Corporate Social Responsibility in the Water Sector (STWI) PDF

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Corporate Social Responsibility in the Water Sector Developed to guide for waterworks. corporate social responsibility (CSR) is a self-regulating business model that helps a company be socially accountable—to itself, its stakeholders, and the public. By practising corporate social responsibility, al...

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Hello, my name is Emilio Guzman, and I work at the Stockholm International!Water Institute, specifically together with the team leading the Sweden Textile!Water Initiative. I will be sharing some insights and thoughts about corporate!social responsibility and sustainability being integrated in a business!partnerships and collaborating together with the private sector to move the!sustainability agenda together. The Sweden Textile Water Initiative is a!capacity-building program towards improving the environmental performance!of suppliers and sub suppliers to private companies. We focus on mainly!working with water efficiency chemicals, leather production, and energy management.!We work with the main Nordic companies and throughout the years we have had a!collaboration with H&M, IKEA, Lindex Filippa K, KappAhl, and Indiska and!many others, total 30 companies. We have managed to reach about 400 factories and!we are focused geographically in the main production hubs of fashion and!textile: China, India, Bangladesh, and Turkey. Our program is intended to build!capacities in the subsuppliers and supply chain. Our goal is to increase!cooperation by creating a healthy, open and trustful environment. It is!fundamental for us to create the conditions of trust where companies and!with the support of the Sweden Textile Water Initiative, we can address those!challenges and perhaps solve those problems together by showcasing concrete!examples. There is an inevitable ripple effect which positively affects social!wellbeing and poverty alleviation in developing countries, but the key!approach here is that by knowledge transferring and empowering local!factories, local communities with knowledge and building those capacities,!we can become redundant. It is our intention that with time the factories, the!employees, the technical experts there, will be able to address!sustainability challenges in the future, new ones, without the support of!an organization like ours. Before we share a couple of insights and ideas!on key concepts that we need to bear in mind when we work with private companies,!and this collaboration with nonprofit organization like ours, we need to go!back to the basics. What's the definition of corporate social responsibility?!Perhaps everyone knows the triple bottom line approach where we have three!main pillars-profit, financial picture, economics, then we have the planet and!the environment, and also the social conditions, people. The challenge and the!beauty of working with a corporate social responsibility is that we!constantly need to work along these intersections between these three. It is!not feasible enough to just provide solutions for one of these three pillars;!those three need to reach consensus, those three need to work together to!address the main problems that we have, whether its water supply ,water!contamination, or other environmental variables that are affected by working!with water. The first idea is about awareness. Corporations, staff, the product!development teams, and sourcing developers need to be aware that with!big size, with big volumes, comes responsibility. Small changes in their!product development, small changes in picking the right suppliers with the!right environmental considerations, times the big volume that corporations and!private companies have, will make a

huge difference. In many cases, it is essential!that engineers, designers who picks the suppliers, communication must be aware!that their decisions will have an environmental impact. Together, these need!to be anchored to the company values. It is often discussed that what comes!first: we make the business case, we revise the budget and the resources that!we're willing to invest, and then see what we can do about it, or we turn the!discussion around and actually we say, what are the values,!what does the brand wants to stand for, and based on that build the business!case. Awareness is perhaps one of the first and key elements of my second idea,!which is change management. We need to move gradually away from social and!environmental issues to more a business priority. The companies that we have the!the privilege to work with have understood this, and openly bring their!insights and their contributions to make their supply chain with our support!better. It is not about short-term investments, short-term actions, it is!about long-term profitability. Actions and approaches such as clean up after!the mess is not viable anymore, and the experience has proven that is more!expensive. It is necessary to plan ahead and perhaps have considerations!such as material choice, separable and recyclable constructions, and using!materials that can be separable, but change management also requires time!in the sense that the organization needs to have the time to digest these ideas,!and with transparency, with openness integrated in their working routines. In!many cases, experiences such as pushing for strong KPIs at the very beginning of!a sustainability intervention could not bring the best results. It is fundamental!that the KPIs and the indicators and the ambition with short-, mid-, and long-term!comes after a proper awareness. It is fundamental that the colleagues, the ones!that will be working directly with sustainability, will have these messages!clear. A corporate social responsibility environmental improvements in a!production line or in a water efficiency program in a supplier, the!best ideas will often come from the staff, the technicians that work directly!with the production lines, not with expert, not with a sustainability!manager, sustainability responsible people in the brands, in the companies.!Therefore, it's important to anchor these key messages in this agenda throughout!the organization. My next thought is about moving away from neutrality. Less!bad is not enough. A good example of this discussion is the climate. Perhaps 5, 10!years ago, becoming climate neutral was a good!ambition. Today, it's not good enough. We need to become and make our companies!climate positive. But think about it; if you're running quickly,!top speed, towards a cliff putting the gear in neutral is not a solution. You!need to step on the brake, and eventually turn around. That is the change that we!need to do in these organizations with the support of governments, of legal!framework, and the nonprofit sector. Look at the waste as resources and reuse!mindset. It's a very good example that the textile industry and some fashion!companies are selling and developing, sewing kits, repair kits for clothes, so!customers understand that reparation is a sustainable option, not always throw!away is the best behavior, and by influencing customers, perhaps

companies!can influence communities, and therefore society. We need to encourage companies!to develop products that have a more sustainable behavior, that enable!the customers to change their patterns, and sewing and repair kits is a good example!of this. Measure, is another thought. Measure as soon as possible. Start!measuring; it does have to be perfect, but have a sense of capturing the!improvements and the movement of sustainability within the supply chain!and within the product development processes. Develop your own!sustainability scorecard, with short and long-term goals. Scorecards can!incorporate criteria such as the material use, waste, yield. This!shirt, for instance, how effective and efficient was this brand, this company to!actually cut and sew in the most efficient way to use the material and!diminish waste? What happened in the supply chain? Was this made with!renewable energy sources? Was the water recycled in the!production lines? How about the supplies long-term plans to unlock their energy!sources from traditional sources of energy, such as fossil fuels? Are they!planning to put solar PVs, are they planning to put renewable energy sources!in the production in the coming years? The sourcing teams in the brands also!play a crucial role here, because by enabling suppliers to develop their!policies and their improvements towards more sustainable production, we'll also!allow brands and companies to share with their customers, through their!sustainability reports, these good examples. In many cases, suppliers share!the same brands, the same private companies. Therefore, these brands, and!that's one of the initiatives that we also driving through our Sweden!Textile Water Initiative, is to reach a level of consensus and agreement on the!kind of requirements that we put to the factories and to the suppliers. Ao!alignment here from the brands as customers from these!suppliers is essential. And finally, within measuring, what are you going to!measure? Important to set clear boundaries and prioritize. Sustainability!is tempting, because it's so urgent and needed, that we try to address all!possible sustainability problems. But in some cases depending on the nature of!the industry, we will have to prioritize and say no to certain initiatives which!are further away from the brand and from the kind of supply chain to make a big!impact. My next thought is about daring to explore and support. Sustainability in!many cases is about innovation, creativity, finding ways that are!imaginative. I was referring to the triple bottom!line approach and how nonprofit and private and government needs to meet!somewhere. These interactions require smart interactions, require that we need!to be able to step out of the comfort zone. This means that in some cases, where!the representatives from private companies or representatives from the!nonprofit sector will have to take risks, and in some cases make mistakes. We need!to develop and tolerate mistakes culture in the companies and!in the organizations. Stretch outside the standard frame, and by the end of the!day have the feeling that I wish I would have done something better. It is!important to start the journey and moving and getting the the conclusions!of a learning curve as soon as possible. None of this can be done with a proper!stakeholders engagement plan.

Stakeholders, external, but also!internal stakeholders within the organization. In many cases, nonprofit!organizations and NGOs have this report with high media attention pinpointing!and addressing supply chain or environmental problems that they can!identify in the companies. It is important that everyone in these!situations seek for collaboration from all sectors. Attempt a collaborative!atmosphere with these NGOs that are challenging companies, and NGOs needs to!be responsible and internally analyze the problem in case before making public!statements. Accept their own responsibility and improve. If this is!the case, in many cases experience has shown that companies can turn situation!into a success story, and therefore, share the benefits of it with their customers,!with the society, through their sustainability reports. In many cases, the!interaction with between private and nonprofit can somehow function as an!early warning mechanism. Imagine if the representative from the NGO has such a!good collaboration with a representative of sustainability from the private!company, and this one has done a proper engagement plan in the private company,!the messages can flow in a more dynamic way. Therefore, once a problem is!identified, this person will be able to go back to their teams, go back to!sourcing, and perhaps in some cases stop buying from certain key suppliers that!are perhaps contributing to deforestation, to contaminating rivers,!continue using hazardous materials, etc etc. At the end of the day, we're talking!about trust, we're talking about openness, and a phone call can solve a lot of!issues. My next reflection is about the business!case. In the private sector jargon, we usually tend to say we would like to!have a business case for it, but the business case is not just about!investment, return on investment, and implementation; in many cases, it needs to!go beyond this. There are extra benefits, soft sustainability benefits, such as!governance, influencing the decisionmakers at the country level, at!the community level, or at the factory level. Capacity building and transfer!this knowledge to employers and the technical stuff and the designers within!the suppliers. There's a brand reputation issue, which is more difficult and less!tangible to measure, but this brand reputation, it is heavily connected to!brand value. It is a risk mitigation strategy. Having a good sustainability!practices will help brands to deal with crisis in a better way and also support!the supply chain collaboration, where suppliers and companies and brands work!hand in hand. These extra benefits are very seldom considered in the!traditional standard business case. If we were creative enough, if we're innovative!enough, if we would collaborate enough, we will be able to highlight these issues!at the level it has to be, just by having a technical!intervention in a supplier, improving the water conditions, there's a ripple effect!and all of these concepts will also be affected possibly. At the same time, if there is!competition, brands and corporation want to be at the center,!want to be seen as leaders, but the sustainability agenda has a high urgency.!Therefore, these leaders needs to move quick, otherwise someone else will take!their place. It's a fast pace, there's urgency there, and the companies

need!to step up for rapid change. I believe in the Sweden Water Textile Initiative the!wonderful team that we have put together and the spirit of the member companies!are getting us there. Openness and constructive criticism will allow us to!take the next step and develop the mechanisms to continue scaling up our!program. That's the challenge for 2018, and we look forward to engage with more!companies that are willing to be part of this initiative. Value-based leadership;!figure out how to move all the pieces together in this puzzle. This is not just!about private interests, this is not just a nonprofit pulling their agenda, this is!not just about government legislation and social issues, it is all of us moving!all the pieces of this puzzle together. Finally, sustainability is not a!technical problem, sustainability is an ethical one, and with a generous approach,!collaboration, openness, and trust, I am sure that we can get there. Thank you!very much....