Explaining the jargon behind social and environmental business responsibilities

Confused by CSR, ESG and DEI? Not sure what they mean? Strategic consultancy Boxless is here to explain.

If you are confused by all of this, rest assured you’re not alone. While these have been in place for some time now, advancements in compliance, legislation and social awareness have placed significant importance on the inclusion of these across business. So what do they mean? Let’s break it down for you.

CSR – Corporate Social Responsibility

CSR was first coined in 1953 when economist Howard Bowen published ‘Social Responsibilities of the Businessman’. This book highlighted the great power and responsibility that organisations hold and that their actions have an immediate effect on society. To put it simply, CSR has often been referred to as a business’s efforts to improve society in some way, such as donating money to charity or implementing environmentally-friendly policies in the workplace. The focus is generally on the positive impact a company can make outside of its immediate business operations, without a direct link to financial performance. CSR often refers to these activities a business chooses to employ.

ESG – Environmental, Social & Governance

ESG specifies a set of standards for a company’s operations. Under the environmental criteria, organisations are expected to review and improve on their sustainability responsibilities. Mandated by the Government’s 2050 net zero target, it would be wise to expect compliance in this area to increase considerably. 

Social criteria looks at how organisations manage relationships with employees, suppliers and customers. We’ve seen Social challenges escalate as cultures evolved during covid. Millennials and GenZ are leading the charge as we are also seeing an increased demand for social justice, diversity and inclusion practices. 

Governance deals with a company’s leadership, audits, internal controls and shareholder rights. Ethical business practices are becoming standardised requirements to mitigate risk, exposure and compliance failure. Policy creation and delivery now play a huge role in an organisation’s governance journey.

ESG is acknowledged not only as more integrated with business strategy but a standard to which business must adopt: It is widely acknowledged that ESG commitments are highly favoured with suppliers, consumers, stakeholders and investors.

DEI – Diversity, Equity and Inclusivity

Diversity, Equity and Inclusivity is designed to promote fairness, respect and opportunities for all individuals regardless of their background.

Diversity refers to the efforts made to cater to a wide range of identities, backgrounds and perspectives within a group or organisation. The aim is to understand within a business the challenges required to overcome race, ethnicity, gender, sexual orientation, age, disability and socio-economic status. The expectation is to be actively trying to improve

Equity, (not to be confused with equality) highlights the accessibility an organisation offers. Providing everyone access to the same opportunities and resources with equity, requires splitting support based on the severity of the challenge faced. By acknowledging that individuals may start from different positions, organisations can improve fairness and justice.

Inclusivity focuses on environments and how they are created. Providing spaces where individuals feel valued, respected and empowered to participate fully is of huge value.  For organisations to get things right, involving and engaging diverse backgrounds in decision-making processes will bring new voices and perspectives perhaps not considered.

DEI initiatives are all about creating workplaces and communities where diversity is celebrated not just accepted, where equity is practised not dismissed and where inclusion is the norm. By embracing these principles, organisations can unlock innovation, foster creativity and build stronger cultures that align with brand vision, mission and values.

This is Global! – The United Nations Sustainability Goals

In 2015, all United Member States (currently 193) made a commitment to strive for peace and prosperity for people and the planet, now and into the future. These promises were made in the form of the Sustainable Development Goals, a set of 17 interlinked Global Goals which are a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030.

Success in business is becoming more conditional on ESG and DEI best practice. As Howard Bowen highlighted in the 1950’s, the power organisations hold comes with responsibility.

Introducing Boxless

Boxless is uniquely positioned to build better organisational culture. Through strategic consultancy, we support brands to achieve their social and environmental responsibilities. Boxless focuses on People and Planet, so business leaders can focus on Profit.

Boxless provides a 10-step solution to help organisations develop an ESG & DEI strategic plan.

www.boxless.uk

info@boxless.uk