Corporate Social Responsibility (CSR) is a growing concept that is beginning to affect all businesses…are you ready to meet the requirements?
Corporate Social Responsibility, or CSR, refers to the concept that ALL businesses have responsibility for the social, safety and environmental consequences of their business activities.
Put simply, the world expects all of us to be good corporate citizens, working towards a future where business practices are fair, workers are kept safe and paid correctly, the environment is not unduly harmed by business activities, and these standards are promoted and respected right down the supply chain.
Sounds good, but what does this mean for you?
Who is likely to be asked to undergo a CSR Audit?
Many of the world’s leading corporations have taken the lead in Corporate Social Responsibility and have enforced audits upon all sections of their supply chain. This is also true of Australia’s largest brands.
Therefore, if you are a supplier to any large corporation, no matter how peripheral your input, it is highly likely that you will be asked to undergo a CSR audit.
So, if you supply a big corporation, being CSR compliant is a good way of protecting your business.
If you don’t supply a big corporation, CSR compliance is a great potential selling point, that can differentiate you from your competition.
Many businesses have taken it upon themselves to request a CSR audit prior to having it forced upon them, as a way of demonstrating their compliance, and to be seen as leaders in their field.
What does a CSR audit look like?
CSR audits follow a pattern that will be familiar to those who have had their management systems audited, and indeed the management system is part of the audit. There are some stark differences, however, as you can see from the audit outline below.
The audit process follows these general steps:
1. Opening Meeting with Management
2. Site tour, particularly reviewing WHS systems, and usually with photographs of the site
3. Employee interview (this is something that only ever really occurs in CSR audits)
4. Management System review, including:
· WHs policies, procedures, records
· HR policies, procedures, and records
· Environmental policies, procedures, and records
· Business Ethics
5. Payroll review, including:
· Examination of payslips for interviewed employees
· Work contract review
· Timesheet review
· Work permission review (including Vevo checks, etc.)
6. Preparation of the findings by the auditor
7. Closing Meeting and formulation of Corrective Action Plan with Management.
What standards does a CSR audit follow?
There is no single, accepted standard for CSR.
The most commonly used standard in Australia is the SMETA 4 Pillar or 2 Pillar standards.
The 4 Pillars referred to are:
· Labour Standards (encompassing worker’s rights, their treatment and pay conditions)
· Worker’s Health and Safety
· Business Ethics
· Environmental Practices.
The SMETA 2 Pillar standard does not have the extra environmental or business ethics clause found in the 4 Pillar standard (although it has elements of both of these).
Many large corporations have developed their own CSR standards that they ask their suppliers to be compliant with.
How do you know if your business is compliant with CSR standards?
You’re a good corporate citizen, right? You look after your employees and pay them what they deserve, right? You have a WHS management system in place, and maybe environmental policies and procedures…
Well, that’s all a good start, but you may need to do better. Have you got a CSR Policy or Ethical Trading Policy in place? Are all your workers’ contracts correct and signed?
You need to do a Gap Assessment – which may be difficult if you are unfamiliar with the CSR standards.
Is it all about ticking a compliance box?
I think we all want to be proud of our businesses and know that we are good corporate citizens. Compliance with CSR shows that you are an ethical company with standards that will stand up to scrutiny all around the world.
That is a goal worth achieving.
Just give us a call on 1300 370 665 or send an email to firstname.lastname@example.org and we’ll talk you through the best options for your organisation, no matter where you are in Australia.