеспечения его безопасной и безаварийной работы;

– создание в ОАО «Лукойл» эффективных процедур подготовки и реализации программ в области промышленной безопасности, охраны труда и охраны окружающей среды, обеспечивающих постоянное выявление и решение наиболее важных задач промышленной и экологической безопасности, возникающих перед компанией;

– стабилизация и последующее сокращение количества, а также снижение токсичности выбросов, сбросов загрязняющих веществ и отходов при увеличении объемов производства за счет внедрения новых прогрессивных технологий, оборудования, материалов и повышения уровня автоматизации управления технологическими процессами;

– снижение техногенной нагрузки на окружающую среду от вновь вводимых объектов посредством улучшения качества подготовки предпроектной и проектной документации и проведения ее экологической экспертизы и экспертизы промышленной безопасности в ОАО «Лукойл»;

– повышение эффективности производственного контроля за соблюдением требований промышленной безопасности и экологического мониторинга на объектах компании на основе внедрения современных информационных технологий, методов технической диагностики и дистанционного зондирования (remote sensing).

Источник: www.lukoil.ru