What are the biggest obstacles to integrating climate change risks in CSR strategy?

Some of the biggest obstacles to integrating climate change risks in CSR strategy include lack of understanding and awareness of climate change issues, short-term focus on financial performance, difficulty in quantifying and measuring climate change impacts, and resistance to change within the organization.

en tant qu'ancien consultant en stratégie, et cadre dirigeant dans des multinationales, les obstacles sont double : l'absence réelle de volonté des actionnaires , la stratégie occupationnelle par l'amoncellement de structures, d'organisations, de comité et de réglementation qui se chevauchent, qui s'annihilent ou se contredisent, sans parler des conflits de normes que l'on retrouve tous azimuts. En résumé, la RSE est le développement durable du 21e siècle, beaucoup de papier, beaucoup de parleurs, beaucoup de bons penseurs, beaucoup de complexité administrative pour peu ou pas de résultats tangibles pour le citoyen lamba qu'il soit européen ou ailleurs sur un autre continent impacté par des choix stratégiques mondiaux : la désincarnation ?

I’ve seen 10k’s of organisations over the 15 years we’ve been driving CSR. The biggest issue is always the companies purpose and values. If those are clear and focused on being the best they can, then CSR strategy and implementation is simple. It might not be easy but it is simple. The problem I’ve seen for over a decade hence the watered down version of CSR we have in all sectors is the trying to fit CSR into the balance sheet and not disrupt the P&L. Companies that put CSR first and then shape the business around it are the survivors as we move closer to runaway climate. This will be the biggest factor to companies folding, loosing staff and customers! Nature and society is sorting the wheat from the chaff, next it will be policy.

The understanding of CSR is often not clear enough on various staff levels of the company. It has nothing to do with philanthropy but is the commitment to accurately assess the impact of corporate actions on stakeholders inside (employees, shareholders) and outside of the firm (customers, suppliers, community, environment). Hence, a CSR strategy has to start with a commitment on the top, followed by stakeholder dialogues, and internal costs-benefit analyses on all firm levels of different options with their respective impacts. This process needs to be repeated regularly. Educating managers and regular employees on how an adequate CSR strategy can support the firm's long-term success and sustainability will help reduce opposition.

In opinion the complexity associated with the interpretation of climate data, uncertainty in long-term impacts, and varying regulatory landscapes are some of the obstacles affecting an effective integration of climate change risks into CSR strategies. Lack of comprehensive localized data further hinders effective monitoring by impeding accurate risk assessment, making it challenging for companies to tailor strategies to specific regions and prioritize impactful sustainability initiatives.

Data is undoubtedly the driving force for the right decisions. Make sure your data is robust in a 360 and wholistic way and act on it. Try not to focus on the same drivers you always have, be open to change using data that aligns with the new purpose and values. Also don’t loose the human data, heart decisions are often right, and the data can be the guide.

Based on improved CSR awareness in the firm, the next step in implementing a CSR strategy would be to collect adequate data inside and outside the firm. Technical data (emissions, energy standards, environmental regulations) is mostly quantifiable and has to be collected by trained professionals in the relevant technical fields, either in-house or by hired experts. Stakeholder dialogues, on the other hand, help to assess the impact of the firm's actions on employees, customers, suppliers, and the community and deliver less quantifiable information, such as employee engagement, customer loyalty, supplier trust, corporate image, etc. For this step, employees or external experts with experience in qualitative data collection are needed.

The only incentive is doing what’s right. I always question leaders in this…. We all know in our hearts what to do, so be true to self and don’t water down decisions because of …. Always be the best you can, and trust that decision. We have no time for anything but what’s right at its best for the whole. Time to be thinking inclusivity, community and what’s best for people and planet.

Even when managers understand the social and environmental utility of implementing a CSR strategy, they still have little incentive to change their approach. A CSR strategy will only be successful if decision-makers on all levels of the firm contribute to the process by assessing the impact of their individual decisions in the company. Incentives on three levels my help: a) Intrinsic Value: Making business ethically, socially and environmentally responsible can give managers a sense of fulfilment. b) Corporate Success: An adequate CSR strategy can help the firm's long-term success. c) Individual Benefit: Including CSR progress, such as improved energy consumption into the KPI can boost personal engagement and commitment.

In my experience, a good way to tackle the issue of CSR strategy design and implementation starts from the top. The company head or a senior manager needs to be closely involved in the process, realizing that CSR needs to be an equally important topic such as product development, financial stability, and other traditional aspects of running the business. Executives, managers and regular employees need different forms of training to deal with CSR issues. An executive benefits from CSR strategy training or exchanges on business fora. Managers from different departments need more concrete implementation training, on the employee level the training needs to be job-related. Learning from best practices in other companies is a great help.

For innovative CSR strategies amidst climate change risks, prioritize leadership commitment, cross-functional collaboration, and robust R&D investments. In addition, emphasize employee education, foster external partnerships, and incentivize sustainability. Furthermore, set clear goals, conduct thorough risk assessments, and employ scenario planning to guide strategic decisions. It is also important to benchmark against industry leaders, encourage continuous improvement, and transparently communicate with stakeholders. This comprehensive approach ensures adaptability and resilience in navigating the intricate landscape of climate change, promoting long-term sustainability and positioning the organization as a responsible corporate citizen.

Change management The impact to mitigate climate impact risk will involve the entire organization where a lot of time, effort and resources are needed to manage the change.

Embrace the complexity of integrating climate change into CSR by viewing it as an opportunity for innovation and leadership. Educate, collaborate, and innovate to turn challenges into strategic advantages. Remember, the path to sustainable business practices is a journey of continuous learning and adaptation.