Promoting CSR management with the principle of hierarchy of responsibility

source:goldencsr date:2018-04-22 23:29:36

The principles of corporate social responsibility management include both general management principles, like the most basic PDCA (Plan, Do, Check, and Action) cycle, and specific principles.

According to International Organization for Standardization (ISO) and International Electrotechnical Commission (IEC), the formulation of the management system standards is summarized as seven high-level structural elements. The core of leadership is to define management goals. Plan means making management measures. Support refers to coordinating management resources. Operation is the core management process of implementing management measures by using management resources. Performance evaluation is the management result. Improvement refers to management promotion.

These also form the most basic management cycle. This article contends that, for the successful operation of a CSR management system, there are at least seven principles related with these 7 elements to be considered. Now, what you are reading is one of the principles, that is, the hierarchy of responsibility principle.

Promoting CSR management with the pinciple of hierarchy of responsibility

The first thing to consider about CSR management is what to be managed.

The decisions and activities of an enterprise will exert influence on economy, society and environment, and they are also the foundation for enterprises to assume social responsibility and to conduct CSR management.

In brief, influence equals to responsibility. Then, what is this influence? It is the influence on the interests, appeals or expectations of stakeholders.

This influence is hierarchical. The influence at the first level is that in terms of law. It can judge enterprises’ influences on legitimate rights and interests and appeals of stakeholders according to related laws and regulations and thoughts, reflecting the most general expectation of society to enterprises in abiding by laws and regulations.

The influence at the second level is related to morality. It can evaluate enterprises’ actions in observing morality and following local customs from the aspect of morality, showing the general expectation of society to enterprises in observing moral and ethic rules.

The influence at the third level is that beyond the general social expectations, including general expectations in terms of both law and morality, or there is no requirement in terms of law or morality. This kind of influence demonstrates and reflects the advanced requirements and expectations of social progress.

Corresponding to these three levels of influence, there are there levels of social responsibility.

Obligatory responsibility, corresponding to the first level of influence, is the responsibility that enterprises must assume, and it is the most basic social responsibility of enterprises. It is about what enterprises must do.

Expected responsibility, corresponding to the second level of influence, is the responsibility that represents what enterprises should do. If an enterprise fails to fulfill the responsibility, it may undertake no legal responsibility but will be criticized by the public.

Discretional responsibility, corresponding to the third level of influence, is the responsibility that refers to the voluntary pursuit of enterprises with no requirement by the law or general expectations of the society. If an enterprise fails to fulfill the responsibility, there will be no legal punishment, nor moral criticism. It is a self-pursuit of the enterprises.

Meanwhile, these three levels of social responsibility embody different risks and opportunities. The enterprises’ performance in assuming obligatory responsibility is related to their risk avoidance on law and regulations; the expected responsibility is linked to the steady operation of the enterprises; and the discretional responsibility is connected with whether to create the competitive advantage of differentiation of enterprises.

Starting from the principle of continuous improvement of management system, we can see that these three levels of responsibility are hierarchical. From the obligatory, to the expected, and to the discretional, the requirements for enterprises in assuming social responsibility escalate constantly. However, their transformation is reverse.

That is, discretional responsibility will turn into expected responsibility after a certain period, and expected responsibility will transform into obligatory responsibility someday.

If we can introduce some indexes to represent these three levels of responsibility, that is, obligatory responsibility index, expected responsibility index and discretional responsibility index, then we can use them to evaluate enterprises’ performance in assuming social responsibility, a functional department’s performance in managing social responsibility, and staff’ fulfillment of social responsibility in their posts.

The hierarchy of responsibility principle is a structural analysis method. It can help enterprises, according to their interior and exterior environment, analyze influences brought by their decisions and production and operation activities, and evaluate the level of the influence, and the risks and opportunities coming alone at each level. Based on this, the theme for enterprises to assume social responsibility in a certain period can be defined.

The division of responsibility makes the concepts and understanding of social responsibility more specific. The indexes introduced according to this hierarchy can be used to evaluate enterprises’ performance in assuming social responsibility directly while enterprises improving their CSR management constantly.