Sustainability and CSR
The idea behind “Corporate Social Responsibility”, or CSR for short, is that companies should take responsibility for their impact on society and run their business in a sustainable way.
In practice, many companies use the terms CSR and sustainability interchangeably. For example, some companies have sustainability strategies and a sustainability report, while others have CSR strategies and a CSR report. In theory, however, CSR as a concept is defined more narrowly than sustainability: CSR refers to the specific contribution that companies make to sustainable business practices and sustainability.
A few years ago, many companies also started using the term corporate responsibility (CR) as a synonym for CSR. When discussing CR, some authors put more of an emphasis on the economic dimension of sustainability as well as on questions of corporate governance than when looking at CSR, others prefer CR in an effort to avoid confusion. This is because many people in German-speaking countries mistakenly see CSR as a concept that targets only the social dimension of corporate sustainability, rather than its broader societal scope. This explains why, in recent years, German companies have in some contexts started using CR more often than CSR.
Corporate citizenship, on the other hand, only refers to those activities of a company that go beyond its business activities. In other words, it describes a company's civic engagement. By and large, corporate citizenship is limited to sponsoring, donations and the work of foundations.
Core business anchoring
How CSR is implemented varies from company to company: The CSR activities of a manufacturing company differ from those of a retail company, and a publicly traded corporation faces different challenges than a family-run, medium-sized business with regional roots.
All companies that get CSR right have one thing in common: they ensure it is connected to their core business. Companies that treat CSR as an add-on, separate from their business model and core processes, are not realising its full potential. Be it occupational safety and health, employee satisfaction, energy efficiency or minimum standards along supply chains - many CSR fields have a huge bearing on a company's business success.