Trajectory Trends Breakfast March 2016

CSR, Trust and the New MoralityA return to the past?

Introduction

Defining the issue

Defining CSRThe academic perspective – meta-analysis

of multiple studies

Margolis (Harvard), Efenbein(Berkeley/Washington) and Walsh

(Michigan)

2007 and 2009 analyses based on 167 and 214 studies respectively

Overall conclusion – CSR generates a 13% uplift in company

performance

Pre-Recession: Green is Everything

‘Traditional’ ethical concerns drive ‘green’ CSR agenda and consumer spending

Recessionary concerns: Malfeasance, Cock-ups & Scrutiny

Myriad organisational scandals drive / caused by consumer focus on corporate practice

Business Priorities

33%

21%

11%

0%

5%

10%

15%

20%

25%

30%

35%

2003 2010 2015

% Mentioning

Environment as Priority

Corporate Tax Avoidance – 35%

Executive Pay – 34%

Workers being able to speak out – 20%

Exploitative labour – 19%

Bribery and corruption – 19%

Source: Ipsos Mori, 2015; n=997

Top 5 Issues, 2015

The Question

Google Tax Deal

More of the same?

VW Emissions Scandal

Back to the future?

Current Context

The Unlikely Rise of Trust

+17% trust in multinational business leaders 2014-15

+9% trust in national business leaders 2014-15

Why?

Fragile Recovery

-9.0%

-8.0%

-7.0%

-6.0%

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

1 2 3 4 5 6 7 8 9 1011121314151617181920212223242526

Total GDP, quarterly change after pre-recession

peak

80s recession

90s recession

Great Depression

Current downturn

2.4%GDP Growth in 2016,

OBR Forecast

November 2015

2.0%GDP Growth in 2016,

updated OBR

Forecast March 2016

“The Social Responsibility of Business is to increase its Profits”

Milton Friedman, New York Times Magazine 1970 (available online)

The New Morality in 2016

New Morality

2016

Demand for

Authenticity

New

Seriousness

‘Don’t know, don’t care’

approach to global issues

High(er) trust

Changing scandals Improving economic

environment

Continued

Austerity

External warning

signs

Ethical and price concerns

7%

19%

15%

23%

29%

26%

27%

20%

15%

9%

7%

3%

0% 20% 40% 60% 80% 100%

Buying products and services from

ethical companies

Getting the cheapest price when

shopping

Very much like me Like me Somewhat like me A little like me Not like me Not at all like me

Source: Trajectory Global Foresight, 2015; n = 501

The Future of CSR

A complicating factor

“The 20th-century corporation… was sustained by deep interdependencies with its populations.

That market form intrinsically valued its populations of newly modernizing individuals as its source of employees and customers; it depended upon its populations in ways that led over time to institutionalized reciprocities.

The ‘five dollar day’ was emblematic of this systemic logic, recognizing as it did that the whole enterprise rested upon a consuming population.”

Big other: surveillance capitalism and the

prospects of an information civilization Shoshana Zuboff, 2015

Big Data and CSR

Working Communities

The Ethical Employee

36% would work harder if their

company benefitted society

42% want to work for an organisation

that has a positive impact on the world

62% of millennials want to work for a

company that makes a positive impact

Global Tolerance, 2016

Fragmentation

Public Service CSR

The future of CSR

• Will ‘green’ issues ever dominate CSR agendas again?

• Is a fragmented CSR agenda asking too much of organisations?

• How can a business’s CSR programmes be communicated?

• Does greater trust increase the efficacy of CSR messages?

• What are the implications of a conflict between an organisations employees

and its customers?

• Is there any chance of a reciprocal relationship when it comes to data?

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