Corporate Responsibility in the Digital Age

A Practitioner's Roadmap for Corporate Responsibility in the Digital Age

Ivri Verbin

• Editore: Routledge
• Anno: 2020
• ISBN:
  9781000225600
• Edizione: 1
• Argomento: Economics
• Categoria: Sustainable Development

This book is a roadmap to help organizations adopt corporate responsibility and sustainability practices and be fit for purpose in a digital era. It explains why corporate responsibility is the only option in the twenty-first-century post-COVID-19 world, and guides readers through the process of transforming their organizations with continued reference to the importance of technology.

This is not a technical manual, and it is not an academic textbook: it is designed to be a quick, easily digested read. The first part looks at the current landscape – both of business and of the world in which it operates. The second part explains why corporate responsibility is the only realistic option for business in the twenty-first-century, post-COVID, and who needs to take responsibility for it. The third part is a step-by-step guide to putting principles into practice, covering: values, stakeholder engagement, employees, supply chain, environment, community, customers and marketing, and reporting and transparency. Each chapter is linked to relevant UN Sustainable Development Goals and supported by dozens of real-world examples.

By the end of the book, business leaders will have understood the scope of the challenge involved in leading a truly socially and environmentally responsible organization, and, crucially, will have understood why such a course of action is not only desirable but essential. And they will also have been inspired by a sense of purpose. The book offers direct access to the processes, insights, and techniques for installing corporate responsibility throughout organizations large and small, based on the author's many years' experience working in government and with successful large corporations. It is up-to-date and relevant, addressing the implications of COVID-19 and the modern technological "Fourth Industrial Revolution."

1Introduction

I write this in an unprecedented era amidst a global pandemic – a pandemic that has hit us at a time of unpredictable change. After a long period of gradually building momentum, the rallying cries for climate and social justice have suddenly become impossible to ignore. The deleterious effects of neoliberal capitalism are becoming common knowledge, and individual organizations are under constant scrutiny in the digitally connected world. Is the old order transforming or merely adjusting? How will businesses and the global economy adjust post-COVID-19? One thing is certain: business-as-usual is a recipe for oblivion for the companies that practice it.

COVID-19 has tested many of our long-held assumptions and challenged the economic and social foundations of the neoliberal paradigm. The UK’s Financial Times, a champion of the private sector and free markets, even began calling for an enhanced role for government and better corporate responsibility. The crisis also served as a litmus test to distinguish genuinely responsible companies from the cynical.

I contend that the sustainability revolution has much in common with previous revolutions, from the First Industrial Revolution to the Digital Revolution. Companies that do not adapt will not survive. This book provides practical tools for the required adaptation.

So how do we go about being fit for purpose in the digital, post-pandemic age of the 2020s and beyond?

Before we continue, let us take a moment to reflect that, despite the global challenges we are facing, we are in fact fortunate to be living in a period of history that is wonderful for many reasons. Life expectancy is higher than ever, many diseases have been eradicated (pandemics are not a new phenomenon), and quality of life has improved across the planet for a majority. The air is (in most places) breathable, most enjoy clean running water and safe beaches, and, with inevitable exceptions, we are experiencing an era of relative peace.

Some definitions: corporate responsibility; digital era

I look at the definitions of sustainability and responsibility in greater detail in Chapter 4, but suffice it to say at this point that sustainability, which is a holistic view of care for the planet – which means meeting our own needs without compromising the ability of future generations to meet theirs – is now interlinked with modern definitions of corporate responsibility. As we will see throughout this book, corporate responsibility is a self-regulation management approach that helps a company to be accountable to its stakeholders.¹ Since it also works toward the goals of sustainability, for the purposes of our discussions the two terms will often cross over.

While there are already shelves full of books about corporate responsibility, the ramifications of the digital age we are now experiencing are changing everything, and there is still much to be written about the subject in the context of technology. Let us now briefly focus on this topic.

We are in the midst of a “Fourth Industrial Revolution,” and it is already hard to imagine a world without mobile phones. Virtual reality, machine learning, 3D printing, robotics, the “internet of things” (IoT), and blockchain are all fast becoming just as commonplace. Such technologies and applications, made possible by ever-more powerful processors, large-scale memory, and high-speed communication protocols, are enabling people and organizations to work, communicate, innovate, and add value for our stakeholders in increasingly faster and cheaper ways.

Change in both technology and ecosystems is accelerating faster than ever in human history. Today, these are not simply information technology tools but rather a social phenomenon that changes the way we think, interact, work, travel, and shop. For businesses, it alters the way – and the speed with which – we think and plan, collect and analyze data, and even report and communicate with our stakeholders.

My friend from Tel Aviv College, Professor Yesha Sivan, differentiates between infrastructure technologies – personal computers, servers, networks, WiFi, cyber-security software, GPS, etc. – and applications that allow the company to execute its business operations, such as customer relationship management (CRM), enterprise resource planning (ERP), and billing software, along with the many other applications that support organizational decision-making and analysis processes, such as data warehouses, data mining, or artificial intelligence and so on, together with tools such as portals, email, and social networks.²

The principle that digital technology is now integral to the very philosophy of one’s business was highlighted in a McKinsey & Co. article which says that “to be meaningful and sustainable … digital should be seen less as a thing and more a way of doing things” and that it is a means of “unlocking growth now.” It breaks the benefits down into three main categories: (1) creating value at new frontiers (re-examining how you actually do business); (2) creating value in core businesses (improving how you serve your customers); and (3) building foundational digital capabilities (becoming agile and fast).³

What is the connection between digital technology and sustainability?

Such a fundamental transformation within both the business world and society at large has huge ramifications for the meaning and practice of corporate responsibility and sustainability. As technology transforms, so does corporate responsibility, with data and know-how transferred faster and in a more transparent way than ever before – which has a dramatic effect on a corporation’s relations with its stakeholders. That is why you will find, throughout this book, practical examples of the role that technology plays in implementing corporate responsibility as well as some of the challenges it presents. As a corporate responsibility expert and practitioner, I do not claim any specialized expertise in technology, but I hope in this book to persuade other non-technology-experts that we ignore its importance at our peril.

On the sustainable development front, there is no doubt that new technologies can accelerate and scale up our ability to meet the 17 United Nations Sustainable Development Goals (SDGs). The achievement of each of the SDGs – whether it be zero hunger, tackling climate change, or education and well-being – is dependent either directly or indirectly on new technologies and innovation. The success and correct application of these technologies will determine whether or not we can meet the challenges.

A World Economic Forum paper offers a careful analysis of technology’s role in addressing the SDGs: the benefits and risks. On the positive side, it notes, we can already see how AI-augmented computing can help in medicine (doctors making fewer mistakes), agriculture (improved yields and minimized inputs), education (customization and dissemination), and research (climate and weather modeling, or advanced material generation for clean fuels). On the negative side, technology has the power to increase stress on society. The daily news cycles remind us of the threats facing our privacy, of crime and security issues, the growing market power of the tech giants, the risks to democracy and human rights from the misuse of technology, and the impact of automation on jobs and inequality.⁴

There is another link – which underpins the chapters in this book – between the digital transformation that companies are necessarily undergoing for the sake of their very survival and the sustainability transformation upon which many are only just embarking. I firmly believe that sustainability/corporate responsibility is a prerequisite for survival and growth, and that it is therefore imperative to begin the journey without delay.

Fifty years from now

Our greatest problems still lie in our imminent future. The COVID-19 crisis momentarily distracted our attention away from the even more momentous reality of potentially irreversible climate breakdown. Fifty years from now, will all this simply be a dying memory? Imagine a sun that is dimmer because of the pollution emitted from factories. The particles will filter out sunlight and engulf the world in a grayish fog. At night, the moon will be a faded, blurred image of itself. Clean air and water will be private goods exploited for profit and unaffordable to many. The oceans will rise, displacing millions and turning them into refugees. Natural resources will dwindle, and access to them will be the cause of bitter conflicts.

Even in the wealthier countries, daily existence will be a struggle for survival. The same will apply to businesses as much as individuals. In a world without responsibility, the strong will subdue the weak and compassion will disappear. The rich will barricade themselves behind guns, and the poor will riot.

Does this sound like a cliché of a dystopian future? Absolutely. Is it science fiction? Definitely not. Current economic and geopolitical trajectories are taking us in precisely that direction. The Industrial Revolution began barely a moment ago on the scale of human existence. But in those 250 years not only have we transformed the world and the opportunities within it, but we have played havoc with the planet’s chemistry, ransacked its resources, and exterminated much of its flora and fauna. Global emissions increased from 2 billion tons of carbon dioxide in 1900 to over 36 billion tons 120 years later,⁵ and species are now going extinct at 1,000 times above the baseline rate if not faster.⁶ Only now are we waking up to the consequences of the transformations of the last two centuries. Environmental, social, and ethical responsibility has been a belated and reluctant adjunct foisted on corporations that have been designed only to maximize the bottom line and which have become more powerful than governments. But the question now is no longer about whether the outcomes described here will happen, but rather when and to what extent.

In essence, the next 50 years will be crucial in determining the trajectory of the environmental crisis. The IPCC (the UN’s Intergovernmental Panel on Climate Change) in its 2019 report points to the “urgency of prioritizing timely, ambitious and coordinated action to address unprecedented and enduring changes in the ocean and cryosphere.”⁷ The earth has already warmed to 1°C above pre-industrial levels because of past and current greenhouse gas emissions. The IPCC is the most reliable source of scientific consensus on this issue. They warn that warming must be kept below 2°C to avoid catastrophic change across the globe, with 1.5°C the goal expressed in the Pari...

Indice dei contenuti

• Cover
• Half Title
• Title
• Copyright
• Dedication
• Contents
• List of boxes
• Acknowledgments
• Preface
• 1 Introduction
• Part 1 The good planet: the changing world and the changing business world
• Part 2 The good challenge: future-proofing
• Part 3 The good process: step by step
• Afterword: take the lead and go beyond
• About Good Vision
• Index