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The New Guidelines on

Social Responsibility
Standard ISO 26000
as
per Flydal
October 2007
Einar

senior adviser, Telenor R&I,


chair of Norwegian committee on ISO26000

A standard on responsibility?
Standards - Why?
What is social responsibility?
Why such a crazy and ambitious task as a responsibility
standard?
Why ISO, and what kind of standard?
For whom?
The process of work, and where we are, and who
Main topics in ISO 26000
Probable outcomes related to Green Branding
Essential green matters that will not be treated, but need
attention

Standards why?

Traditionally: technical details


and interfaces
Since the steam engine and
electricity: Axellerated growth with
regard to technological,
organisational and market
complexity
The development of laws and
regulations often lag behind
In practice, the responsibility for
safety, relevance to purpose, and
consequences for social, political,
economical, environmental
sustainability has been left to the
agents themselves
Standards are tools to adress
this problem
Standards may be more or less
mandatory advice <> law
Standards are tools to make
larger markets and more
complex products possible

An example:
Telenors mobile communications
unthinkable without standardization
13 countries

123 million customers

100.000 new customers/day

500.000 Points of sale

64.000 base stations

300 mill conversations / day

Why such a crazy and ambitious task


as a responsibility standard?
Standardization is a tool for making things happen
Standards create compatibility

If you dont have common concepts, you cant co-operate!


i.e. design tools in an ever more complex world

Standards are guides and tools to achieve practical goals


If you cant measure, you cant manage!

Standards create level playing fields, enlarge markets, and


extend influence, i.e. tools in wellfare, modernization and
globalization

By the way, what is


Social Responsibility?
Working definition p.t. in ISO26000:
Social responsibility concerns the
behaviour of an organisation with
respect to its impact on others and on
the natural environment. As with the
broader concept of responsibility, the
social responsibility of organizations
involves being held accountable for
actions and decisions. Because it
involves willingness by an organisation to
be held accountable for actions over
which it has control, it is an
intrinsically moral or ethical concept
requiring an acceptance that there is
right and wrong. The actions that
constitute social responsibility include the
decision to refrain from a specific
activity where that is considered the
right thing to do.

A hierarchy of SR
charity

business adressing basic needs


expectations according to
good morality and ethics
duties according to local laws

international conventions
demands for environmental, social,
political sustainability

Where
does
SR
start
or
end?

Globalization has created the need


- and needs standardization

Globalization, de-regulation, neo-liberalism, increased FDI, and the global


ICT and financial grids have created a turbulent and confusing development
that set (Corporate) Social Responsibility on the political agenda:

increased wellfare for many,


unequal exchange and exploitation,
extreme wealth creation in the hands of few,
environmental problems / climate change,
corruption and nepotism colliding with level playing field and public service man ethics,
the cultural collisions inherent in modernization and increased communication.

The antagonism / division of work between neo-liberlist thinking and social


responsibility in this framework creates an arena for continous political strife
(Seattle, Genve, Gteborg, 9/11, etc...)

States have lost power. The UN appeals to private enterprise for help.
A standard is a way of establishing new norms acceptable to private
enterprise.

The business of
business is business and
nothing but business...

Free-market
competition is the
optimal method for
maximizing wellfare!

Adam Smith (1723-1790)

Milton Friedman (1912-2006)

Why ISO?
What kind of standard?

Many (C)SR norms, indices, declarations, etc around


ISOs international position is unique as a UN body of reach.
ISO is in position to establish a universally accepted system
standard
System standards describe how to build the organisations
management and operational systems:

ISO 9000-series - standards for quality management systems:

procedures that cover all key processes in the business:


monitoring processes;
keeping adequate records;
checking output, with appropriate corrective action;
regularly reviewing processes and the quality system itself for effectiveness;
facilitating continual improvement
Certification that consistent business processes have been built into the manament
and operations system.

ISO 14000-series - how to organize to reduce negative impact on


environment

ISOs contribution to 1992 Earth Summit in Rio de Janeiro (United Nations Conference
on Environment and Development (UNCED))

A system standard,
but advisory only
ISO 26000 will be a system standard, but will not be a
management system standard
ISO 26000 will provide background, definitions,
recommendations / advice as to how to behave, what
measures to take, what to take into consideration, what to
conform to, i.a. advice as to what to implement in the
management system to be socially responsible
ISO 26000 will not be a certification standard:
There will be no such thing as an ISO 26000 certification

For whom?
Universally applicable

Business organisations

Governmental organisations

e.g. public administration

Non-governmental
organisations (NGOs)

from SMEs to large corporations

e.g. relief organisations

i.e. all kinds of (modern and


formal) organisations
Globally applicable, i.e. all
countries, but not part of law

In practice (my guess):


A practical tool for SMEs
A branding / marketing tool for
commercial enterprises
A political lever for stakeholder
groups (consumerists and other
activists)
A cost to be internalized in the
daily operations
A framework for consultants
to build indicators / indexes and
benchmarking tools

The process and where we are

Tedious work, thousands involved


Lots of large meetings and
committees
Slowly convergence of views,
concepts and wordings

When the expert Task


Groups agree

ISO 26000
Publication

FDIS

International
Standard SR

process
We are here,
working on
Working Draft
version 3

DIS
(Enquiry)

CD
(Committee)

WD
(Preparatory)

NWIP
(Proposal)

Oct 2004
Jan 2005

Mar 2005
(2. Meeting),
Nov 2007
(5th meeting)

Nov 2007
Jan 2008

Dec 2008
Apr 2008

Sept 2009
Oct. 2009
Approaval

NP
WD
CD
DIS
FDIS
ISO

Nov. 2009

New Work Item Proposal


Working Draft
Committee Draft
Draft International Standard
Final DIS
ISO Standard

Delay 6-12 months?

Norwegian ISO 26000 Mirror


Committee Members
(abridged list)

Arbeidstilsynet
Barne- og likestillingsdepartementet, BLD
Bedriftskonomisk institutt, BI
Finansnringens hovedorganisasjon, FNH
Forbrukerombudet
Forbrukerrdet
Fringilla AS
Handels- og serviceorganisasjonenes hovedorganisasjon, HSH
Hydro
Hgskolen i Hedmark
Initiativ for etisk handel
Iris Research
KPMG
KS bedrift
NORAD
Nringslivets hovedorganisasjon, NHO
Peterson AS
Roll-Royce Marine
Statens Institutt for forbruksforskning, SIFO
StatoilHydro
Storebrand
Utenriksdepartementet, UD
UNIL
Veritas

Experts and delegates:


Government
NGOs
Business
Consultants,
research, standards
institutes

Main topics in ISO 26000


(Working Draft 3)

Chapter
Chapter
Chapter
Chapter

1:
2:
3:
4:

Scope (area of relevance / reach)


Normative references
Terms and definitions
Social responsibility in context

history, trends, concept, practice, the importance of stakeholders involvement

Chapter 5: Principles of social responsibility

legal compliance, respect for internationally recognized instruments,


stakeholders and their concerns (incl. consumers, employees, local interest
groups), accountability, transparency, sustainable development, ethical
conduct, precautionary approach, fundamental human rights, diversity

Chapter 6: Guidance on core topics / principles


Chapter 7: Guidance for an organization on implementing social
responsibility

No prescriptions or demands, but advice


Flexible approach: more or less may be adopted; SR-implementation may be
more or less detailed in the management system, ...
Key words: sustainability, transparency, stakeholders, ethics, responsibility
up/down value chains, management systems and processes, relations
to/communications with stakeholders

Main topics related to Green


Branding

Chapter
Chapter
Chapter
Chapter

1:
2:
3:
4:

Scope (area of relevance / reach)


Normative references
Terms and definitions
Social responsibility in context

history, trends, concept, practice, the importance of stakeholders involvement

Chapter 5: Principles of social responsibility

legal compliance, respect for internationally recognized instruments,


stakeholders and their concerns (incl. consumers, employees, local interest
groups), accountability, transparency, sustainable development, ethical
conduct, precautionary approach, fundamental human rights, diversity

Chapter 6: Guidance on core topics / principles


Chapter 7: Guidance for an organization on implementing social
responsibility

No prescriptions or demands, but advice


Flexible approach: more or less may be adopted; SR-implementation may be
more or less detailed in the management system, ...
Key words: sustainability, transparency, stakeholders, ethics, responsibility
up/down value chains, management systems and processes, relations
to/communications with stakeholders

Challenges to organisations, and


to Green Branding in particular

All kinds of organisations may be confronted with the ISO26000 advices

Increased awareness / importance attached to

reputation management
ethics

Private enterprise might have to revise its perceptions as to relevant


stakeholders:

in media, it is hard to argue that ISO 26000 is not mandatory

owners and customers


partners
society at local and higher levels
everybody concerned
even impersonal stakeholders: animals, nature, technologies, business models?
Stakeholders rights to be heard and get response will be strengthened

Organisations will be held more responsible as to both direct and indirect


effects of their activities, to the extent they are in control, evt could abstain
Moral demands and international conventions will be underpinned by an
ISO standard, even if not part of local law
Principle of precautionary approach (Fre-var-prinsippet) will be strengthened
Polluter-pays-principle will be strengthened
Demand for LCA (Life cycle assessments) as a basis for products will be
strengthened
Responsibility along production chain (value chain) will be strengthened

Essential green matters that


will not be treated

Largely speaking, green measures are about efficiency gains (Factor 4


or Factor 10), i.e. producing using less energy, resources, etc.

The potential for such increased energy and resource efficiency is high

Hence, higher efficiency is fine, is important, and much can be achieved

Increased responsibility along the value chain is a adequate tool for this

However, 2. and 3. order effects of products may lead to increased


production

Sometimes: Indirect resource use > direct resource use

Such effects will be outside the scope of ISO 26000. It will need some kind of
strategy, which is more far reaching and complicated, but urgent.
Example from ICT sector follows

The upside:
ICT solutions with factor 1000+

Virtualization, decoupling,
de-materialization are the hype
words since the 1990-ies
ICT has been expected to be the tool
for this

= 9 km by car, or
production of
1,5 kg newspaper

Factor 1000+?

Lockheed Martin Pole Cat


Sneak photo 19.07.06 of prototype

To be used by US Air Force


for long distance operations
wing span: 28 m
weight: 4,5 tonnes
90% printed on a composit
printer!

Next-to-Beaming:
remote copying
remote productionon-demand

Factor = high

The downside:
It does not seem to help!
Global ICT Spending 1999-2009 ($US Trillions)
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Hardware
Communications

Global paper
production

Software
Total ICT

Digital Planet 2006

EU Whitebook 2001

Services

ICT does not replace: Efficiency gains are harvested in


relative, not absolute terms!
Basic knowledge: Efficiency gains are quickly absorbed
by increased activity if not quickly harvested
ICT and traditional activities re-inforce each other

mail > email


paper advertising
> advertising on the
net
newspapers
> news sites
music discs > CDs (10
Giga/year) > MP3
downloading
books > ebooks
archives > databases
libraries
> net resources
(55 Giga docs,
up 7,3 mill
web pages/day!)
atlases
> GoogleEarth
film rolls
> streaming

Telcos are no exception:


higher energy efficiency, more people served,
but also increased total consumption

Relative decrease, absolute increase


GWh per 100 mill
subscriptions

GWh total

This is the next


challenge!
We fax
pizzas, limited
offer!

einar.flydal@telenor.com

Topics for discussion

In your view, what is the greenest policy:

How might it be possible for a brand to profitably benefit from


associating itself with lower consumption themes such as:

1) selling a higher proportion of environmentally friendly products,


OR
2) selling less consumption of the product (i.e. encourage
consumers to buy only what they can efficiently use)?
Why do you believe this?
Is this purchase really necessary?
Have you (the consumer) done everything reasonable to extend the
products life?

In your industry,

What percentage of consumers are willing to make substantial


sacrifices in their lifestyles in order to be green (i.e. willing to pay
higher prices, willing to have less convenience, willing to have lower
quality, etc.)?
Assuming that these green disadvantages cannot be eliminated in
the short-term, what factors might make this portion higher?