Directors' survey delivers reality check for 'CSR evangelists'

Further evidence of poor take-up of environmental policies among smaller firms was revealed recently in a survey of members of the Institute of Directors.1

The survey, conducted by opinion pollsters NOP, was intended to form the centrepiece of a joint report on business attitudes to corporate social responsibility (CSR) by the IoD and the centre-left Institute for Public Policy Research.

Some 500 company directors, all IoD members, were interviewed. Half the sample were from companies with fewer than 50 staff, while only 20% had more than 250.

The IPPR says much of what has been written about CSR is based on opinions in large FTSE-listed companies, and that its survey is important in presenting the views of small and medium enterprises with less than 250 staff. "It is all too easy for CSR evangelists to be blind to the reality of corporate behaviour."

Funded by the IoD, the survey looked at how often boards discuss environmental and social issues, whether companies collect and report data on impacts and whether they have policies to reduce impacts.

The results suggest a significant gap between directors' recognition of corporate social responsibility as a serious business issue and what the firm is actually doing about it. One-third of companies had a board member with responsibility for environmental issues, and almost 63% discussed environmental issues routinely or occasionally at board meetings, rising to 73% in larger firms.

Two-thirds of directors also thought it important for their company to know about a supplier's or customer's environmental impacts. The proportion falls to a half when it comes to considering social issues.

However, only 28% of companies had a policy to reduce greenhouse gas emissions. These tended to be larger industrial firms. 44% of large companies had a greenhouse gas reduction policy, compared with only 23% of SMEs.

Some 80% of directors said that their company did not publish a report on its environmental or social performance. Large companies were four times more likely to report than small ones.

Only 61% of directors had ever heard of the international environmental management standard ISO14001. Some 25% had become engaged in it. Recognition of the Government's Making a Corporate Commitment campaign was a pitifully low 7%.

The IPPR concludes that "the goodwill fails to be translated into policies that are effective or systematically evaluated." It suggests that there is scope for more market-based incentives to promote CSR. Directors see customers, shareholders and employees as more important than the Government in stimulating such work.

The report led to ructions with the IoD, which objected to the IPPR's interpretation of the data and tried to stop it from publishing its work. In a report intended to counter IPPR's version, IoD head of policy Ruth Lea puts a far more positive spin on the survey findings. "We were pleasantly surprised by the results," she said.

The IoD drew comfort from the proportion of boards that discuss sustainability issues and played down the far smaller numbers taking action.

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