Articles

MONTHLY FEATURE

February 2001

By

Ivor Hopkins

 Corporate Social Responsibility in Small and Medium Sized Businesses

Introduction

Corporate Social Responsibility is primarily regarded as the province of large corporations who not only have deep pockets and legions of staff, but who also have the collective guts to do something. Companies like Shell, BT and The Body Shop have famously burnished their corporate reputations and gained marketing kudos whilst doing their bit for our planet: they have the size, depth and reach to make a difference. But what about the large number of small or medium sized enterprises, whose depth is measured by a multi tasking MD and whose reach is more likely to be local than national? Maybe a company like yours? Should you bother to invest precious time and resources in what is perceived as another management fad? Are you unsure of any returns? Or should you simply duck out with a shrug, not because your interest is slight, but because your perceived impact would be too small?

"The fact that small businesses have a heightened requirement for good, multi-skilled employees, strong personal relationships and successful local engagement means that small firms can be a good environment for corporate social responsibility to flourish" says Stephanie Draper, in her very accessible publication Corporate Nirvana: Is the Future Socially Responsible?

She continues, the main motivational factors for small businesses to be socially responsible based on interviews with managers and owners of small businesses are as follows:

1.   Learning for staff - new skills and competencies developed

 2.   Improved culture - increased motivation and commitment of staff

  3. Reputation - enhancing the firms image locally

 4.   Recruitment - links with potential recruits

 5.   Productivity - gathering innovation for products and efficiencies

 6. Corporate responsibility - personal satisfaction from discharging wider responsibilities

      7.   Customers - expanding the customer base

Pipedream or potential?

Let's look at some of these ideas in practice. BOVINCE LTD is a family run printing business in a deprived area in the East of London, UK that specialises in poster printing and 'bus shelter and 'bus advertising panels. The company is run by MD Peter Rosen, whose zeal for CSR issues comes from a deep personal conviction and a desire to make a difference, not only with the company's stakeholders but also for the company's profitability. His enthusiasm has inspired two other key members of his staff who now drive CSR with him: the trickle down of their ideas into the rest of the 60+ staff is in itself inspiring!

BOVINCE LTD is an excellent example of how CSR issues make serious business sense. Their activities started with Peter Rosen's father and his focus on waste paper management: listed below, following the above list, are just some of their successes:

1.   Learning for staff: the Kaizen Continuous improvement programme seriously impacted on the technicians and their working practices

2.   Improved culture: at a time when the phrase "a job for life" brings a jaded and knowing smile to most managers' faces, staff turnover is very low and the average length of service is 10 years

3.   Reputation: they recycle waste, give drawing paper from their own production to local schools, as well as re-direct old stock from their suppliers. This has not only enhanced their position in the local community, but has enabled upstream stakeholders to clear old inventory and free up storage space without having to meet extra disposal costs. BOVINCE's fame has also spread to the Corridors of Power: Peter Rosen was recently invited to a meeting on business regeneration by Tony Blair, and funding from a whole battery of governmental and local authority sources flows into the company.

4.   Recruitment: as a result of their efficiencies, they can offer their staff higher than average salaries, which is real bonus, given the positive company culture.

5.   Productivity: Health and Safety issues are crucial. They have dramatically cut down days lost through illness or injury: as an example, film processor developer was formerly delivered as a liquid in drums which were difficult to handle. A move to a powdered form - which was more expensive - cut down storage space, spillages and injuries, because the containers were so much smaller.

6.   Environmental: they moved to computer based processing of the graphics images sent in by their clients: this has not only meant a huge reduction in the use of photographic film and in the subsequent amount of waste, but it has also meant that the number of motor bike couriers roaring up to their site has so dropped off that Peter is often astonished at both the calm and the improved air quality!

7.   Corporate responsibility: in the case of Peter's two key employees, Derek Hall and Don Blackwood, their personal involvement in CSR has enriched their private lives which has fed back into enthusiasm and commitment in the company: they are prepared to go that extra mile in their daily work.

8.   Customers: as a marketing instrument, BOVINCE's engagement with CSR is one that will help the company to expand into Europe.

Before you think that this is all too good to be true, life is not perfect and there are two downsides to BOVINCE's CSR engagement. But, as in life, neither is insurmountable:

a.   BOVINCE's activity takes a lot of management time and Peter and his team are currently rethinking how they can better prioritise these activities in a way that supports the business but prevents them from literally becoming the victims of their own success.

b.   Peter's clients are primarily advertising companies and, whilst he can discuss and pursue CSR issues with his suppliers, this is currently not an option with his customers. Until he also proves to them the business sense of CSR.

Final Remarks

CSR is a huge issue and it is this hugeness that puts off many small companies, either because they don't know where to start or because they fear being overwhelmed. BOVINCE is committed to CSR because it is good for business and, whilst the company might be re-focusing their involvement, they are not about to give up. Far from it, in the case of BOVINCE, it is certainly the MD's personal commitment and enthusiasm that started the snowballing above but he now has two equally enthusiastic lieutenants who are also hands-on and eager to drive the mission. And, as Peter said to MHCi: "CSR is good for my business and brings a challenge that we all enjoy. Our CSR activity motivates my staff, helps the environment and positively affects our bottom line".

1.   Stephanie Draper, Corporate Nirvana: Is the Future Socially Responsible? (The Industrial Society, 2000), p. 15

2.   Joseph, E A welcome engagement: SMEs and Social Inclusion (IPPR 2000)


Contact: Peter Rosen, c/o MHCi

Contributed by: Ivor Hopkins, Director, ex Partner MHC International Ltd with thanks to Peter Rosen for assistance.