Corporate Social Responsibility. The importance of partnerships with non-profit organizations

By Adriano Izzo, Civil Lawyer and President of Gennaro Santilli Foundation,

Climate warming, the unsustainable use of resources and the unequal distribution of wealth require us to review the way we do business.

We live in an era in which the logic of profit maximization must necessarily be replaced by a corporate culture that knows how to reconcile economic performance with the simultaneous achievement of socio-environmental objectives.

The term Corporate Social Responsibility (CSR) has animated the political, legal and financial debate in recent years and its meaning has been the subject of multiple interpretations and declinations, demonstrating the multipurpose nature of its meaning.

According to EU Communication n.681 of 2011, Corporate Social Responsibility (CSR) means “the responsibility of companies for the impacts they have on society“.

Never more than in the current context, characterized by global social and environmental challenges – such as climate change, economic inequality and the Covid-19 pandemic -, a company’s actions must be “Responsible”, that is, having among its objectives are to respect the rights of all the company’s stakeholders, i.e. those subjects (suppliers, customers, employees, shareholders, management, local community) who can be influenced by the achievement of company results.

The reduction of greenhouse gas emissions, the adoption of diversity and inclusion policies, the donation of a percentage of profits to charitable causes and the adoption of ethical working conditions are some of the virtuous actions that can create shared value for the company and society as a whole.

The company, in other words, must have not only an economic and legal dimension but also an ethical one, that is, it must take on a social role, take responsibility for the environmental impacts and consequences deriving from its activity.

The European Union, in recent years, has started a series of reforms on the topic of Corporate Social Responsibility with the aim of creating an increasingly sustainable economic-financial system, aimed at making companies aware and responsible of their impact on the planet.

The Corporate Sustainability Reporting Directive (CRSD),  is the new European Union regulation in force from 5 January 2023, which requires EU companies to report on the environmental and social impact of their activities and the business impact of their efforts and their environmental, social and governance (ESG) initiatives.

The objective of the CRSD is to provide transparency to help investors, analysts, consumers and other stakeholders better assess the sustainability performance of EU companies, as well as related business impacts and risks.  CSRD reporting is based on the concept of dual materiality: organizations must disclose information on how their business activities affect the planet and people, and how sustainability objectives, measures and risks impact the financial health of the company. After the historic agreement reached by the United Nations Climate Conference (COP28) held in Dubai in December 2023, which recognizes for the first time the need for a transition from fossil fuels, new scenarios are opening up that give rise to hope for the future of our planet. In this context of renewed hope, deriving from the provision of binding commitments for States regarding environmental and social impact, there is a fact that deserves to be highlighted: the possibility for the profit sector, called to new challenges in the name of sustainability and transparency of its actions, to build new partnerships and synergies with the non-profit world, made up of that set of non-profit entities (voluntary organisations, NGOs, social cooperatives, foundations etc.), which constitute an indispensable resource for carrying out social interventions capable of generating a measurable positive impact on people and the territory. If we talk about Corporate Social Responsibility (CSR) and virtuous relationships with the non-profit sector, we cannot fail to mention the emblematic case of Patagonia Inc., a multi-billion dollar Californian company leader in the sports and outdoor clothing sector. Its founder Yvon Chouinard, in the introduction to his beautiful book “Let my people go surfing”, wrote: “I have been an entrepreneur for more than sixty years. I have a hard time saying this: it’s like admitting you’re an alcoholic or a lawyer. It’s a profession I’ve never respected. Much of business is hostile to nature, destroys native cultures, steals from the poor to give to the rich and poisons the earth with factory waste. But entrepreneurship can also produce food, cure diseases, control population growth and generally enrich our lives. And he can do it while earning money and without giving up his soul“. The “Don’t buy this jacket” advertising campaign on the occasion of Black Friday in 2011 has become legendary, with which the company invited people to “buy less and think before spending“. The advertisement was accompanied by a series of tips that promoted a concept of sustainable fashion, inviting consumers to repair their clothing rather than replace them with new ones. At the basis of Chouinard’s entrepreneurial vision is a wonderful rebellious philosophy, refractory to the logic of consumption and resource depletion, which led him in 2022 to make a revolutionary and counter-current choice: to sell Patagonia Inc. to an organization non-profit created by himself with the aim of investing part of the company’s profits in activities to combat climate change. “We hope this influences a new form of capitalism that doesn’t end up with a few rich people and a lot of poor people” Chouinard, 83, said in an interview with the New York Times. Another future is possible. Just want it. And take action.

Photo source: Patagonia inc.

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