The recently concluded anti-bribery management system and corporate social responsibility workshop organised by the Institute of Corporate Governance of Uganda (ICGU), in collaboration with CSR International, Austria, raised a number of misconceptions in the governance and management of both public and private institutions in the country.
In an attempt to champion good corporate governance practice, the training first focused on clearly understanding the difference between corporate social responsibility (CSR) and social responsibility. Most often, organisations view CSR as a charitable activity, where the organisations participate in giving out their products and services without due consideration of whether it had been part of their earlier plan (budgeted) to create an impression of a responsible organisation.
CSR International, Austria, refers to CSR, ISO 26,000 as a strategic management tool that helps management to do and remain sustainable in business. It is an investment well thought out right from the strategic planning level for the sustainability of the organisation without compromising profitability, society needs and the protection of natural resources. Sustainability is an approach to creating value that sustains or enhances the systems and resources upon which the value depends. Due to the growth in population and consumption placing visible stress on access to natural resources, organisations need to be innovative.
For organisations to benefit from CSR investment, there is need to consider the business upon which financial and manufactured (goods) capital is realised, society where human, social and intellectual capital is harnessed, and the environment where natural resources are preserved. Organisations need to rethink of the business model for sustainability.
For an ideal organisation, a holistic approach to CSR requires the organisation to consider the following seven elements to create an economic, social and environmental impact: corporate governance, human rights, labour practices, fair operating practices, consumer issues, community involvement and development, and the environment.
However, each element covers specific issues that an organisation should take into account when identifying its social responsibility.
Management should be able to detect weaknesses in these practices that can lead to fraud and bribery. Every element, but not necessarily each issue, has relevance for every organisation. Corporate governance provides a framework for monitoring and safeguarding the interests of various market actors and stakeholders.
Consumer tastes keep changing, thereby requiring organisations to be creative and innovative to meet these needs. The environment provides the natural resources required for production, but management should be able to apply fair operating practices for the organisations sustainability for not only its survival, but growth, development and prosperity.
Community involvement and development provides assurance of market for the organisation’s products and services, ultimately leading to sustainability of an organisation’s operations as the community buys and consumes the products and services provided.
The community also can provide valuable information into product and service development and the quality therein to satisfy customer needs.
Secondly, the training raised awareness towards international certification of organisations so that their products and services meet international standards – a general requirement for organisations to remain globally competitive.
As we embark on our local Buy Uganda and Build Uganda (BUBU) policy, our institutions must be responsive to the globalisation trends. We shall not remain consuming our own products and services, when the borders are widely open to our brothers and sisters in the Diaspora, who need international standards.
Therefore, to embrace CSR initiative, managers of our institutions should set aside funds for training their staff in these certification courses if they wish to compete globally.
Competition is the number one challenge world over and managers should be able to take it head-on through transformational innovation in products and process technologies. Success will require completely new business models. Interestingly too, the challenge is likely to encourage a much more collaborative form of capitalism. All in all, the CSR seven elements highlighted above provide a comprehensive framework upon which an audit of any organisation shows its sustainability and prosperity, hence globally competitive.