The business case
Corporate and investor responsibility doesn’t just make moral sense. It makes business sense.
Growing evidence indicates that companies are more likely to build reputations and business, and to outperform their rivals over the medium to long term, if they act responsibly.
Stable and mutually beneficial relationships with local communities give companies a ‘social licence to operate’. Such relationships help prevent confrontations and conflicts that can result in delayed or suspended operations, costly damage to property, higher security and insurance costs, reputational damage, and legal and risk management costs.
Non-exploitative supply chain relationships, and genuine social and environmental investments in producer countries, help ensure security of supply and a good international reputation.
A good reputation helps companies secure new business opportunities, obtain project approval from host governments, and attract and retain high-calibre staff and loyal customers.
Energy-, water- and waste-conservation measures have been shown to generate cost savings that translate into higher share values.
Companies that manage their business in a transparent way are less likely to pose a risk to the interests of their shareholders and investors. A growing majority of institutional investors now recognise that corporate responsibility has a positive effect on business.