The direction of any CSR activity comes from firm’s corporate policy; being socially responsive can be differently interpreted in different cultures at different levels of awareness – as agents of globalisation which either make firms a part of the solution or part of the problem, they are claimed many a times for exploitation, corruption, encroachment of human rights and most of the cases degrading environment (Lasserre, 2007). We think the concept revolves around ‘charitable donations’ or ‘community investment’ (Clutterbuck, Dearlove& Snow, 1990), which were earlier tagged in a very small way in defining CSR activities; today it is understood with much boarder perception which includes environment, transparency, global citizenship, equal opportunities which tries to comprehends all the stakeholders of the firm. The investment management industry is facing immense unbending competition and strategic consolidation. Significantly in general with other types of businesses even the investment management firms are pro-actively responding to the CSR cause (O’Riordan&Fairbrass, 2008). There are many questions which arise from the major crises and scams in the financial sector which further drives CSR activities towards fair trade, responsible investments, investor’s disclosures and the top most being investor’s protection and education. They are sometimes voluntarily initiated and many a times driven through regulatory pressures but the prime intention of any CSR activity is to create a socially responsible entity. Global Ethical Web (Lasserre, 2007) Host Countries United Nations European Union International Institutions Governments IMF World Bank Investors’ countries CSR Financial Markets Industry Associations Global Firms Corporate Executives Shareholders SRI Funds Front-line Managers Public Opinions Caux Amnesty International Non-government Organizations Green Peace Press TV Churches Academia Transparency International Corp-watch A global ethical web (Lasserre, 2007) which introduces us to various stakeholders in the financial sector, it shows interrelationships with each other and the community as a whole. It communicates firm’s impact on various stakeholders and assumed/forced responsibilities as below: a) Responsibilities towards customers b) Responsibilities towards employees c) Responsibilities towards suppliers d) Responsibilities towards investors e) Responsibilities towards political arena and country specific f) Responsibilities towards the broader community g) Responsibilities towards the environment h) Sponsorships and partnerships The above list (Clutterbuck. et. al., 1990) has been evolved under various global demands from various stakeholders. A well guided strategy under a strong leadership needs no force or suggestion; its CSR actions become a standard by itself. An approach to futuristic CSR strategy can also be consolidated through a framework explaining rationale for Orb Investment’s CSR activities. It will not only shows Orb’s direction of CSR agenda but also throws light on how Orb can commit ethically and economically in making ‘people’ equip with knowledge, in channelizing finance engines towards purpose/responsible investment to make the ‘planet’ a better and prosperous place and reinvesting ‘profits’ in empowering the community in need. Design Framework for CSR agenda (Lasserre, 2007 & Sir. Cadbury, 1987) Social responsibility issues and the global firm. Sustainable Development Business Ethics Global Social Responsibility Issues Global Citizenship Human Rights and Dignity Orb Investment’s CSR activity is mainly governed by the 3 dimensional model keeping in mind the order in which the 3Ps (People, Planet and Profit) “We aim to contribute a percentage of company profits back into the community, charities and the environment”. are achieved. It operates as a trend setter in the investment management industry in Australia through its philanthropic practises and now wishes to expand its CSR and Social Responsibility activities across the world – it has initiated few projects – mainly towards empowering underprivileged communities through education (in financial markets and other investments). Sustainable Development: There are various ways of attaining sustainable development; it may be through maximum utilization of resources with reduction in the intensity of materials used or energy used, it can also be achieved by maximum use of renewable resources or through recyclable means and minimum waste dispersion. Product durability and service intensity is further an innovative way of sustainable avenues to development, all the above can be combined or approached separately for gaining sustainable development (Holliday, Schmidheiny, Lehni and Watts, 2001). At Orb Investments, we increase the service intensity of our investors and use investment and finance engines to support those investments which would facilitate one or all the above. Many socially responsible investments are channelized for achieving a balanced growth for the future keeping in mind areas of sustainability. And also through the SA project we propose to enhance the service intensity in the investment trading platform by introducing a new class of South African villagers to part take in the commodity and exchange market trading. Human Rights and Dignity: Corporations have faced many abuses and confronted direct and indirect human rights issues with various complicities in violating them (Freeman, 1984; Daniels and Radebaugh, 2001; Bowmann-Larsen, and Warren, 2004). The most concerning is child labour and civil unrest (Oxfam/VSO/Save the Children 2002; Clark 2000; Brammer and Pavelin 2004; www.twnside.org. 2004; Weiss 1998:35). Orb has thoroughly worked out ways and means to be socially responsible in the areas of protecting human degrade and dignity and empowering society through social investments; also via the SA project Orb is intending to take a stride in being socially responsible by enhancing the human dignity through education and knowledge and equipping them with investment tools. Business Ethics: It’s basically how a company incorporates its core values in the business practice and decision making; it is purely reflected in its policies and practices. Orb being into financial services has to follow a comprehensive list of regulatory norms, along with complex structure of financial reporting and accounting integrity, it not only maintains decorum with finances but also use ethical advertising, equal employment, fair trading, non-corruption and non-bribery practises. Keeping in mind the concept of equality; through the SA project Orb would encourage economic development in making the subjects – self-content in working for them and making a living along with a healthy contribution to the community in which they live. This is a futuristic view of equal employment and economic development which is not limited to nation’s boundary but extends to the rest of the world. Global Citizenship: This is not an attempt to create profits and distribute it across communities for their betterment this would only be like giving them a fish to eat for a day but it’s a concrete effort and a holistic approach to touch all dimensions of the society and its stakeholders in teaching them to fish on their own. Global citizenship would create a win-win situation for all its stakeholders and through this SA project Orb engrosses a higher podium to create employment, wealth, social awareness, community development and above all empowerment through education. Comprehensive Approach: The above four dimensional framework would act as a guiding star to direct Orb’s CSR cause and efforts considering the global ethical web and its stakeholders along with the framework through which CSR policies can be originated; through this we can infer that every establishment or company should have a comprehensive approach while conducting CSR activities. The context in which they choose to function, the circumstances they presently operate in, the events occurring in the internal-external and globe environment; also the different stances of the stakeholders in the business are the factors which influences a company’s CSR activity. Many companies struggle to define CSR and SR in the real sense hence their approaches varies – you all would agree with us if we say that effective CSR departments & SR firms definitely make a good brand image (for the firm); of course – ‘yes’ but Orb Investments considers it with a different ‘perception’ moreover taking it as self-responsibility than as obligation and also takes social responsibility as a personal concern. Orb Investments major challenge is to inculcate the same perceptions of CSR &SR in its old and new investors/client base and it encounters this challenge by community contribution, educating society and today by empowering the underprivileged through education; to earn their living and for the society they belong to. To induce such a perception among its stakeholders Orb’s prime agenda would be inculcate such perceptions in its organisation culture among its employees and management practices to consider social responsibility as top most priority in their business function, the objective should be successfully creating value for the firm, people and planet, during which Orb should also align its policies, programme, governance, cause and strategies on those paths. We will see a graphical framework of factors influencing Orb Investment’s CSR activities. A brief representation of factors influencing CSR activities (O’Riordan & Fairbrass 2006) would not only elucidate Orb’s scope, reach and approach towards its CSR needs but would also highlight the strategic CSR process (formulation and implementation) required to tackle these factors successfully. Factors Influencing CSR & SR activities (O’Riordan & Fairbrass 2006) CONTEXT Circumstances Size & Power of the Industry Globalisation Trends and Behaviour PEST Analysis Culture & Architecture Stakeholders Types Power Spread Relationships Events Crisis Issues Timing Scenerio PERCEPTION CSR Perception - Responsibility - Obligation Challenges - Elusive concept - Conflicting Expectations CSR PRACTICES/RESPONSE Management Strategy Practices/Policies Governance Communication Image Reputation Control/Measurement By understanding the context under which factors influence a firm’s CSR activity, which leads to its perception towards responsibility and obligation towards society and expectations from the society. This can serve the basis for the logical reaction or response from the firm in framing CSR strategies, policies, communication and a long run framework for future activities. The same has been unfolded and justified for us as below: Context: Every CSR activity before formulation and implementation needs to be assessed for effectiveness and sustainability in the present context, the need to do ‘good’; comes with a cost of implementation and controlled by the limitation of a firm’s resources (like availability, opportunity cost, etc), it is also governed by other dimensions of firm’s environment and governance capabilities. Present Circumstances: The best way to scrutinise this systematically is by a thorough enquiry of the external environment and circumstances of the investment management and related industry. The size, the power and the influence on the economy which the industry has – would be crucial to identify and by this awareness we can gauge the reach, scope, impact and perception which exist among present and potential customers. The PESTLE will help us to find a path way through which all the variables and parameters can be studied which would be vital in making valid assumptions for CSR activity and strategy formulation. Globalisation being at the crux of all the above concepts and it also in many ways affect a firm’s functioning – may it be operations, strategies, policies, competition or even in context to CSR activity. In fact considering factors of globalisation would help a firm/corporate to be at the fore front of any development or competition while formulating any strategy. CSR activities differed from nation to nation earlier but since globalisation the world is becoming one place for setting norms as far as environment, human dignity, business ethics and social responsibility is concern (Deresky 2000; BowmannLarsen and Wiggen 2004; www.mallenbaker.net(b) 2004; Stigson 2002; Castka et al 2004; Woodward et al 2001; Maignan et al. 2002; Maignan and Ferrell 2003; Epstein and Roy 2001; Haugh 2003; Crane and Matten 2004:439). Global citizenship is the objective which every firm today wants to achieve for being ‘the preferred corporate’ along with the key towards ‘sustainable growth’, Orb would also try and aim to be a firm of/for the future. Stakeholders: The various stakeholders as we refer to the ethical web act as drivers to a firm’s business and its strategy. They hold a major say in the company’s direction to conduct business, the influence may vary from their different types (Murray & Vogel, 1997); sometimes direct consumers/stakeholders may have less articulation than the press/media and other lobbies for human rights and environment protection. But of course treating the direct consumers/stakeholders is the key for market share; on the other hand the power of stakeholders also determines the direction towards firm’s CSR activity as their perception towards responsibility has to be satisfied by incorporating their views in the CSR policies. The spread of those stakeholders would invite variety and complexities with a global perceptive and stakeholder relationship (Murray & Vogel, 1997) would also communicate present and future expectations with the firm. Initially it might be hard for a firm to understand the view of its stakeholders in the existing scenario but it would definitely widen the perception and scope required by the firm to be on the edge of competition and gain competitive advantage. The Porter’s five forces analysis would be helpful in case of Orb while drawing conclusions on various stakeholders in an organised and consolidated way. Events: There are few events which have changed the entire view at which economic or non economic activities are conducted in the world. After the Bhopal gas tragedy safety and protection of employees are governed with highest priority (Gladwell, 2005) in certain countries where such norms did not exist, after the financial crisis certain disclosures and statutory publishing have become mandatory for transparency and fair conduct (Gladwell, 2005) and other issues have brought obligatory pressures on the firm’s responsibility position. There are many firms today who work on many more responsibility issues in addition to the one which are by obligations. Orb has been in the investment management industry for last 20 years and has kept a close eye on the circumstances, events and stakeholders expectations. With its expertise have predicted the wind of unexpectancies; at the same time have been able to keep space with the socially responsible image on the obligatory front and also towards future concerns of the society. It proposes to do more through this SA project via its sensitive CSR approach. Perception: There are certain perceptions which already exist by obligation in the CSR forum; like going green, equal opportunity etc. But while breathing the circumstances and events in its day to day affairs one tends to develop certain perception about the prevailing world (internal and external environment) around; CSR also flourishes from such perceptions or insights by being a part of the web, this gains momentum and from the PESTLE factors, industry trend, power of the stakeholders or relationship with the stakeholders makes a firm sensitive or aware of certain situation which it might choose to work for. This perception then becomes a cause for the firm to direct its CSR activities. There is another school of thought (Gladwell, 2005; Gavin & Wiley, 2006; O’Riordan & Fairbrass, 2006) which shouldn’t be ignored while dealing with perceptions in CSR, it’s four dimensional; which includes analysis of Country>>Industry>>Company>and>Individual’s perception. It’s a very simple and convenient way through this study; to amplify the level and concept of perception under different context of country, industry, company and even the CEO’s understanding of perception. It is easy when the firm’s and the stakeholder’s perceptions match but it becomes challenging when it differs widely. This gap can be narrowed by constant communication with the stakeholders in avoiding conflicts over expectations. Orb has to build a series of communication channels through which it can convince and constantly communicate with its stakeholders. Though it’s an individually driven proprietary firm it has widely inherits proper organisational structure along with democratic decision making. Even decisions at the CSR front are extensively and mutually decided between various stakeholders and Orb as an entity, the South African project has also been communicated and mutual consent from all the clients have been acquired; the profit sharing ratio of Orb and the paying client which it intends to use in the SA project has been collectively approved. Response: These are the results which are usually expected from any competitive firm who not only wants to make a mark through CSR but who aligns its radar to sense areas where social responsibility is required now and for the future. The expected response is actually to redefine the below areas which functioned earlier without CSR focus; the same needs to be refurbished with CSR at its priority. Orb has been functioning always with CSR objective at the crux of its business activity but again this was just at the local or national level, this is the first time it is moving out of the national boundaries for a global cause, hence it has to get all things right at the first go with the areas listed below to inculcate social responsibility at every area of its function along with control mechanism. • Management: The word management as we understand is through all the function it performs from planning to implementation and review and back to planning needs to have a CSR angle. On the another hand, Orb would be benefited by having a global outlook by being exposed to different variables and circumstances of the investment management and related industry and its linkages along with CSR perspective. • Strategy: Strategies for the firm needs to be formulated and implemented keeping in mind the CSR outcomes. CSR earlier may be perceived as social stunt performed for recognition, we still can debate that few corporations perform CSR functions only for recognition, goodwill and fame, as at the end the outcome is to earn a clean image but with lot of research and enquiries we can conclude that today’s corporation strives to work for the society strategising for sustainable growth and development. Orb also wishes to drive through its CSR; keen to create an ever expanding and sustainable business model and add few deliverables to its corporate strategy by believing what Bill Gates once said, “As we look ahead into the next century, leaders will be those who empower others” and that’s Orb strategy to empower and create new class of traders, brokers, investment custodians and many other different investors through the SA project. • Practices/Policies: CSR idea needs to be embedded in every practice and should be a flavour in every policy; this is how it can conduct its CSR activities in a consolidated fashion. Orb can augment its policies according to different nations it functions and as per the CSR cause it wishes to implement. • Governance: It is required at various steps and various level of succession to manage the every strategy (even CSR activity) it wishes to employ. Proper governance will result in faster processes and more over better utilisation of resources occupied for this cause. It would also safe guard the image/reputation of the firm to watch violation of policies or misconduct if any. Communication: Orb already has hands on educating people through investment lectures, business talks and other motivational and self-development lectures but through this project it attempts to engross different territories of different nations in providing them education to trade in currency and commodity markets and the first pilot would be in SA and then replicate the same in different countries where it operates and wishes to operate. The same has to be communicated to its different stakeholders in their respective forums and meeting to maintain harmony in formulating and implementing. Such a communication can be a stepping stone for prospective stakeholders in the line of businesses; this can be helpful for Orb to pose its position in the investment management industry presently and for the future; where people would easily identify Orb Investments with rest of the players in the market. • Image Reputation: Reputation will surely be an outcome of such CSR employment and hence needs to be managed effectively and efficiently; this execution can also bring global risk and bad reputation if mismanaged. On the other hand, when managed well will surely bring global reputation and recognition. Orb aims to empower the society through education and with the SA project in hand it proposes to take a stride in its CSR agenda for the villagers who haven’t experienced economic contentment, by this agenda Orb will be respected and accepted in emerging economies like SA and can create a global pathway to penetrate new markets. CSR activity of this stature will surely help Orb to gain a global image and maintain its global value for the future. • Control/Measurement: Through the mechanism of control/measurement a firm quantifies the work which is yet to be completed and keeps a track of direction required to complete the same. Orb needs to form a gang chart to formulate an action plan to measure, control and set milestones to complete the pilot by 30th November, 2011. At GABA we suggest Orb Investments to revamp and rephrase its website keeping in mind the agenda of CSR. Orb can also follow the above model along with few suggestions listed below and they are: 1) To conduct an environment scan (PESTLE analysis which GABA will help them to) of the immediate past and near future along with few expert suggestion from their operational and fund managers, keeping in mind the context, circumstances, events and stakeholders. 2) Analyse, evaluate and balance the perception of the country, industry, company, stakeholder and individual. 3) Follow the process of CSR as mentioned below (which includes the Consultancy Report/ proposed process) 4) Constantly review its strategy, process and implementation. Suggested CSR Process (O’Riordan & Fairbrass, 2006) Implementation Strategy Development Value Alternative Stakeholder priorities Vision/Mission Causes supported Objectives Methods of support Scope Practices/Policies Strategy Implement/Control Output Selection Communicate Goodwill/Reputation Combination Stakeholder Sustainability Based on Value - Fit Dialogue Image