Canadian Business for Social Responsibility
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It’s no secret that companies today operate in a global business environment. Supply chains span across international borders, foreign markets influence domestic prices and business deals are made over Skype.

Worldwide trends like population growth, dwindling natural resources and climate change are set to impact every business unless sustainability itself becomes a global priority. For countries operating within natural resource-centric economies such as Canada, there’s even more to worry about. In other words, money does literally grow on trees—if we cut them all down, everybody will lose.

Companies who not only recognize these risks, but aim to do something about them, can help transform the very industries and business models that they operate within.

Canadian Business for Social Responsibility (CBSR), a nonprofit organization that works with companies to improve their social and environmental performance, recently released a framework for the essential qualities of a transformational company. These are companies that take active steps to create net positive social and environmental impacts through their business models.

The framework outlines 19 qualities that make companies transformational, covering everything from sustainable purpose and enlightened leadership to employee engagement, value chain influence and stakeholder accountability. The list is meant to act as a guide for organizations who are looking to amplify their corporate social responsibility (CSR) and sustainability practices.

It’s not a popular way of doing business—at least not yet—but one that Steven Fish, executive director of CBSR, says is crucial if companies want to survive growing global risks.

“Planetary limits is not just an environmental story, it’s a story for us as people,” says Fish. “Do you want to wake up one day with a tragedy that was preventable?”

You can’t say you didn’t know

Fish says companies can no longer turn a blind eye to the impacts of their supply chains. He notes incidents like the collapse of a garment factory in Bangladesh this year that produced clothing for some of the world’s most recognizable brands. More than 1,100 people were killed after the building crumbled because of structural failure. Incidents like this, Fish says, are preventable if companies take serious ownership of where they do business.

“You can’t say ‘you didn’t know’ [anymore],” he continues. “Sometimes we need to reach across competitive tables to help the industry.”

That means moving conversations about sustainability outside the confines of corporate boardrooms and annual reports, and into the real world. Take IKEA for example. Cotton is one of the most important raw materials for the company. Cotton production, however, has serious environmental and social impacts. Harmful chemicals used in the production of cotton cause not only damage to land, but also to the health of the people who apply them.

In 2010, the Swedish retailer founded the Better Cotton Initiative (BCI), a multi-stakeholder organization committed to reducing the environmental impacts of cotton production and improving the livelihoods of individuals in that industry.

Since then, numerous partners have joined including cotton suppliers and manufacturers, worker unions and major retailers like H&M and Adidas. BCI efforts directly address market demand throughout IKEA’s supply chain for cleaner forms of cotton production.

It’s more than just words

The idea of CSR is not a new concept. Yet the term is thrown about to cover everything from employee recycling programs to major philanthropy initiatives. Transformational companies go beyond zero harm goals.

Having said that, CSR is still a contentious issue, especially when trying to convince executives of the business relevance of changing the way a company operates to a more green (and potentially more costly and time-consuming) model.

“People used to say your company will lose competitive advantage and to some degree that is true. But if you take CSR seriously, you’re getting better as a company,” says Fish.

Climate change, for example, will affect energy costs for every company in the future no matter what the industry. If organizations go beyond greenwashing and help influence industry standards, they can be truly sustainable while protecting their bottom line.

Social good to drive employee retention

A growing body of research suggests that employees, especially those in Gen Y, are increasingly looking to work for businesses that do social and environmental good. Many are willing to take a pay cut or switch companies. Fish notes that this heavy turnover is costing money to companies who are unwilling to change.

“That [alone] is a strong business driver to do CSR right and to communicate to employees that there’s a broader social purpose to a company,” Fish says.

Any organization, no matter the size, can find a quality in CBSR’s report to aspire to and to use as inspiration for changing the way they do business. To help companies use the framework, the qualities are divided into three sections: What they do, How they do it, and Who they interact with?

See the full list of qualities of transformational companies on the CBSR website.

Jelena Djurkic
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Jelena Djurkic is a Communications Associate at MaRS Discovery District. Her previous work as an associate editor at sparked her passion for social innovation. Contact her on Twitter @jdjurkic

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